Youbet.com Reports Small First-Quarter Loss
by Tom LaMarra
Date Posted: 5/7/2010 7:56:57 AM
Last Updated: 5/8/2010 10:38:25 AM

Youbet.com reported a small loss for the first three months of 2010, noting there would have been a similar gain if not for $1 million in expenses tied to its impending merger with Churchill Downs Inc.

Meanwhile, pari-mutuel handle of $115.7 million for the first quarter was down 6.62% from $123.9 million for the first three months of 2009, according to financial information released May 6 by the online betting company.

Youbet.com president and chief executive officer David Goldberg said company business was impacted by a 9.2% reduction in racing dates in the first quarter of 2010 versus the same period last year and the “broadening of access to certain racing content.” He said the drop in handle through Youbet.com was lower than the national decline of 10.4%.

Youbet.com generated a record handle for Kentucky Derby (gr. I) day with more than $6.1 million wagered May 1, up 9.4% from the 2006 record. Combined Derby and Kentucky Oaks (gr. I) day handle was $8.6 million, the company reported.

Total revenue for the first quarter was $25.9 million, down 7.46% $28 million in the first quarter of 2009. Net loss was $527,000 versus a net gain of $820,000 last year.

Of the $115.7 million wagered in the first quarter of 2010, $21.2 million (18.8%) is listed as commissions. Net racetrack revenue—described as commission revenue less track and licensing fees—was $7.9 million. That figure was down 9.3% from the first three months of 2009.

Youbet.com, as CDI did earlier the week of May 3, said it expects the merger with CDI to close sometime in the second quarter. Youbet.com shareholders recently approved the deal.



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