International Speedway Corporation Reports Record Third Quarter Results
5 October 1999
International Speedway Corporation Reports Record Third Quarter Results
DAYTONA BEACH, Fla.--Oct. 5, 1999--International Speedway Corporation ("ISC") today reported record results for the third quarter and nine months ended August 31, 1999.Total revenues for the 1999 third quarter increased to $66.2 million compared to $17.8 million in the 1998 third quarter. Operating income for the third quarter increased to $16.8 million from a loss of $4.7 million. Net income increased to $9.6 million, or $0.20 per diluted share, versus a loss of $1.9 million, or $0.05 per diluted share. Results for the 1999 third quarter includes a charge to earnings of $1.7 million, or $0.04 per diluted share, which represents the after-tax effect of the cash component of the proposed settlement of the Americrown Service Corporation souvenir litigation.
For the nine months ended August 31, 1999, revenues increased 56% to $194.1 million from $124.3 million. Operating income increased 85% to $66.6 million, and net income rose 75% to $42.4 million, or $0.96 per diluted share, versus $24.3 million, or $0.62 per diluted share. Results for 1999 include the effect of the aforementioned proposed litigation settlement.
ISC's results for the third quarter and nine-months ended August 31, 1999, are not comparable with the corresponding periods from 1998 as the Company hosted three weekends of NASCAR Winston Cup racing in the 1999 third quarter compared to one in the 1998 third quarter. This is due to the addition of the NASCAR weekend at Michigan Speedway to the Company's 1999 third quarter as a result of the Penske merger, and to the postponement of the 1998 Pepsi 400 at Daytona to the fourth quarter due to statewide fires.
William C. France, Chairman and Chief Executive Officer of ISC, commented, "The third quarter was highlighted by the accelerated closing of the Penske Motorsports merger, which was finalized on July 26th. Since the closing of the transaction, we have made considerable progress in the integration of Penske's management and facilities.
"Our motorsports events during the quarter featured ISC's first race weekend at a facility formerly owned by Penske Motorsports. The NASCAR weekend at Michigan Speedway, the most successful weekend in the history of the facility, featured record attendance at Saturday's Busch Series, Grand National Division event and Sunday's Winston Cup Pepsi 400 at Michigan. With a sold out crowd on hand at the 125,000- seat facility, the Pepsi 400 continues to be the largest sporting event in the state of Michigan.
"The quarter's two other Winston Cup races were also strong performers. Our fans continued to react positively to the nighttime scheduling of the Winston Cup Pepsi 400 at Daytona. The event enjoyed the largest crowd in its history, driven by the addition of approximately 13,000 seats since last year's race. CBS's coverage of the event marked the first time a major network broadcast a NASCAR Winston Cup event in primetime and resulted in a 59% increase in television households over the previous year. The August 15th running of The Frontier at the Glen once again delivered a solid performance, as fans watched Jeff Gordon win his third straight race at the historic road racing facility."
Mr. France continued, "During the quarter, the Company continued to progress with its development projects. Construction on the speedway in Kansas City, Kansas is proceeding on schedule. The facility is beginning to take shape and the grandstand support structure is being erected. We have experienced tremendous demand for luxury suites and have responded by more than doubling the planned number to 68. Also, our initial launch of Preferred Access Speedway Seating was oversubscribed, so we have expanded the number of subscriptions being offered. Racing at the facility is expected for the 2001 season.
"In Chicago, our plans to develop a superspeedway as part of Raceway Associates are also on schedule. Last week, we formally broke ground on the construction phase of the project, and the architectural and engineering process is underway. With nearly half of the construction contracts in place we now expect ISC to incur approximately $9 to $11 million in net additional costs, and are exploring alternate funding mechanisms for the increase. We are closely monitoring the variance as we build this world class facility in the nation's third largest market."
Mr. France concluded, "Our fourth quarter posted a solid start with the running of the Pepsi Southern 500 at Darlington Raceway on September 5th. Attendance increased on a year-over-year basis due in part to the expanded seating capacity at the track. For the remainder of the quarter, we have four additional Winston Cup events: the Winston 500 at Talladega Superspeedway; the ACDelco 400 at North Carolina Speedway; the Dura Lube 500 at Phoenix International Raceway; and the inaugural Pennzoil 400 at Homestead-Miami Speedway. In addition, we look forward to hosting our first CART event at one of the former Penske facilities, the Marlboro 500 presented by Toyota at California Speedway."
International Speedway Corporation is a leading promoter of motorsports activities in the United States, currently promoting more than 100 events annually. The Company owns and/or operates 10 major motorsports facilities, including Daytona International Speedway in Florida (home of the Daytona 500); Talladega Superspeedway in Alabama; Michigan Speedway located outside Detroit, Michigan; California Speedway near Los Angeles, California; Homestead-Miami Speedway in Florida; Phoenix International Raceway in Arizona; Darlington Raceway in South Carolina; North Carolina Speedway in Rockingham, North Carolina; Watkins Glen International in New York, and Nazareth Speedway in Pennsylvania. Other track interests include the operation of Tucson (Arizona) Raceway Park and an indirect 37.5% interest in Raceway Associates, LLC, which owns the Route 66 Raceway and is developing a superspeedway in the Chicagoland area. The Company also owns and operates MRN Radio, the nation's largest independent sports radio network; DAYTONA USA, the "Ultimate Motorsports Attraction" in Daytona Beach, Florida, the official attraction of NASCAR; Americrown Service Corporation, a provider of catering services, food and beverage concessions, and merchandise sales, and Motorsports International, a producer and marketer of motorsports-related merchandise. For more information, visit the Company's website at www.iscmotorsports.com.
Statements made in this release that state the Company's or management's beliefs or expectations and which are not historical facts or which apply prospectively are forward-looking statements. It is important to note that the Company's actual results could differ materially from those contained in or implied by such forward looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward looking statements is contained from time to time in the Company's SEC filings including but not limited to the 10-K and subsequent 10-Q's. Copies of those filings are available from the Company and the SEC.
INTERNATIONAL SPEEDWAY CORPORATION
Consolidated Statements of Income
(Unaudited)
(In thousands, except for share and per share data)
Three months ended Nine months ended
August 31, August 31,
1999 1998 1999 1998
REVENUES:
Admissions, net $ 31,857 $ 5,184 $ 90,136 $ 54,432
Motorsports related income 22,356 9,187 72,805 50,104
Food, beverage, and
merchandise income 11,600 3,054 29,913 18,666
Other income 413 397 1,243 1,095
66,226 17,822 194,097 124,297
EXPENSES:
Direct race expenses:
NASCAR direct expenses 8,803 2,443 28,252 19,727
Motorsports related
expenses 10,958 5,449 32,458 22,119
Food, beverage, and
merchandise expenses 6,630 2,288 15,995 10,396
General & administrative
expenses 16,608 9,020 36,814 26,365
Depreciation & amortization 6,405 3,309 13,936 9,593
49,404 22,509 127,455 88,200
Operating income (loss) 16,822 (4,687) 66,642 36,097
Interest income 2,070 1,462 6,783 2,531
Interest expense (1,586) (77) (2,511) (518)
Gain on sale of equity
investment 0 0 0 1,245
Equity investment
income (loss) (1,006) 131 (1,472) (111)
Minority interest 77 0 77 0
Income (loss) before
income taxes 16,377 (3,171) 69,519 39,244
Provision (benefit)
for income taxes 6,742 (1,227) 27,101 14,993
Net income (loss) $ 9,635 $ (1,944) $ 42,418 $ 24,251
Basic earnings
(loss) per share $ 0.21 $ (0.05) $ 0.96 $ 0.62
Diluted earnings
(loss) per share $ 0.20 $ (0.05) $ 0.96 $ 0.62
Dividends per share $ 0.00 $ 0.00 $ 0.06 $ 0.06
Basic weighted average
shares outstanding 46,917,080 40,864,391 44,229,684 39,100,175
Diluted weighted average
shares outstanding 47,040,272 40,864,391 44,355,217 39,259,164
Consolidated Balance Sheet Data
(In Thousands)
August 31, November 30,
1999 1998
(Unaudited)
Cash, cash equivalents and
short-term investments $ 59,791 $ 92,803
Current assets 106,475 108,444
Restricted investments 96,246 53,500
Goodwill 546,865 38,927
Total assets 1,388,586 476,818
Deferred income 114,656 62,253
Current liabilities 149,430 80,954
Long-term debt 282,540 2,775
Shareholders' equity 887,986 366,855