Speedway Motorsports Reports Record Results For The Three and Six Months Ended June 30, 2005
CONCORD, N.C.--Aug. 3, 2005--Speedway Motorsports, Inc. (SMI) today reported record results for the three and six months ended June 30, 2005. Second quarter 2005 results include total revenues of $216.2 million, net income of $55.5 million and diluted earnings per share of $1.26. Six month 2005 results include total revenues of $311.5 million, net income of $69.6 million and diluted earnings per share of $1.57.The second 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 second quarter 2005 that were held and reported in the first quarter 2004. 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: (i) variable revenues and costs directly related to held events and (ii) certain fixed costs that do not change when race dates change.
Second Quarter Comparison
The following increases in second quarter 2005 results are largely attributable to reporting NASCAR racing events at Bristol Motor Speedway in the second quarter 2005 that were reported in the first quarter 2004. For the second quarter 2005 as compared to 2004:
-- total revenues increased 31% or $51.3 million to $216.2 million;
-- net income increased 39% or $15.6 million to $55.5 million; and
-- diluted earnings per share increased 37% or $0.34 to $1.26.
Year-to-Date Comparison
For the six month 2005 period as compared to 2004:
-- total revenues increased 9% or $24.5 million to $311.5 million;
-- net income increased 8% or $4.9 million to $69.6 million; and
-- diluted earnings per share increased 5% or $0.08 to $1.57.
Stock Repurchase Program
During the second quarter 2005, the Company repurchased 100,000 shares of common stock for approximately $3.5 million under its previously announced stock repurchase program authorizing the repurchase of up to 1.0 million shares.
2005 Second Quarter Highlights
Second quarter highlights include Bristol Motor Speedway again hosting sold-out capacity crowds at its NASCAR Food City 500 NEXTEL Cup Series racing event, and large crowds at the Sharpie Professional 250 Busch Series racing event despite being rescheduled to Monday because of poor weather. Texas Motor Speedway attracted sold-out attendance at its NASCAR Samsung/RadioShack 500 NEXTEL Cup Series, and large crowds at the O'Reilly 300 Busch Series, racing events. Also, strong promotional efforts increased corporate marketing revenues for Lowe's Motor Speedway's NASCAR NEXTEL All-Star Challenge, Coca-Cola 600 NEXTEL Cup and CARQUEST Auto Parts 300 NASCAR Busch Series racing events to record levels, and Infineon Raceway's Dodge/Save Mart 350 NASCAR NEXTEL Cup Series weekend racing attracted strong crowds. Other highlights include Texas Motor Speedway achieving record attendance at its Bombardier Learjet 500 IndyCar Series race, and its second highest attendance at the Chex 400 NASCAR Craftsman Truck Series race.
2005 Earnings Guidance Reaffirmed
The Company reiterated these second quarter 2005 earnings are consistent with its previous full year 2005 guidance of $2.15 to $2.25 per diluted share.
Recent Developments - Atlanta Motor Speedway Tornado Damage
On July 6, 2005, a tornado struck Atlanta Motor Speedway causing significant damage to its facilities. Although the Company continues to assess the extent of damages and has established preliminary restoration plans, associated losses, if any, are not expected to significantly exceed insurance coverage limits. Also, the Company believes restoration will progress sufficiently to allow AMS to conduct its NASCAR NEXTEL Cup Series and other races as scheduled in October 2005.
"Our second quarter 2005 results, on a comparable event basis, show record revenues and net income, and we are particularly encouraged by the strong increases in sponsorship, luxury suite rentals, advertising and other corporate revenues," stated H.A. Wheeler, chief operating officer and president of Speedway Motorsports. "The corporate interest in SMI's premier facilities, geographic markets and the motorsports industry is clearly expanding. We were extremely proud to recently announce a multi-year event title and official sponsorship agreement with Bank of America, Lowe's Motor Speedway and other SMI speedways. These major long-term marketing alliances illustrate that advertisers and broadcasters are increasingly recognizing the long-term marketing opportunities that SMI and the motorsports industry provide."
"So far in 2005, broadcast television and cable ratings for NASCAR NEXTEL Cup events are up 7% and 16%, respectively, over last year to new highs," stated O. Bruton Smith, chairman and chief executive officer of Speedway Motorsports. "Increasing enthusiasm and spectator interest in our sport successfully demonstrate precisely what sponsors, advertisers and promoters are looking for. The positive trend in TV ratings and marketing value increases bode well for the ongoing NASCAR broadcast rights negotiations. Our 2006 event and official sponsorships are trending well ahead of this year and corporate marketing interest and promotional spending appears to be broadening and gaining momentum. These trends, along with the strong interest continuing to develop in Texas Motor Speedway's new NASCAR triple header weekend in November 2005, bring us strong growth visibility for 2006."
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 subsidiaries, 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 and Six Months Ended June 30, 2005 and 2004
(In thousands except per share amounts)
Three Months Ended Six Months Ended
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INCOME STATEMENT DATA 6/30/2005 6/30/2004 6/30/2005 6/30/2004
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REVENUES:
Admissions $74,516 $53,965 $106,723 $102,804
Event related revenue 62,960 51,588 90,838 83,679
NASCAR broadcasting
revenue 66,468 46,855 91,678 77,319
Other operating revenue 12,232 12,447 22,268 23,227
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Total Revenues 216,176 164,855 311,507 287,029
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EXPENSES AND OTHER:
Direct expense of events 36,275 28,452 51,361 47,849
NASCAR purse and
sanction fees 43,514 32,316 60,655 54,041
Other direct operating
expense 10,717 10,469 19,327 20,544
General and
administrative 20,423 17,581 37,647 34,091
Depreciation and
amortization 9,304 8,753 18,572 17,777
Interest expense, net 4,979 3,894 10,928 8,328
Other expense (income),
net 104 (2,335) (816) (2,225)
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Total Expenses and
Other 125,316 99,130 197,674 180,405
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Income Before Income Taxes 90,860 65,725 113,833 106,624
Income Tax Provision 35,344 25,857 44,281 42,012
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NET INCOME $55,516 $39,868 $69,552 $64,612
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BASIC EARNINGS PER SHARE $1.26 $0.92 $1.58 $1.50
Weighted average shares
outstanding 43,942 43,165 43,929 43,082
DILUTED EARNINGS PER SHARE $1.26 $0.92 $1.57 $1.49
Weighted average shares
outstanding 44,189 43,531 44,203 43,432
Major NASCAR-sanctioned
Events Held During Period 8 6 12 11
Significant Race Schedule Changes:
-- Bristol Motor Speedway held one NASCAR NEXTEL Cup and one Busch
Series racing event in the second quarter 2005 that were reported
in the first quarter 2004
-- Atlanta Motor Speedway held one NASCAR Busch Series racing event
in the first quarter 2005
BALANCE SHEET DATA 6/30/2005 12/31/2004
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Cash and cash equivalents $238,463 $216,731
Total current assets 345,347 288,025
Property and equipment,
net 954,537 913,987
Goodwill and other
intangible assets, net 157,806 157,917
Total assets 1,494,984 1,398,343
Deferred race event
income, net 86,840 99,589
Total current liabilities 172,247 142,887
Revolving credit facility
borrowings 50,000 50,000
Total long-term debt 430,228 427,149
Total liabilities 791,860 765,018
Total stockholders'
equity $703,124 $633,325
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