Churchill Downs Inc. has income boost of 45 percent in second quarter

Churchill Downs Inc. had net income of $40.7 million in the second quarter of 2011, a 45-percent increase over second-quarter earnings last year, largely on the strength of higher revenue from the company’s casino and account-wagering operations, according to financial statements released late Wednesday.

During the quarter, Churchill had revenue of $249.7 million, according to the statements, up 16 percent over revenue of $215.4 million in the second quarter of 2010. Revenue from the company’s racing, gambling, and online operations were all up quarter-over-quarter.

Some of the gains were accountable to acquisitions Churchill made last year. Online revenue was $46.5 million in the quarter, up 56 percent, but this year’s second-quarter results included a full three months of operations from Churchill’s acquisition of Youbet.com, a large account-wagering company, whereas last year’s second-quarter results included only one month of the companies’ combined operations. In addition, Churchill purchased a Mississippi casino late in 2010, boosting its gambling revenue by 38 percent, from $35.8 million last year to $49.5 million this year.

In a release, Churchill said that increased revenues from the Kentucky Derby and Kentucky Oaks played a significant role in its improved results from racing operations. During the quarter, racing revenue was $148.2 million, compared with $147.4 million last year. The company also benefited from $2.9 million in tax breaks during the quarter, Churchill said.

For the first six months of the year, Churchill had net income of $40 million, compared with $19 million for the first six months of 2010. The company owns Churchill Downs, Arlington Park, Calder Race Course, Fair Grounds, and the largest account-wagering company in the United States, Twinspires.com. Both Calder and Fair Grounds operate casinos.