The parent company of the Kentucky Derby, Churchill Downs Incorporated, exceeded Wall Street’s expectations regarding Kentucky sports betting, with a record of $559.5 million in revenue for the first quarter of this year.
CDI Beats the Street
Not only was Churchill Downs’ revenue nearly $560 million for the first quarter, the net income was three times what it was last year with $155.7 million this year versus the $42.1 million it delivered last year.
The live and historic racing portion of the business generated $214.4 million while the 149th Kentucky Derby Day program produced a record $288.7 million. Speaking of which, a few weeks before racing’s fastest two minutes in sports, Carstanjen said:
“It is really great to see the Kentucky Derby festivities return to the traditional energy and excitement as we prepare to open our gates at Churchill Downs Racetrack to a full capacity crowd for the first time in 2 years,” Carstanjen wrote in an email. “Based on advanced reserved ticket sales, we expect to deliver record Derby Week results.”
And he wouldn’t be proven wrong as this year’s Run for the Roses attracted more than 150,000 people which was slightly above last year’s 147,294 attendance figures. Twin Spires, the betting subsidiary of CDI, reported a record-breaking handle of $73.6 million during the Derby event, eclipsing last year’s mark of $67.4 million.
Carstanjen said after the reports were revealed that the lofty numbers had his team revisit financial expectations, “We expect the Kentucky Derby Week adjusted EBITDA to reflect a new record with $14 to $16 million of growth over the prior record set last year.”
Horse Racing Partnerships
Churchill Downs is also providing technology and horse racing content in partnership with DraftKings. CDI will reportedly receive the lion’s share of a 60/40 split with the online sports betting giant in a recently unveiled horse racing platform called DK Horse. A similar deal has also been struck with FanDuel.
“We believe the depth and quality of our online offering through TwinSpires is unmatched in horse racing,” said CDI’s CEO Carstanjen. “We are excited to establish this relationship with DraftKings and to deliver a full end-to-end white label ADW solution that will introduce their significant base of sports betting customers to horse racing wagering.”
DK Horse: An Innovative Mobile Horse Racing Platform
Jason Robins, CEO and Chairman of the Board of DraftKings, said “Together with Churchill Downs Incorporated, an industry leader with a deep-rooted history in horse racing, we will deliver an innovative, mobile customer experience.
“Our goal is to provide our customers with best-in-class sports and gaming products, and we expect DK Horse to provide a fun and new way to engage with renowned races like the upcoming Run for the Roses.”
At some point, the DK Horse platform will be integrated into the DraftKings app which includes sports betting, daily fantasy sports, and the online casino. But for now, there is a separate, standalone advance deposit wagering platform.
DK’s Robins commented further on the partnership with CDI by saying, “Due to the structure of the agreement, we expect this new product offering to be immediately profitable.”
Calculators
