Churchill Downs Incorporated Reports 2011 Fourth-Quarter and Year-End Results

• Fourth Quarter 2011

• Record revenue of $149.3 million up 9% over fourth quarter 2010
• Record EBITDA of $19.6 million up 144% over fourth quarter 2010
• Record earnings from continuing operations per diluted common share of $0.25 versus a loss of $0.26 in fourth quarter 2010

• Full-Year 2011

• Record revenue of $696.9 million up 19% over 2010
• Record EBITDA of $158.7 million up 97% over 2010
• Record earnings from continuing operations per diluted common share of $3.55 up 182% over 2010

LOUISVILLE, Ky., March 12, 2012 (GLOBE NEWSWIRE) -- Churchill Downs Incorporated ("CDI" or "the Company") (Nasdaq:CHDN) today reported business results for the fourth quarter and year ended Dec. 31, 2011.

2011 Fourth-Quarter Results of Operations:

During the fourth quarter of 2011, CDI grew net revenues from continuing operations to $149.3 million, an increase of nine percent from net revenues of $137.2 million recorded during the prior year's period. CDI's fourth-quarter EBITDA (earnings before interest, taxes, depreciation and amortization) more than doubled to $19.6 million. The year-over-year growth in EBITDA during the quarter was driven by the performance of the Company's Gaming and Online Business segments. Revenues of the Gaming Business segment increased 37% while EBITDA increased 52%. Revenues of the Online Business segment increased 18% while EBITDA more than tripled to $9.1 million from $2.8 million in the prior year's fourth quarter. EBITDA of the Company's Racing Business showed a loss of $3.3 million compared to a loss of $2.7 million in the fourth quarter of 2010.

Net earnings from continuing operations set a fourth-quarter record of $4.3 million, or $0.25 per diluted common share, versus a net loss from continuing operations of $4.3 million, or a net loss of $0.26 per diluted common share, during the final quarter of 2010.

2011 Year-End Results of Operations:

Net revenues from continuing operations for 2011 climbed to $696.9 million, a 19-percent increase from prior-year. The growth in net revenues was due principally to the continued expansion of the Company's Gaming and Online Businesses, including the effects of the 2010 acquisitions of Youbet.com LLC ("Youbet") and Harlow's Casino Resort & Hotel ("Harlow's").

Calder Casino, which opened on Jan. 20, 2010, increased total revenues by $17.6 million compared to its 2010 results. Calder Casino's improved performance was due, in part, to a new marketing strategy executed during 2011 along with the effect of having a full year of operations in 2011.

Revenues generated by CDI's Online Business increased $44.0 million in 2011 compared to the previous year, primarily reflecting the acquisition of Youbet during the second quarter of 2010, and the five additional months of Youbet operations that were included in CDI's 2011 results.

Revenues from the Company's Racing Business segment declined three percent in 2011.

EBITDA for the year nearly doubled to $158.7 million from the $80.4 million recorded in 2010. Gaming EBITDA increased $28.5 million as CDI benefitted from the acquisition of Harlow's during December 2010. Harlow's generated $17.5 million of EBITDA during 2011, despite closing for twenty-five days in May due to the Mississippi River flooding, compared to $1.2 million in the prior year. Additionally, Calder Casino generated EBITDA of $13.7 million, versus $3.7 million of EBITDA in the prior year. Fair Grounds Slots and VSI EBITDA increased $2.2 million to $25.8 million during 2011 primarily reflecting operating efficiencies at our video poker locations compared to the same period of 2010.  

Online Business EBITDA increased $20.5 million primarily due to merger-related cost synergies realized by the Company during 2011 as well as an additional five months of Youbet operations during 2011. 

Racing Operations EBITDA increased $27.8 million over the previous year, primarily reflecting the release of Illinois Horse Racing Equity Trust Fund proceeds with a net favorable impact of $19.3 million on EBITDA during 2011. In addition, Racing Operations benefitted from the increased profitability of Kentucky Oaks and Derby week, which contributed an additional $6.4 million in EBITDA during 2011.  

Net earnings from continuing operations for 2011 were $60.8 million, or $3.55 per diluted common share, compared to net earnings from continuing operations of $19.6 million, or $1.26 per diluted common share, in 2010.

Finally, the Company benefitted from favorable comparisons to the prior year, which included legal and development expenses of $4.2 million and reorganization charges of $3.4 million during 2010 related to our acquisitions of Harlow's and Youbet.

CDI Chairman and Chief Executive Officer Robert L. Evans said: "All of us at CDI are proud of the Company's performance in 2011. The record financial results in the fourth quarter and for the entire year; our strong cash flows that enabled us to reduce long-term debt by $137.5 million, from $265.1 million at year-end 2010 to $127.6 million at year-end 2011; the 20% increase in our annual dividend to shareholders, from $0.50 per share to $0.60 per share; and the 20.1% increase in our stock price, from $43.40 at year-end 2010 to $52.13 at year-end 2011, all reflect the strategy we have developed and executed over the last several years. As we look toward 2012, we hope to put in place the growth drivers that will enable the Company to continue its success in the future."

A conference call regarding this news release is scheduled for Tuesday, March 13, 2012, at 9 a.m. EDT. Investors and other interested parties may listen to the teleconference by accessing the online, real-time webcast of the call at http://ir.churchilldownsincorporated.com/events.cfm or by dialing (877) 372-0878 and entering the conference ID number44275812 at least 10 minutes before the appointed time.  International callers should dial (253) 237-1169. An online replay of the webcast will be available by noon EDT in the "Investors" section the Company's website at http://ir.churchilldownsincorporated.com/events.cfm. A copy of the CDI news release announcing quarterly results and relevant financial and statistical information abut the period will be accessible at www.churchilldownsincorporated.com.

In addition to the results provided in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), CDI has provided a non-GAAP measurement, which presents a financial measure of earnings before interest, taxes, depreciation and amortization ("EBITDA"). CDI uses EBITDA as a key performance measure of results of operations for purposes of evaluating performance internally. CDI believes the use of this measure enables management and investors to evaluate and compare, from period to period, CDI's operating performance in a meaningful and consistent manner. This non-GAAP measurement is not intended to replace the presentation of CDI's financial results in accordance with GAAP. A reconciliation of EBITDA to net earnings is included in the Supplemental Information by Operating Unit table within this news release.

Information set forth in this news release contains various "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The Private Securities Litigation Reform Act of 1995 (the "Reform Act") provides certain "safe harbor" provisions for forward-looking statements. All forward-looking statements made in this news release are made pursuant to the Reform Act. The reader is cautioned that such forward-looking statements are based on information available at the time and/or management's good faith belief with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements. Forward-looking statements speak only as of the date the statement was made. The Company assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. Forward-looking statements are typically identified by the use of terms such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "might," "plan," "predict," "project," "should," "will," and similar words, although some forward-looking statements are expressed differently. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, management can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from expectations include those factors described in Item 1, "Risk Factors," within the Company's Annual Report on Form 10-K.

Readers should review this news release with the financial statements in conjunction with other financial information included in the Company's Annual Report on Form 10-K. The Company's significant accounting polices are described in Note 1 to the Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

CONTACT: John Asher

         (502) 636-4586 (office)

         (502) 494-3626 (mobile)

         John.Asher@KyDerby.com

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