CDI Reports Decline in Net Income for 2009

Net income declined in 2009 for Churchill Downs Inc., the company reported March 2.

Churchill Downs Inc. reported a decline in net income for 2009, as well as a fourth-quarter loss for the year.

According to a March 2 earnings release, CDI reported net income of $16.8 million for 2009, compared with net income of $28.5 million in 2008. Revenue for the year was $439.7 million compared with $430.6 million the previous year.

Revenue dropped almost $6 million in the fourth quarter, when CDI was wrapping up construction of a slot machine parlor at Calder Casino & Race Course in Florida. CDI also cited costs tied to its efforts to acquire the advance deposit wagering system; that deal is expected to close this spring.

The release noted Kentucky-based CDI in 2008 received more than $17 million in insurance payments because of hurricane damage to Fair Grounds Race Course & Slots in Louisiana.

CDI president and chief executive officer Robert Evans said the company has increased revenue in each of the last three years at a compound annual growth rate of 5%.

"CDI is making significant investments in our racing business, though it is proving increasingly difficult to generate an acceptable return on those investments," Evans said in a statement. "We are converting the live racing video at all of our racetracks to high-definition format. We are currently installing track lights to support night racing programs at Churchill Downs.

"We have taken a leadership position on improving racing safety and have now completed full safety accreditation of all four racetracks by the NTRA Safety and Integrity Alliance. We are also funding the televising of three weekends of Kentucky Derby (gr. I) prep races this spring on NBC Universal's networks.

"These initiatives, plus others, represent over $10 million in new investments in our racing operations."

Evans said "anticipated growth" in 2010 is likely to be driven by the new Calder Casino, which opened Jan. 22 of this year.