Tracks in Md. in the money

With expenses pared, thoroughbred tracks post higher profit

Highest gain since 1995

Pimlico, Laurel report $2.46M combined profit

April 19, 2000|By Jon Morgan | Jon Morgan,SUN STAFF

Maryland's major thoroughbred racetracks have pared their expenses and last year posted their highest profit since 1995, according to financial results reported to state regulators.

The Maryland Jockey Club, owner of Pimlico Racecourse and Laurel Park, reported a combined profit of $2.46 million for 1999. That is up considerably from the $136,547 net income reported the previous year, when the tracks spent $2.4 million on a campaign to win legalization of slot machine gaming in the state. That effort failed to win a change in the law, but it did manage to anger anti-slot Gov. Parris N. Glendening.

The tracks were eligible last year to apply for up to $1 million in state money for 1998 marketing expenses, but chose not to, according to the financial reports turned over to the Maryland Racing Commission on Friday and given to The Sun yesterday.

Revenues for the tracks were up less than 1 percent, to $55.58 million. But expenses were down more than 5 percent, including a cut of more than $1 million in advertising costs.

"I think we're definitely encouraged by the numbers. The year was one we were happy with," said Doug Illig, chief financial officer for the Jockey Club.

He said the profit was the highest since 1995 when the organization made $4.1 million.

"The numbers are back on target. We're getting back into watching our expenses. That is an area where we can drive our bottom line," he said.

Betting on live racing at Maryland tracks continues to decline, but more slowly than in past year. It was off 4 percent last year, but was offset by a strong increase in demand for Maryland's simulcast signal at tracks around the country.

The Preakness Stakes -- the state's biggest racing event each year -- also recovered last year from the disastrous power outage a few hours before 1998's race that left fans hot, angry and unable to wager.

Betting on Preakness day last year totaled $8.8 million, nearly $2 million above the previous year. The track keeps a percentage of the money bet.

Illig said the first quarter of this year has been strong, and he predicted benefits from a blockbuster revenue-sharing plan recently agreed to between the state's harness and thoroughbred industries.

Among the changes the plan makes possible: races that start later in the day and extend into the early evening, allowing working fans to attend.

"It's tough to say, but I'm encouraged by 2000. It's looking like a pretty good year," Illig said.

Last year, Pimlico's revenue was up about $1 million, to $30.56 million, and the Baltimore track's profit was $1.95 million.

Laurel posted revenues of $25.02 million, down slightly from the previous year, and a profit of $5.05 million.

The net income figures were much improved from the year before when Pimlico reported $219,732 and Laurel lost $83,185.

On the upswing

Combined profits of Laurel Park and Pimlico race courses: 1999: $2.46 million

1998: $136,000

1997: $1.8 million

1996: $1.7 million

1995: $4.1 million

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