Warning: Undefined array key "post_type_share_twitter_account" in /var/www/vhosts/casinonewsblogger.com/public_html/wp-content/themes/cryptocurrency/vslmd/share/share.php on line 24
Shares of Churchill Downs (NASDAQ: CHDN) rallied in after-hours trading after the racetrack operator announced estimate-beating second-quarter results and an acquisition while updating investors on projects at its namesake Kentucky track.
The gaming company said it entered into a definitive agreement to reacquire the 49% of United Tote it sold to a unit of the New York Racing Association (NYRA) in April 2024. At the time of the 2024 deal, the NYRA agreed to use United Tote for racetrack and “gaming related pari-mutuel wagering systems.” Under the terms of the new transaction, that agreement is extended through 2035.
“This acquisition supports Churchill Downs’ (CDI) long-term strategy to own and vertically integrate key technologies and services related to pari-mutuel wagering and horse racing, while strengthening the Company’s position as a leading business-to-business distributor of horse racing content and provider of racing services,” according to a statement. “United Tote also enhances CDI’s ability to develop, deploy, and manage critical horse racing related wagering technology.”
Financial terms of the acquisition, which is slated to close on Aug. 5, weren’t disclosed. United Tote makes and operates pari-mutuel wagering systems used by racetracks, off-track-betting (OTB) facilities and other gaming entities.
Churchill Downs Sprucing Up Ahead of 2027 Kentucky Derby
Coming off a 2026 Kentucky Derby in which Derby Week racing wagering activity topped earnings before interest, taxes, depreciation and amortization (EBITDA) records, Churchill Downs updated shareholders on a trio of projects at its eponymous Kentucky racecourse.
Those include Victory run, which will be located between the First Turn Club and the Skye Terrace. Last October, the gaming company forecast spending of $280 million to $300 million on that project. While those figures weren’t mentioned today, the company said it expects Victory Run enhancements to be ready for the 2028 Derby, with temporary amenities available for the 2027 Run for the Roses.
The Homestretch expansion, which includes new bars and restaurants and added VIP seating, is expected to be ready for the 2027 Derby as is the infield seating upgrade.
“We will be removing the tote boards so we can create new customer experiences in a very desirable area of the infield with exceptional views of the homestretch, the finish line, and the Derby winner’s trophy presentation,” said the company regarding the infield upgrade. “We are adding 1,400 temporary seats and will be testing a new infield cabana offering with 500 covered reserved seats along the turf course.”
Churchill Downs Posts Solid Q2 Results
With the aforementioned help of a strong Derby Week, Churchill Downs delivered sturdy quarterly results. In the June quarter, the operator earned $3.45 a share on sales of $980 million. Analysts expected earnings of $3.43 on revenue of $987.5 million.
That revenue tally and adjusted EBITDA of $477 million set records. Revenue in the company’s Kentucky and Virginia historical racing machine (HRM) operations rose by $12 million and $1 million, respectively.