Avioli Say Breeders' Cup Is Operating At A Substantial Deficit

Breeders' Cup President & CEO Greg Avioli said the organization is operating at a "substantial deficit," and other company officials said that it is becoming "increasingly likely that purses for its top events and supplemental stakes program will need to be cut to return the organization to financial stability," according to Matt Hegarty of DAILY RACING FORM. Avioli previously "projected a $5.6[M] budget deficit this year." The question of "how to address the deficit is the backdrop to an election Thursday to fill six" of the Breeders' Cup BOD's 13 seats. BOD members said that the Breeders' Cup "weathered a near revolt among its nominators late last year when it attempted to suspend" a $6M supplemental purse program, but the recession "leaves purse cuts as one of the few options to control expenses without further dipping into its depressed reserves." The Breeders' Cup "expects to distribute" $30.5M in purses this year, compared to the $21.8M distributed in '05. Financial statements from '08 indicated that the Breeders' Cup had "negative cash flow last year" of $7.5M, "reducing its cash balance" to $1.2M by year end. In "large part, that reduction was caused by a fall-off in the value of its investments."  Avioli in a statement last week said Breeders' Cup officials "expect that our 2009 results will be consistent with the budget." Hegarty noted "approximately 40[%] of Breeders' Cup revenues are derived from fees paid by owners of foals and stallions," and officials indicated that revenues from those sources are "expected to drop by at least" 20%, "largely because stallion nominations are tied to stud fees and book size, which have fallen significantly" (DRF.com, 7/6).

NEW YORK STATE OF MIND: The Albany BUSINESS REVIEW's Adam Sichko notes this is the "first full racing season since NYRA exited bankruptcy and received a new, 25-year franchise to run horse racing," and NYRA's handle is "down 10[%] from this time last year." But the organization expects the Saratoga meet, which starts this month, to "cut that percentage in half." Still, there are "more questions than answers." NYRA COO Harold Handel: "For years, the mantra was that we were recession-proof. We've proved this time that that's not the case. We've struggled." Sichko notes the Saratoga meet is NYRA's "money-maker, with average daily crowds up to 10 times larger than NYRA's two other race tracks," Belmont Park and Aqueduct Race Track. NYRA President & CEO Charles Hayward said that "smaller crowds would hurt because the tracks, particularly Saratoga Race Course, are valuable places to develop new customers." But Hayward "remains confident ahead of the Saratoga meet." Hayward: "I'm hopeful with the economy turning around, stock markets ticking up, that people will be a little more confident" (Albany BUSINESS REVIEW, 7/3 issue).

Attendance For Churchill Downs Night Racing Cards Up 318% Over Corresponding '08 Dates

DOWNS AFTER DARK: In Louisville, Jennie Rees noted attendance for Churchill Downs Inc.'s (CDI) three night-racing cards was up 318% "over the corresponding 2008 dates while on-track betting was up" 151%. The track had "anticipated a tailing-off for the last two cards," but Thursday's attendance of 33,481 "surpassed the inaugural night by 5,470 people, achieving what is believed to be the largest Downs crowd ever outside the Kentucky Derby, Oaks and Breeders' Cup." CDI COO Bill Carstanjen and GM Jim Gates "aren't sure if night racing will become a permanent fixture," but if it "doesn't return in some form, it will rank among the largest upsets in track history, given the rousing reception 'Downs After Dark' received and the talk it generated in the community" (Louisville COURIER-JOURNAL, 7/4).