$80-$90 Million Project will Debut for the 151st Kentucky Derby in May 2025

LOUISVILLE, Ky., July 24, 2024 (GLOBE NEWSWIRE) — Churchill Downs Incorporated (“CDI” or “the Company”) announced today an $80-$90 million renovation to the existing grandstand at Churchill Downs Racetrack (“Churchill Downs”) that will update ticketed seating options while significantly improving and adding to the amenities available for all guests in the grandstand area. Construction on the Grandstand Club and Pavilion is scheduled to begin in August with completion planned in time for the 151^st Kentucky Derby in May 2025.

The renovation of the Grandstand Club will transform existing outdoor aluminum bleachers into a combination of 8,300 new comfortable seating varieties. Updated seating options will include covered and uncovered stadium-style seats as well as rail boxes along the dirt track’s outer rail that will offer a “trackside” seating experience where guests will be able to closely watch horses break from the Kentucky Derby Starting Gate. First-floor amenities for the Grandstand Club will include new and upgraded permanent concessions, bars and wagering windows.

^{The Grandstand Club will transform existing bleachers to stadium-style seats and rail boxes.}

The project will also considerably improve and add amenities for 2,800 guests in the existing third floor box seats under the Starting Gate Suites. The Grandstand Pavilion will create a more upscale social environment by converting the existing second-floor amenity area into a covered outdoor garden environment with new concessions, bars and wagering windows. Expansion to the second floor will create additional space for overall guest circulation and add an outdoor balcony for added dining seats. A new stately entrance to the Grandstand Pavilion will unify the surrounding exterior architecture.

Advertisement

^{The Grandstand Pavilion will be a covered outdoor garden environment featuring updated finishes, new concessions, bars and wagering windows.}

“Like all of our recent enhancements at Churchill Downs, the renovation of the grandstands represents our commitment to providing unique guest seating options while honoring the historic significance of the property in order to achieve a world class sports and entertainment experience for our guests,” said Mike Anderson, President of Churchill Downs.

For more information on purchasing options for the Grandstand Club and Pavilion, sign up for the online sale at KentuckyDerby.com or call (502) 636-4447 for additional purchasing options including personal seat licenses.

About Churchill Downs Incorporated

Churchill Downs Incorporated (“CDI”) (Nasdaq: CHDN) has been creating extraordinary entertainment experiences for over 150 years, beginning with the company’s most iconic and enduring asset, the Kentucky Derby. Headquartered in Louisville, Kentucky, CDI has expanded through the development of live and historical racing entertainment venues, the growth of the TwinSpires horse racing online wagering business and the operation and development of regional casino gaming properties. www.churchilldownsincorporated.com/

Advertisement

This news release contains various “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by the use of terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “predict,” “project,” “seek,” “should,” “will,” “scheduled,” and similar words or similar expressions (or negative versions of such words or expressions), although some forward-looking statements are expressed differently.

Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Important factors, that could cause actual results to differ materially from expectations include the following: the occurrence of extraordinary events, such as terrorist attacks, public health threats, civil unrest, and inclement weather, including as a result of climate change; the effect of economic conditions on our consumers’ confidence and discretionary spending or our access to credit, including the impact of inflation; additional or increased taxes and fees; the impact of any pandemics, epidemics, or outbreaks of infectious diseases, including possible new variants of COVID-19, and related economic matters on our results of operations, financial conditions and prospects; lack of confidence in the integrity of our core businesses or any deterioration in our reputation; loss of key or highly skilled personnel, as well as general disruptions in the general labor market; the impact of significant competition, and the expectation that competition levels will increase; changes in consumer preferences, attendance, wagering, and sponsorships; risks associated with equity investments, strategic alliances and other third-party agreements; inability to respond to rapid technological changes in a timely manner; concentration and evolution of slot machine and historical racing machine (HRM) manufacturing and other technology conditions that could impose additional costs; failure to enter into or maintain agreements with industry constituents, including horsemen and other racetracks; inability to successfully focus on market access and retail operations for our TwinSpires sports betting business and effectively compete; online security risk, including cyber-security breaches, or loss or misuse of our stored information as a result of a breach including customers’ personal information could lead to government enforcement actions or other litigation; reliance on our technology services and catastrophic events and system failures disrupting our operations; inability to identify, complete, or fully realize the benefits of our proposed acquisitions, divestitures, development of new venues or the expansion of existing facilities on time, on budget, or as planned; difficulty in integrating recent or future acquisitions into our operations; cost overruns and other uncertainties associated with the development of new venues and the expansion of existing facilities; general risks related to real estate ownership and significant expenditures, including risks related to environmental liabilities; personal injury litigation related to injuries occurring at our racetracks; compliance with the Foreign Corrupt Practices Act or other similar laws and regulations, or applicable anti-money laundering regulations; payment-related risks, such as risk associated with fraudulent credit card or debit card use; work stoppages and labor problems; risks related to pending or future legal proceedings and other actions; highly regulated operations and changes in the regulatory environment could adversely affect our business; restrictions in our debt facilities limiting our flexibility to operate our business; failure to comply with the financial ratios and other covenants in our debt facilities and other indebtedness; increases to interest rates (due to inflation or otherwise), disruption in the credit markets or changes to our credit ratings may adversely affect our business; increase in our insurance costs, or inability to obtain similar insurance coverage in the future, and any inability to recover under our insurance policies for damages sustained at our properties in the event of inclement weather and casualty events; and other factors described under the heading “Risk Factors” in our most recent Annual Report on Form 10-K and in other filings we make with the Securities and Exchange Commission.

We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Photos accompanying this announcement are available at:

https://www.globenewswire.com/NewsRoom/AttachmentNg/0927730a-971b-4878-b2aa-e353e5c3bba3

Advertisement

https://www.globenewswire.com/NewsRoom/AttachmentNg/f9d0736f-c54e-40d6-9ca8-6f6c6ca0a213

LOUISVILLE, Ky., July 24, 2024 (GLOBE NEWSWIRE) — Churchill Downs Incorporated (“CDI” or “Company”) announced today that Robert L. Fealy retired from CDI’s Board of Directors on July 23, 2024.

“We are grateful for Bob’s long-term exemplary service as a board member of Churchill Downs Incorporated,” said Bill Carstanjen, CDI’s President and Chief Executive Officer. “We will miss his perspective, insight, and dedication to our Company. I want to also personally thank him for his friendship and wisdom over the many years we have worked together.”

About Churchill Downs Incorporated

Churchill Downs Incorporated (“CDI”) (Nasdaq: CHDN) has been creating extraordinary entertainment experiences for over 150 years, beginning with the company’s most iconic and enduring asset, the Kentucky Derby. Headquartered in Louisville, Kentucky, CDI has expanded through the development of live and historical racing entertainment venues, the growth of the TwinSpires horse racing online wagering business and the operation and development of regional casino gaming properties. www.churchilldownsincorporated.com/

Investor Contact: Sam Ullrich
(502) 638-3906
[email protected]

Advertisement

LOUISVILLE, Ky., July 24, 2024 (GLOBE NEWSWIRE) — Churchill Downs Incorporated (Nasdaq: CHDN) (the “Company”, “CDI”, “we”) today reported business results for the second quarter ended June 30, 2024.

Company Highlights

• All-time record net revenue of $890.7 million compared to $768.5 million in second quarter 2023
• Net income attributable to CDI of $209.3 million compared to $143.0 million in second quarter 2023
• All-time record Adjusted EBITDA of $444.8 million compared to $363.7 million in second quarter 2023
• Delivered record second quarter revenue and Adjusted EBITDA across all of our reporting segments
  • Live and Historical revenue up 20% and Adjusted EBITDA up 25% compared to the second quarter of 2023
  • TwinSpires revenue up 15% and Adjusted EBITDA up 36% compared to the second quarter of 2023
  • Gaming revenue up 11% and Adjusted EBITDA up 14% compared to the second quarter of 2023
• Churchill Downs Racetrack ran the 150^th Kentucky Derby with all-time record all-sources handle for the Kentucky Derby Race, Kentucky Derby Day Program, and Kentucky Derby Week Races, and with all-time record Derby Week contribution to Adjusted EBITDA
  • We signed a new seven-year agreement with NBC to continue hosting the Kentucky Derby Week on NBC and Peacock for 2026 through 2032
• We opened the Terre Haute Casino Resort in Terre Haute, Indiana on April 5, 2024 and the hotel on May 15, 2024
• On July 3, 2024, we successfully amended our revolving credit facility and Term Loan A facility to, among other things, extend the maturity dates from 2027 to 2029
• We ended the second quarter of 2024 with net bank leverage of 4.0x

The summaries below present revenue from external customers and intercompany revenue from each of our reportable segments.

Live and Historical Racing

Revenue for the second quarter of 2024 increased $82.2 million due to a $53.8 million increase at Churchill Downs Racetrack, which includes a $37.6 million increase due to a record-breaking Derby Week; a $17.4 million increase attributable to growth at our Virginia properties and the opening of the Rosie’s Emporia property in September 2023; a $10.3 million increase attributable to growth at our Kentucky HRM properties; and a $0.7 million increase at our other Live and Historical Racing properties.

Advertisement

Adjusted EBITDA for the second quarter of 2024 increased $55.7 million due to a $38.1 million increase at Churchill Downs Racetrack, which includes a $32.2 million increase due to a record-breaking Derby Week; a $16.1 million increase attributable to growth at our Virginia properties, which includes $5.6 million related to Exacta savings; and a $1.5 million increase from growth at our other HRM properties.

TwinSpires

Revenue for the second quarter of 2024 increased $20.8 million due to a $14.7 million increase attributable to Exacta, a $4.3 million net increase in Horse Racing revenue primarily due to increased affiliate wagering handle partially offset by a decline in TwinSpires retail horse racing handle due to shifts in race days at other tracks and market access, and a $1.8 million increase attributable to our online sports betting market access agreements and our retail sports betting business.

Adjusted EBITDA for the second quarter of 2024 increased $12.3 million due to a $10.1 million increase attributable to Exacta, a $1.9 million increase attributable to our online sports betting market access agreements and our retail sports betting business, and a $0.3 million increase in Horse Racing from increased revenue that was mostly offset by higher content and related expenses.

Gaming

Advertisement

Revenue for the second quarter of 2024 increased $26.5 million due to a $33.9 million increase attributable to the opening of the Terre Haute Casino Resort in April 2024 and a $1.9 million increase in New York, partially offset by a $5.4 million decrease in Pennsylvania primarily due to our decision not to renew the management agreement at Lady Luck at the end of June 2023, a $2.7 million decrease in Maine primarily due to inclement weather in April 2024, and a $1.2 million net decrease at our other Gaming properties.

Adjusted EBITDA for the second quarter of 2024 increased $17.3 million due to a $19.9 million increase attributable to the opening of the Terre Haute Casino Resort in April 2024 and a $3.5 million increase in New York primarily due to union-related payments in 2023 that did not recur. The increase was partially offset by a $2.2 million decrease in Maine primarily due to inclement weather in April 2024, a $0.9 million decrease in Pennsylvania primarily due to our decision not to renew the management agreement at Lady Luck at the end of June 2023, and a $3.0 million net decrease at our other Gaming properties primarily driven by Louisiana, Maryland, and Mississippi.

All Other

Revenue for the second quarter of 2024 reflects intercompany revenue related to the captive insurance company that was established in April 2024. All captive revenue is eliminated in consolidation.

Adjusted EBITDA for the second quarter of 2024 decreased $4.2 million driven primarily by increased corporate compensation related expenses and other corporate administrative expenses.

Advertisement

Share Repurchase Program

The Company repurchased 93,874 shares of its common stock at a total cost of approximately $13.0 million based on trade date under its share repurchase program in the second quarter of 2024. We had approximately $179.9 million of repurchase authority remaining under this program on June 30, 2024.

Revolving Credit Facility and Term Loan A Facility Amendment

The Company successfully closed an amendment of its senior secured credit agreement to extend the maturity date of its revolving credit facility and Term Loan A facility from 2027 to 2029 and to make certain other changes to its existing credit agreement.

The Company’s second quarter 2024 net income attributable to CDI was $209.3 million compared to $143.0 million in the prior year quarter.

Advertisement

The following impacted the comparability of the Company’s second quarter 2024 net income to the prior year quarter:

• an $18.5 million decrease in after-tax non-cash impairment costs; and
• a $5.8 million after-tax decrease in transaction, pre-open, and other expenses primarily related to Arlington exit costs in 2023.

This was partially offset by:

• a $1.0 million increase of other items.

Excluding the items above, second quarter 2024 net income increased $43.0 million primarily due to the following:

• a $49.1 million after-tax increase primarily driven by the results of our operations,
• partially offset by a $6.1 million after-tax increase in interest expense associated with higher outstanding debt balances and higher interest rates.

Conference Call

A conference call regarding this news release is scheduled for Thursday, July 25, 2024 at 9 a.m. ET. Investors and other interested parties may listen to the teleconference by accessing the online, real-time webcast and broadcast of the call at http://ir.churchilldownsincorporated.com/events.cfm, or by registering in advance via teleconference here. Once registration is completed, participants will be provided with a dial-in number containing a personalized conference code to access the call. All participants are encouraged to dial-in 15 minutes prior to the start time. An online replay will be available by noon ET on Thursday, July 25, 2024. A copy of the Company’s news release announcing quarterly results and relevant financial and statistical information about the period will be accessible at www.churchilldownsincorporated.com.

Use of Non-GAAP Measures

In addition to the results provided in accordance with GAAP, the Company also uses non-GAAP measures, including adjusted net income, adjusted diluted EPS, EBITDA (earnings before interest, taxes, depreciation and amortization), and Adjusted EBITDA.

The Company uses non-GAAP measures as a key performance measure of the results of operations for purposes of evaluating performance internally. These measures facilitate comparison of operating performance between periods and help investors to better understand the operating results of the Company by excluding certain items that may not be indicative of the Company’s core business or operating results. The Company believes the use of these measures enables management and investors to evaluate and compare, from period to period, the Company’s operating performance in a meaningful and consistent manner. The non-GAAP measures are a supplemental measure of our performance that is not required by, or presented in accordance with, GAAP, and should not be considered as an alternative to, or more meaningful than, net income or diluted EPS (as determined in accordance with GAAP) as a measure of our operating results.

Advertisement

We use Adjusted EBITDA to evaluate segment performance, develop strategy, and allocate resources. We utilize the Adjusted EBITDA metric to provide a more accurate measure of our core operating results and enable management and investors to evaluate and compare from period to period our operating performance in a meaningful and consistent manner. Adjusted EBITDA should not be considered as an alternative to operating income as an indicator of performance, as an alternative to cash flows from operating activities as a measure of liquidity, or as an alternative to any other measure provided in accordance with GAAP. Our calculation of Adjusted EBITDA may be different from the calculation used by other companies and, therefore, comparability may be limited.

Adjusted net income and adjusted diluted EPS exclude discontinued operations net income or loss; net income or loss attributable to noncontrolling interest; changes in fair value for interest rate swaps related to Rivers Des Plaines; Rivers Des Plaines’ legal reserves and transaction costs; transaction expense, which includes acquisition and disposition related charges, as well as legal, accounting, and other deal-related expense; pre-opening expense; and certain other gains, charges, recoveries, and expenses.

Adjusted EBITDA includes our portion of EBITDA from our equity investments and the portion of EBITDA attributable to noncontrolling interest.

Adjusted EBITDA excludes:

• Transaction expense, net which includes:
  • Acquisition, disposition, and property sale related charges;
  • Other transaction expense, including legal, accounting, and other deal-related expense;
• Stock-based compensation expense;
• Asset impairments;
• Gain on property sales;
• Legal reserves;
• Pre-opening expense; and
• Other charges, recoveries, and expenses.

As of December 31, 2021, our property in Arlington Heights, Illinois (“Arlington”) ceased racing and simulcast operations and the property was sold on February 15, 2023 to the Chicago Bears. Arlington’s results and exit costs in 2023 are treated as an adjustment to EBITDA and are included in other expenses, net in the Reconciliation of Comprehensive Income to Adjusted EBITDA.

On June 26, 2023, the Company’s management agreement for Lady Luck in Farmington, Pennsylvania expired and was not renewed. The Company completed the sale of substantially all its assets at Lady Luck for an immaterial amount.

Advertisement

For segment reporting, Adjusted EBITDA includes intercompany revenue and expense totals that are eliminated in the Consolidated Statements of Comprehensive Income. See the Reconciliation of Comprehensive Income to Adjusted EBITDA included herewith for additional information.

About Churchill Downs Incorporated

Churchill Downs Incorporated (“CDI”) (Nasdaq: CHDN) has been creating extraordinary entertainment experiences for over 150 years, beginning with the company’s most iconic and enduring asset, the Kentucky Derby. Headquartered in Louisville, Kentucky, CDI has expanded through the development of live and historical racing entertainment venues, the growth of the TwinSpires horse racing online wagering business and the operation and development of regional casino gaming properties. https://www.churchilldownsincorporated.com/

This news release contains various “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by the use of terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “predict,” “project,” “seek,” “should,” “will,” “scheduled,” and similar words or similar expressions (or negative versions of such words or expressions), although some forward-looking statements are expressed differently.

Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Important factors, that could cause actual results to differ materially from expectations include the following: the occurrence of extraordinary events, such as terrorist attacks, public health threats, civil unrest, and inclement weather, including as a result of climate change; the effect of economic conditions on our consumers’ confidence and discretionary spending or our access to credit, including the impact of inflation; additional or increased taxes and fees; the impact of any pandemics, epidemics, or outbreaks of infectious diseases, including possible new variants of COVID-19, and related economic matters on our results of operations, financial conditions and prospects; lack of confidence in the integrity of our core businesses or any deterioration in our reputation; loss of key or highly skilled personnel, as well as general disruptions in the general labor market; the impact of significant competition, and the expectation that competition levels will increase; changes in consumer preferences, attendance, wagering, and sponsorships; risks associated with equity investments, strategic alliances and other third-party agreements; inability to respond to rapid technological changes in a timely manner; concentration and evolution of slot machine and historical racing machine (HRM) manufacturing and other technology conditions that could impose additional costs; failure to enter into or maintain agreements with industry constituents, including horsemen and other racetracks; inability to successfully focus on market access and retail operations for our TwinSpires sports betting business and effectively compete; online security risk, including cyber-security breaches, or loss or misuse of our stored information as a result of a breach including customers’ personal information could lead to government enforcement actions or other litigation; reliance on our technology services and catastrophic events and system failures disrupting our operations; inability to identify, complete, or fully realize the benefits of our proposed acquisitions, divestitures, development of new venues or the expansion of existing facilities on time, on budget, or as planned; difficulty in integrating recent or future acquisitions into our operations; cost overruns and other uncertainties associated with the development of new venues and the expansion of existing facilities; general risks related to real estate ownership and significant expenditures, including risks related to environmental liabilities; personal injury litigation related to injuries occurring at our racetracks; compliance with the Foreign Corrupt Practices Act or other similar laws and regulations, or applicable anti-money laundering regulations; payment-related risks, such as risk associated with fraudulent credit card or debit card use; work stoppages and labor problems; risks related to pending or future legal proceedings and other actions; highly regulated operations and changes in the regulatory environment could adversely affect our business; restrictions in our debt facilities limiting our flexibility to operate our business; failure to comply with the financial ratios and other covenants in our debt facilities and other indebtedness; increases to interest rates (due to inflation or otherwise), disruption in the credit markets or changes to our credit ratings may adversely affect our business; increase in our insurance costs, or inability to obtain similar insurance coverage in the future, and any inability to recover under our insurance policies for damages sustained at our properties in the event of inclement weather and casualty events; and other factors described under the heading “Risk Factors” in our most recent Annual Report on Form 10-K and in other filings we make with the Securities and Exchange Commission.

Advertisement

We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Advertisement

Advertisement

Advertisement

Contact: Sam Ullrich
(502) 638-3906
[email protected]

Advertisement