Revenue from casinos and online gambling boosted Churchill Downs' third-quarter net revenue to a record for the quarter, the Louisville racetrack company announced Wednesday.
Net revenue jumped 13 percent, from $147.5 million in 2010 to $166.3 million 2011, largely due to $13.4 million generated by Harlow's Casino Resort & Hotel in Mississippi, which was purchased in December, and improved performance at Calder Casino in Florida.
Churchill Downs Inc.'s online segment, TwinSpires.com, saw a 4.2 percent increase in wagering compared to the prior-year period; some of the growth was in new customers, but there also was an increase in average-daily wagering through the platform, the company said.
This came at a time when total wagering on U.S. Thoroughbred races fell an average of 7.4 percent. Churchill's own racing segment saw revenue decline by 1 percent, while gaming revenue rose 50 percent and online revenue grew 7 percent.
Third-quarter earnings soared, from $17.2 million in 2010 to $43 million in 2011, the company said. Gaming and TwinSpires together accounted for $9.3 million of the earnings before interest, taxes, depreciation, and amortization, or EBITDA, growth.
Net earnings from continuing operations were $19.7 million, or $1.16 per diluted common share, compared to $3.7 million, or 22 cents per diluted common share, in 2010.
During this year's third quarter, Churchill received $19.3 million in Illinois Horse Racing Equity Trust Fund proceeds from riverboat casino impact fees that had been held in escrow.
"It was a very good quarter, even when we exclude the impact of the Illinois Horse Racing Equity Trust Fund proceeds," said Robert L. Evans, chairman and CEO of Churchill Downs Inc. "Once again, the decline in net revenues and EBITDA — excluding those trust fund proceeds — in our racing operations was more than offset by significant gains in our online and gaming businesses."
Churchill used the improved cash flow to pay down $28.6 million in long-term debt, bringing debt reduction for the first nine months of the year to $108.8 million.
Evans will speak to investors and answer questions from analysts at 9 a.m. Thursday in a conference call that will be available via webcast at Churchilldownsincorporated.com.