Churchill Downs Incorporated (CDI) achieved a record-breaking revenue of $2.46bn in its 2023 fiscal year, demonstrating a substantial 36% increase from the previous year. This impressive growth is largely credited to the success of Kentucky Derby events, thoughtful strategic acquisitions, and the expansion in Historical Racing Machine (HRM) operations. Nevertheless, despite this revenue boost, the company experienced a slight decrease in net profit, primarily due to escalated operating expenses.
Churchill Downs Has Record Year in Terms of Net Revenue
The year 2023 marked an extraordinary milestone for Churchill Downs Inc. (CDI) (NASDAQ:CHDN), a renowned entity in the horse racing, gaming, and online entertainment arena. The company proudly announced its net revenue approaching the $2.5 billion threshold, reflecting a significant 36% growth compared to the $1.8 billion earned in 2022.
This impressive revenue hike is a result of major events such as the 149th Kentucky Derby, along with strategic company expansions, including the acquisition of Exacta Systems and the advancement in HRM operations.
The celebrated racecourse, acclaimed for hosting the yearly Kentucky Derby, experienced a 70.4% increase in its live and historical racing segments, reaching a new peak of $1.05bn. This growth was mainly fueled by the acquisition of Virginia properties through the company’s $2.75bn purchase of Peninsula Pacific Entertainment in November 2022, contributing an added $313.9m. Furthermore, the gaming segment generated $974.6 million in revenue over the year, marking an increase from 2022’s $761.8 million.
Churchill Downs Net Income Down From 2022
However, the path wasn’t entirely smooth. Churchill Downs witnessed a 5% decline in net income year-over-year, dropping to $417 million in 2023 from $439 million in 2022. This decrease was largely due to a 27.6% rise in operating expenses, amounting to $1.90bn, which somewhat overshadowed the revenue increase.
The company has also announced plans to launch new properties in Indiana, Kentucky, and Virginia in 2024. These include The Rose Gaming Resort in Virginia and Owensboro Racing & Gaming in Kentucky, both expected to substantially enhance the company’s revenue streams. The Owensboro property will feature a retail sportsbook, an ideal addition for the upcoming Kentucky Derby.
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