NYSE: TRK +0.25 ( +1.38% ) Volume: 21,341
May 24, 2019

Speedway Motorsports Reports Results for the Fourth Quarter and Year Ended December 31, 2001 and Provides Additional Guidance on 2002 Operating Results

02/12/2002

CONCORD, N.C., Feb. 12 /PRNewswire-FirstCall/ -- Speedway Motorsports, Inc. (NYSE: TRK) today reported record revenues and earnings for 2001. Total revenues for the fourth quarter increased 5% or $4.2 million to $80.9 million compared to last year. Net income increased 8% or $542,000 to $7.7 million, and diluted earnings per share increased $0.01 or 6% to $0.18 exceeding revised expectations, excluding current quarter non-recurring pre-tax income of $4.8 million, $2.9 million net of tax or $0.07 per diluted share, related to settlement of a cancelled Championship Auto Racing Teams (CART) race at Texas Motor Speedway. Including such non-recurring income, fourth quarter 2001 net income increased $3.5 million or 49% to $10.6 million and diluted earnings per share increased $0.08 or 47% to $0.25.

For the year ended December 31, 2001, total revenues increased 6% or $22.4 million to $376.7 million, net income increased 23% or $10.7 million to $57.6 million, and diluted earnings per share increased 22% or $0.24 to $1.34, compared to last year. Excluding non-recurring amounts in fiscal 2001 and 2000, and the cumulative effect of an accounting change in 2000, full year net income increased 13% or $6.7 million and diluted earnings per share increased 13% or $0.15. Fiscal year 2001 results reflect non-recurring pre-tax income of $1.4 million, $826,000 net of tax or $0.02 per diluted share, related to the CART settlement net of associated race expenses reported in the second quarter 2001. Fiscal year 2000 results reflect a non-recurring pre-tax charge of $3.2 million, $1.9 million net of tax or $0.04 per diluted share, related to the resolution of concession contract rights at Sears Point Raceway. The accounting change affected revenue recognition for Speedway Club membership fees and reduced net income by $1.3 million and diluted earnings per share by $0.03 in fiscal 2000.

In the fourth quarter, Lowe's Motor Speedway hosted the UAW-GM Quality 500 NASCAR Winston Cup Series and Little Trees 300 NASCAR Busch Series racing events, and Atlanta Motor Speedway hosted the season finale NAPA 500 NASCAR Winston Cup Series and companion PORK - The Other White Meat ARCA Series 400 racing events. Also, Texas Motor Speedway hosted the NASCAR Craftsman Truck Series Silverado 350 and Indy Racing Northern Light Series (IRL) Chevy 500 racing events rescheduled from the third quarter following the September 11, 2001 incidents.

"The fourth quarter turned out well despite our racing events being hosted under a combination of circumstances never before encountered," stated H.A. "Humpy" Wheeler, chief operating officer and president of Speedway Motorsports. Attendance and corporate spending were negatively impacted by public concerns over additional incidents, air travel, and difficult economic conditions, as well as the substantial lead by Jeff Gordon in the Winston Cup Series championship points race. Despite these challenges, we continue to report consecutive year-over-year revenue and operating growth. These results prove to us that our traditional core fan base remains solid."

"We, like most, are glad to have 2001 behind us, and are looking forward to 2002 with more enthusiasm and determination than ever," stated O. Bruton Smith, chairman and chief executive officer of Speedway Motorsports. "We are extremely excited about showcasing our newly-modernized and expanded Sears Point Raceway and beginning our partnership with Levy Restaurants, the market leader in premium foodservice at sports and entertainment facilities. The 38% year-over-year growth in Winston Cup television ratings, along with a 36% increase in the number of households, clearly demonstrate that the ongoing strength of motorsports racing is attracting ever-larger and widening demographic audiences. We are well positioned for the inevitable future upturn in economic conditions and to capitalize on the industry's next growth cycle."

"Challenging economic conditions and air travel concerns continue to affect near-term consumer and corporate spending sentiment and earnings visibility," stated William R. Brooks, chief financial officer of Speedway Motorsports. "Assuming current industry and economic trends continue, the Company estimates 2002 total revenues of $360-$380 million, net income of $59-$62 million, depreciation and interest of $60-$65 million and diluted earnings per share of $1.40-$1.45. Our estimates of 2002 quarterly diluted earnings per share range from $0.36-$0.40 in the first quarter, $0.77-$0.81 in the second quarter, $0.00-$0.04 in the third quarter, and $0.16-$0.20 in the fourth quarter. Full year revenue estimates reflect the recently announced long-term food and beverage agreement with Levy Restaurants and Compass Group assuming the contract closes as scheduled in the first quarter of 2002."

The Company is adopting Statement of Financial Accounting Standards (SFAS) No. 142 "Goodwill and Other Intangible Assets" as of January 1, 2002. The estimated 2002 results above reflect the effects of eliminating goodwill amortization of approximately $1.5 million or $0.02 per diluted share in adopting SFAS No. 142. The Company continues to assess the effects of SFAS No. 142, and has until June 30, 2002 to assess initial goodwill impairment under transitional rules. The estimated 2002 results do not reflect non-recurring charges, if any, resulting from such assessment. The potential exists that approximately $5 million of goodwill associated with certain non-motorsports related reporting units of the Company, that were not considered impaired under previous accounting standards, could be considered impaired under the new accounting guidelines. Initial impairment, if any, would be reported as a non-cash cumulative effect of a change in accounting principle.

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, Lowe's Motor Speedway at Charlotte, Las Vegas Motor Speedway, Sears Point Raceway and Texas Motor Speedway. The Company provides event food, beverage, and souvenir merchandising services through its Finish Line Events subsidiary, and manufactures and distributes smaller-scale, modified racing cars through its 600 Racing subsidiary. The Company also owns Performance Racing Network which broadcasts syndicated motorsports programming to over 750 stations nationwide. For more information, visit the Company's Website at www.gospeedway.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, the success of expense reduction efforts, and economic conditions. These factors and other factors, including those contained in Exhibit 99.1 to the Company's Annual Report on Form 10-K, 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 today at 11:00 a.m. ET. The call is open to all participants. Please dial (800) 447-0521 to connect to the call. The reservation number is 5277677. Participating in the call will be H.A. Wheeler, Chief Operating Officer and President; William R. Brooks, Chief Financial Officer; and Marylaurel E. Wilks, Vice President, Communications and General Counsel.

    Speedway Motorsports, Inc. and Subsidiaries
    Selected Financial Data - Unaudited
    For The Three and Twelve Months Ended December 31, 2001 and 2000
    (In thousands except per share amounts)

                                            Three Months      Twelve Months
                                               Ended              Ended

    INCOME STATEMENT DATA         12/31/2001 12/31/2000 12/31/2001 12/31/2000
    REVENUES:
      Admissions                     $26,476    $29,683   $136,362   $142,160
      Event related revenue           44,373     33,566    201,520    163,634
      Other operating revenue         10,040     13,465     38,796     48,503
         Total Revenues               80,889     76,714    376,678    354,297
    EXPENSES AND OTHER:
      Direct expense of events        27,066     25,153    131,801    117,229
      Other direct operating expenses 10,953     13,358     36,292     44,432
      General and administrative      15,827     14,331     60,313     53,794
      Depreciation and amortization    8,536      7,576     33,182     31,192
      Interest expense, net            5,745      6,602     24,382     26,973
      Cancelled CART race
       settlement, net                (4,830)        --     (1,361)        --
      Concession contract rights
       resolution                         --         48         --      3,185
      Other income, net                  134       (910)    (2,864)    (1,740)
         Total Expenses and Other     63,431     66,158    281,745    275,065
    Income Before Income Taxes and
     Cumulative Effect of
       Accounting Change              17,458     10,556     94,933     79,232
    Income Tax Provision               6,858      3,459     37,341     31,100
    Income Before Cumulative Effect of
     Accounting Change                10,600      7,097     57,592     48,132
    Cumulative Effect of Accounting
     Change for Club
       Membership Fees                    --         --         --     (1,257)
    NET INCOME                       $10,600     $7,097    $57,592    $46,875

    Basic Earnings Per Share:
       Before Cumulative Effect of
        Accounting Change              $0.25      $0.17      $1.38      $1.16
       Accounting Change                  --         --         --      (0.03)
       Basic Earnings Per Share        $0.25      $0.17      $1.38      $1.13
       Weighted average shares
        outstanding                   41,770     41,680     41,753     41,663

    Diluted Earnings Per Share:
       Before Cumulative Effect of
        Accounting Change              $0.25      $0.17      $1.34      $1.13
       Accounting Change                  --         --         --      (0.03)
       Diluted Earnings Per Share      $0.25      $0.17      $1.34      $1.10
       Weighted average shares
        outstanding                   44,249     44,559     44,374     44,715

    Note: The Company changed its revenue recognition policies for Speedway
          Club membership fees in 2000. As discussed in the Company's Annual
          Report on Form 10-K for fiscal 2000, the operating results for the
          twelve months ended December 31, 2000 reflect the cumulative effect
          of the accounting change as of January 1, 2000.


    Speedway Motorsports, Inc. and Subsidiaries
    Selected Financial Data - Unaudited
    As of December 31, 2001 and 2000
    (In thousands)

                                                 Consolidated
    BALANCE SHEET DATA                             12/31/01          12/31/00

    Cash and cash equivalents                       $93,980           $30,737
    Total current assets                            148,132            83,303
    Property and equipment, net                     813,154           798,481
    Goodwill and other intangible assets, net        56,742            59,105
    Total assets                                  1,063,578           991,957

    Current liabilities                             106,054           105,183
    Revolving credit facility borrowings             90,000            90,000
    Deferred race event income, net                  71,578            72,052
    Senior and convertible subordinated
     long-term debt                                 306,061           318,788
    Total long-term debt                            397,313           410,097
    Total liabilities                               624,689           612,616
    Total stockholders' equity                     $438,889          $379,341


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SOURCE Speedway Motorsports, Inc.
Web site: http: //www.speedwaymotorsports.com http://www.gospeedway.com
CONTACT: Lauri Wilks of Speedway Motorsports, Inc., +1-704-455-3239

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