Speedway Motorsports, Inc. (SMI) (NYSE: TRK) today reported
first quarter 2016 total revenues of $83.2 million and net income
of $861,000 or $0.02 per diluted share. These results were within
management’s expectations, and SMI reaffirmed its full year 2016
earnings guidance of $0.90 to $1.10 per diluted share as further
described below.
Management believes many of the Company’s revenue categories
continue to be negatively impacted by economic conditions,
including underemployment and absence of a stronger middle class
economic recovery, certain currency exchange rates and high food
and health-care costs. Management also believes admissions and
certain event related revenues were negatively impacted by poor
weather surrounding the NASCAR Sprint Cup racing event held at Las
Vegas Motor Speedway in the first quarter 2016.
First Quarter Comparison:
- Charlotte Motor Speedway held one major
NHRA racing event in the first quarter 2015 that is being held in
the second quarter 2016
- Total revenues were $83.2 million in
2016 compared to $85.3 million in 2015
- After tax loss on early debt redemption
and refinancing of $5.3 million or $0.13 per diluted share in
2015
- After tax interim interest expense
associated with early debt redemption of $1.1 million or $0.03 per
diluted share in 2015
- Net income was $861,000 or $0.02 per
diluted share in 2016 compared to a net loss of $4.4 million or
$0.11 per diluted share in 2015
- Non-GAAP net income was $861,000 or
$0.02 per diluted share in 2016 compared to $1.9 million or $0.05
per diluted share in 2015
Non-GAAP Financial Information and
Reconciliation
Net income and diluted earnings per share as adjusted and set
forth below are non-GAAP (other than generally accepted accounting
principles) financial measures presented as supplemental
disclosures to their individual corresponding GAAP basis amounts.
The following schedule reconciles those non-GAAP financial measures
to their most directly comparable information presented using GAAP,
all net of taxes. Management believes such non-GAAP information is
useful and meaningful to investors and helps in understanding,
using and comparing the Company’s operating results.
Management uses the non-GAAP information to assess the Company’s
operations for the periods presented, analyze performance trends
and make decisions regarding future operations because it believes
this separate information better reflects ongoing operating
results. This non-GAAP financial information is not intended to be
considered independent of or a substitute for results prepared in
accordance with GAAP. This non-GAAP financial information may not
be comparable to similarly titled measures used by other entities
and should not be considered as alternatives to net income or loss,
or diluted earnings or loss per share, determined in accordance
with GAAP. Individual quarterly per share amounts may not be
additive due to rounding. Amounts below are in thousands except per
share amounts.
Three Months Ended March 31: 2016 2015 Net income
(loss) using GAAP $ 861 $ (4,399 ) Loss on early debt redemption
and refinancing -- 5,266 Interim interest expense --
1,062 Non-GAAP net income $ 861
$ 1,929 Consolidated diluted earnings (loss) per
share using GAAP $ 0.02 $ (0.11 ) Loss on early debt redemption and
refinancing -- 0.13 Interim interest expense --
0.03 Non-GAAP diluted earnings per share $
0.02 $ 0.05
Significant 2016 First Quarter Racing
Events
- Atlanta Motor Speedway - NASCAR Folds
of Honor QuikTrip 500 Sprint Cup, Heads Up Georgia 250 Xfinity and
Great Clips 200 Camping World Truck Series racing events
- Las Vegas Motor Speedway - NASCAR
Kobalt 400 Sprint Cup and Boyd Gaming 300 Xfinity Series racing
events
2016 Earnings Guidance
The Company reaffirmed that first quarter 2016 results are
consistent with its previous full year 2016 earnings guidance of
$0.90-$1.10 per diluted share, excluding non-recurring and other
special items. The range of earnings guidance reflects the
continuing negative impact of uncertain economic conditions, among
other factors. Potential higher fuel, health-care and food costs,
and continued underemployment could significantly impact our future
results.
Dividends and Stock Repurchase
Program
On February 17, 2016, the Company’s Board of Directors declared
a quarterly cash dividend of $0.15 per share of common stock
aggregating approximately $6.2 million, which was paid on March 18,
2016 to shareholders of record as of March 1, 2016. On April 19,
2016, the Company’s Board of Directors declared a quarterly cash
dividend of $0.15 per share of common stock aggregating
approximately $6.2 million payable on June 6, 2016 to shareholders
of record as of May 16, 2016. The Board of Directors plans to
continue to evaluate cash dividends on a quarterly basis in the
future.
During the first quarter 2016, the Company repurchased 61,000
shares of common stock for approximately $1.1 million under its
stock repurchase program. As of March 31, 2016, the total number of
shares available for future repurchase as currently authorized is
633,000.
Comments
“SMI’s first quarter 2016 results were within our expectations,
notwithstanding the ‘unusual’ poor weather surrounding our NASCAR
Sprint Cup race at Las Vegas Motor Speedway,” stated Marcus G.
Smith, Chief Executive Officer and President of Speedway
Motorsports. “Our year-over-year revenues and results reflect
moving one of Charlotte Motor Speedway’s major NHRA racing events
to the second quarter of 2016, currency exchange rates that
continue to negatively impact sales to our Canadian customers, and
declines in certain non-core revenues. Many of our event related
revenue categories are reflecting stabilizing or improving trends,
particularly track rental, driving school and radio broadcasting
revenues. Most of our 2016 NASCAR event sponsorships, and many for
2017 and beyond, are already sold and interest in our promotional
activities and facilities use is growing. Notwithstanding lower gas
prices, the improving economy has not reached many of our core and
targeted fans. Many continue to struggle with underemployment and
increased costs for basic necessities. As such, SMI has lowered or
maintained reduced ticket and food and beverage concession prices
for many of our 2016 events.
“NASCAR’s ongoing improvements to our sport are clearly paying
off with increased racing competition, fan entertainment and
appeal. The media coverage and event broadcasting by NBC Sports
Group and FOX Sports Media Group has been outstanding, and just
keeps getting better and better. SMI, NASCAR and the broadcasting
powerhouses are working harder than ever, individually and
collectively, to win over younger and first-time fans, families and
our sport’s largely untapped demographic markets. We strongly
believe that SMI’s steadfast commitment to delivering unsurpassed
motorsports entertainment and value, along with these combined
efforts to capture the next generation of race fans, provide us
with strong prospects for renewed growth and profitability.”
O. Bruton Smith, Executive Chairman of Speedway Motorsports
stated, “SMI is well positioned for long-term growth. We continue
to successfully execute our strategic initiatives, including
ongoing debt reduction and restrained capital spending. We have
very substantial long-term contracted revenue streams such as the
ten-year NASCAR broadcasting agreements through 2024, and many
multi-year sponsorship and other marketing agreements. SMI’s
management team continues our enduring history of innovating
marketing and industry firsts. We now have three of the world’s
largest high-definition video boards at our Bristol, Charlotte and
Texas Motor Speedways, are installing new higher-end leader boards
at several of our speedways, and are nearing completion of
installing new distributed antenna systems for high-speed wireless
performance and connectivity options at all of our speedways. Our
focus is providing our fans with entertainment and high-end
customer service choices that cannot be duplicated at home or other
venues, all for their highest possible enjoyment and value.”
Speedway Motorsports is a leading marketer and promoter of
motorsports entertainment in the United States. The Company,
through its subsidiaries, owns and operates the following premier
facilities: Atlanta Motor Speedway, Bristol Motor Speedway,
Charlotte Motor Speedway, Kentucky Speedway, Las Vegas Motor
Speedway, New Hampshire Motor Speedway, Sonoma Raceway 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 US Legend Cars International subsidiary; and produces and
broadcasts syndicated motorsports programming to radio stations
nationwide through its Performance Racing Network subsidiary. For
more information, visit the Company's website at
www.speedwaymotorsports.com.
This news release contains forward-looking statements,
particularly statements with regard to our future operations and
financial results. There are many factors that affect future events
and trends of our business including, but not limited to, economic
factors, weather, the success of NASCAR and others as sanctioning
bodies, capital projects and expansion, financing needs, income
taxes and a host of other factors both within and outside of
management control. These factors and other factors, including
those contained in our 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
webcast today at 10:00 AM (ET) open to the public. To participate
in the conference call, you may dial 877-201-0168 (US / Canada /
toll-free) or 647-788-4901 (international). The reference number is
97140045. A webcast of the call can be accessed at the Company's
website at www.speedwaymotorsports.com under “Investors”.
Participating in the call will be Marcus G. Smith, Chief Executive
Officer and President, and William R. Brooks, Vice Chairman, Chief
Financial Officer and Treasurer.
Speedway Motorsports, Inc. and Subsidiaries
Selected Financial Data - Unaudited For The Three Months
Ended March 31, 2016 and 2015 (In thousands except per share
amounts) Three Months Ended
STATEMENT OF OPERATIONS DATA
3/31/2016 3/31/2015
Revenues: Admissions $15,439 $18,752 Event related revenue 21,730
22,270 NASCAR broadcasting revenue 37,447 36,319 Other operating
revenue 8,560 7,933 Total
Revenues 83,176 85,274 Expenses
and Other: Direct expense of events 13,060 14,870 NASCAR event
management fees 22,298 21,619 Other direct operating expense 5,589
4,838 General and administrative 24,074 23,091 Depreciation and
amortization 13,371 13,335 Interest expense, net 3,339 6,257 Loss
on early debt redemption and refinancing - 8,372 Other expense
(income), net 68 (390) Total
Expenses and Other 81,799 91,992
Income (Loss) Before Income Taxes 1,377 (6,718) (Provision) Benefit
for Income Taxes (516) 2,319 Net
Income (Loss) $861 ($4,399)
Basic Earnings (Loss) Per Share $0.02 ($0.11) Weighted
average shares outstanding 41,227 41,338 Diluted Earnings
(Loss) Per Share $0.02 ($0.11) Weighted average shares outstanding
41,244 41,376 Major NASCAR-sanctioned Events Held During
Period 4 4 Certain Race Schedule Changes: • Charlotte Motor
Speedway held one major National Hot Rod Association racing event
in the first quarter 2015 that is being held in the second quarter
2016 • Poor weather resulted in delaying the start of the NASCAR
Sprint Cup race held at Las Vegas Motor Speedway in the first
quarter 2016
BALANCE SHEET DATA
3/31/2016 12/31/2015 Cash and
cash equivalents $79,273 $82,010 Total current assets 156,867
142,886 Property and equipment, net 1,028,192 1,019,650 Goodwill
and other intangible assets, net 345,736 345,736 Total assets
1,561,487 1,539,197 Deferred race event and other income,
net 92,306 57,549 Total current liabilities 138,770 108,369 Credit
facility borrowings (all term loan) 118,000 120,000 Total long-term
debt 319,206 321,383 Total liabilities 782,894 754,357 Total
stockholders' equity 778,593 784,840
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version on businesswire.com: http://www.businesswire.com/news/home/20160427005341/en/
Speedway Motorsports, Inc.Janet Kirkley, 704-532-3318
Speedway Motorsports (NYSE:TRK)
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