The 145th Kentucky Derby Presented by Woodford Reserve Sets All-time Wagering Record as Country House Takes Home the ‘Run for the Roses’

LOUISVILLE, Ky. (May 4, 2019) – Derby fans weathered a steady late-afternoon rain as Country House captured the 145th Kentucky Derby Presented by Woodford Reserve over a sloppy track. Wagering from all-sources was the highest all-time on both the Kentucky Derby Day program and on the Kentucky Derby race.

Wagering from all-sources on the Kentucky Derby Day program totaled $250.9 million, an 11% increase over the 2018 total and previous record of $225.7 million. Wagering from all-sources on the Kentucky Derby race increased 10% to $165.5 million from the previous record of $149.9 million set last year. This year’s wagering record includes $4.1 million of handle wagered in Japan with this being the first year the Kentucky Derby has ever been offered for wagering in the country.

Attendance of 150,729 decreased 4% compared to last year, as the threat of an all-day rain forecast kept many fans away.

This year’s Derby purse was elevated $1 million to a guaranteed $3 million making it the richest in history for America’s greatest race and first leg of horse racing’s Triple Crown.

BUSINESS COMMENTARY

“We are deeply grateful to all of the fans of the Kentucky Derby around the world who once again made this an amazing and memorable experience,” said Bill Carstanjen, CEO of Churchill Downs Incorporated (“CDI”). “We expect the Kentucky Derby Week Adjusted EBITDA to reflect another record with $4.5-to-$6.0 million of growth over last year.”

TWINSPIRES

TwinSpires, the country’s leading online and mobile betting platform and the official betting partner of the Kentucky Derby, recorded $48.4 million in handle on Churchill Downs races for the Kentucky Derby Day program, an increase of 20% over the prior year. TwinSpires’ handle on the Kentucky Derby race alone was $30.2 million, up 23% over 2018.

DERBY WEEK

All-sources handle for Opening Night, Saturday, April 27, through Derby Day, Saturday, May 4, rose to a new record of $343.0 million, up 10% from the previous record of $311.2 million set last year. Attendance for those five days was 360,237, down 4% over 2018.

Use of Non-GAAP Measures

In addition to the results provided in accordance with GAAP, the Company also uses non-GAAP measures, including adjusted net income, adjusted diluted EPS, EBITDA (earnings before interest, taxes, depreciation and amortization) and Adjusted EBITDA.

The Company uses non-GAAP measures as a key performance measure of the results of operations for purposes of evaluating performance internally. These measures facilitate comparison of operating performance between periods and helps investors to better understand the operating results of CDI by excluding certain items that may not be indicative of the Company's core business or operating results. The Company believes the use of these measures enable management and investors to evaluate and compare, from period to period, the Company’s operating performance in a meaningful and consistent manner. The non-GAAP measures are a supplemental measure of our performance that is not required by, or presented in accordance with GAAP, and should not be considered as an alternative to, or more meaningful than, net income or diluted EPS (as determined in accordance with GAAP) as a measure of our operating results.

We use Adjusted EBITDA to evaluate segment performance, develop strategy and allocate resources. We utilize the Adjusted EBITDA metric to provide a more accurate measure of our core operating results and enable management and investors to evaluate and compare from period to period our operating performance in a meaningful and consistent manner. Adjusted EBITDA should not be considered as an alternative to operating income as an indicator of performance, as an alternative to cash flows from operating activities as a measure of liquidity, or as an alternative to any other measure provided in accordance with GAAP. Our calculation of Adjusted EBITDA may be different from the calculation used by other companies and, therefore, comparability may be limited.

Adjusted net income and adjusted diluted EPS exclude discontinued operations net income or loss; recapitalization costs related to the Midwest Gaming transaction; transaction expense, which includes acquisition and disposition related charges, Calder exit costs, as well as legal, accounting, and other deal-related expense; pre-opening expense; and certain other gains, charges, recoveries, and expenses.

Adjusted EBITDA includes CDI's portion of the EBITDA from our equity investments.

Adjusted EBITDA excludes:

• Transaction expense, net which includes:

• Acquisition and disposition related charges, including fair value adjustments related to earnouts and deferred payments;

• Calder Racing exit costs; and

• Other transaction expense, including legal, accounting, and other deal-related expense;

• Stock-based compensation expense;

• Recapitalization costs related to the Midwest Gaming transaction;

• Asset impairments;

• Gain on Ocean Downs/Saratoga Transaction;

• Loss on extinguishment of debt;

• Pre-opening expense; and

• Other charges, recoveries and expenses

For purposes of segment reporting, Adjusted EBITDA includes intercompany revenue and expense totals that are eliminated in the condensed consolidated statements of comprehensive income. Refer to the reconciliation of comprehensive income to Adjusted EBITDA included herewith for additional information.

About Churchill Downs Racetrack

Churchill Downs, the world’s most legendary racetrack, has conducted Thoroughbred racing and presented America’s greatest race, The Kentucky Derby, continuously since 1875. Located in Louisville, the flagship racetrack of Churchill Downs Incorporated (Nasdaq: CHDN) offers year-round simulcast wagering at the historic track. Churchill Downs will conduct the 145th running of the Kentucky Derby Presented by Woodford Reserve on May 4, 2019. The track’s 2019 Spring Meet is scheduled for April 27 – June 29. Churchill Downs has hosted the Breeders’ Cup World Championships nine times. Information about Churchill Downs can be found online at www.churchilldowns.com.