Strong Preakness Drove Up MJC Net Income
Updated: Monday, March 18, 2002 4:40 PM
Posted: Sunday, March 17, 2002 11:28 AM
The Maryland Jockey Club reported a combined net income of $1,492,000 for Pimlico Race Course and Laurel Park for 2001, according to audited financial statements filed Friday with the state racing commission. Net income rose by $822,000, up from $670,000 reported in 2000 as combined net income for the two tracks.
A record-setting Preakness Stakes (gr. I) was the reason for the strong financial results. The Preakness attracted more than 104,000 people, the second largest crowd in Pimlico history, and achieved records for in-state handle and total handle.
Through 2001, the MJC said it reinvested its profits instead of distributing dividends to its owners. The MJC reported spending $4.3 million for capital expenditures, which included physical improvements to Pimlico and Laurel. The capital expenditures were funded with virtually all of its cash flow generated from operations in 2001, as well as a portion of its outstanding line of credit with Mercantile-Safe Deposit & Trust Company, the company reported.
"We are very pleased that, notwithstanding continued intense competition both regionally and nationally, we were able to increase our bottom line, albeit modestly, in 2001," said Joe De Francis, president and chief executive officer of the MJC.
Meanwhile, the Maryland Senate has approved a $4.5-million transfer of funds to the horse racing industry, but it remains to be seen whether the House of Delegates will approve the measure.
The money designated by the Senate is in a special account funded by a portion of wagers and uncashed winning tickets. The money was to go to racetrack improvements. In 2001, the General Assembly cut $10 million in purse supplements effective July 1.
The Baltimore Sun
reported that Maryland Jockey Club president Joe De Francis was surprised by the Senate vote. "That money is the industry's money, and we definitely should use it to improve the industry," he told the < />.
The loss of the purse supplement last year led all Maryland tracks to restructure their racing programs. At Laurel Park and Pimlico, overnight purses were maintained, but the stakes program was slashed.
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