CHDN · Churchill Downs Incorporated

Churchill Downs Incorporated delivered a strong first quarter in 2026, achieving record net revenue of $663 million and record Adjusted EBITDA of $257 million. The 3% revenue growth was primarily driven by the Live and Historical Racing segment, which saw a $24 million increase to $301 million. This growth was fueled by robust performance in Kentucky HRM venues, particularly in Western, Northern, and Southwestern Kentucky, alongside contributions from Virginia and New Hampshire operations. The opening of Marshall Yards Racing & Gaming in Southwestern Kentucky on February 25, 2026, further bolstered the segment's performance. Conversely, the Gaming segment experienced a $5 million revenue decline to $262 million, largely attributable to the cessation of HRM operations in Louisiana in May 2025 and decreases in Florida and Mississippi properties, partially mitigated by growth in New York, Indiana, and Maryland. The Wagering Services and Solutions segment contributed modest growth, with revenue rising $2 million to $118 million, driven by retail sports betting.

Profitability improved significantly, with net income attributable to CDI rising 8% to $83 million. Adjusted EBITDA growth of 5% reflected operational leverage and lower legal expenses in the Horse Racing business. However, the 'All Other' segment saw a $2 million decrease in Adjusted EBITDA due to claim development within the captive insurance company. Operationally, the company is expanding its footprint with a planned $180-$200 million investment in the Rockingham Grand Casino in New Hampshire, targeting a mid-2027 opening. A strategic highlight includes the definitive agreement to acquire the intellectual property rights for the Preakness Stakes and Black-Eyed Susan Stakes for $85 million, signaling a significant expansion of the company's racing portfolio. The balance sheet remains leveraged at 3.8x net bank leverage, while the company continues its shareholder return program, having paid a $0.438 per share dividend, marking the fifteenth consecutive year of dividend increases.