Penske Motorsports Reports Q1 Revenues
30 April 1998
Penske Motorsports Reports Record First Quarter Revenues
DETROIT, April 30 -- Penske Motorsports, Inc. (PMI)
today announced record revenues for the first quarter ending
March 31, 1998. First quarter revenues increased 87% to $10.1 million, versus
$5.4 million in the prior year period. The increase in revenues was primarily
the result of the February race weekend held at North Carolina Speedway (NCS).
The Company now owns 100% of NCS, while it maintained a minority position in
NCS during the first quarter of 1997. The Company's net loss for the period
was $1.6 million, or $.12 per share, compared to a net loss of $1.5 million,
or $.11 per share for the prior year period. Included in the first quarter
results was an after-tax gain of $681,000 from the Company's previously
announced sale of its 7.3% interest in Grand Prix Association of Long Beach.
Greg Penske, President of PMI, stated, "Several significant events
occurred in the first quarter, highlighted by our first race weekend as owners
of the North Carolina Speedway. The weekend was a tremendous success, as a
new attendance record was set for the GM Goodwrench 400 Winston Cup event.
Attendance and corporate support for the Marlboro Grand Prix of Miami were
also strong, resulting in a significant contribution to PMI's earnings through
our investment in the Homestead-Miami Speedway. In addition to the
exceptional start to our racing season, we made strategic investments which
will promote the long term growth of the Company. We recently expanded the
seating capacity at Michigan Speedway and California Speedway by over 5,000
and 15,000 seats, respectively. We are also in the process of increasing
the seating capacity at North Carolina Speedway by nearly 14,000 seats in time
for our October event weekend. Additionally, we increased our investment in
Homestead by 5% to 45%, and sold our interest in Grand Prix Association of
Long Beach. We continue to believe our investment in the vibrant South
Florida racing market has the potential to be a strong contributor to the
Company's future performance."
Mr. Penske added, "In light of the significant investments we have made
in the last twelve months, we have lessened our dependence on summer events.
I am also extremely pleased with the operating performance exhibited in the
first quarter, as the amount of our operating loss before depreciation and
amortization was reduced by over $1.0 million."
The Company's racing schedule for the second quarter includes two NASCAR
Winston Cup Series, one CART FedEx Championship Series, one NASCAR Busch
Series Grand National Division, one NASCAR Craftsman Truck Series, one Dayton
PPG Indy Lights, and two International Race of Champions (IROC) events.
Penske Motorsports, Inc. is a leading promoter and marketer of
professional motorsports in the United States. PMI owns and operates the
following facilities through its wholly-owned subsidiaries: Michigan Speedway
in Brooklyn, Michigan; Nazareth Speedway in Nazareth, Pennsylvania; California
Speedway in San Bernardino County, California; and North Carolina Speedway
near Rockingham, North Carolina. PMI also holds a 45% interest in Homestead-
Miami Speedway, LLC, near Miami, Florida. In addition, PMI produces and
markets motorsports-related merchandise and accessories such as apparel,
souvenirs and collectibles through its subsidiary, Motorsports International
Corp.; and a subsidiary of PMI distributes and sells Goodyear brand racing
tires in the Midwest and Southeast regions of the United States.
Penske Motorsports' major shareholder is a majority-owned subsidiary
of Penske Corporation, a closely held, diversified transportation services
company which conducts its business through a number of wholly or partially-
owned companies, including Penske Truck Leasing Company, Detroit Diesel
Corporation, Diesel Technology Company, Penske Automotive Group, Inc., Penske
Auto Centers, Inc., and Penske Capital Partners. The Penske group of
businesses has annual revenues exceeding $6 billion and employs more than
28,000 around the world.
PENSKE MOTORSPORTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, December 31,
1998 1997
ASSETS (Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $1,018 $249
Receivables 13,533 4,787
Inventories 2,452 2,433
Prepaid expenses and other 2,585 2,082
TOTAL CURRENT ASSETS 19,588 9,551
PROPERTY AND EQUIPMENT, net 230,817 224,666
INVESTMENTS 14,572 15,366
GOODWILL, net 40,088 40,112
OTHER ASSETS 2,593 2,077
TOTAL $307,658 $291,772
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt $607 $1,017
Accounts payable 5,984 3,868
Accrued expenses 2,424 2,343
Other payables 150 9,956
Deferred revenues, net 43,085 22,529
TOTAL CURRENT LIABILITIES 52,250 39,713
LONG-TERM DEBT, less current portion 50,129 47,278
DEFERRED REVENUES, net 738 738
DEFERRED TAXES 15,495 13,349
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, par value $ .01 share:
Authorized 50,000,000 shares
Issued and outstanding 14,208,898
shares in 1998 and 1997 142 142
Additional paid-in-capital 159,371 159,371
Retained earnings 29,533 31,181
TOTAL STOCKHOLDERS' EQUITY 189,046 190,694
TOTAL $307,658 $291,772
PENSKE MOTORSPORTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except share and per share data) THREE MONTHS ENDED
MARCH 31,
1998 1997
REVENUES:
Speedway admissions $3,238
Other speedway revenues 2,953
Merchandise, tires and accessories 3,946 $5,375
TOTAL REVENUES 10,137 5,375
EXPENSES:
Operating 6,190 2,286
Cost of sales 2,462 3,176
Depreciation and amortization 2,675 789
Selling, general and administrative 2,252 1,730
OPERATING EXPENSES 13,579 7,981
OPERATING LOSS (3,442) (2,606)
EQUITY IN INCOME OF AFFILIATES 512
GAIN ON SALE OF INVESTMENT 1,108
INTEREST INCOME (EXPENSE), net (859) 125
LOSS BEFORE INCOME TAXES (2,681) (2,481)
INCOME TAX BENEFIT 1,033 970
NET LOSS $(1,648) $(1,511)
BASIC NET LOSS PER SHARE $(.12) $(.11)
BASIC WEIGHTED AVERAGE NUMBER OF SHARES 14,208,898 13,241,798
SOURCE Penske Motorsports, Inc.