Canterbury Park Holding Corporation (NASDAQ:CPHC) today
announced results for the second quarter and six months ended June
30, 2015.
Canterbury Park Holding Corporation (the “Company”) reported net
income of $571,650 on net revenues of $14,848,077 for the three
months ended June 30, 2015, compared to net income of $442,934 on
net revenues of $13,784,714 for the same period in 2014. For the
six months ended June 30, 2015, net income was $960,254 on net
revenues of $24,729,115, compared to net income of $848,941 on net
revenues of $23,159,168 for the same period in 2014. Diluted income
per share for the second quarter of 2015 was $.14 compared to $.11
for the same period in 2014. Diluted income per share for the six
month period ended June 30, 2015 was $.23 compared to diluted
income per share of $.20 for the six month period ended June 30,
2014.
The 7.7% increase in net revenues in the 2015 second quarter
compared to the same period in 2014 reflects the following
results:
- Pari-mutuel revenues increased $49,754
from $3,276,216 in the 2014 second quarter to $3,325,970 in the
2015 second quarter, or 1.5%. This slight increase reflects the
growth of live racing revenues offset by a decline in simulcast
revenues.
- Card Casino revenues increased 6.5%
from $6,932,066 in the 2014 second quarter to $7,381,906 in the
2015 second quarter, primarily due to increased wagering in our
table games operations.
- Food and Beverage revenue increased
19.9%, from $2,099,973 in the 2014 second quarter to $2,518,847 in
the 2015 second quarter, primarily due to an increase in revenues
from special events
For the six months ended June 30, 2015, our 6.8% increase in net
revenues compared to the same period in 2014 is primarily
attributable to increases in Card Casino and Food and Beverage
revenues of 6.5% and 14.8%, respectively, offset by an 2.3%
decrease in Pari-mutuel revenues.
The Company generated EBITDA of $2,802,907 in the first six
months of 2015, an increase of $322,934, or 13%, from the same
period a year ago.
Operating expenses increased $846,277, or 6.5%, and $1,383,463,
or 6.4%, respectively, in the second quarter and six month periods
ended June 30, 2015. These increases are primarily due to increased
salaries and benefits expense, increased depreciation expense and
increased other operating expenses, partially offset by a reduction
in utilities expense.
Further detail regarding our results for the second quarter and
first six months of 2015 is presented in the accompanying table,
and additional information regarding the Company’s financial
results will be presented in the Company’s Form 10-Q Report that
will be filed on August 14, 2015 with the Securities and Exchange
Commission.
Randy Sampson, Canterbury Park’s President and CEO commented:
“We are pleased with the solid revenue increases in our Card Casino
and Food and Beverage operations for the second quarter and six
months ended June 30, 2015. We are also encouraged that our
pari-mutuel operations achieved a slight increase in revenues for
the second quarter in spite of continued declines in simulcast
revenues. For the quarter, the decline in simulcast revenue was
more than offset by a 4.3% increase in on-track handle and a 45%
increase in out-of-state handle during the first 26 days of our
2015 live race meet. However, our operating expenses also increased
in the three and six month periods at a similar pace to our revenue
increases, primarily due to a state mandated minimum wage increase
and an increase in head-count to support our expanded catering and
events operations.”
Mr. Sampson added: “We are optimistic about the Company’s
prospects for the remainder of 2015. Due in large measure to our
Cooperative Marketing Agreement with the Shakopee Mdewakanton Sioux
Community, our current live meet features the highest quality horse
racing in Canterbury Park history as substantiated by our strong
out-of-state handle. Our Card Casino and Food and Beverage revenues
are expected to continue at their strong results and we are
starting to see growth in revenues resulting from our Events Center
and remodeled Triple Crown Club.”
Mr. Sampson added: “We continue to analyze the feasibility of
various options for development of our underutilized land. The
initial step in that process is to reorganize our corporate
structure and subdivide our property into the land used in our
horse racing, card casino and related businesses from land to be
developed. Subject to shareholder approval, as well as approval of
the Minnesota Racing Commission, we anticipate completion prior to
year end of the process of forming a new holding company with two
subsidiaries, one that will continue to operate the current horse
racing, card casino and related businesses, and a real estate
subsidiary to hold the excess land for development. Maximizing the
potential of our property for a 200 acre mixed use development
featuring destination retail and entertainment businesses as well
as multi-family residential and office space will likely require
relocation of our barn area. We are therefore, also in the process
of analyzing our options and costs to determine the feasibility of
building a new horse barn area and other necessary infrastructure
to free up the existing backside as the prime 'front door' for our
retail and entertainment businesses. Additionally, as we believe
tax increment financing is a necessary component of any plan to
relocate the current barn area and make infrastructure improvements
that are necessary for a major mixed use development on our
underutilized land, we are in the process of preparing an
application to the City of Shakopee to create a Tax Increment
Financing district on a portion of the Canterbury Park property.
Finally, we are evaluating options as to what role Canterbury Park
will play in the development of our underutilized land. We don’t
anticipate funding construction of the retail, residential and/or
office components of the project, nor do we expect to have
substantial ownership interest in these components. Currently our
expectation is that we will either sell or lease parcels through
ground leases to developers with expertise in these types of
projects.”
Mr. Sampson concluded: “While we are confident we can enhance
shareholder value through development of our property, until we
have completed the analysis of the feasibility of relocating our
barn area and are able to determine the financial incentives
available from local government, we are uncertain as to when and
how that development will take place. We will continue to incur
substantial costs as we proceed with our feasibility analysis and
pre-development processes, which will not be completed until year
end at the earliest. We believe this will be a good investment in
the Company’s future.”
Use of Non-GAAP Financial Measures:To supplement our
financial statements, we also provide investors with EBITDA
(defined below), which is a non-GAAP measure. EBITDA represents
earnings before interest income, income tax expense, and
depreciation and amortization. EBITDA is not a measure of
performance or liquidity calculated in accordance with generally
accepted accounting principles ("GAAP"), and should not be
considered an alternative to, or more meaningful than, net income
as an indicator of our operating performance, or cash flows from
operating activities as a measure of liquidity. EBITDA has been
presented as a supplemental disclosure because it is a widely used
measure of performance and basis for valuation of companies in our
industry. Moreover, other companies that provide EBITDA information
may calculate EBITDA differently than we do.
About Canterbury Park:Canterbury Park Holding Corporation
owns and operates Canterbury Park Racetrack and Card Casino,
Minnesota’s only thoroughbred and quarter horse racing facility.
The Company’s 70-day 2015 live race meet began on May 15th and ends
September 12th. In addition, Canterbury Park’s Card Casino hosts
“unbanked” card games 24 hours a day, seven days a week, offering
both poker and table games. The Company also conducts year-round
wagering on simulcast horse racing and hosts a variety of other
entertainment and special events at its facility in Shakopee,
Minnesota. For more information about the Company, please visit us
at www.canterburypark.com.
Cautionary Statement:From time to time, in press releases
and in other communications to shareholders or the investing
public, Canterbury Park Holding Corporation may make
forward-looking statements concerning possible or anticipated
future financial performance, business activities or plans based on
management’s beliefs and assumptions. These forward looking
statements are typically preceded by the words such as "believes,"
"expects," "anticipates," "intends" or similar expressions.
Shareholders and the investing public should understand that these
forward-looking statements are subject to risks and uncertainties,
including those disclosed in our periodic filings with the
Securities and Exchange Commission, which could cause actual
performance, activities or plans after the date the statements are
made to differ significantly from those indicated in the
forward-looking statements when made.
CANTERBURY PARK
HOLDING CORPORATION’S
SUMMARY OF
OPERATING RESULTS
(UNAUDITED)
Three Months Three Months
Six Months Six Months Ended Ended Ended Ended
June 30, 2015 June 30, 2014 June 30,
2015 June 30, 2014 Operating Revenues, (net)
$14,848,077 $13,784,714 $24,729,115 $23,159,168 Operating
Expenses $13,879,109 $13,032,832
$23,097,918
$21,714,455 Non-Operating Income, (net) $688 $712 $1,305
$1,349 Income before Income Taxes $969,656 $752,594
$1,632,502 $1,446,062 Income Tax Expense ($398,006 )
($309,660 ) ($672,248 ) ($597,121 ) Net Income $571,650
$442,934 $960,254 $848,941 Basic Net Income Per Common Share
$0.14
$0.11
$0.23
$0.20
Diluted Net Income Per Common Share
$0.14
$0.11
$0.23
$0.20
RECONCILIATION OF
NET INCOME TO EBITDA
Six Months Six Months Ended Ended
June 30,
2015
June 30,
2014
Net income $960,254 $848,941 Interest income (1,305 )
(1,349 ) Income tax expense 672,248 597,121
Depreciation
1,171,710
1,035,255
EBITDA $2,802,907 $2,479,968
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version on businesswire.com: http://www.businesswire.com/news/home/20150813006443/en/
Canterbury Park Holding CorporationRandy Sampson,
952-445-7223
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