CDI Reports Record-Breaking Q3 Revenue

In Q3, gaming emerged as the driving force behind CDI's financial success, with the segment generating $244.9 million in revenue. This remarkable figure represents a substantial increase of 31.7% compared to the same period in the previous year. A significant portion of this increase, $70.2 million, can be attributed to the revenue generated from properties in New York and Iowa, which CDI acquired in the Peninsula Pacific Entertainment (P2E) transaction. This strategic move, which took place in November of the previous year, involved a purchase worth $2.75 billion. However, CDI did experience a slight setback in Pennsylvania, where revenue dipped by $8.7 million. This decline was mainly due to the decision not to renew a management agreement at Lady Luck and a $2.5 million net decline from other gaming properties.

The live and historical racing segment experienced a substantial revenue increase of 120.2%, reaching $225.5 million in Q3. This boost was largely driven by $89.0 million derived from properties acquired in Virginia as part of the P2E deal. CDI also benefited from a $14.7 million increase in revenue from properties acquired in both the Ellis Park and Chasers transactions. The acquisition of Kentucky's Ellis Park in September 2022, and ownership of Chasers Poker Room in New Hampshire, contributed to this growth. Further revenue, $8.8 million, was generated from the opening of Turfway Park in Kentucky in September of the previous year, while Derby City Gaming and Oak Grove venues, both located in Kentucky, added $7.4 million and $4.3 million, respectively. However, these gains were partially offset by a $1.1 million decrease at Churchill Downs Racetrack, attributed to the shifting of July race days to Ellis Park during the Churchill Downs Racetrack Spring Meet.

In addition to gaming and racing, CDI's TwinSpires business saw a revenue increase of 4.7% in Q3, reaching $107.4 million. This growth is primarily attributed to an additional $5.5 million in revenue from the acquisition of Exacta Systems, a historical horse racing provider, for $250.0 million in August of this year. A further $900,000 came from all other horse racing revenue, mainly due to the B2B expansion strategy associated with United Tote totalisator fees. However, a $1.4 million decline in sports and casino revenue partially offset these gains.

In Q3, CDI reported a net profit of $61.0 million, reflecting a notable increase of 7.0%. Adjusted EBITDA also reached a record-high of $218.2 million, up by 33.7% compared to the previous year.

Looking at the year-to-date performance, CDI's revenue for the nine months ending on September 30 reached $1.90 billion, indicating a remarkable increase of 42.9% compared to the previous year. This performance puts CDI on track to exceed $2.00 billion in revenue for the full year. However, operating expenses rose by 41.5% to $1.44 billion, resulting in a pre-tax profit of $489.9 million, down by 19.9%. After accounting for taxes, CDI's net profit stands at $359.7 million, representing a decrease of 18.0% year-on-year. Nevertheless, adjusted EBITDA for this period was 38.1% higher, reaching $804.8 million.

This impressive Q3 performance and promising year-to-date results suggest that CDI is on a path of sustained financial growth.