CONCORD, N.C.--(BUSINESS WIRE)--May 7, 2008--Speedway Motorsports,
Inc. (SMI) (NYSE:TRK) today reported record first quarter 2008
revenues, demonstrating that demand and appeal for motorsports
entertainment and merchandise in SMI's markets remain strong despite
challenging economic times. Also, SMI reaffirmed its full year 2008
earnings guidance of $2.40 to $2.50 per diluted share.
First Quarter Comparison
For the first quarter 2008 as compared to 2007:
-- total revenues were $155.2 million in 2008 compared to $152.2
million in 2007;
-- net interest expense was $9.4 million in 2008 compared to $4.7
million in 2007, reflecting increased borrowings to fund the
acquisition of New Hampshire Motor Speedway;
-- equity investee after tax earnings were $966,000 in 2008
compared to after tax losses of $2.1 million in 2007;
-- net income was $30.9 million in 2008 compared to $31.9 million
in 2007; and
-- diluted earnings per share were $0.71 in 2008 compared to
$0.72 in 2007.
Purchase of New Hampshire Motor Speedway and Quarterly Seasonality
As previously announced, SMI purchased New Hampshire Motor
Speedway (NHMS) with available cash of $40 million and borrowings of
$300 million under the Company's Credit Facility. NHMS, a multi-use
1,175-acre complex located in Loudon, New Hampshire, featuring a
1.058-mile oval superspeedway and a 1.6-mile road course, currently
has approximately 96,000 permanent seats and 38 luxury suites.
NHMS is scheduled to hold one NASCAR Sprint Cup and one Nationwide
Series racing event in the second quarter, and another NASCAR Sprint
Cup racing event in the third quarter, of fiscal 2008. The first
quarter 2008 operating results as compared to last year reflect
attendant increases in overhead and interest expenses. As compared to
prior periods, future operating income in 2008 will likely be
positively impacted in the second and third quarters and negatively
impacted in the fourth quarter due to the seasonality of these NHMS
events.
2008 Earnings Guidance Reaffirmed
The Company reiterated that first quarter 2008 earnings are
consistent with its previous full year 2008 guidance of $2.40 to $2.50
per diluted share, assuming current industry and economic trends
continue, and excluding our 50% share of Motorsports Authentics joint
venture operating results, non-core businesses, capital expenditures
exceeding current plans, the impact of further increases in fuel
prices, interest rates, geopolitical conflicts, poor weather
surrounding our events or other unforeseen factors.
2008 First Quarter Highlights
First quarter highlights include continuing record levels of
corporate marketing and other event related revenues for NASCAR racing
events held this period. Las Vegas Motor Speedway (LVMS) hosted near
sold-out crowds at its NASCAR UAW-Dodge 400 Sprint Cup Series, and
strong attendance at its Sam's Town 300 Nationwide Series, racing
events. Atlanta Motor Speedway (AMS) hosted its NASCAR Kobalt Tools
500 Sprint Cup Series and Nicorette 300 Nationwide Series racing
events, although poor weather surrounding those events negatively
impacted attendance. Bristol Motor Speedway (BMS) again hosted
sold-out capacity crowds at its NASCAR Food City 500 Sprint Cup Series
race, and strong crowds at its Sharpie Mini 300 Nationwide Series
race, even though delayed and shortened due to poor weather. Also,
BMS's pole position qualifying for its NASCAR Sprint Cup Series race
was cancelled due to poor weather.
SMI believes admissions, concessions, souvenir merchandising and
other event related first quarter 2008 revenues were negatively
impacted by poor weather surrounding certain NASCAR racing events held
at AMS and BMS, and by declines in consumer spending from higher fuel
prices and difficult consumer credit and housing markets.
Stock Repurchase Program
During the first quarter 2008, the Company repurchased 75,000
shares of common stock for approximately $2.2 million under its
previously announced stock repurchase program. As of March 31, 2008,
the Company has repurchased 1,307,000 shares since adoption of the
program in April 2005. The total number of shares available for future
repurchase under the program, as currently authorized, is 693,000.
Other Comments
"Despite record gas prices, difficult credit markets and other
consumer concerns, SMI's record first quarter 2008 revenues reflect
ongoing increases in sponsorships, luxury suite rentals, ancillary
broadcasting rights and other event related revenues," stated H.A.
Wheeler, Chief Operating Officer and President of Speedway
Motorsports. "We are very pleased that Motorsports Authentics'
earnings significantly improved over last year's first quarter. Also,
all of our NASCAR Sprint Cup and Nationwide event sponsorships for
2008, and many for 2009, are already sold and pre-sales for other
corporate event related revenues continue to trend ahead of last year.
These factors clearly demonstrate that SMI's core business, along with
individual fan and corporate interest in NASCAR and other motorsports,
remains strong even in challenging economic times."
Bruton Smith, Chairman and Chief Executive Officer of Speedway
Motorsports stated, "SMI's 2008 racing season is off to a strong
start. We reported record first quarter 2008 revenues, long-term
contracted NASCAR broadcasting revenues have begun their steady climb,
and broadcast ratings are up over last year. However, we have decided
to implement certain cost reduction efforts to mitigate the ongoing
effects of escalating gas prices and other economic malaise.
"We are extremely excited about showcasing our first NASCAR Sprint
Cup and Nationwide Series racing events at SMI's newly purchased New
Hampshire Motor Speedway on June 28-29, 2008. Our 'Neon Garage' at Las
Vegas Motor Speedway continues to be overwhelmingly successful, and we
believe demonstrates the merits of SMI continuing to invest in
leading-edge facilities. When finished, our new 'state-of-the-art'
dragway at Lowe's Motor Speedway will likely be the finest dragway
facility in motorsports today. We look forward to hosting the
Carolinas NHRA Nationals on September 11-14, 2008. SMI's strategy of
owning the finest fan-friendly, most exciting race entertainment
facilities in motorsports, provides our sponsors and other corporate
partners with outstanding long-term marketing opportunities."
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, New Hampshire Motor Speedway and Texas Motor
Speedway. The Company provides souvenir merchandising services through
its SMI Properties subsidiaries; manufactures and distributes
smaller-scale, modified racing cars and parts through its 600 Racing
subsidiary; and produces and broadcasts syndicated motorsports
programming to radio stations nationwide through its Performance
Racing Network subsidiary. The Company also equally-owns Motorsports
Authentics, a joint venture formed with International Speedway
Corporation to produce, market and sell licensed motorsports
merchandise. For more information, visit the Company's website at
www.speedwaymotorsports.com.
This news release contains forward-looking statements,
particularly statements with regard to the Company's future operations
and financial results. There are many factors that affect future
events and trends of the Company's business including, but not limited
to, consumer and corporate spending sentiment; air travel;
governmental regulations; military actions; national or local
catastrophic events; the success of and weather surrounding NASCAR,
IRL, NHRA and other racing events; our relationship with NASCAR and
other sanctioning bodies; the success of Motorsports Authentics
merchandising joint venture; the success of expense reduction efforts;
capital projects; expansion; economic conditions; stock repurchases;
financing needs; insurance; litigation; taxes; oil and gas activities,
including the possibility of discontinuing operations; geopolitical
situations in foreign countries; and other factors outside of
management control. These factors and other factors, including those
contained in the Company's Annual Report on Form 10-K and subsequently
filed Quarterly Reports on Form 10-Q, involve certain risks and
uncertainties that could cause actual results or events to differ
materially from management's views and expectations. Inclusion of any
information or statement in this news release does not necessarily
imply that such information or statement is material. The Company does
not undertake any obligation to release publicly revised or updated
forward-looking information, and such information included in this
news release is based on information currently available and may not
be reliable after this date.
Note: Speedway Motorsports will host a conference call and
web-cast today at 11:00 AM (ET) which are open to all participants. To
participate in the conference call, you may dial 888-735-0476
(toll-free) or 706-758-1524 (toll). The reference number is 44915872.
A web-cast of the call can be accessed at the Company's website at
www.speedwaymotorsports.com. To listen to a playback of the call, you
may dial 800-642-1687 or 706-645-9291 beginning after 12:00 PM (EST)
May 7th through 11:59 PM (EST) May 21st. The reference number is
44915872. Participating in the call will be H.A. Wheeler, Chief
Operating Officer and President; William R. Brooks, Chief Financial
Officer and Executive Vice President; Marcus G. Smith, Executive Vice
President, National Sales and Marketing; and Marylaurel E. Wilks, Vice
President, Investor Relations and Communications.
Speedway Motorsports, Inc. and Subsidiaries
Selected Financial Data - Unaudited
For The Three Months Ended March 31, 2008 and 2007
(In thousands except per share amounts)
Three Months Ended
----------------------------
INCOME STATEMENT DATA 3/31/2008 (a) 3/31/2007
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Revenues:
Admissions $ 53,620 $ 56,516
Event related revenue 51,275 48,958
NASCAR broadcasting revenue 37,633 36,902
Other operating revenue 12,698 9,800
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Total Revenues 155,226 152,176
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Expenses and Other:
Direct expense of events 23,039 24,309
NASCAR purse and sanction fees 26,894 26,329
Other direct operating expense 13,156 11,103
General and administrative 21,480 20,140
Depreciation and amortization 11,800 10,553
Interest expense, net 9,449 4,694
Equity investee (earnings) losses (1,591) 3,454
Other expense (income), net 89 (25)
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Total Expenses and Other 104,316 100,557
----------------------------------------------------------------------
Income Before Income Taxes 50,910 51,619
Income Tax Provision (20,008) (19,754)
----------------------------------------------------------------------
Net Income $ 30,902 $ 31,865
----------------------------------------------------------------------
Basic Earnings Per Share $ 0.71 $ 0.73
Weighted average shares outstanding 43,523 43,773
Diluted Earnings Per Share $ 0.71 $ 0.72
Weighted average shares outstanding 43,563 43,968
Major NASCAR-sanctioned Events Held
During Period 6 6
BALANCE SHEET DATA 3/31/2008 (a) 12/31/2007
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Cash, cash equivalents and short-term
investments $ 172,138 $ 168,462
Total current assets 284,963 242,648
Property and equipment, net 1,126,115 1,066,393
Equity investments in associated entities 77,260 76,678
Goodwill and other intangible assets, net 558,290 155,993
Total assets 2,083,120 1,578,320
Deferred race event income, net 140,648 112,099
Total current liabilities 231,742 177,720
Revolving credit facility borrowings 398,438 98,438
Total long-term debt 728,458 428,460
Total liabilities 1,225,818 750,649
Total stockholders' equity 857,302 827,671
----------------------------------------------------------------------
(a) Reflects business acquisition of New Hampshire Motor Speedway on
January 11, 2008, including its results of operations after
acquisition and financial condition as of March 31, 2008.
CONTACT: Speedway Motorsports, Inc.
Lauri Wilks, 704-455-3299
SOURCE: Speedway Motorsports, Inc.
