Speedway Motorsports Reports Financial Results
CONCORD, N.C.--April 27, 2005--Speedway Motorsports, Inc. (SMI) today reported first quarter 2005 total revenues of $95.3 million, net income of $14.0 million and diluted earnings per share of $0.32, reaffirmed its earnings guidance for the full year 2005 of $2.15 to $2.25 per diluted share, and announced a stock repurchase program.The first quarter 2005 results are not directly comparable to 2004 because of NASCAR NEXTEL Cup and Busch Series racing events at Bristol Motor Speedway held and reported in the first quarter 2004 that are being held and reported in the second quarter 2005.
Changes in race schedules at the Company's speedways from time to time lessen the comparability of operating results between quarterly financial statements of successive years. Quarterly operating results are impacted principally from variable revenues and costs directly related to held events and certain fixed costs do not change when race dates change.
First Quarter Comparison
The following decreases in first quarter 2005 results are primarily attributable to reporting NASCAR racing events at Bristol Motor Speedway in the first quarter 2004 that will be reported in the second quarter 2005. For the first quarter 2005 as compared to 2004:
-- total revenues decreased 22% or $26.8 million to $95.3 million;
-- net income decreased 43% or $10.7 million to $14.0 million; and
-- diluted earnings per share decreased 44% or $0.25 to $0.32.
2005 Earnings Guidance Reaffirmed
The Company reiterated these first quarter 2005 earnings are consistent with its previous full year 2005 guidance of $2.15 to $2.25 per diluted share.
Stock Repurchase Program
The Company's Board of Directors has approved a stock repurchase program authorizing SMI to repurchase up to 1.0 million shares of outstanding Company common stock from time to time, depending on market conditions, share price and other factors. The purchases could be in the open market or private transactions. The stock repurchase program is effective immediately, will be funded using the Company's working capital and may be suspended or discontinued at any time. As of March 31, 2005, the Company had approximately $252.2 million of cash and cash equivalents and 43,953,000 shares of common stock outstanding.
2005 First Quarter Highlights
First quarter highlights include Las Vegas Motor Speedway hosting record sold-out capacity crowds at its NASCAR UAW-DaimlerChrysler 400 NEXTEL Cup Series, and record near sold-out attendance at the Sam's Town 300 Busch Series, racing events. Also, Atlanta Motor Speedway attracted near record attendance at its NASCAR Golden Corral 500 NEXTEL Cup and Aaron's 312 Busch Series racing events.
Other first quarter highlights include the Company's successful amendment of its $300.0 million bank credit facility and term loan (the Credit Facility) which provides greater flexibility with respect to letters of credit, dividend payments, repurchases of Company common stock and permitted investments of available cash, as well as reduces interest rates and extends maturity to March 2010 from May 2008.
"Our first quarter 2005 results, on a comparable event basis, show significant increases in all event revenue categories, and would show a significant increase in net income over last year if the results of Bristol Motor Speedway's first quarter 2004 NASCAR NEXTEL and Busch Series racing events were excluded," stated H.A. Wheeler, chief operating officer and president of Speedway Motorsports. "Atlanta Motor Speedway's strong NASCAR NEXTEL Cup event attendance evidences its long-standing reputation of offering fans some of the best on-track competition in NASCAR. Atlanta's location in a top media market, along with the ongoing roadway expansion surrounding and leading into our speedway, represents a tremendous long-term growth opportunity for us as well as advertisers and broadcasters."
"These strong 2005 results reflect the ever-growing demand and untapped potential of Las Vegas Motor Speedway's entertainment factor where our NASCAR NEXTEL Cup and Busch Series events were sold-out or near sold-out even with 13,000 additional temporary seats. Looking beyond this quarter, all of our NASCAR NEXTEL Cup and Busch Series event sponsorships for 2005 are pre-sold and strong interest continues to develop in Texas Motor Speedway's new NASCAR triple header weekend in November 2005," stated O. Bruton Smith, chairman and chief executive officer of Speedway Motorsports.
"SMI is constructing approximately 8,000 new premium seats at Las Vegas Motor Speedway because of the overwhelming demand for its NASCAR NEXTEL Cup and Busch Series events. Our event and official sponsorships are trending well ahead of last year and corporate marketing interest and promotional spending appears to be broadening and gaining momentum. We believe these factors demonstrate the increasing marketing appeal of the demographics surrounding motorsports entertainment and the merits of SMI investing in first-class facilities and premium markets. We believe SMI remains well positioned for continued strong growth visibility in 2005 and beyond with excellent marketing opportunities for broadcasters, sponsors and other corporate partners."
Speedway Motorsports is a leading marketer and promoter of motorsports entertainment in the United States. The Company owns and operates the following premier facilities: Atlanta Motor Speedway, Bristol Motor Speedway, Infineon Raceway, Las Vegas Motor Speedway, Lowe's Motor Speedway and Texas Motor Speedway. The Company provides souvenir merchandising services through its SMI Properties subsidiary, and manufactures and distributes smaller-scale, modified racing cars through its 600 Racing subsidiary. The Company also owns Performance Racing Network which broadcasts syndicated motorsports programming to over 710 radio stations nationwide. For more information, visit the Company's website at www.gospeedway.com.
Speedway Motorsports, Inc. and Subsidiaries
Selected Financial Data - Unaudited
For The Three Months Ended March 31, 2005 and 2004
(In thousands except per share amounts)
Three Months Ended
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INCOME STATEMENT DATA 3/31/2005 3/31/2004
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REVENUES:
Admissions $32,207 $48,839
Event related revenue 27,878 32,091
NASCAR broadcasting revenue 25,210 30,464
Other operating revenue 10,036 10,780
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Total Revenues 95,331 122,174
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EXPENSES AND OTHER:
Direct expense of events 15,086 19,397
NASCAR purse and sanction fees 17,141 21,725
Other direct operating expense 8,610 10,075
General and administrative 17,224 16,510
Depreciation and amortization 9,268 9,024
Interest expense, net 5,949 4,434
Other expense (income), net (920) 110
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Total Expenses and Other 72,358 81,275
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Income Before Income Taxes 22,973 40,899
Income Tax Provision 8,937 16,155
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NET INCOME $14,036 $24,744
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BASIC EARNINGS PER SHARE $0.32 $0.58
Weighted average shares outstanding 43,915 42,999
DILUTED EARNINGS PER SHARE $0.32 $0.57
Weighted average shares outstanding 44,216 43,332
Major NASCAR-sanctioned Events Held During
Period 4 5
Significant Race Schedule Changes:
-- Bristol Motor Speedway held one NASCAR NEXTEL Cup and one Busch Series racing event in the first quarter 2004 that will be reported in the second quarter 2005
-- Atlanta Motor Speedway held one NASCAR Busch Series racing event in the first quarter 2005
BALANCE SHEET DATA 3/31/2005 12/31/2004 ---------------------------------------------------------------------- Cash and cash equivalents $252,161 $216,731 Total current assets 348,553 288,025 Property and equipment, net 935,568 913,987 Goodwill and other intangible assets, net 157,854 157,917 Total assets 1,479,593 1,398,343 Deferred race event income, net 146,101 99,589 Total current liabilities 190,226 142,887 Revolving credit facility borrowings 50,000 50,000 Total long-term debt 430,263 427,149 Total liabilities 829,776 765,018 Total stockholders' equity $649,817 $633,325 ----------------------------------------------------------------------