Churchill Downs, the Louisville-based operator, set records in first quarter net revenue and adjusted EBITDA.
The $590.9 million revenue mark climbed 6% compared to Q1 2023, and adjusted EBITDA also rose 9% year-over-year.
Churchill Downs is obviously known for its horse racing history, and it delivered record first quarter revenue and adjusted EBITDA for both its live and historical, and TwinSpires segments.
The live and historical racing segment enjoyed a 15% spike in revenue with $248.9 million, a $33.1 million boost from Q1 2023’s $215.8 million. Adjusted EBITDA for this segment increased $18.7 million year-over-year, resulting in $100.8 million compared to the $82.1 million from the same period in the prior year, good for a 23% improvement.
TwinSpires is one of the largest and most profitable U.S. online wagering platforms for horse racing. Announcing the quarter’s results, the company touted $114.1 million in revenue and $39.6 million adjusted EBITDA for this segment, rising $17.8 million and $10.2 million, respectively, compared to Q1 2023 which are 18% and 35% improvements for each statistic.
This is an impressive start to 2024 for Churchill Downs after it booked a record $2.5 billion in revenue for 2023. Lady Luck was not necessarily on the company’s side in Q1 though, and I mean that literally.
The company chose not to renew its management agreement at Lady Luck Casino Nemacolin in June 2023, which it attributed a first-quarter decrease of $8.4 million in Pennsylvania’s gaming revenue to. Adjusted EBITDA for the first quarter in the gaming segment also decreased $6.7 million primarily due to inclement weather at many of its gaming properties, the company also said. Overall, its gaming business drove $243.2 million in net revenue, dropping from Q1 2023’s $251.6 million. Adjusted EBITDA for this segment fell from $129.5 million to $122.8 million year-over-year as well.
Big plans for the big race
Churchill Downs Racetrack hosts the longest continuously held annual sporting event in the U.S. with the Kentucky Derby.
The company’s investor presentation called this “an iconic and irreplaceable asset,” and it announced significant capital investments ahead of the 150th Kentucky Derby in May.
The Paddock experience will receive up to $200 million in enhancements with 3,025 new premium reserved seats and 3,250 new standing room only premium tickets while also upgrading more than 3,700 existing premium reserved seats. This capital investment activates a vision to redesign and improve the flow of guests throughout the Paddock, including a larger walking ring for viewing the horses prior to the races, a New Paddock Club along with new hospitality and other guest amenities, and a new Turf Club balcony overlooking the Paddock.
On Dec. 6, Churchill Downs kicked off 150 days of celebration leading up to the 150th Run for the Roses. The investor presentation also claimed that the 149th Kentucky Derby was NBC’s most watched program since Super Bowl LVII with 16.6 million peak viewership and 14.8 million average viewership.
The Churchill Downs Racetrack is just one of the company’s four racetracks in Kentucky, and together, this segment grossed $249 million in first quarter revenue and $101 million in adjusted EBITDA, year-over-year increases of 15% and 23% respectively.
