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Estimates Reduced Due to Alternative Gambling
Churchill Downs Incorporated ("CDI" or the "Company") today announced
that it is revising its earnings outlook for the third quarter of 2004
and further lowering its outlook for the full year to reflect
increased spending on alternative gambling efforts and special,
non-cash impairment charges for Ellis Park due to softness in business
at that racetrack. The Company now expects results for the third
quarter to be a loss of $0.29 per share, below the earnings range of
$0.33 to $0.38 per share estimated during the second quarter earnings
call in July. Earnings for the year, factoring in the third quarter
charges of $0.34 at Ellis Park, are projected to be approximately
$1.00 to $1.05 per share, compared to the previously revised year-end
range of $1.44 to $1.53 per share.
"As we advised in July, strategic initiatives such as our alternative
gaming efforts might require additional, non-deductible legislative
expenses, the extent of which continues to be contingent upon the
efforts' prospects and need," said Thomas H. Meeker, CDI's president and
chief executive officer. "The ballot initiatives in California and
Florida, which are key growth opportunities for the Company, required
higher than projected spending levels, some of which were moved forward
into the third quarter versus the fourth. Our decision to increase our
investment, a possibility we discussed publicly in July, is one of two
key factors that triggered our third quarter loss.
"The second factor, the impairment charges that total $6.2 million
for Ellis Park, reflects our reassessment of that operation following
the completion of its disappointing meet in September," continued
Meeker. "After careful review, we determined that we needed to adjust
the carrying value of the asset. We will continue to evaluate viable
options that offer the racetrack the greatest opportunity for long-term
success.
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2004 Online Casino News Archive
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