Churchill Downs online revenues flat on racing seasonality
Group revenues offset by 51% increase in gaming revenues after BetAmerica sportsbook venues launch
Churchill Downs posted flat online revenues of $63.4m for Q1 2019, down from $63.6m the previous year, as the Kentucky-based operator divides its online and retail revenues for the first time since launching its online platform.
Adjusted EBITDA decreased by $1m year-on-year to $16.9m following the launch of its SBTech-powered platform which went live in February.
Its advance deposit horseracing wagering site, TwinSpires, saw revenues drop $300,000 on the previous year, despite active players growing by 2.4%.
Net revenue per active player declined by 3.3% and industry racing handle fell due to the shift in racing dates at Oaklawn Park Racetrack from the first quarter to the second quarter of 2019, as well as bad weather.
However, overall group revenues were offset by gaming sales for the quarter which increased by 51.2% to $170.1m on the acquisition of Presque Isle in January, as well as the consolidation of Ocean Downs after the acquisition of remaining shares and the opening of the BetAmerica sportsbooks at its Mississippi venues.
UK analyst firm Regulus Partners said the operator’s diversification into gaming has helped balance seasonality in racing and a “relatively lacklustre online wagering performance.”
“We remain concerned that while gaming diversification makes a lot of commercial sense, it further reduces the necessity for CDI to reinvigorate US horseracing, a product badly in need of development, in our view,” the analyst note said.