With nine of its 68 pages devoted to outlining the success of this year’s Kentucky Derby (G1) and the event overall, a Churchill Downs Inc. investor presentation issued after this year’s 150th edition of the race documents its enduring success.
And it also points to CDI building on the approaches it attributes to that success: a strong partnership with the community and broadcast partner NBC, further investment in the track facility, and enhancing international opportunities.
And all of those efforts have helped increase wagering interest, as Derby week handle has improved each year from the COVID year of 2020. In 2021 handle returned to a comparable pre-pandemic level of $315 million, and it has increased in each of the three years that have followed—up to $447 million this year. That’s a 42% increase since 2021.
NBC’s tried and true approach of featuring the Derby on its programs such as the Today Show, the Tonight Show with Jimmy Fallon, the Kelly Clarkson Show, The Players, Access, and E! News helped increase interest ahead of this year’s milestone edition of the race. Those efforts paid off as the Kentucky Derby broadcast averaged 16.7 million viewers and peaked at 20.1 million. That’s the most viewing interest since 1989. Consider that the final round of The Masters averaged 9.6 million viewers.
While horse racing overall has struggled to attract a younger demographic, the Kentucky Derby again is an exception to that rule as 29% of its attendees were between 18-34 and 31% were between ages 35-54.
In terms of income levels, 72% of ticket buyers make $100,000 or more a year, with 22% at $250,000 or more. That demographic has supported the premium seating. Those premium tickets account for about 60% of Churchill’s Derby week revenue. The company said more than a third of its reserved seats are under non-cancellable contracts with staggered expirations of three-to-seven years through personal seat licenses, suite contracts, and other agreements.
CDI believes its near-continual upgrades at Churchill Downs racetrack are paying dividends. With that in mind the report notes a further $60 million-$80 million investment in the track to be completed by April 2025. As for potential major future projects, the report noted the possibilities of renovating additional reserved seating areas, adding infield seating, and a hotel. A previous hotel project at the track was abandoned in favor of building the First Turn seating.
The report notes that offering international qualifying paths to the Derby, specifically the Japan Road to the Kentucky Derby and the European Road to the Kentucky Derby, has generated international starters, international customers, added wagering, and provides an extended marketing opportunity for sponsors. The report suggests that these qualifying paths could be expanded in the years ahead.
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