Churchill Downs, Inc. reported net earnings from continuing operations for the second quarter of $33.4 million, or $2.45 per diluted share, significantly higher than the $22.7 million, or $1.69 per diluted share, earned during the same period in 2005.Net revenues from continuing operations during the quarter, which ended June 30, totaled $175.0 million, an increase of 7.2% from net revenues of $163.2 million one year earlier. A record-breaking Kentucky Derby weekend at Churchill Downs racetrack, which also led to higher Churchill Downs Simulcast Network revenues; strong business levels at the company's Louisiana simulcast-wagering and video poker operations; and five additional days of live racing during the quarter contributed to the quarterly gains. During the quarter, the company also recorded $9.6 million of pre-tax net insurance recoveries stemming from storm-related damages sustained in 2005 at the company's Louisiana operations, Calder Race Course and Ellis Park. Aside from the impact of these recoveries, the company increased net earnings from continuing operations by 22.1% year over year.
Thomas H. Meeker, who will step down as CDI's president and chief executive officer when Robert L. Evans assumes the position on Aug. 14, said he is pleased to transition to a new CEO at a time when the company is enjoying positive momentum and is well positioned for the future."We continue to be encouraged by the strong performance of our company's signature racing events as well as the strong business trends we are experiencing in Louisiana," said Meeker. "We are quickly completing repairs to our storm-damaged facilities, including Fair Grounds Race Course, which reopens for live racing in November. Also, we recently negotiated a sales agreement for Ellis Park that allows the track to benefit from an independent operator while keeping the Ellis Park signal in our CDSN portfolio. "While we are not changing our policy with respect to earnings guidance, we are heartened by our current year performance, particularly from the Kentucky Derby and in Louisiana," Meeker continued. "At this time, we expect that our earnings from continuing operations will equal or exceed the current average analyst estimate, even without the impact of our insurance recoveries."