During a third quarter conference call on October 29, Churchill Downs CEO Bill Carstanjen said the Kentucky Derby will return to its normal date on the first Saturday in May, but ticket sales for the time being will be no more than 50 percent of capacity and only for reserved seating.
No general admission will be permitted unless the coronavirus pandemic is overcome.
In other conference call news, Carstanjen said the company will delay rebuilding Turfway Park in Northern Kentucky because of a recent ruling by the Kentucky Supreme Court that invalidated a type of gambling machine at use at racetracks throughout the state, according to DRF.
Come January 3, the legislature will reconvene and the hope is that with support from Governor Andy Beshear, they will enact a law to address a court decision considered problematic. The machines earn millions of dollars each year for operators, and subsidies from the games doubled purses at Kentucky tracks over the past decade. The machines are so profitable that a casino Churchill opened at its Trackside training center two years ago has recouped its entire investment, Carstanjen said.
Churchill Downs also delayed the start of construction for hotel and casino at the Louisville track, again the result of the court ruling, plus the pandemic impact.
While Churchill’s third-quarter earnings suffered as a result of the pandemic, racing operations rose in large part due to the rescheduled Derby from May to September.
Revenue from Churchill Downs in the quarter more than doubled to $68 million, up from $32 million in the third quarter of 2019. Revenue from Churchill’s online wagering business jumped 77 percent from $70.4 million to $126.4 million, the company said. Handle through the account wagering company, TwinSpires, went from $368.7 million last year to $622.4 million this year.
But the migration of wagering to online operations has proven a thorn to some horsemen because online bets return less revenue than retail off-track betting sites. Carstanjen believes online customers will continue to bet mobile even after tracks return to full operations.
“The customers tend to be very sticky to the product,” he said. “They hang around and do most of their betting online.”
In all, Churchill reported net income of $43.2 million in the third quarter of 2020, up from $14.8 million in the third quarter of last year. Net revenue for the quarter was $337.8 million, up from $306.3 million in 2019. Net revenue for Churchill’s casinos declined almost 25 percent due to closures and reductions because of the pandemic.
