Churchill Downs Inc. reported increased quarterly revenues, stemming largely from gains in on-line wagering and slots operations at Fair Grounds in New Orleans, but decreased earnings due to declines in pari-mutuel revenue at Arlington Park in Illinois and Calder Race Course in Florida, and a tax adjustments to the IRS.
Churchill (NASDAQ: CHDN) reported third quarter net revenues of $100.9 million, up $1.3 million or 1 percent, compared to the same quarter of 2008.
For the quarter, Churchill reported net losses of $2.3 million, including losses from discontinued operations, compared with earnings of $2.5 million for the same quarter of 2008. Excluding discontinued operations, losses for the quarter were $1.2 million, compared with earnings of $2.3 million for 2008.
During the third quarter of 2009, Churchill recognized $2.3 million of income tax expenses from proposed adjustments that arose during an IRS audit of the company's tax returns from 2004 to 2007, according to the company's release.
Year-to-date, net revenues were up 3 percent, while net earnings dropped 25 percent compared with the first three quarters of 2008.
Net revenues from racing operations were down 7 percent for the quarter to $68.4 million, while that from online operations rose 33 percent to $17.4 million, and that from gaming rose 22 percent to $14.1 million. Handle wagered through TwinSpires.com rose 43 percent in the quarter, according to the company.
"Total pari-mutuel handle for the U,S. Thoroughbred industry, according to figures published by Equibase, declined 10 percent during the third quarter compared to the same period in 2008. While we outperformed the industry, with our total pari-mutuel handle down only 3 percent during the third quarter, gains in our other business segments didn't offset the decline in racing," said Robert L. Evans, Churchill president and CEO.
Churchill will discuss the quarterly report in a conference call with stock analysts Thursday morning.