Championship Auto Racing Teams Announces 2002 Financial Guidance

DETROIT, March 6 Championship Auto Racing Teams, Inc. today provided financial guidance for the year ending December 31, 2002. The company noted that the following statements are based on current expectations and do not include the proposed FedEx Championship Series race in Miami, Florida, for October 2002. These statements are forward-looking, and actual results may differ materially as a result of the factors more specifically referenced below.

The company estimates that:

Revenues for the year will total approximately $68.0 million to $71.0 million An operating loss of between $1.0 million and $4.5 million will be incurred Net income, benefiting from approximately $4.4 million in interest income will range from a profit of $2.2 million or $0.15 per diluted share to a loss of $78,000 or $0.01 per share. ``This is clearly a transition year for CART, with a changed business model, new management structure and an uncertain economic environment,'' said Christopher R. Pook, president and chief executive officer. ``Nevertheless, we are confident that we have the right elements in place to succeed for the long-term and that we will show significant progress in 2002 toward evolving CART to a marketing driven company and achieving sustainable operating profitability.''

``We will continue to enhance our race schedule to provide optimum marketing opportunities for our sponsors, manufacturers and vendors,'' Pook continued. ``In 2002 we have added a second race in Mexico at the Autodromo Hermanos Rodriguez in Mexico City and a third race in Canada at the Circuit Gilles Villeneuve in Montreal, Quebec. Domestically, we are reducing the number of races concentrated in the Midwest and adding a race in the western United States in Denver, Colorado.''

Pook added: ``The race season ahead challenges CART to demonstrate our skills as great race promoters. We are taking on the opportunities and risks of new television arrangements in an extremely soft advertising environment. We are also working with lower sponsor revenue, in the face of a tougher economic environment. We have conservatively framed our business outlook for the year against this backdrop, recognizing that CART enters 2002 with a business and financial model that provides less visibility than previously available to us. At the same time, we come to these challenges with tremendous experience and a history of successful execution that underpins our enthusiasm. As an example, I want to build pre-race excitement with sponsors, the news media and the fans for CART races, so we have established a new Advance Program department that will initiate a two-seater Champ Car program that will run in advance of our events. This program allows our key constituents to experience the thrill of a Champ Car ride first hand with a professional driver and generates media attention leading up to the race.''

Thomas L. Carter, CART's chief financial officer stated, ``We are joint venturing with three of our venues as co-promoters. In this model, we are accepting lower sanction fees with the expectation of greater upside return by sharing in the profits of the race. Leveraging the strength of the CART brand and Chris Pook's experience as a successful promoter, we are stepping up to the plate and acting as promoter for our race in Chicago and offering a broad array of marketing opportunities for advertisers, vendors and sponsors.''

``Our growth ambitions are supported by an excellent balance sheet,'' Carter concluded. ``At year-end, December 31, 2001, CART had $115.4 million in cash and short-term investments and working capital of $111.6 million with no long- term debt.''

Projections for the year are based on the following assumptions:

Sanction fees are expected to range from $43.0 million to $44.0 million. This is down from 2001 sanction fees of $47.2 million, and reflects 18 races in 2002 compared with 20 races last year. While 20 races have been announced for the 2002 schedule, the company is accounting for the self-promoted race in Chicago as a separate revenue source under ``race promotion revenue'' and has not included any financial impact of the recently announced Miami race. New venues for 2002, included in sanction fees, are Denver, Mexico City and Montreal. In 2002, the company will not return to race at Nazareth, Pennsylvania; Brooklyn, Michigan; Detroit, Michigan and Houston, Texas.

Sponsorship revenue is expected to be approximately $10.0 million, down from $12.3 million in 2001 and reflecting the previously announced discontinuance of the Indy Light Series and reduced fees from other sponsors.

Television revenue in 2002 is forecast to range from $8.0 million to $9.0 million, reflecting gross receipts, less commissions, on estimated advertising revenues, international rights and video production. Television revenue for 2002 is not comparable to 2001 revenue of $5.2 million, when the company received fees for its television rights with no related expenses. (See ``Television Expenses'')

Race promotion revenue, a new category reflecting the CART-promoted race in Chicago, is expected to be between $4.0 million and $5.0 million. Included in this revenue line are management forecasts for all the commercial rights associated with promoting a CART event, such as admissions, event sponsorship and hospitality sales.

No engine lease, rebuild or wheel sale revenue is projected in 2002 due to the discontinuance of the Indy Lights Series in 2001.

Other revenue in 2002 is projected to be about $3.0 million, down from $4.2 million in 2001, principally reflecting the discontinuance of the Indy Lights Series and fewer teams.

Total expenses in 2002 are expected to be between $72.0 million and $72.5 million, compared with $78.8 million in 2001. The components affecting expense spending are anticipated as follows:

Race payments should be about $18.4 million, nearly unchanged from 2001. Savings from the discontinuance of the Indy Lights Series are expected to be offset by an increased purse and a higher year-end point fund for the Toyota Atlantic Series and greater reimbursements to CART teams.

Race expenses are projected to total $11.0 million, up from $10.6 million in 2001, largely reflecting increased safety-related and technical inspection expenses and staffing.

Television expenses, a new category for 2002, will approximate $9.9 million, reflecting forecasts for production cost and time-buy expenses under new television agreements with Fox/SPEED Channel and CBS, as well as international feed expenses.

Race promotion expenses, also a new category, are forecast to be between $3.0 and $3.5 million. These expenses include all costs associated with promoting a CART event.

Administration and other indirect expenses are expected to be held to about $28.0 million, down from $35.6 million in 2001. The decrease is predominantly attributed to severance payments made in 2001 and also reflects the elimination of CART's Entertainment Division and certain other costs. These decreases are offset in part by the addition of the Advance Program and Joint Venture departments. The Advance Program department will be overseeing the two-seater Champ Car program, and the Joint Venture department will be spear-heading all co-promoted and self-promoted races.

Depreciation and amortization in 2002 is projected to total $1.7 million compared with $1.5 million in 2001. This is based on anticipated capital expenditures of approximately $4.0 million. CART said that it is still evaluating the impact on goodwill of adopting SFAS 141 and 142. At this time, however, the company said it has no expectations that a write down of goodwill will be necessary nor does it currently anticipate any impairment of goodwill going forward, although future reviews are required by SFAS 142 on a quarterly basis.

The company currently has authorization to repurchase up to 2.5 million shares of its outstanding common stock in open market or privately negotiated transactions. Through December 31, 2001, CART had repurchased 1.1 million shares. For per share calculation purposes, in 2002, CART is assuming 15,000,000 shares on a fully diluted basis.

CART noted that financial results for any given quarter vary based on the number of races held during the quarter, the mix of races, sanction fees and advertising revenues. Consequently, changes in race schedules from year to year can significantly alter the comparability of quarterly results. Therefore, CART only provides guidance on an annual, rather than quarterly basis.

Pook also noted that negotiations with potential engine suppliers continue regarding CART's previously announced change in engine specifications beginning in 2003.

Investor Conference Call

In conjunction with this news release, CART will host a teleconference on Wednesday, March 6, 2002 at 11:00 a.m. EST. The teleconference call-in number is 1-877-917-3611 from the U.S. and Canada. International callers should phone 1-630-395-0145. The password for the teleconference is 'Championship' and the call leader is Thomas Carter. All callers are asked to call in approximately five minutes to the starting time. A replay of the call will be available until 12:00 noon EST, Wednesday, March 13 by dialing 1-800-925-0570 from the United States and Canada, or for international callers by dialing 1-402-998-0851.

About CART

Championship Auto Racing Teams, Inc. owns, operates and markets the CART FedEx Championship Series. Former series champions Michael Andretti and Jimmy Vasser are among the stars who will battle for the 2002 FedEx Championship Series title on ovals, temporary street circuits and permanent road courses. The 2002 CART FedEx Championship Series season kicks off March 10 at Monterrey, Mexico and the 20-race schedule will be broadcast by new television partners, CBS, FOX, and SPEED Channel. CART also owns and operates its top development series, the CART Toyota Atlantic Championship. Learn more about CART's open-wheel racing series at www.CART.com .