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Churchill Downs Revises Earnings Forecast

LOUISVILLE, Kentucky – (PRESS RELEASE) -- Churchill Downs Incorporated ("CDI" or the "Company") (Nasdaq: CHDN) today announced that it is revising its earnings outlook for the full year and second quarter of 2004. The Company now expects earnings for the year to be approximately 10 to 15 percent lower than its previous year-end estimate of $1.70 per share. Earnings for the second quarter are anticipated to be approximately three percent below the $2.10 to $2.15 per share range estimated during the first quarter earnings call in May.

"We are lowering our guidance estimates as a result of significant investments in strategic initiatives that we feel are essential to position us for the future - primarily alternative gaming efforts as well as our Customer Relationship Management ("CRM") program," said Thomas H. Meeker, CDI's president and chief executive officer. "These initiatives have only recently developed to the extent that we are now able to communicate the potential short-term impact to earnings.

"We have also experienced softness in business due to a number of factors that include inclement weather at Arlington Park, bad weather and the ongoing Master Plan construction at Churchill Downs, late-arriving workers' compensation relief at Hollywood Park, and the impact of short fields on our simulcast product," Meeker continued. "In the past, we have countered any softness in our business by managing our cost structure, and we will continue to prudently address current business trends. However, cost management alone will not offset our level of investment in these long-term growth initiatives."

Meeker concluded: "This guidance revision is subject to change due to the fluid nature of the legislative process, primarily in California and Florida. If these efforts continue to move forward, we will likely increase our spending; if they do not proceed, we will not spend what we now anticipate."

The Company intends to report its full financial results for the completed second quarter of 2004 on Tuesday, July 20, 2004.

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