DATE: Tuesday, May 13, 1997                 TAG: 9705130291

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY CHRISTOPHER DINSMORE, STAFF WRITER 

                                            LENGTH:  103 lines

NO RACES, BUT COLONIAL DOWNS PROFITS ON OFF-TRACK BETTING

The track won't open as scheduled July 1, but the Colonial Downs horse ran a good race anyway during the first quarter.

The company building a horse-racing track in New Kent County near Williamsburg made $429,000 in the three months ended March 31, thanks to the strength of its off-track betting parlors, one in Chesapeake and the other in Richmond.

It was Colonial Downs Holdings Inc.'s first quarter as a publicly traded company. It went public with a stock offering in March, selling 4.25 million shares.

The Colonial Downs track won't hold its first horse race until Sept. 1, the company disclosed. It had been scheduled to open July 1, but litigation with one of the other parties that was seeking the state's only horse-racing license delayed the opening, said Herb Jones, a Colonial Downs spokesman.

The track will conduct its first thoroughbred meet from Sept. 1 until Oct. 12 with 30 days of live racing. The first harness racing meet, which was to have occurred this year after the thoroughbred meet, will now be run from April 1998 to July 1998.

The delay will adversely affect 1997 results because of the deferral of expected revenue, said President O. James Peterson III, in a statement.

However, Colonial Downs did turn a profit faster than it had expected. ``If you look at our prospectus, we didn't expect to make any money until we had four parlors and the track open,'' Jones said.

The first quarter's $429,000 profit compares to a $66,000 loss in the same period last year when it had just opened the Chesapeake parlor. Earnings per share were 12 cents, compared to a 2-cent loss a year ago.

Revenue soared 311 percent to $5.4 million in the first quarter from $1.3 million a year earlier.

``We are pleased to have earned a profit in our first quarter as a publicly held company, before live horse racing has begun at the new Colonial Downs racetrack currently under construction and before our third and fourth satellite wagering facilities have opened in Hampton and Brunswick County,'' Peterson said.

Colonial Downs said it has sold out the available box seats and dining room tables this year. It has also signed a ``significant'' sponsorship deal with Pepsi that puts sponsorship income on pace to exceed expectations.

ESPN has scheduled broadcasts of two thoroughbred races during the inaugural season, Colonial Downs officials said.

Colonial Downs stock, which sold for $9.50 a share in the March stock offering, remained unchanged Monday at $6.75 a share in NASDAQ trading.

The track won't open as scheduled July 1, but the Colonial Downs horse ran a good race anyway during the first quarter.

The company building a horse-racing track in New Kent County near Williamsburg made $429,000 in the three months ended March 31, thanks to the strength of its off-track betting parlors, one in Chesapeake and the other in Richmond.

It was Colonial Downs Holdings Inc.'s first quarter as a publicly traded company. It went public with a stock offering in March, selling 4.25 million shares.

The Colonial Downs track won't hold its first horse race until Sept. 1, the company disclosed. It had been scheduled to open July 1, but litigation with one of the other parties that was seeking the state's only horse-racing license delayed the opening, said Herb Jones, a Colonial Downs spokesman.

The track will conduct its first thoroughbred meet from Sept. 1 until Oct. 12 with 30 days of live racing. The first harness racing meet, which was to have occurred this year after the thoroughbred meet, will now be run from April 1998 to July 1998.

The delay will adversely affect 1997 results because of the deferral of expected revenue, said President O. James Peterson III, in a statement.

However, Colonial Downs did turn a profit faster than it had expected. ``If you look at our prospectus, we didn't expect to make any money until we had four parlors and the track open,'' Jones said.

The first quarter's $429,000 profit compares to a $66,000 loss in the same period last year when it had just opened the Chesapeake parlor. Earnings per share were 12 cents, compared to a 2-cent loss a year ago.

Revenue soared 311 percent to $5.4 million in the first quarter from $1.3 million a year earlier.

``We are pleased to have earned a profit in our first quarter as a publicly held company, before live horse racing has begun at the new Colonial Downs racetrack currently under construction and before our third and fourth satellite wagering facilities have opened in Hampton and Brunswick County,'' Peterson said.

Colonial Downs said it has sold out the available box seats and dining room tables this year. It has also signed a ``significant'' sponsorship deal with Pepsi that puts sponsorship income on pace to exceed expectations.

ESPN has scheduled broadcasts of two thoroughbred races during the inaugural season, Colonial Downs officials said.

Colonial Downs stock, which sold for $9.50 a share in the March stock offering, remained unchanged Monday at $6.75 a share in NASDAQ trading. ILLUSTRATION: CANDICE C. CUSIC/file color photo

This off-track betting parlor in Chesapeake is one of two owned by

Colonial Downs Holdings Inc. A spokesman said Colonial Downs didn't

expect to profit until more parlors and its New Kent County track

opened.

Graphic

EARNINGS

Colonial Downs Holding Inc. made $429,000 in its first quarter as a

publicly traded company. That compares with a $66,000 loss in the

same period last year. Earnings per share were 12 cents, compared

with a 2-cent loss a year ago. KEYWORDS: OFF-TRACK BETTING HORSE RACING RACE

TRACKS

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