On Racing Season Gains, Canterbury Expects 2012 Revenue Growth
Shakopee-based Canterbury Park Holding Corporation, which operates Canterbury Park, is poised for revenue growth this year, partly thanks to gains during Canterbury Park’s summer horse racing season—which concluded Monday.
Average attendance for the 62 days of live racing was 6,595, up 7.3 percent from last year and a new record. Meanwhile, the amount of money wagered during the racing season, referred to as “handle,” increased 25 percent to roughly $28 million compared to last year—and average daily handle was up 12.9 percent to $452,405.
One reason for the year-over-year gains has to do with last summer’s state government shutdown. Because Canterbury Park’s operations are regulated by the Minnesota Racing Commission, a state agency that was forced to cease operations during the 20-day shutdown, the park also had to close during that period. Canterbury extended its racing season past its traditional Labor Day ending to try to recoup some of the lost revenue resulting from the shutdown, but the park still lost six racing days and an estimated $2 million to $3 million.
Canterbury CEO and President Randy Sampson told Twin Cities Business on Thursday that he expects a “double-digit” revenue increase in the third quarter of this year, which ends in September. During last year’s third quarter, revenue declined 9.1 percent to $10.92 million.
Meanwhile, Sampson has high hopes for the full fiscal year as well. He declined to provide a specific estimate but said revenues are expected to exceed the $40.6 million reported last year, which represented a 1.7 percent increase over 2010.
In addition to offering live horse racing between May and September, Canterbury Park operates a card club and offers year-round simulcasting of horse races.
Another big boost to Canterbury stems from a deal it struck in June with the Shakopee Mdewakanton Sioux Community, which operates Mystic Lake Casino in nearby Prior Lake. The tribe agreed to make annual payments to Canterbury Park that will total roughly $75 million over the course of the 10-year agreement. And in exchange, Canterbury Park Holding Corporation agreed to drop efforts to pass racino legislation, which would allow for combined racetracks and casinos, for the duration of the decade-long agreement.
The entire $75 million will be used to increase Canterbury’s purses—the money awarded to race winners. But company spokesman Jeff Maday said that it could indirectly boost revenue as well. A bigger payout is likely to lead to more horses and better horses coming to Canterbury to compete, both of which are believed to boost the amount that attendees wager and would thus increase the company’s portion of that pot. This season, $2.7 million of the total sum was added to the purse fund.
Maday said that Canterbury supported racino legislation in order to make horse racing viable in Minnesota, and both he and Sampson said the agreement with the tribe accomplishes that goal.
“Now . . . instead of spending our time and energy pursuing the legislative efforts, we’re really able to focus on our core business and ways we can grow our core business,” Sampson said Thursday.
Canterbury Park spent $420,000 on racino-focused lobbying efforts in 2010 and $460,000 in 2011, according to the Minnesota Campaign Finance and Public Disclosure Board.
Canterbury Park Holding Corporation is among Minnesota's 80 largest public companies based on revenue.