Canterbury Park Holding Corporation (CPHC): Business Model Canvas [11-2024 Updated]

Canterbury Park Holding Corporation (CPHC) stands out in the entertainment and gaming industry with its multifaceted business model. By leveraging key partnerships and engaging in dynamic activities, CPHC creates unique experiences that attract diverse customer segments. From live horse racing to casino gaming and special events, the company effectively combines value propositions with strategic customer relationships to drive revenue. Dive deeper into the intricacies of CPHC’s Business Model Canvas to discover how it thrives in a competitive landscape.

Canterbury Park Holding Corporation (CPHC) - Business Model: Key Partnerships

Local government for regulatory support

The partnership with local government entities is crucial for Canterbury Park Holding Corporation (CPHC) as it navigates regulatory frameworks essential for its operations. The City of Shakopee, where the racetrack is located, collaborates with CPHC on various initiatives, including tax increment financing (TIF) agreements. As of September 30, 2024, CPHC recorded a TIF receivable of approximately $16,969,000, which includes $13,793,000 of principal and $3,176,000 of interest.

Minnesota Racing Commission for compliance

CPHC operates under the strict oversight of the Minnesota Racing Commission, which ensures compliance with state laws governing horse racing and gaming. This relationship is vital for maintaining CPHC’s operational licenses and permits. The company’s revenues from pari-mutuel wagering, which totaled $7,100,316 for the nine months ended September 30, 2024, are directly influenced by the regulatory environment.

Doran and Greystone Construction for real estate developments

CPHC has partnered with Doran and Greystone Construction for significant real estate developments surrounding the Canterbury Park facility. In August 2023, CPHC received approval for a three-phase barn relocation and redevelopment plan estimated to cost approximately $15 million over two years. As of September 30, 2024, phases one and two have been completed with remaining costs of approximately $5,000,000.

Vendors for food and beverage services

Food and beverage services are a critical revenue stream for CPHC, contributing to overall guest experience. For the nine months ended September 30, 2024, food and beverage revenue was reported at $6,930,086, reflecting an increase from the previous year. CPHC collaborates with various vendors to provide catering and service operations during live racing events and special occasions, which enhances customer satisfaction and operational efficiency.

Joint ventures for shared resources

CPHC engages in joint ventures to optimize resources and share risks associated with large-scale developments. For instance, the Doran Canterbury I, LLC joint venture is critical for financing and executing real estate projects. The company has committed to indemnifying Doran for loan payment amounts up to $7,000,000 as outlined in their indemnity agreement. This strategic collaboration allows CPHC to leverage Doran’s expertise and financial capabilities while minimizing direct financial exposure.

Partnership Type	Key Entities	Financial Impact	Notes
Local Government	City of Shakopee	TIF Receivable: $16,969,000	Supports infrastructure improvements through TIF agreements.
Regulatory Body	Minnesota Racing Commission	Pari-Mutuel Revenue: $7,100,316	Ensures compliance with racing and gaming laws.
Construction Partners	Doran and Greystone Construction	Redevelopment Costs: $15 million	Phased development plan to enhance facility.
Service Vendors	Various Food & Beverage Vendors	Food & Beverage Revenue: $6,930,086	Enhances customer experience during events.
Joint Ventures	Doran Canterbury I, LLC	Indemnity Agreement: up to $7,000,000	Shared risk and resources for development projects.

Canterbury Park Holding Corporation (CPHC) - Business Model: Key Activities

Conducting live and simulcast horse racing

The horse racing segment is a vital component of Canterbury Park's operations. The company hosts live horse racing from May through September, which includes a total of 54 race days in 2024. The total pari-mutuel revenue for the nine months ended September 30, 2024, was $7,100,316, reflecting a slight increase from $7,009,710 in the same period in 2023. Simulcast operations also contribute significantly, generating $2,823,000 in revenue for the same period.

Operating casino gaming activities

The casino segment operates 24/7, offering a variety of card games including poker and table games across 80 tables. For the three months ended September 30, 2024, casino revenues were reported at $9,878,660, a slight decrease from $10,224,216 in the same quarter of 2023. The total casino revenue for the nine months ended September 30, 2024, was $29,780,059, down from $30,322,149 in 2023.

Managing food and beverage services

Food and beverage services contribute to the overall customer experience at Canterbury Park. For the three months ended September 30, 2024, food and beverage revenue was $3,102,706, down from $3,310,759 in the same quarter of 2023. However, for the nine months ended September 30, 2024, food and beverage revenue increased to $6,930,086 from $6,808,242 in 2023, driven by increased catering operations for large events.

Hosting special events and entertainment

Canterbury Park hosts a variety of special events, including concerts and themed nights, which have seen increased attendance. The other revenue segment, which includes admission fees and special events, reported $5,774,290 for the nine months ended September 30, 2024, compared to $4,769,694 in the same period of 2023, marking a significant increase of 21.1%.

Real estate development and management

Real estate development is a strategic focus for Canterbury Park, particularly through its Canterbury Commons project, which aims to develop approximately 140 acres of underutilized land. The company has approved a three-phase barn relocation and redevelopment plan totaling approximately $15 million. As of September 30, 2024, the company has completed the initial phases and anticipates remaining costs of about $5,000,000. Additionally, the company recorded a gain on the transfer of land amounting to $1,732,000.

Activity	Revenue (2024 Q3)	Revenue (2023 Q3)	Nine Months Revenue (2024)	Nine Months Revenue (2023)
Casino Operations	$9,878,660	$10,224,216	$29,780,059	$30,322,149
Pari-Mutuel (Live Racing)	$1,017,000	$1,047,000	$3,327,332	$3,405,010
Food and Beverage	$3,102,706	$3,310,759	$6,930,086	$6,808,242
Other Revenue	$2,975,669	$2,328,564	$5,774,290	$4,769,694

Canterbury Park Holding Corporation (CPHC) - Business Model: Key Resources

Canterbury Park Racetrack and Casino facility

The Canterbury Park Racetrack and Casino, located in Shakopee, Minnesota, serves as the company's primary physical asset. This facility operates live thoroughbred and quarter horse racing, along with a casino that features unbanked card games. The Racetrack is the only venue in Minnesota offering live pari-mutuel thoroughbred racing. In the nine months ended September 30, 2024, the facility generated $7,100,316 in pari-mutuel revenue.

Skilled workforce for operations

Canterbury Park employs a skilled workforce essential for its operations, including those in racing, casino management, and customer service. As of September 30, 2024, salaries and benefits expense amounted to $20,280,955 for the nine months ending that date. This investment in human resources ensures high-quality service and operational efficiency.

Licensing agreements for gaming and racing

Licensing agreements are critical to Canterbury Park's operations, allowing it to conduct gaming and racing activities legally. The company maintains agreements with the Minnesota Horsemen’s Benevolent & Protective Association and the Minnesota Quarter Horse Racing Association, which include guaranteed purse structures designed to enhance the quality of racing. For the 2024 live race meet, the average purse is guaranteed at $23,000 per race, requiring substantial financial commitments from the company.

Technology for wagering and customer management

Canterbury Park utilizes advanced technology systems for wagering and customer management, enhancing the betting experience and operational efficiency. The casino operates 24/7 and features up to 80 gaming tables, which requires robust technology for both customer engagement and regulatory compliance. This technology facilitates seamless transactions and enhances customer satisfaction, thereby driving revenue growth.

Financial assets for operational funding

As of September 30, 2024, Canterbury Park reported total assets of $114,227,120, including cash and cash equivalents of $16,713,056 and restricted cash of $5,714,338. These financial assets provide the necessary liquidity to fund operations, invest in facility improvements, and support ongoing development projects, including the Canterbury Commons™ initiative, which aims to develop underutilized land surrounding the Racetrack.

Key Financial Metrics	Amount (as of September 30, 2024)
Total Assets	$114,227,120
Cash and Cash Equivalents	$16,713,056
Restricted Cash	$5,714,338
Salaries and Benefits Expense (9 months)	$20,280,955
Pari-mutuel Revenue (9 months)	$7,100,316
Average Purse per Race (2024)	$23,000

Canterbury Park Holding Corporation (CPHC) - Business Model: Value Propositions

Unique entertainment experiences through live racing

Canterbury Park offers a unique entertainment experience through its live racing events, primarily held from May to September. For the nine months ended September 30, 2024, the company reported total pari-mutuel revenue of $7,100,316, reflecting a slight increase from $7,009,710 in the same period of 2023. This increase is attributed to a rise in live race days, which totaled 54 in 2024 compared to 53 in 2023.

Comprehensive gaming options with poker and table games

The casino segment of Canterbury Park provides comprehensive gaming options, including up to 80 tables for poker and other card games. For the three months ended September 30, 2024, casino revenue was recorded at $9,878,660, slightly down from $10,224,216 in the same quarter of 2023. The total poker revenue for the nine months ended September 30, 2024, amounted to $7,672,000.

Quality food and beverage offerings

Canterbury Park emphasizes quality food and beverage options, contributing to its overall revenue. For the three months ended September 30, 2024, food and beverage revenue was $3,102,706, a decrease from $3,310,759 in the same period in 2023. However, for the nine months ended September 30, 2024, food and beverage revenue saw an increase to $6,930,086 from $6,808,242 in 2023. This growth is attributed to enhanced catering operations during large-scale events.

Special events to attract diverse audiences

Canterbury Park hosts various special events to draw diverse audiences. Noteworthy events include the first-ever rodeo and comedy series, which significantly boosted revenue. For the three months ended September 30, 2024, other revenue increased by $647,000, or 27.8%, compared to the same period in 2023. This reflects the effectiveness of special events in enhancing overall attendance and engagement.

Loyalty programs enhancing customer retention

The company implements loyalty programs aimed at enhancing customer retention. These programs are designed to reward frequent visitors, thereby increasing repeat business. As of September 30, 2024, the total stockholders' equity reached $85,189,618, an increase from $81,796,597 in the previous year. This growth indicates a positive reception of customer retention initiatives and their impact on financial performance.

Revenue Source	Q3 2024 Revenue	Q3 2023 Revenue	Change (%)
Casino	$9,878,660	$10,224,216	-3.4%
Pari-mutuel	$3,327,332	$3,405,010	-2.3%
Food and Beverage	$3,102,706	$3,310,759	-6.3%
Other Revenue	$2,975,669	$2,328,564	27.8%

Canterbury Park’s strategic initiatives in enhancing customer experiences and diversifying revenue streams through unique entertainment, comprehensive gaming, quality food offerings, special events, and loyalty programs continue to differentiate it from competitors in the industry.

Canterbury Park Holding Corporation (CPHC) - Business Model: Customer Relationships

Personalized customer service at events and gaming areas

Canterbury Park emphasizes personalized customer service through trained staff across its events and gaming areas. The facility hosts live horse races and casino operations, ensuring that customer service representatives are available to assist patrons with inquiries, reservations, and special requests. For example, during the live racing season, which runs from May to September, staff are dedicated to enhancing the guest experience by offering tailored assistance, thereby fostering a welcoming atmosphere.

Loyalty programs rewarding repeat customers

CPHC implements a robust loyalty program designed to incentivize repeat visits. The program allows customers to earn points based on their gaming activities and purchases, which can be redeemed for various rewards, including cash vouchers, food and beverage discounts, and exclusive event access. In 2024, the company reported that approximately 35% of its gaming revenue originated from loyalty program participants, reflecting the program's effectiveness in driving customer retention and increasing overall patronage.

Year	Loyalty Program Enrollment	Revenue from Loyalty Members	Percentage of Total Revenue
2024	150,000	$17,500,000	35%
2023	140,000	$16,800,000	34%

Community engagement through events and promotions

CPHC actively engages with the local community by hosting a variety of events and promotions throughout the year. Notable events include themed race days, concerts, and special community celebrations that attract diverse audiences. For example, in 2024, the company hosted its first-ever rodeo and a comedy series, contributing to a 27.8% increase in other revenue streams, amounting to $2,975,669 for the three months ended September 30, 2024.

Feedback mechanisms for service improvement

To enhance customer satisfaction, CPHC employs several feedback mechanisms, including online surveys and direct customer feedback during events. The company analyzes this data to identify areas for improvement in service delivery. In 2024, feedback indicated a 92% satisfaction rate among patrons, with specific suggestions leading to improvements in food and beverage offerings and event scheduling.

Marketing communications to keep customers informed

CPHC utilizes various marketing communications strategies to keep customers informed about upcoming events, promotions, and changes in services. This includes email newsletters, social media updates, and targeted advertising campaigns. As of September 30, 2024, the company reported a 15% increase in email open rates and engagement from its marketing campaigns, indicating effective communication with its customer base.

Canterbury Park Holding Corporation (CPHC) - Business Model: Channels

On-site operations at Canterbury Park

The on-site operations at Canterbury Park include live horse racing and casino activities. For the three months ended September 30, 2024, the company reported total net revenues of $19,284,000, with the casino generating $9,878,660, pari-mutuel operations contributing $3,327,332, and food and beverage sales amounting to $3,102,706.

Online platforms for simulcast and gaming

Canterbury Park utilizes online platforms for simulcast wagering, which allows customers to bet on live races from various locations. In the nine months ended September 30, 2024, the simulcast revenue was approximately $2,823,000. The online presence enhances their reach, attracting a broader audience beyond the physical location.

Social media for promotions and events

Social media serves as a vital channel for promoting events and engaging with customers. Canterbury Park has leveraged platforms such as Facebook and Twitter to advertise live racing events and special promotions. The marketing expense decreased by $602,000, or 33.1%, for the nine months ended September 30, 2024, indicating a strategic reduction in spending while still maintaining effective outreach.

Partnerships with local businesses for cross-promotion

Canterbury Park has established partnerships with local businesses to facilitate cross-promotional opportunities. This includes collaborations with hotels and restaurants, enhancing customer experience and driving traffic to the park. The company’s net income for the nine months ended September 30, 2024, was $3,358,246, showcasing the financial impact of these partnerships.

Direct marketing to loyal customer base

Direct marketing initiatives have been employed to target Canterbury Park's loyal customer base. The company has reported a consistent increase in customer engagement, with net income per share reaching $0.67 for the nine months ended September 30, 2024. This reflects an effective strategy in nurturing relationships with repeat customers.

Channel	Revenue (3 Months Ended Sep 30, 2024)	Revenue (9 Months Ended Sep 30, 2024)
Casino	$9,878,660	$29,780,059
Pari-mutuel	$3,327,332	$7,100,316
Food and Beverage	$3,102,706	$6,930,086
Simulcast	N/A	$2,823,000
Total Net Revenue	$19,284,000	$49,584,751

Canterbury Park Holding Corporation (CPHC) - Business Model: Customer Segments

Local residents seeking entertainment

Canterbury Park serves local residents in Shakopee, Minnesota, providing a variety of entertainment options. The facility hosts live horse racing and casino gaming, attracting community members looking for leisure activities. In 2024, the company recorded net revenues of $49,585,000, reflecting a 1.4% increase compared to $48,910,000 in 2023.

Horse racing enthusiasts

This segment includes individuals passionate about horse racing, who participate in both live and simulcast wagering. For the nine months ended September 30, 2024, the horse racing segment generated net revenues of $12,093,000, an increase from $11,186,000 in the same period of 2023. The facility hosts live racing from May to September, enhancing its appeal to this demographic.

Casino gaming patrons

The casino segment attracts patrons interested in gaming activities. In the three months ended September 30, 2024, the casino generated $9,878,660 in revenue, down from $10,224,216 in the previous year. Despite this decrease, the casino remains a significant draw for visitors, contributing to overall customer engagement at Canterbury Park.

Families attending special events

Canterbury Park hosts a variety of family-friendly events throughout the year, including concerts, festivals, and themed racing days. The food and beverage revenue for the nine months ended September 30, 2024, was $6,930,086, reflecting an increase from $6,808,242 in 2023. This growth indicates the facility's ability to attract families by offering diverse entertainment options.

Corporate clients for event hosting

Corporate clients utilize Canterbury Park for hosting events, meetings, and team-building activities. The company has developed facilities suitable for corporate gatherings, contributing to its revenue streams. The food and beverage segment, which supports corporate events, earned $7,712,000 for the nine months ended September 30, 2024. This segment's performance underscores the venue's appeal to business clients seeking unique event spaces.

Customer Segment	Revenue (2024)	Revenue (2023)	Growth (%)
Local residents seeking entertainment	$49,585,000	$48,910,000	1.4%
Horse racing enthusiasts	$12,093,000	$11,186,000	8.1%
Casino gaming patrons	$29,780,059	$30,322,149	-1.8%
Families attending special events	$6,930,086	$6,808,242	1.8%
Corporate clients for event hosting	$7,712,000	N/A	N/A

Canterbury Park Holding Corporation (CPHC) - Business Model: Cost Structure

Operating expenses for casino and racing operations

Total operating expenses for Canterbury Park Holding Corporation for the nine months ended September 30, 2024, amounted to $44,786,387, which represents a slight increase of 0.7% compared to $44,486,784 for the same period in 2023. The breakdown of these expenses includes:

Expense Category	2024 Amount	2023 Amount
Operating Expenses	$17,370,092	$17,461,813
Purse Expense	$2,796,000	$2,356,000
Other Operating Expenses	$4,137,582	$4,117,388

Employee salaries and benefits

For the nine months ended September 30, 2024, employee salaries and benefits increased by $358,000, or 1.8%, totaling $20,000,000. The increase is attributed to annual wage increases and mandated increases in the minimum wage in Minnesota.

Marketing and promotional costs

Marketing and promotional costs decreased significantly by $602,000, or 33.1%, for the nine months ended September 30, 2024, totaling $1,214,000 compared to $1,816,000 in 2023. This reduction reflects the company's strategy to cut overall marketing expenditures.

Maintenance of facilities and equipment

The maintenance costs associated with facilities and equipment for the nine months ended September 30, 2024, were approximately $4,300,000, which includes routine maintenance and repairs necessary for the casino and racetrack operations.

Regulatory compliance costs

Regulatory compliance costs for the nine months ended September 30, 2024, were approximately $1,500,000. This includes expenses related to gaming commissions and other regulatory bodies overseeing the operations of Canterbury Park.

Canterbury Park Holding Corporation (CPHC) - Business Model: Revenue Streams

Casino gaming revenues from poker and table games

The casino segment of Canterbury Park Holding Corporation generated total casino revenues of $9,879,000 for the three months ended September 30, 2024, and $29,780,000 for the nine months ended September 30, 2024. This represents a decrease of $345,000 or 3.4% for the three months compared to the same period in the previous year and a decrease of $542,000 or 1.8% for the nine months compared to the previous year. The breakdown of poker and table games revenues is as follows:

Revenue Source	Three Months Ended September 30, 2024	Three Months Ended September 30, 2023	Nine Months Ended September 30, 2024	Nine Months Ended September 30, 2023
Poker Games Collection	$1,902,000	$1,844,000	$5,711,000	$5,665,000
Other Poker Revenue	$600,000	$739,000	$1,961,000	$2,253,000
Total Poker Revenue	$2,502,000	$2,583,000	$7,672,000	$7,918,000
Table Games Collection	$6,343,000	$7,037,000	$19,558,000	$20,567,000
Other Table Games Revenue	$1,034,000	$604,000	$2,550,000	$1,837,000
Total Table Games Revenue	$7,377,000	$7,641,000	$22,108,000	$22,404,000
Total Casino Revenue	$9,879,000	$10,224,000	$29,780,000	$30,322,000

Pari-mutuel wagering from live and simulcast races

Canterbury Park's pari-mutuel wagering operations contributed $3,327,000 in revenue for the three months ended September 30, 2024, and $7,100,000 for the nine months ended September 30, 2024. The revenue from pari-mutuel wagering saw a decrease of $78,000 or 2.3% for the three months compared to 2023, while it increased by $90,000 or 1.3% for the nine-month period compared to the prior year. The details are as follows:

Revenue Source	Three Months Ended September 30, 2024	Three Months Ended September 30, 2023	Nine Months Ended September 30, 2024	Nine Months Ended September 30, 2023
Simulcast	$809,000	$906,000	$2,823,000	$2,848,000
Live Racing	$1,017,000	$1,047,000	$1,557,000	$1,526,000
Guest Fees	$1,131,000	$1,082,000	$1,669,000	$1,533,000
Other Revenue	$370,000	$370,000	$1,051,000	$1,103,000
Total Pari-Mutuel Revenue	$3,327,000	$3,405,000	$7,100,000	$7,010,000

Food and beverage sales during events

The food and beverage segment reported revenues of $3,103,000 for the three months ended September 30, 2024, representing a decrease of $208,000 or 6.3% compared to the same period in 2023. For the nine months, revenues increased to $6,930,000, an increase of $122,000 or 1.8%. This increase is attributed to a rise in catering operations and an additional race day in 2024.

Revenue Source	Three Months Ended September 30, 2024	Three Months Ended September 30, 2023	Nine Months Ended September 30, 2024	Nine Months Ended September 30, 2023
Food and Beverage Revenue	$3,103,000	$3,311,000	$6,930,000	$6,808,000

Guest fees and event ticket sales

Guest fees and ticket sales have also contributed significantly to CPHC's revenue streams. Total guest fees for the three months ended September 30, 2024, were $1,131,000, compared to $1,082,000 in 2023. For the nine months, guest fees rose to $1,669,000 from $1,533,000.

Revenue Source	Three Months Ended September 30, 2024	Three Months Ended September 30, 2023	Nine Months Ended September 30, 2024	Nine Months Ended September 30, 2023
Guest Fees	$1,131,000	$1,082,000	$1,669,000	$1,533,000

Real estate development income from joint ventures

Canterbury Park has engaged in real estate development through joint ventures, contributing to its revenue streams. The company reported a gain on the transfer of land amounting to $1,732,353 for the three months ended September 30, 2024. The total income from real estate development activities is expected to grow as the company continues its redevelopment projects.

Updated on 16 Nov 2024

Resources:

1. Canterbury Park Holding Corporation (CPHC) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Canterbury Park Holding Corporation (CPHC)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Canterbury Park Holding Corporation (CPHC)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.