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ONLINE REVENUES MAKE A USEFUL CONTRIBUTION TO RACING COMPANY
The exemptions in US law that allow the horseracing industry to take bets over the Internet seem to be working well for the major Churchill Downs Inc track operator. So well, in fact, that it has attracted criticism from the press as distracting management from the core live racing business.
The Louisville Courier-Journal reports that the exchange between management and media took place during a conference call discussing the company's first quarter 2009 results. Washington Post columnist
Andrew Beyer criticised the focus by Churchill on the new online wagering business in a Kentucky Derby week piece, citing disputes Churchill had over the last year with horsemen's groups on how to share revenue from account wagering, and CEO Bob Evans defended his company.
"We aren't abandoning racing," Evans said. "We're rebuilding it." Evans went on to confirm that the company's results are increasingly benefitting from non-pari-mutuel gaming and its online pari-mutuel business, TwinSpires.com, and those trends will continue "...because the growth rates of these new businesses are higher than [those in] racing."
The Washington Post writer had opined that Churchill's bid to increase income was at the expense of the owners and trainers who put on the show at the tracks.
Evans made a general response in which he pointed out that "every single dollar spent by Churchill Downs on slot operations and online operations produces more purses for horsemen at CDI tracks, expands the customer base to which we can market racing and makes CDI a stronger financial entity, which enables us to make more investments and take greater risks."
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