On July 24, 2024, Churchill Downs Inc (CHDN, Financial) released its 8-K filing for the second quarter of 2024, showcasing a robust financial performance that surpassed analyst expectations. The company reported an all-time record net revenue of $890.7 million, significantly higher than the estimated $856.47 million. Additionally, the diluted earnings per share (EPS) stood at $2.79, exceeding the analyst estimate of $2.69.
Company Overview
Churchill Downs Inc is a gaming entertainment, online wagering, and racing company. It operates through three business segments: Live and Historical Racing, TwinSpires, and Gaming. The Live and Historical Racing segment includes live and historical pari-mutuel racing. The TwinSpires segment encompasses online horse racing, online and retail sports betting, and iGaming wagering. The Gaming segment includes revenue from casino properties, slot machines, table games, video lottery terminals, video poker, HRMs, and ancillary services.
Performance Highlights
Churchill Downs Inc reported a net income attributable to CDI of $209.3 million, a substantial increase from $143.0 million in the second quarter of 2023. The company also achieved an all-time record Adjusted EBITDA of $444.8 million, up from $363.7 million in the same period last year.
“We delivered record second quarter revenue and Adjusted EBITDA across all of our reporting segments,” the company stated in its filing.
Segment Analysis
The Live and Historical Racing segment saw a revenue increase of 20% to $490.2 million, driven by a record-breaking Derby Week and growth at Virginia and Kentucky properties. Adjusted EBITDA for this segment rose by 25% to $279.2 million.
The TwinSpires segment reported a 15% increase in revenue to $159.9 million, with Adjusted EBITDA climbing 36% to $46.2 million. This growth was attributed to increased affiliate wagering handle and market access agreements.
The Gaming segment experienced an 11% rise in revenue to $274.4 million, with Adjusted EBITDA up 14% to $140.7 million. The opening of the Terre Haute Casino Resort in April 2024 significantly contributed to this growth.
Financial Achievements
Churchill Downs Inc's financial achievements are noteworthy in the Travel & Leisure industry, where consistent revenue and EBITDA growth are critical. The company's ability to deliver record-breaking results across all segments underscores its operational efficiency and market strength.
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Net Revenue | $890.7 million | $768.5 million |
| Net Income Attributable to CDI | $209.3 million | $143.0 million |
| Diluted EPS Attributable to CDI | $2.79 | $1.86 |
| Adjusted EBITDA | $444.8 million | $363.7 million |
Key Metrics and Analysis
Key metrics such as net revenue, net income, and Adjusted EBITDA are crucial for evaluating Churchill Downs Inc's performance. The significant year-over-year increases in these metrics highlight the company's strong operational execution and strategic growth initiatives.
Churchill Downs Inc's successful amendment of its revolving credit facility and Term Loan A facility, extending maturity dates from 2027 to 2029, further strengthens its financial position. The company ended the second quarter with a net bank leverage of 4.0x, indicating a balanced approach to debt management.
Conclusion
Churchill Downs Inc's record-breaking second quarter results demonstrate its robust business model and effective growth strategies. The company's performance across all segments, coupled with strategic financial management, positions it well for continued success in the gaming and entertainment industry.
Explore the complete 8-K earnings release (here) from Churchill Downs Inc for further details.
