Speedway Motorsports, Inc. : Speedway Motorsports Reports Results for First Quarter 2012 and Reaffirms Full Year 2012 Guidance
05/02/2012| 08:05am US/Eastern
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Speedway Motorsports, Inc. (SMI) (NYSE: TRK) today reported first
quarter 2012 total revenues of $84.8 million and a loss from continuing
operations of $118,000 or $0.00 per diluted share. These results were
within management's expectations, and SMI reaffirmed its full year 2012
earnings guidance of $0.90 to $1.20 per diluted share from continuing
operations.
The Company's admissions and many event related revenue categories
continue to be negatively impacted by declines in consumer and corporate
spending due to weak economic conditions, including high unemployment
and fuel prices. In 2012, similar to 2011, the Company maintained
reduced ticket and other prices for its fans and corporate customers to
help counter these tough economic times and mitigate near-term demand
weakness.
Because many revenues such as admissions and corporate marketing
arrangements are sold well in advance of scheduled events, management
believes it may take relatively longer for SMI's results to reflect
sales growth as economic conditions improve.
First Quarter Comparison:
Total revenues were $84.8 million in 2012 compared to $86.7 million in
2011
After tax loss on early debt redemption and refinancing was $4.5
million or $0.11 per diluted share in 2011
Loss from continuing operations was $118,000 or $0.00 per diluted
share in 2012 compared to $1.2 million or $0.03 per diluted share in
2011
After tax losses from discontinued operations were $28,000 or $0.00
per diluted share in 2012 compared to $274,000 or $0.01 per diluted
share in 2011
Net loss was $146,000 or $0.00 per diluted share in 2012 compared to
$1.5 million or $0.04 per diluted share in 2011
Non-GAAP Financial Information and Reconciliation
Income (loss) from continuing operations, and diluted earnings (loss)
per share from continuing operations, as adjusted, set forth below
are non-GAAP (other than generally accepted accounting principles)
financial measures presented as supplemental disclosures to their
individual corresponding GAAP basis amounts. The following schedule
reconciles those non-GAAP financial measures to their most directly
comparable information presented using GAAP, all net of taxes.
Management believes such non-GAAP information is useful and meaningful
to investors and helps in understanding, using and comparing the
Company's results of continuing operations separate from discontinued
operations and a certain 2011 charge. Management uses the non-GAAP
information to assess the Company's continuing operations for the
periods presented, analyze performance trends and make decisions
regarding future operations because it believes this separate
information better reflects ongoing operating results. This non-GAAP
financial information is not intended to be considered independent of or
a substitute for results prepared in accordance with GAAP. This non-GAAP
financial information may not be comparable to similarly titled measures
used by other entities and should not be considered as alternatives to
net income or loss, diluted earnings or loss per share, or income or
loss and diluted earnings or loss per share from continuing operations,
determined in accordance with GAAP.
Three Months Ended
March 31:
2012
2011
(in thousands, except per share amounts)
Consolidated net loss using GAAP
$
(146
)
$
(1,518
)
Loss from discontinued operation
28
274
Consolidated loss from continuing operations
(118
)
(1,244
)
Loss on early debt redemption and refinancing
--
4,458
Non-GAAP consolidated (loss) income from continuing operations
$
(118
)
$
3,214
Consolidated diluted loss per share using GAAP
$
(0.00
)
$
(0.04
)
Loss from discontinued operation
0.00
0.01
Consolidated diluted loss per share from continuing operations
(0.00
)
(0.03
)
Loss on early debt redemption and refinancing
--
0.11
Non-GAAP diluted (loss) earnings per share from continuing operations
$
(0.00
)
$
0.08
Significant 2012 First Quarter Racing Events
Las Vegas Motor Speedway - NASCAR Kobalt Tools 400 Sprint Cup and
Sam's Town 300 Nationwide Series racing events
Bristol Motor Speedway - NASCAR Food City 500 Sprint Cup and Ford
EcoBoost 300 Nationwide Series racing events
2012 Earnings Guidance
The Company reiterated that first quarter 2012 results are consistent
with its previous full year 2012 earnings guidance of $0.90-$1.20 per
diluted share from continuing operations. The wide range of earnings
guidance reflects the continuing negative impact of uncertain economic
conditions, as well as the timing and pace of economic recovery. The
guidance also reflects expiration of Infineon Raceway's naming rights
agreement and reduced NASCAR ancillary rights revenues. High or
increasing fuel and food prices could significantly impact our future
results.
Dividends and Stock Repurchase Program
On February 22, 2012, the Company's Board of Directors declared a
quarterly cash dividend of $0.15 per share of common stock aggregating
approximately $6.2 million, which was paid on March 15, 2012 to
shareholders of record as of March 5, 2012. On April 17, 2012, the
Company's Board of Directors declared a quarterly cash dividend of $0.15
per share of common stock aggregating approximately $6.2 million,
payable on June 8, 2012 to shareholders of record as of May 18, 2012.
These quarterly dividends represent a 50% increase over comparable
quarterly amounts declared last year. The Board of Directors plans to
continue to evaluate cash dividends on a quarterly basis in the future.
During the first quarter 2012, the Company repurchased 33,000 shares of
common stock for approximately $517,000 under its previously announced
stock repurchase program. As of March 31, 2012, the Company has
repurchased 3,665,000 shares since adoption of the program in April
2005, and the total number of shares available for future repurchase
under the program, as currently authorized, is 335,000.
Comments
"Although SMI's first quarter results were within our expectations, they
reflect the continuing impact of high unemployment and fuel prices on
our core fan base," stated Marcus G. Smith, Chief Operating Officer and
President of Speedway Motorsports. "SMI is striving harder than ever to
provide our fans and customers with race entertainment value second to
none, while continuing to reduce ticket and other prices to help counter
these tough economic times. We are working to persuade local and
regional lodging proprietors that lowering prices can stimulate demand
that benefits us both, as well as our fans. Our untiring investments in
traffic infrastructure improvements are paying off through dramatically
shorter travel times, which our fans are favorably embracing more and
more. Also, SMI is investing heavily in unique pre-race and contemporary
interactive digital entertainment that appeals to our next generation of
younger fans and fosters family attendance.
"Looking forward, we have already sold all of our NASCAR Sprint Cup and
most of our Nationwide Series event sponsorships for 2012, and many for
racing seasons beyond 2012. Corporate interest in our premier facilities
for track rentals, driving schools and other promotional activities
continues to increase. These, and other bullish signs like stabilizing
advance ticket sales, are all positive signs that SMI's business
continues to rebound."
"We believe the future of SMI and motorsports is much brighter now than
at this same time last year. Several positive long-term business
initiatives are converging," stated O. Bruton Smith, Chairman and Chief
Executive Officer of Speedway Motorsports. "Our focus on our core
business includes increased efforts to grow revenues, constrain capital
spending and further reduce leverage. Exciting new Sprint Cup drivers
representing sizeable and largely untapped demographics in NASCAR racing
are being introduced. NASCAR efforts to improve on-track racing and
bring back the competitive excitement that created our loyal fan base
and our sport's popularity continue, with exciting upcoming changes such
as restoring brand identity to 'stock car' racing with the introduction
of re-styled Sprint Cup cars in 2013. These are all positive long-term
initiatives that provide tremendous marketing and growth opportunities
for broadcasters, advertisers and SMI, and bode well for the upcoming
renewal of the long-term NASCAR broadcasting contract."
Speedway Motorsports is a leading marketer and promoter of motorsports
entertainment in the United States. The Company, through its
subsidiaries, owns and operates the following premier facilities:
Atlanta Motor Speedway, Bristol Motor Speedway, Charlotte Motor
Speedway, Infineon Raceway, Kentucky Speedway, Las Vegas Motor Speedway,
New Hampshire Motor Speedway and Texas Motor Speedway. The Company
provides souvenir merchandising services through its SMI Properties
subsidiaries; manufactures and distributes smaller-scale, modified
racing cars and parts through its US Legend Cars International
subsidiary; and produces and broadcasts syndicated motorsports
programming to radio stations nationwide through its Performance Racing
Network subsidiary. The Company also equally owns Motorsports
Authentics, a joint venture formed with International Speedway
Corporation to design, market and sell licensed motorsports merchandise.
For more information, visit the Company's website at www.speedwaymotorsports.com.
This news release contains forward-looking statements, particularly
statements with regard to our future operations and financial results.
There are many factors that affect future events and trends of our
business including, but not limited to, economic factors, weather, the
success of NASCAR and others as sanctioning bodies, the success of our
Motorsports Authentics merchandising joint venture, capital projects and
expansion, financing needs, and a host of other factors both within and
outside of management control. These factors and other factors,
including those contained in our Annual Report on Form 10-K and
subsequently filed Quarterly Reports on Form 10-Q, involve certain risks
and uncertainties that could cause actual results or events to differ
materially from management's views and expectations. Inclusion of any
information or statement in this news release does not necessarily imply
that such information or statement is material. The Company does not
undertake any obligation to release publicly revised or updated
forward-looking information, and such information included in this news
release is based on information currently available and may not be
reliable after this date.
Note: Speedway Motorsports will host a conference call and webcast today
at 10:00 AM (ET) open to the public. To participate in the conference
call, you may dial 888-735-0476 (US / Canada / toll-free) or
706-758-1524 (international / local). The reference number is 74410456.
A webcast of the call can be accessed at the Company's website at www.speedwaymotorsports.com
under "Event Calendar." To listen to a playback of the call, you may
dial 855-859-2056 or 404-537-3406 beginning at 12:00 PM (ET) May 2nd
through 11:59 PM (ET) May 18th. The reference number is
74410456. Participating in the call will be Marcus G. Smith, Chief
Operating Officer and President, and William R. Brooks, Vice Chairman,
Chief Financial Officer and Treasurer.
Speedway Motorsports, Inc. and Subsidiaries
Selected Financial Data - Unaudited
For The Three Months Ended March 31, 2012 and 2011
(In thousands except per share amounts)
Three Months Ended
STATEMENT OF OPERATIONS DATA
3/31/2012
3/31/2011
Revenues:
Admissions
$22,469
$24,576
Event related revenue
24,702
26,625
NASCAR broadcasting revenue
29,433
28,426
Other operating revenue
8,198
7,048
Total Revenues
84,802
86,675
Expenses and Other:
Direct expense of events
14,989
15,552
NASCAR purse and sanction fees
18,755
18,293
Other direct operating expense
5,054
5,374
General and administrative
21,879
21,503
Depreciation and amortization
13,916
13,250
Interest expense, net
10,436
11,247
Loss on early debt redemption and refinancing
-
7,433
Other income, net
(46
)
(20
)
Total Expenses and Other
84,983
92,632
Loss from Continuing Operations Before Income Taxes
(181
)
(5,957
)
Income Tax Provision
63
4,713
Loss from Continuing Operations
(118
)
(1,244
)
Loss from Discontinued Operation, Net of Taxes
(28
)
(274
)
Net Loss
($146
)
($1,518
)
Basic Loss Per Share:
Continuing Operations
($0.00
)
($0.03
)
Discontinued Operation
(0.00
)
(0.01
)
Net Loss
($0.00
)
($0.04
)
Weighted average shares outstanding
41,443
41,594
Diluted Loss Per Share:
Continuing Operations
($0.00
)
($0.03
)
Discontinued Operation
(0.00
)
(0.01
)
Net Loss
($0.00
)
($0.04
)
Weighted average shares outstanding
41,451
41,594
Note: Individual quarterly per share amounts may not be additive due
to rounding.
Major NASCAR-sanctioned Events Held During Period
4
4
BALANCE SHEET DATA
3/31/2012
12/31/2011
Cash and cash equivalents
$96,282
$87,368
Total current assets
198,275
157,895
Property and equipment, net
1,173,084
1,177,154
Goodwill and other intangible assets, net
533,692
533,677
Total assets
1,940,340
1,904,643
Deferred race event and other income, net
105,257
62,658
Total current liabilities
168,972
121,643
Credit facility revolving and term loan borrowings
141,250
145,000
Total long-term debt
568,498
572,557
Total liabilities
1,105,834
1,063,463
Total stockholders' equity
834,506
841,180
Speedway Motorsports, Inc. Janet Kirkley, 704-532-3318
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