Magna Entertainment Loses $95.6 Million

In reporting the results of what President and Chief Executive Officer Jim McAlpine described as "a tough year, no question," Magna Entertainment, the horse racing and gaming conglomerate that owns Laurel Park and Pimlico, suffered a net loss of $95.6 million in 2004.

With the oft-delayed dirt track surface reconstruction at Laurel Park, the extensive redevelopment of Gulfstream Park in Florida, soft business at Santa Anita Park and $20 million invested in pursuit of alternative gaming such as slot machines in several states, Magna lost money for the third year in a row.

The company hasn't posted a profit since 2001, when it reported net income of nearly $13.5 million. It lost nearly $105.1 million in 2003.

"As a company, Magna Entertainment is still a work in progress," McAlpine said in a conference call with investors, "but we have a great future."

Although overall revenues increased from $708.9 million in 2003 to $731.6 last year, handle at Magna racetracks dropped from $561.9 million in 2003 to $559.3 in 2004.

Maryland operations lost more than $1.7 million in the final three months of the year, and McAlpine pointed to the loss of racing days at Laurel because of the $20 million rebuilding project that was repeatedly set back by drainage issues and poor weather.

Much of Magna's planned redevelopment -- particularly at Pimlico -- will be predicated on the passage of slot machine legislation in Annapolis, McAlpine said yesterday.

-- John Scheinman