Churchill Downs Inc. continues to benefit from entering into the online social games market, but the Louisville-based company said its most improved performers for the first three months of 2016 in adjusted earnings were its casino and online pari-mutuel betting businesses.
The company saw earnings of $2.8 million compared with a $1.6 million loss in the first quarter of 2015.
Thanks to Big Fish Games’ revenues increasing by a third over the same period a year ago, Churchill Downs Inc.’s net revenues set a record at $288.4 million, up 15 percent. The company’s earnings adjusted before factors like taxes and depreciation increased 6 percent to a record $52.8 million.
Perhaps most interesting, the adjusted earnings fell for Big Fish, which Churchill bought in 2014, actually declined by $5 million for the quarter to $15 million. The gains came from its casinos, which improved $3.9 million, and the TwinSpires account wagering business. TwinSpires improved $2 million thanks to a 10.6 percent increase in handle — while horse betting nationally gained by 7.5 percent.
After the earnings release, Churchill announced that it will spend $25 million to build a hotel at its Oxford, Maine casino, which saw its adjusted earnings increase $1.4 million increase over the same quarter a year ago as a result of milder weather and market share growth helping business. The casino, bought by Churchill in 2013, also saw net revenues increase $2.4 million to $19.9 million for the three-month period.
The smallest revenue driver for the company and its only adjusted earnings loser in the quarter was its racetracks (which it should be noted allow it to have three casinos — if the leased-out Calder is included — that show gains and losses in the casinos segment). The adjusted earnings loss there decreased from $9.2 million a year ago to $7.4 million this quarter.