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Going Hollywood: CDI Looking At
Selling California Track |
Churchill Downs Inc. (CDI) “signaled yesterday it may be interested in selling Hollywood Park,” according to Marcus Green of the Louisville COURIER-JOURNAL. CDI CFO Mike Miller: “We’re sitting on acreage out there which we think has tremendous value and we just need to see ... if that’s the right place to race in Southern California.” Green writes Hollywood Park “did not fare poorly in” ’04, although CDI was “counting on passage of a November referendum that would have led to slot machines at California racetracks.” The track accounted for $7.3M of the company’s $51.1M operating income in ’04 (Louisville COURIER-JOURNAL, 3/17). Hollywood Park President Rick Baedeker said, “There is nothing planned to announce the sale of Hollywood Park.” But in California, Art Wilson wrote rumors stated that “the sale of Hollywood Park to either [UPS] or FedEx would be finalized today and that the track was negotiating with Santa Anita to hold its autumn meet in Arcadia.” Trainer Dan Hendricks: “I would be surprised if [Magna Entertainment Chair] Frank Stronach would do anything to help [CDI]” (SAN GABRIEL VALLEY TRIBUNE, 3/17).
FINANCIALS: The COURIER-JOURNAL’s Green notes CDI netted a Q4 loss of $3.2M, or $0.25 per share, which was attributed to a $4.3M charge “to reflect the change in value of a promissory note issued in October.” For FY ’04, CDI reported a profit of $8.9M, or $0.67 per share, down from $23.4M, or $1.77 per share, for ’03. Miller blamed the drop in profits “on a string of unexpected expenses,” including $5.9M on failed ballot measures to expand gambling in California and Florida, an October stock buyback, and a $6.2M reduction in the book value of Ellis Park (Louisville COURIER-JOURNAL, 3/17).
