Slides
Page 1
June 17, 2025 Investor Presentation
Page 2
Forward-Looking Statements Certain statements made in this presentation contain various “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by the use of terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “predict,” “project,” “seek,” “should,” “will,” “scheduled,” and similar words or similar expressions (or negative versions of such words or expressions), although some forward-looking statements are expressed differently. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we 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 the following: • The occurrence of extraordinary events, such as terrorist attacks, public health threats, civil unrest, and inclement weather, including as a result of climate change; • The effect of economic conditions on our consumers' confidence and discretionary spending or our access to credit, including the impact of inflation; • Changes in, or new interpretations of, applicable tax laws or rulings that could result in additional tax liabilities; • The impact of any pandemics, epidemics, or outbreaks of infectious diseases, and related economic matters on our results of operations, financial conditions and prospects; • Lack of confidence in the integrity of our core businesses or any deterioration in our reputation; • Negative shifts in public opinion regarding gambling that could result in increased regulation of, or new restrictions on, the gaming industry; • Loss of key or highly skilled personnel, as well as general disruptions in the general labor market; the impact of significant competition, and the expectation that competition levels will increase; • Changes in consumer preferences, attendance, wagering, and sponsorships; • Risks associated with equity investments, strategic alliances and other third-party agreements; • Inability to respond to rapid technological changes in a timely manner; • Concentration and evolution of slot machine and historical racing machine (HRM) manufacturing and other technology conditions that could impose additional costs; • Failure to enter into or maintain agreements with industry constituents, including horsemen and other racetracks; • Inability to successfully focus on market access and retail operations for our sports betting business and effectively compete; • Online security risk, including cyber-security breaches, or loss or misuse of our stored information as a result of a breach including customers’ personal information could lead to government enforcement actions or other litigation; • Costs of compliance with increasingly complex laws and regulations regarding data privacy and protection of personal information; • Reliance on our technology services and catastrophic events and system failures disrupting our operations; • Inability to identify, complete, or fully realize the benefits of our proposed acquisitions, divestitures, development of new venues or the expansion of existing facilities on time, on budget, or as planned; • Difficulty in integrating recent or future acquisitions into our operations; • Cost overruns and other uncertainties associated with the development of new venues and the expansion of existing facilities; • General risks related to real estate ownership and significant expenditures, including risks related to environmental liabilities; • Personal injury litigation related to injuries occurring at our racetracks; • Compliance with the Foreign Corrupt Practices Act or other similar laws and regulations, or applicable anti-money laundering regulations; • Payment-related risks, such as risk associated with fraudulent credit card or debit card use; • Work stoppages and labor problems; risks related to pending or future legal proceedings and other actions; • Highly regulated operations and changes in the regulatory environment could adversely affect our business; • Restrictions in our debt facilities limiting our flexibility to operate our business; • Failure to comply with the financial ratios and other covenants in our debt facilities and other indebtedness; • Increases to interest rates (due to inflation or otherwise), disruption in the credit markets or changes to our credit ratings may adversely affect our business; • Increase in our insurance costs, or inability to obtain similar insurance coverage in the future, and any inability to recover under our insurance policies for damages sustained at our properties in the event of inclement weather and casualty events; and • Other factors described under the heading “Risk Factors” in our most recent Annual Report on Form 10-K and in other filings we make with the Securities and Exchange Commission. We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. 2
Page 3
T able of Contents Business Overview and Case for Investing Segment Overviews: – Live and Historical Racing – Wagering Services and Solutions – Gaming Capital Management ESG Appendix 3
Page 4
Business Overview and Case for Investing 4
Page 5
GamingChurchill Downs Racetrack (“CDRT”) Kentucky Seven entertainment venues with ~5,130 HRMs and one new HRM venue under construction Virginia Eight entertainment venues with ~4,600 HRMs and one new HRM venue under construction New Hampshire Chasers Poker Room in Salem with significant HRM and table game expansion opportunity We have a unique and diverse collection of entertainment assets that generate high margins with significant Adjusted EBITDA and Free Cash Flow 1. Includes Miami Valley Gaming, 50% owned Ohio joint venture, and Rivers Casino Des Plaines, 61% owned Illinois joint venture. T welve gaming properties1 with ~14,360 slot machines and video lottery terminals and ~360 table games in eleven states Hosts the longest continuously held annual sporting event in the U.S., the Kentucky Derby One of the largest and most profitable U.S. online wagering platforms for horse racing Expanding pari-mutuel content and technology services to B2C sports betting platforms Exacta provides HRM technology in our Virginia & Kentucky venues and to third parties in the U.S. and globally Churchill Downs Incorporated (“CDI”) Overview Business Overview 5 Historical Racing Machines (“HRMs”) Wagering Services and Solutions
Page 6
Case for Investing Iconic and irreplaceable asset Consistent high margin growth and significant free cash flow over the long-term from marquee asset Growing international engagement through Japan and European Roads to the Derby Proven record of disciplined capital allocation and earnings growth Successful track record of integrating new businesses and execution of organic growth projects Diverse backgrounds with multi-industry, technology, and international experience Expansion of HRM entertainment venues in Kentucky, Virginia, New Hampshire, and other states Provider of HRM technology to existing and future central determinant system businesses Most profitable, industry-leading online wagering platform for horse racing driven by access to best-in-class racing content and linkage to the Kentucky Derby Diverse portfolio of wholly- owned regional gaming properties and strategic equity investments Strong free cash flow generation with disciplined maintenance capital spending Ability to pursue strategic reinvestment in organic growth, M&A, dividends, and share repurchases to maximize shareholder returns Conservative balance sheet with financial flexibility and significant access to capital Case for Investing The Kentucky Derby Diverse Organic Growth Strong Financial Profile With a Proven Management T eam and Organizational Depth for Execution 6
Page 7
The Kentucky Derby is Only the Beginning Case for Investing Vinton Hampton Richmond Emporia Colonial Downs/ New Kent Virginia Live and Historical Racing Gaming Kentucky 7 1. Marshall Yards Racing & Gaming in Kentucky is expected to open in 1Q’26. 2. Roseshire HRM venue in Virginia is expected to open in 4Q’25. Collinsville Northern Virginia (Dumfries) Henrico
Page 8
8 Strong 2024 Growth & Performance 8 Case for Investing 11% Annual Revenue Growth from 2023 to 2024 $ in millions 13% Annual Adj. EBITDA Growth from 2023 to 2024 $ in millions $2,462 $182 $42 ($23) $2,734 2023 Live & Historical Racing Wagering Services Gaming All Other 2024 2023 Wagering Services & Solutions Gaming All Other & Eliminations 2024 $1,024 $99 $34 $18 ($16) $1,159 2023 Live & Historical Racing Wagering Services Gaming All Other 2024 2023 Live & Historical Racing Gaming All Other & Eliminations 2024Wagering Services & Solutions Live & Historical Racing $71
Page 9
$243 $1 $2 $1 ($1) $245 1Q'24 Live & Historical Wagering Services Gaming All Other 1Q'25 $591 $28 $2 ($2) 1Q'24 Live & Historical Wagering … Gaming All Other 1Q'25 9 Strong 1Q’25 Performance 9 Case for Investing 9% Annual Revenue Growth from 1Q’24 to 1Q’25 $ in millions 1% Annual Adj. EBITDA Growth from 1Q’24 to 1Q’25 $ in millions Gaming All Other & Eliminations Live & Historical Racing Wagering Services & Solutions1Q’24 1Q’25 $24 $643 Gaming All Other & Eliminations Live & Historical Racing Wagering Services & Solutions1Q’24 1Q’25
Page 10
(8%) 44% 14% 50% (9%) 53% 25% 31% 10 One of a Kind Portfolio 10 Case for Investing $ in billions $0.3 Gaming: Rivers equity investment & expansion Iowa and New Y ork acquisition T erre Haute organic investment Wagering Services & Solutions: Exacta acquisition T winSpires core & B2B Live & Historical Racing: Virginia HRM acquisition Kentucky HRM organic investment Kentucky Derby organic investment +193% +100% +463% Adj. EBITDA Growth: Segment Growth Drivers: 1. Continuing operations; 2018 reflects current segmentation 2018 Adjusted EBITDA1 Gaming Wagering Services & Solutions Live & Historical Racing Other $1.2 1Q’25 TTM
Page 11
11 Project Capital Investments Project Capital Investments Location – Project T arget Completion 2025 Planned Spend ($ Millions) The Kentucky Derby CDRT – Finish Line Suites & The Mansion April 2026 $15-20 Historical Racing Machines Virginia – Richmond (HRM Expansion) 3Q’25 $30-35 Virginia – Henrico (Roseshire – HRM Venue) 4Q’25 $30-35 Southwestern Kentucky – Calvert City (Marshall Yards Racing & Gaming – HRM Venue) 1Q’26 $30-35 New Hampshire – Salem (HRM Venue) TBD TBD All Other All Other TBD $70-80 2025 Project Capital Forecast: $250-290 million
Page 12
Our capital investments provide strong returns and drive long term shareholder value Proven Track Record of Generating Strong Returns on Capital Projects Project Capital Investments 12 Property1 Initial Year of Investment Cumulative Investment ($ millions)2 Projected Unlevered IRR Derby City Gaming (HRM) 2018 $154 > 65% Newport Racing & Gaming (HRM) 2020 $36 > 30% Oak Grove (HRM) 2020 $196 > 30% Turfway Park (HRM) 2022 $179 Mid-teens Homestretch Club at CDRT 2022 $37 > 30% First T urn at CDRT 2023 $87 > 20% 1. Properties with greater than 2 years of actual performance included using an unlevered DCF analysis. 2. Investment represents capital spend and acquisition costs.
Page 13
Disciplined Acquirer & Seller of Strategic Assets M&A Investments 13 Disciplined Acquisitions $ in millions Asset Initial Year of Investment Purchase Price Implied Multiple1 Rivers Casino Des Plaines 2019 $407 < 5x P2E & Exacta2 2022 & 2023 $3,000 7-8x 1. Based on purchase price and 2024 Adjusted EBITDA. 2. Excludes the investment in and Adjusted EBITDA from Emporia, The Rose, Richmond expansion, and Henrico County. Strategic Seller of Assets $ in millions Asset Year of Sale Sale Price After-Ta x Gain on Sale Big Fish Games 2018 $990 $168 Calder Land Sales 2016 & 2022 $318 $298 Arlington Property Sale 2023 $197 $86
Page 14
Churchill Downs Racetrack Capital Investments Announced Project Capital Investments 14 First Turn The Mansion, Matt Winn’s, and Finish Line Suites Turf Club Starting Gate Suites Homestretch Club Paddock Jockey Club Suites Finish LineBig Board Finish Line Suites & The Mansion April 2026 Starting Gate Pavilion & Courtyard Significant opportunity remains to grow our iconic asset in alignment with our guiding principles Create unique, once-in-a-lifetime experiences for guests Create new experiences for guests at all ticketing price points Remain focused on time-honored traditions through celebration of the history of Churchill Downs and the Kentucky Derby Minimize construction impact from capital projects on the current year’s Derby to ensure that guests can have a bucket list experience every year
Page 15
Churchill Downs Racetrack – Finish Line Suites & The Mansion Renovate the existing Finish Line Suites and The Mansion for the 152nd Kentucky Derby in May 2026 Modernizes 15 existing Finish Line Suites and adds incremental reserved seating - Expands Finish Line Suites overlooking the finish line with new finishes and other amenities while increasing capacity to 750 guests - Renovates the Trophy Room, which sits behind the Finish Line Suites and hosts over 300 guests each year, with new finishes and a new feature bar for guests to enjoy Enhances The Mansion for a more exclusive experience - Located on the sixth floor, The Mansion provides stunning views of the finish line and CDRT - Introduce updated finishes along with other enhancements Announced Project Capital Investments 15 The Mansion Trophy Room
Page 16
New HRM entertainment venue in Henrico County in Central Virginia 175 HRMs Refined wine bar Live entertainment Simulcast Plan to open in 4Q’25 Virginia Development Rights Announced Project Capital Investments Richmond HRM Expansion The Roseshire – Henrico HRM Venue Expansion of existing Richmond HRM entertainment venue in Central Virginia Addition of ~450 HRMs T otal of ~1,200 HRMs upon completion of project Full project complete in 3Q’25 with phased introduction of additional HRMs May 2025: Gaming floor expansion open, smoking section renovation begins, ~170 incremental HRMs 3Q’25: Full expansion & renovation complete, ~280 incremental HRMs 16
Page 17
Marshall Yards Racing & Gaming New HRM entertainment venue located in Southwestern Kentucky in Calvert City at the intersection of I-69 and I-24 Annex of Oak Grove Racing & Gaming HRM entertainment venue will include: – 250 HRMs – Sports bar – Retail sports book – Simulcast wagering – Food & beverage offerings Plan to open in 1Q’26 17 Marshall Yards Racing & Gaming Announced Project Capital Investments
Page 18
Live and Historical Racing Segment 18
Page 19
Live and Historical Racing Segment Kentucky Live and Historical Racing Overview Properties in italics are not yet open. Live Racing KY Historical Racing Facilities Churchill Downs Home of the Kentucky Derby Derby City Gaming Derby City Gaming Downtown T urfway Park Tu rfw ay Park Racing & Gaming Newport Racing & Gaming Oak Grove Oak Grove Racing, Gaming & Hotel Marshall Yards Racing & Gaming (1Q’26) Ellis Park Ellis Park Racing & Gaming Owensboro Racing & Gaming Four racetracks in Kentucky with ~5,130 HRMs at seven properties currently with approval for up to 9,000 HRMs T otal Segment Key Metrics $ in millions 2024 1Q’25 Revenue $1,267 $276 VPY / VPQ +17% +11% Adjusted EBITDA $575 $102 VPY / VPQ +21% +1% 19
Page 20
The Kentucky Derby utilizes the magic and mystique of Churchill Downs to create unique experiences for our guests The Kentucky Derby The Kentucky Derby Overview 20
Page 21
Comparable Viewership 2025 Date Network Avg. Viewers2 151st Kentucky Derby May 3rd NBC 17.7 Masters Final Round Apr 13th CBS 12.7 NBA Finals3 June 17th ABC 12.2 Indy 500 May 25th Fox 7.1 Daytona 500 Feb 16th Fox 6.8 Formula One Miami Grand Prix May 4th ABC 2.2 The Kentucky Derby The Kentucky Derby - By The Numbers Significant media interest creates long-term support for iconic entertainment event 21.8 million peak viewership1 (8% growth Y oY), largest ever NBC peak audience for the Kentucky Derby 17.7 million average viewership1 (6% growth Y oY), highest NBC average viewership since 1989 NBC’s most watched Saturday program since the NFL Divisional Playoffs in January 2024 Over 285 million social media impressions across Facebook, X (T witter), Instagram, TikT ok, Y ouT ube, LinkedIn, and Pinterest (67% growth Y oY) ~374,000 attendees during Derby Week, equivalent of ~5 Super Bowls Race For The Crown debuted as a T op 10 Netflix series Record-breaking Derby Week all sources wagering Kentucky Derby Week of ~$474 million (6% growth Y oY) Kentucky Derby Day Program of ~$349 million (9% growth Y oY) Kentucky Derby Race of ~$234 million (11% growth Y oY) 1. Includes viewership on NBC and Peacock streaming 2. Viewership in millions 3. 2024 viewership for final game of series 21
Page 22
The Celebration Leading Up to the Kentucky Derby The Kentucky Derby 22
Page 23
The Lead Up to the Kentucky Derby The Kentucky Derby 23
Page 24
Leverage unique experiences and make strategic capital investments Enhance guest experience to enable pricing differentiation for reserved seats Expand Derby Week offerings and attractions Execute capital investments to enable segmentation of guests who do not have a reserved seat Attract additional sponsorships Expand Euro/Mideast Road to Derby and Japan Road to Derby The Kentucky Derby Premium tickets are largest contributor to revenue Demand for premium tickets, including suites, continues to exceed supply Wide range of premium price points for varied customer base Personal seat licenses, suite contracts, and other agreements offer reserved seats under contracts with staggered 3-7 year expirations Cash from ticket sales are received throughout the year Kentucky Derby Growth StrategyDerby Week Revenue A Premier International Sporting & Entertainment Event 24 TicketingPari- mutuel Sponsorships & Licensing Broadcast Other
Page 25
Investing Capital in Unique Experiences The Kentucky Derby Enhance Guest Experience Enable Price Differentiation Capital Investments to Enable Segmentation 2022 Homestretch Club 2023 First T urn Experience 2024 Paddock Project 2025 Starting Gate Pavilion & Courtyard 2026 Finish Line Suites & The Mansion Enhances Long-Te r m Shareholder Value 25
Page 26
Sponsorship Strategy The Kentucky Derby Building relationships with sponsors targeting luxury, lifestyle and technology categories for both onsite experiences and Derby parties around the globe Partners include Woodford Reserve, SAP , Longines, Ford, Accenture, FanDuel, Sports Illustrated, and White Claw Woodford Reserve will be the presenting sponsor of the Kentucky Derby through 2027 Longines will be the presenting sponsor of the Kentucky Oaks through 2028 26
Page 27
Three unique Roads to the Derby for a horse to qualify in one of 20 coveted Derby starting positions Horses compete for one Derby starting position through seven European and UAE races from September to April Euro / Mideast Horses compete for one Derby starting position through four Japanese races from November to March Japan Horses compete for a Derby starting position through 36 races from September through April United States New international customers for the Derby Additional wagering Provides extended marketing opportunity for sponsors Growth Potential The Kentucky Derby International Growth Strategy 27
Page 28
Unique early stage growth model CDI’s HRM business is still in relatively early days, with recently opened properties ramping up and new properties yet to open Consumer education on HRMs is still developing in all of our markets Opportunity remains for innovation in HRM products that can be offered to consumers CDI has the opportunity to expand into other states A historical horse racing machine (“HRM”) is a gaming device that uses the results of previously run horse races to approximate the gaming experience of Class II and Class III machines T op game titles / themes are from Aristocrat, Light and Wonder, International Game T echnology, Konami Gaming, Ainsworth Game T echnology, AGS, and Everi HRM Business Historical Horse Racing Machines 28
Page 29
$38.8 $99.3 2018 2024 Nine racing licenses have been awarded by the Kentucky Horse Racing and Gaming Corporation and are each allowed to have a main facility and one “annex” facility with HRMs within a 60-mile radius of the licensed racetrack CDI holds four racing licenses – Churchill Downs Racetrack, Oak Grove, T urfway Park, and Ellis Park - Churchill Downs Racetrack is permitted to have Derby City Gaming1 & Derby City Gaming Downtown as an annex - T urfway Park has Newport Racing and Gaming as an annex - Ellis Park has Owensboro Racing and Gaming as an annex - CDI has announced Marshall Yards Racing and Gaming as an annex for Oak Grove in Calvert City, Kentucky Purse contributions from the HRM facilities attract more and better-quality horses resulting in better- quality racing content which strengthens the foundation of the entire horse industry in Kentucky and benefits T winSpires HRM Entertainment Venues - Kentucky Keeping Kentucky Strong 1. Derby City Gaming operates at Churchill Downs Racetrack’s ancillary training facility in Louisville, Kentucky 29 Derby City Gaming Opens $ in millions Purses Pair to Horse Owners at CDRT 20% Average Annual Growth Rate Historical Horse Racing Machines
Page 30
Derby City Gaming & Hotel Operates as Churchill Downs Racetrack’s ancillary training facility in Louisville, Kentucky HRM entertainment venue includes: – Center bar with large format televisions, two food venues, open-air gaming patio, and retail sports betting – Oliver’s Chop House & Bourbon Bar Supports purse funding for Churchill Downs Racetrack meets Derby City Gaming Downtown Opened in Downtown Louisville in December 2023 – Targets tourism, “Bourbonism,” and convention attendees HRM entertainment venue includes: – Open-air gaming patio, three unique bar concepts with stages for live music and entertainment, on-site parking, and retail sports betting Supports purse funding for Churchill Downs Racetrack meets 1. Reflects total investment for property, including expanded gaming floor & hotel. 2. Reflects total investment for completed project. 3. Based on the pari-mutuel wagering data from the Kentucky Horse Racing and Gaming Corporation. 4. Based on average of 1,279 operational HRMs for twelve months ended March 31, 2025. 5. Based on average of 455 operational HRMs for twelve months ended March 31, 2025. Churchill Downs Racetrack and Derby City Gaming Opened Sep. 2018 Dec. 2023 To t a l investment ($ millions) $1541 $902 Proximity to major market 8 mi. to Downtown Louisville Downtown Louisville Retail sports betting Sept. 2023 Dec. 2023 Win/Unit/Day3 $4474 $1095 HRMs 1,270 450 HRM capacity approval to date 3,000 Future Organic Growth Opportunity 30 Historical Horse Racing Machines
Page 31
Oak Grove Racing, Gaming & Hotel and Marshall Yards Racing & Gaming Oak Grove Racing, Gaming & Hotel Located off of Hwy 24 on the KY / TN border ~55 miles from Nashville, T ennessee (MSA pop. ~2.1 million) Near Fort Campbell, the second largest military base in the U.S. (MSA pop. ~200,000) HRM entertainment venue includes: – Harness racetrack – 128-room hotel with event center and dining areas Marshall Yards Racing & Gaming Located at the intersection of I-69 and I-24 in Calvert City HRM entertainment venue will include: – Sports bar – Retail sportsbook – Simulcast wagering – Several food & beverage offerings Opened Sep. 2020 1Q’26 To t a l investment ($ millions) $1961 $40-50 Proximity to major market ~55 mi. to Nashville ~18 mi. to Paducah Retail sports betting Sept. 2023 1Q’26 Win/Unit/Day2 $3743 - HRMs 1,240 250 HRM capacity approval to date 1,500 1. Reflects total investment for completed project. 2. Based on the pari-mutuel wagering data from the Kentucky Horse Racing and Gaming Corporation. 3. Based on average of 1,225 operational HRMs for twelve months ended March 31, 2025. 31 Historical Horse Racing Machines
Page 32
T urfway Park Racing & Gaming Located in Northern Kentucky ~10 miles to Cincinnati, OH (MSA pop. ~2.3 million) Opened September 1, 2022 HRM entertainment venue includes: – Thoroughbred racetrack, food and beverage offerings, event center, simulcast wagering, and retail sports betting Supports purse funding for T urfway Park race meets Newport Racing & Gaming Located in Newport, Kentucky ~3 miles to Cincinnati, OH HRM entertainment venue includes: – Simulcast wagering and retail sports betting Supports purse funding for T urfway Park race meets T urfway Park Racing & Gaming and Newport Racing & Gaming Opened Sept. 2022 Oct. 2020 To t a l investment ($ millions) $179 $36 Proximity to major market ~10 mi. to Cincinnati ~3 mi. to Cincinnati Retail sports betting Sept. 2023 Sept. 2023 Win/Unit/Day1 $2382 $2053 HRMs 810 460 HRM capacity approval to date 2,500 32 Historical Horse Racing Machines 1. Based on the pari-mutuel wagering data from the Kentucky Horse Racing Commission. 2. Based on average of 794 operational HRMs for twelve months ended March 31, 2025; can expand up to 1,200 HRMs. 3. Based on average of 451 operational HRMs for twelve months ended March 31, 2025.
Page 33
Opened 1922 Feb. 2025 To t a l investment ($ millions) $79 $100 Proximity to major market ~5 mi. to Evansville, IN ~6 miles to Owensboro, KY Retail sports betting Sept. 2023 Feb. 2025 Win/Unit/Day1 $2282 - HRMs 300 600 HRM capacity approval to date 2,500 Ellis Park Racing & Gaming and Owensboro Racing & Gaming Ellis Park Racing & Gaming Located off Interstate 69 on the KY / IN border ~5 miles from Evansville, Indiana Facility includes: – Thoroughbred racetrack – Retail sports betting Owensboro Racing & Gaming Located off US Highway 60 and Wrights Landing Rd. ~6 miles east of the City of Owensboro – Owensboro, Kentucky is the 4th largest city in Kentucky HRM entertainment venue includes: – Food and beverage offerings – Simulcast wagering area – Retail sports betting Supports purse funding for Ellis Park race meets 1. Based on the pari-mutuel wagering data from the Kentucky Horse Racing and Gaming Corporation. 2. Based on average of 292 operational HRMs for twelve months ended March 31, 2025. 33 Historical Horse Racing Machines
Page 34
Virginia statute permits 5,000 HRMs through CDI’s ownership and operation of Colonial Downs Racetrack Colonial Downs hosts one race day per 100 HRM machines deployed in Virginia with the number of race days increasing as the number of HRMs deployed increases - 27 race days in 2024 - 44 race days in 2025 HRM Entertainment Venues - Virginia 34 Historical Horse Racing Machines CDI created The Virginia Derby as a Kentucky Derby qualifying race in a newly added March race meet in addition to the August race meet Purse contributions from the HRM facilities attract more and better-quality horses resulting in better-quality racing content which strengthens the foundation of the entire horse industry in Virginia and benefits T winSpires
Page 35
HRM Entertainment Venues – Virginia Region Northern Virginia Central Virginia Southern Virginia Western Virginia Location Rosie’s The Rose Richmond Colonial Downs New Kent Henrico County Hampton Emporia Collinsville Vinton Opened Jan. 2021 Nov. 2024 Jun. 2019 Apr. 2019 4Q’25 Oct. 2019 Sept. 2023 Jul. 2021 May 2019 Win/Unit/Day1 $639 $2072 $517 $302 - $405 $428 $333 $329 HRMs 150 1,650 750 490 ~175 700 150 40 470 1. Based on the historical horse racing reports from the Virginia Racing Commission using the average number of operational HRMs at each facility for the twelve months ended April 30, 2025. 2. The Rose opened November 7, 2024; Win/Unit/Day reflects the average of 1,650 operational HRMs for November 7, 2024 through April 30, 2025. 35 Historical Horse Racing Machines
Page 36
Wagering Services & Solutions Segment 36
Page 37
Wagering Services & Solutions Overview Wagering Services & Solutions T winSpires Horse Racing The largest and most profitable legal online horse racing platforms in the US1 - Business to consumer offering through T winSpires - Business to business offering for sports betting platforms 24/7/365 online wagering on ~165,000 races at 360 racetracks around the world Provides horse racing statistical data, live streaming of racing, and handicapping information Provides wagering settlement services for CDI owned properties and third parties through United T ote Exacta Provides central determinant system technology (“HRM technology”) for HRMs at CDI properties Provides HRM technology for third parties in Kentucky, Wyoming, and New Hampshire Opportunity to expand HRM technology internationally Retail & Online Sport Betting Provide retail sports betting services to customers at wholly- owned CDI properties Monetize online sports betting market access in select states (e.g., Indiana, Kentucky, and Pennsylvania) with third parties CDI is the premier pari-mutuel content and technology provider Key Metrics $ in millions 2024 1Q’25 Revenue $501 $116 VPY / VPQ +9% +1% Adjusted EBITDA $166 $41 VPY / VPQ 25% +4% 37 1. Based on U.S. Online Wagering as reported by the Oregon Racing Commission for 2024.
Page 38
$1.5 $2.0 $2.0 $1.9 $0.4 $2.9 $4.5 $4.6 $4.6 $1.1 2019 2022 2023 2024 1Q'25 $ in billions Wagering Services & Solutions T winSpires Horse Racing Growth Strategy U.S. Thoroughbred Horse Racing Online Handle1 T winSpires Horse Racing Growth Strategy Grow core T winSpires horse racing customers Leverage linkage to Kentucky Derby to efficiently acquire customers Utilize in-house development team to continue to enhance superior technology platform Utilize analytics on customer behavior to drive efficient customer acquisition, retention, and activation Grow B2B horse racing relationships Provide technology platform, settlement services, and analytics for sports betting platforms (e.g., FanDuel and DraftKings) Seamless delivery of a casual betting pari-mutuel platform with single wallet integration Other U.S. Online Wagering 1 TwinSpires Online Wagering 3 T winSpires Horse Racing and U.S. Online Wagering have grown significantly since 2019 38 1. U.S. Online Wagering as reported by the Oregon Racing Commission less TwinSpires Handle as reported in corresponding quarterly earnings releases. 2. Online percentage of industry-wide handle represents the ratio of U.S. Online Wagering as reported by the Oregon Racing Commission to U.S. Thoroughbred Horse Racing wagering data as reported by Equibase. 3. TwinSpires handle excludes Velocity. 40% 53% 57% 58%Online Percentage of Industry-Wide Handle2 61%
Page 39
Wagering Services & Solutions Exacta Growth Strategy HRM Unit Counts Exacta Growth Strategy Vertical integration enables significant cost saving synergies and game content diversification at CDI HRM properties Diversify HRM game content to improve customer experience Integrate the Exacta technology selectively within Kentucky Provide HRM technology to third-party HRM operators in Kentucky, Wyoming, New Hampshire, and new states Enhance the HRM technology and product offering Expand Exacta technology and the HRM product into international markets HRM Expansion 39 ~8,500 ~4,600 ~2,150 ~700 ~3,200 Kentucky1 Virginia2 Wyoming3 Other Operators CDI Operated 2019 2025 2019 2025 2019 2025 1. Based on the pari-mutuel wagering data from the Kentucky Horse Racing and Gaming Corporation through February 2025. 2. Based on the historical horse racing reports from the Virginia Racing Commission through April 2025. 3. Internal estimate based on information from the Wyoming Gaming Commission and the New Hampshire Lottery Commission. Exacta technology utilized in both states. ~2,900 New Hampshire3 2019 2025 ~3,100 0
Page 40
40 New Hampshire HRM Strategy Located in Salem, New Hampshire Approximately 30 minutes from downtown Boston The Boston Metro Area (Boston-Cambridge-Newton) has a population of ~4.9 million people Chasers is one of the leading New Hampshire charitable gaming operators Under New Hampshire law, a portion of revenue from charitable gaming operations is allocated to nonprofit organizations licensed in the state CDI plans to construct a new HRM venue with HRMs and table games Chasers Exacta Opportunity in New Hampshire CDI owns one of 13 HRM operating charitable gaming licenses in New Hampshire New Hampshire statute requires every HRM property to utilize two HRM technology system providers Exacta is a provider of HRM technology that can be marketed to other HRM license holders in New Hampshire Exacta HRM technology is used in 11 of the 12 HRM facilities in New Hampshire Wagering Services & Solutions
Page 41
Gaming Segment 41
Page 42
Key Metrics $ in millions 2024 1Q’25 Revenue1 $1,045 $267 VPY / VPQ +7% +10% Adjusted EBITDA2 $507 $124 VPY / VPQ +4% +1% Strategic Advantages Gaming Segment 1. Revenue does not include revenue from our equity investments. 2. Adjusted EBITDA includes our portion of EBITDA from our equity investments. Regional Gaming Properties Diverse portfolio of gaming properties Local approach Unique brands and marketing strategies Menus and offerings reflect local tastes Promotions catered to local customer base Loyal player base Business intelligence analytics Utilize analytics on customer behavior to optimize customer trips and casino / food and beverage offerings Leverage corporate gaming expertise Return on invested capital focused Gaming floor layout and game mix optimization focus Centralized slot purchasing to leverage size Centralized business intelligence analytics and slot purchasing Regional property gaming leaders Significant overall gaming experience Stable executive leadership maintains local market focus 42
Page 43
Gaming Properties Wholly-Owned Gaming Properties 1. Units as of December 31, 2024. 2. Fair Grounds operates 15 OTBs across southeast Louisiana. Unit count as of June 2025. 3. Leased land. State Property Acres Slots1 & Video Poker / VLTs1 Tables1 Racetrack Hotel Rooms Retail Sportsbook FL Calder Casino 54 1,070 6 - - - IA Hard Rock Hotel & Casino Sioux City 15 670 16 - 54 IN Terre Haute Casino Resort 48 1,040 36 - 122 LA Fair Grounds Slots and VSI2 145 1,540 - - ME Oxford Casino and Hotel 97 970 23 - 107 - MD The Casino at Ocean Downs 167 900 19 - MS Harlow’s Casino Resort & Spa 853 660 13 - 105 MS Riverwalk Casino Hotel 22 560 11 - 76 NY del Lago Resort & Casino 83 1,670 80 - 205 PA Presque Isle Casino 270 1,540 34 - T en wholly-owned regional gaming properties 43
Page 44
1.Units as of December 31, 2024. 2.For purposes of statutory requirements, slot machines are counted as 0.9 positions and table games are determined based on ty pe of game (Craps tables have 10 positions, all others have 5 positions). Premier location on 21 acres in Des Plaines, IL (~17 mi. from Chicago) ~2,000 positions1,2 (1,520 slot machines and 120 table games) Eight food and beverage outlets plus a VIP lounge Retail and online BetRivers sportsbook Located on 120 acres in Lebanon, OH (North of Cincinnati, south of Dayton) ~2,220 video lottery terminals1 and four dining facilities Joint venture (50/50) with Delaware North 44 Equity Investments Gaming Properties Rivers Casino Des Plaines (61% Ownership) Miami Valley Gaming (50% Ownership)
Page 45
Capital Management 45
Page 46
Maintain broad and expedient access to the capital markets Ideal target is 3.0x-4.0x bank covenant net leverage - willing to go higher for a strategic investment Engage in open and active dialogue with rating agencies and institutional investors Investments focused on creating long-term shareholder value Invest in organic investments to expand offerings in high growth areas with returns above cost of capital Pursue strategic acquisitions Dividends are considered annually by the Board of Directors based on the health of the Company Opportunistic share repurchases dependent upon free cash flow generation, leverage levels, and other investment opportunities to grow the business Capital Management Capital management philosophy based on creating long-term shareholder value 46
Page 47
Capital Projects Capital Investments Capital Management 4.0x Bank Net Leverage as of March 31, 2025 Significant balance sheet flexibility $1.2 billion revolving credit facility Demonstrated ability to access debt markets with attractive rates / terms Capacity for Future Investments 47 Capital: 2024 Actuals 2025 Forecast Maintenance: $84 million $90 - 100 million Project: $463 million $250 - $290 million Paddock Project at CDRT T erre Haute Casino Resort (Indiana) The Rose Gaming Resort (Virginia HRM) Owensboro Racing & Gaming (Western Kentucky HRM) Churchill Downs Racetrack – Starting Gate Pavilion & Courtyard – Finish Line Suites & The Mansion Owensboro Racing & Gaming (Western Kentucky HRM) Roseshire & Richmond Expansion (Virginia HRM) Marshall Yards Racing & Gaming (Southwestern Kentucky HRM)
Page 48
January 2025 was the 14th consecutive increase in dividend per share Over $260 million paid to shareholders in dividends since 20151 Dividends Share Repurchases Returned over $1.8 billion to shareholders through share repurchases since 20152 - Repurchased ~35.4 million shares at an average price of ~$51 per share2,3 Announced new $500 million Share Repurchase Program on March 12, 2025 Capital Management Reflects our long-term commitment to effectively return capital to shareholders unless there are more attractive growth opportunities 1. Through January 3, 2025. 2. Through March 31, 2025, based on trade date. 3. Split adjusted shares. CDI has returned nearly $2.1 billion of capital to shareholders since 2015 48
Page 49
Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 Jun-21 Jun-22 Jun-23 Jun-24 Jun-25 CHDN S&P 500 Capital Management Churchill Downs Incorporated vs. S&P 500 10-Year Relative Growth As of June 12, 2025 +193% +377%CAGR 5-Year 10-Year CHDN 8% 17% S&P 500 14% 11% 49 1. The graph above reflects 3:1 stock split on January 28, 2019 and a 2:1 stock split on May 22, 2023.
Page 50
Environmental, Social, and Governance 50
Page 51
CDI Approach to Environment, Social and Governance (“ESG”) ESG ESG Committee established to lead ESG initiatives Cross-functional team led by CFO CDI’s Nominating & Governance Committee provides oversight to the Committee and CDI leadership regarding CDI’s ESG strategy Oversight of CDI’s responsible gaming, compliance, environmental, health and safety, sustainability, corporate social responsibility, corporate governance, and other efforts regarding public policy matters and commitments Responsible Gaming CDI only operates in regulated gaming markets CDI promotes responsible gaming at all of our properties and online, for all of our products and services CDI’s leadership team and CDI’s Audit Committee of the Board of Directors provide oversight Environment CDI is committed to environmental responsibility in the communities in which we operate CDI initiatives at properties to lessen energy and water usage, to decrease carbon emissions, and to responsibly manage waste are ongoing Social CDI is investing in the communities in which we operate CDI supports its team members by assisting with funding of continuing education and pursuit of professional licenses and designations, various leadership programs, and programs to help those in need Governance We strive to attract a Board with diversity of race and gender, as well as general diversity of background and experiences including financial, industry, and risk experience Each member of the Board brings unique skills and experiences to the team and plays a vital role in the direction of CDI 51
Page 52
52 CDI Approach to Responsible Gaming ESG T eam Members Customers and Guests Monitoring We provide the knowledge and skills regarding: Importance of responsible gaming CDI policies related to responsible gaming CDI policies regarding advertising and direct marketing How to actively recognize and respond to requests for information and to incidents We provide information regarding: Self-restriction and self-exclusion programs to not receive direct marketing and to be denied access to any CDI property Education on how the games work, tips on how to play responsibly, and to provide referrals and support for problem gambling treatment CDI’s Audit Committee oversees compliance with responsible gaming regulations: Quarterly self reporting of property incidents by CDI Leadership T eam Periodic internal audits reported to CDI’s Audit Committee and state gaming regulators Periodic state gaming regulator audits CDI is committed to promoting responsible gaming at all of our properties and online, for all of our products and services 1. Please visit the ESG section of our Investor Relations webpage to view our Responsible Gaming and Advertising Policy and Policy to Combat Money Laundering and Terrorist Financing Activity.
Page 53
CDI is committed to protecting and furthering equine and jockey health and safety at all of our racetracks Horseracing Integrity and Safety Act (HISA) Independent body responsible for implementing national standards for medication usage and racetrack safety The Anti-Doping and Medication Control (ADMC) Program was implemented in May 2023 and the Racetrack Safety Program was implemented in July 2022 – The ADMC creates a national set of rules and standards for the treatment of horses – This was a welcome change from the prior model where states had their own independent medication programs – HISA contracted veterinarians perform pre-race veterinary examinations of each horse competing prior to each and every race Equine Safety and Welfare “Safety from Start to Finish” Program All horses competing undergo veterinary reviews before each race or timed high-speed workout Equine medical center and on-site equine PET scan at CDRT to help detect and prevent injuries CDI is investing in new technologies to monitor and assess equine athletes (e.g., StrideSAFE) Racing Integrity Barn security and contact logs Escorts and horse identification prior to races Increased out-of-competition testing HISA has hired a 23-year FBI veteran as their Director of Intelligence and Strategy with an extensive team that will use intelligence gathering, data analysis, and investigations to further strengthen the integrity of the industry Jockey Health and Safety CDI tracks have numerous emergency medical technicians onsite during racing and training to provide care to jockeys 53 CDI Approach to Equine and Jockey Health and Safety ESG
Page 54
54 CDI Approach to the Environment We have ongoing initiatives at our properties: T o lessen energy and water usage T o decrease our carbon emissions T o responsibly manage waste Examples of these initiatives include: We are committed to installing LED lighting in all of our newly constructed properties and converting to LED lighting at our existing properties Our properties are implementing a wide range of recycling initiatives Our teams have enhanced the efficiency of our heating and cooling systems, including nightly setbacks, high efficiency compressors on HVAC equipment, and demand controlled ventilation at our properties We installed large pipes at Churchill Downs Racetrack to act as storage basins during heavy rainfalls, reducing an estimated 12 million gallons of wastewater overflows into the neighboring communities Eight of our properties have worked with Restaurant T echnologies to utilize cooking oil recycling; we reduced used cooking oil by 90,624 pounds annually ESG We are committed to reducing our impact on the environment in the communities in which we operate. 1. Please visit the ESG section of our Investor Relations webpage to view our Environmental and Water Policy.
Page 55
Our Business & Technology Rotational Program is a 2-year development track that provides a unique professional development and mentorship opportunity for young professionals to work with senior- level leaders CDI supports and encourages its team members to continue their academic growth by offering tuition reimbursement following one year of service The Helping Others Receive Support in Emergencies (HORSE) Program is a nonprofit charitable organization established by CDI to provide confidential emergency financial assistance to team members and their families in situations caused by unforeseeable and uncontrolled hardships CDI Approach to Social ESG CDI is investing in the communities in which we operate CDI supports its team members by assisting with funding of continuing education and pursuit of professional licenses and designations, various leadership programs, and programs to help those in need CDI contributes over $5.0 million annually via grants and in-kind donations to over 750 organizations Each year, CDI donates tickets and experiences to nonprofit fundraising auctions, resulting in > $2.5 million raised to benefit various charitable causes Our team members demonstrate their commitment to our communities through toy and food drives, neighborhood beautification projects, mentorship projects, and assisting nonprofits with a variety of volunteer initiatives like our Repair Affair Project with New Directions Our Kentucky Oaks charitable initiative fundraises for women’s health advocacy, primarily focused on breast and ovarian cancer - More than $1.5 million raised for women’s health advocacy since its inception - Partnerships with Norton Cancer Institute and Horse & Hopes help to provide preventative access to underserved women, including those that work in the equine industry - Attendees are encouraged to incorporate pink or teal into their outfit and 150 breast and ovarian cancer fighters and survivors march in the Survivors Parade 551. Please visit the ESG section of our Investor Relations webpage to view our Code of Conduct and Anti-Human Trafficking Policy.
Page 56
56 CDI Approach to Governance ESG 6 of 7 directors are independent 2 of 6 independent directors are women or diverse Fully independent Audit and Compensation committees Board includes financial, industry and risk management experts Strong Board of Directors – eight highly qualified members that play a vital role in the direction of CDI Risk Management Sustainability Responsible Gaming Code of Conduct Cybersecurity Oversight by Board of Directors regarding critical governance responsibilities Single-class capital structure protects investor rights Mandatory Board of Director retirement age of 72 Significant shareholder engagement throughout the year Policies and practices in place to protect the integrity of our business Anti-money laundering policy Anti-corruption policy Mandatory ethics and cybersecurity training for all full-time employees 1. Please visit the Governance section of our Investor Relations webpage to view our Charters and Governance Documents.
Page 57
Appendix 57
Page 58
Marcia Dall Executive Vice President and Chief Financial Officer Bill Mudd President and Chief Operating Officer Chief Executive Officer since Aug. 2014; Director since 2015 President and COO, Mar. 2011 – Aug. 2014; COO, Jan. 2009 – Mar. 2011 EVP , General Counsel & Chief Development Officer, July 2005 – Dec. 2008 Former Executive of GE Began career as attorney with Cravath, Swaine, & Moore LLP in NYC Columbia Law School Chief Financial Officer since Oct. 2015 Public company Chief Financial Officer for Erie Insurance Group / Erie Indemnity (Nasdaq: ERIE), Mar. 2009 to Oct. 2015 20+ year tenure with GE / GE Capital in finance / operational / executive roles B.S. in Accounting – Indiana University; MBA – Kellogg School of Management at Northwestern University; CPA Chief Operating Officer since Oct. 2015 President and Chief Financial Officer, Aug. 2014 – Oct. 2015 Chief Financial Officer from Oct. 2007 to Aug. 2014 15-year multi-industry, multi-business background with GE Former Captain in the U.S. Army Reserves B.A. in Mathematics from Bellarmine University; MBA Management Te a m Bill Carstanjen Chief Executive Officer Appendix 58
Page 59
Director since 2022 Senior Executive Vice President and Chief Human Resources Officer for Global Payments, Inc. in Atlanta Extensive human resources executive experience with Habitat for Humanity, Ralph Lauren, Newell Rubbermaid, and The Home Depot Andréa Carter Bill Carstanjen Independent Chairman since 2018 Director since 2008 Chairman of the Board of Sterling G. Thompson Company, LLC President of Upson Downs Farm, Inc. Chairman of James Graham Brown Foundation CEO since 2014; Director since 2015 CDI President and COO, 2011 – 2014; COO, 2009 - 2011 CDI EVP, General Counsel & Chief Development Officer, 2005 - 2008 Former Executive of GE Began career as attorney with Cravath, Swaine, & Moore LLP in NYC Columbia Law School Board of Directors Alex Rankin Chairman of the Board Appendix 59 Doug Grissom Director since 2017 Chair of Nominating and Governance Committee Managing Director of Madison Dearborn Partners’ Business & Government Software and Services team Previously with Bain Capital, McKinsey & Company and Goldman Sachs
Page 60
Paul Varga Director since 2020 Former Chairman and CEO of Brown-Forman Corporation Serves on the Board of Directors of Macy’s Inc. Considerable experience and expertise in corporate finance, building brand awareness, product development, marketing, and sales Director since 2018 Chair of Audit Committee Former Vice Chair and Southeast Regional Managing Partner for Ernst & Young LLP Serves on the Board of Directors of Aflac Inc. Handled mergers, IPOs, acquisitions, and divestures for EY Karole Lloyd Director since 1998 Chair of Compensation Committee President and CEO of HTV Industries, Inc. Extensive financial, accounting, and Chief Executive experience Daniel Harrington Board of Directors (continued) Appendix 60
Page 61
61 CDI Racetrack Overview Racetrack Churchill Downs Ellis Park Colonial Downs Presque Isle Downs Turfway Park Fair Grounds Miami Valley Gaming Oak Grove Ocean Downs Location Louisville, Kentucky Western Kentucky New Kent, Virginia Erie, Pennsylvania Northern Kentucky New Orleans, Louisiana Lebanon, Ohio Southwestern Kentucky Berlin, Maryland 2025 Race Season Apr.-Jun. & Sept. & Nov. Jul.-Aug. Mar. & Jul.-Sept. May-Oct. Jan.-Mar. & Dec Jan.-Mar. & Nov.-Dec. Jan.-May Mar.-Jul. May-Sept. Type of Racing Thoroughbred Thoroughbred Thoroughbred Thoroughbred Thoroughbred Thoroughbred Standardbred (Harness) Standardbred (Harness) Standardbred (Harness) Appendix
Page 62
Churchill Downs Incorporated (the “Company,” “we,”, “our”) management monitors a variety of key indicators to evaluate our business results and financial condition. These indicators include changes in net revenue, operating expense, operating income, earnings per share, outstanding debt balance, operating cash flow and capital spend. Our consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles ("GAAP"). We also use non-GAAP measures, including EBITDA (earnings before interest, taxes, depreciation and amortization) and Adjusted EBITDA. We believe that the use of Adjusted EBITDA as a key performance measure of results of operations enables management and investors to evaluate and compare from period to period our operating performance in a meaningful and consistent manner. Our chief operating decision maker utilizes Adjusted EBITDA to evaluate segment performance, develop strategy, and allocate resources. Adjusted EBITDA is a supplemental measure of our performance that is not required by, or presented in accordance with, GAAP. Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net income (as determined in accordance with GAAP) as a measure of our operating results. Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization, adjusted for the following: Adjusted EBITDA includes our portion of EBITDA from our equity investments and the portion of EBITDA attributable to a noncontrolling interest. Adjusted EBITDA excludes: • Transaction expense, net which includes: o Acquisition, disposition, and property sale related charges; o Other transaction expense, including legal, accounting and other deal-related expense; • Stock-based compensation expense; • Rivers Des Plaines' impact on our investments in unconsolidated affiliates from legal reserves and transaction costs; • Asset impairments; • Gain on property sales; • Legal reserves; • Pre-opening expense; • Other charges, recoveries and expenses; and For segment reporting, Adjusted EBITDA includes intercompany revenue and expense totals that are eliminated in accordance with GAAP in the Consolidated Statements of Comprehensive Income. Further information relevant to the interpretation of non-GAAP financial measures and reconciliations of these non-GAAP financial measures to the most comparable GAAP measures, including reconciliations for the periods other than the three months ended March 31, 2025 and 2024 and the twelve months ended December 31, 2024, is available on the reports we file from time to time with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. Copies of reports we file with the SEC are posted on our website. Definition of Non-GAAP Financial Measures 62
Page 63
Reconciliation from GAAP to Non-GAAP Financial Measures Reconciliation of Comprehensive Income to Adjusted EBITDA 63