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| 8-K - DOVER MOTORSPORTS INC--FORM 8-K - DOVER MOTORSPORTS INC | d763202d8k.htm |
Exhibit 99.1
| FOR IMMEDIATE RELEASE | For further information, call: | |||
| Timothy R. Horne – Sr. Vice President - Finance | ||||
| Dover, Delaware, July 24, 2014 | (302) 857-3292 |
DOVER MOTORSPORTS, INC.
REPORTS RESULTS FOR THE SECOND QUARTER OF 2014
Dover Motorsports, Inc. (NYSE: DVD) today reported results for the three months ended June 30, 2014.
The Company promoted a NASCAR triple-header and hosted the Firefly Music Festival in Dover during the second quarter of 2014 and 2013. The Company leases a portion of its Dover facility to the promoter, provides logistical assistance and handles certain concessions for which the Company retains a certain percent of the gross sales.
Revenues for the second quarter of 2014 were $24,273,000 compared with $24,465,000 in the second quarter of 2013. The decrease in revenues was primarily due to lower motorsports admissions and event-related revenue, partially offset by the contracted increase in broadcasting revenue for the Dover NASCAR weekend and by slightly higher revenue from the Firefly Music Festival.
Operating and marketing expenses were $13,268,000 in the second quarter of 2014 compared to $13,123,000 in the second quarter of 2013. The increase was primarily due to the scheduled increase in purse and sanction fees and increased promotion and security costs for the Dover NASCAR weekend.
General and administrative expenses decreased to $1,776,000 in the second quarter of 2014 from $1,839,000 in the second quarter of 2013.
Net interest expense decreased to $99,000 in the second quarter of 2014 from $275,000 for the second quarter of 2013. The decrease was due to lower interest rates, lower outstanding borrowings and lower fees.
Earnings before income tax expense for the second quarter of 2014 were $8,256,000 compared with $8,391,000 in the second quarter of 2013.
Net earnings for the second quarter of 2014 were $4,844,000 or $0.13 per diluted share compared to $4,903,000 or $0.13 per diluted share for the second quarter of 2013.
At June 30, 2014, the Company’s total indebtedness was $16,920,000 compared with $23,180,000 at June 30, 2013.
As previously announced, the Company entered into an agreement on May 28, 2014 with NeXovation, Inc. to sell its Nashville Superspeedway facility. The agreement provides for an aggregate purchase price of $27 million in cash plus the assumption by NeXovation, Inc. of the Company’s obligations under certain Variable Rate Tax Exempt Infrastructure Revenue Bonds issued by the Sports Authority of the County of Wilson, Tennessee. The transaction is expected to close during the third quarter and is subject to customary closing conditions.
The Company’s balance sheet includes a $1,835,000 contingent obligation related to the bonds noted above which will be reversed upon the closing of the transaction resulting in an increase in our pre-tax earnings by the amount of the contingent obligation at the date of closing.
* * *
This release contains or may contain forward-looking statements based on management’s beliefs and assumptions. Such statements are subject to various risks and uncertainties which could cause results to vary materially. Please refer to the Company’s SEC filings for a discussion of such factors.
Dover Motorsports, Inc. is a leading promoter of NASCAR sanctioned and other motorsports events in the United States whose subsidiaries own and operate Dover International Speedway in Dover, Delaware and Nashville Superspeedway near Nashville, Tennessee. For further information, log on to dovermotorsports.com.
DOVER MOTORSPORTS, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
In Thousands, Except Per Share Amounts
(Unaudited)
| Three Months Ended June 30, |
Six Months Ended June 30, |
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| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| Revenues: |
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| Admissions |
$ | 4,473 | $ | 4,864 | $ | 4,473 | $ | 4,864 | ||||||||
| Event-related |
4,194 | 4,531 | 4,367 | 4,640 | ||||||||||||
| Broadcasting |
15,606 | 15,066 | 15,606 | 15,066 | ||||||||||||
| Other |
- | 4 | 10 | 11 | ||||||||||||
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| 24,273 | 24,465 | 24,456 | 24,581 | |||||||||||||
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| Expenses: |
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| Operating and marketing |
13,268 | 13,123 | 14,303 | 14,177 | ||||||||||||
| General and administrative |
1,776 | 1,839 | 3,636 | 3,750 | ||||||||||||
| Depreciation |
818 | 824 | 1,643 | 1,649 | ||||||||||||
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| 15,862 | 15,786 | 19,582 | 19,576 | |||||||||||||
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| Operating earnings |
8,411 | 8,679 | 4,874 | 5,005 | ||||||||||||
| Interest expense, net |
(99 | ) | (275 | ) | (264 | ) | (550 | ) | ||||||||
| (Provision) benefit for contingent obligation |
(70 | ) | (19 | ) | 8 | 3 | ||||||||||
| Other income |
14 | 6 | 17 | 145 | ||||||||||||
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| Earnings before income taxes |
8,256 | 8,391 | 4,635 | 4,603 | ||||||||||||
| Income tax expense |
(3,412 | ) | (3,488 | ) | (1,909 | ) | (1,979 | ) | ||||||||
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| Net earnings |
$ | 4,844 | $ | 4,903 | $ | 2,726 | $ | 2,624 | ||||||||
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| Net earnings per common share: |
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| Basic |
$ | 0.13 | $ | 0.13 | $ | 0.07 | $ | 0.07 | ||||||||
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| Diluted |
$ | 0.13 | $ | 0.13 | $ | 0.07 | $ | 0.07 | ||||||||
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| Weighted average shares outstanding: |
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| Basic |
36,042 | 36,373 | 36,052 | 36,385 | ||||||||||||
| Diluted |
36,042 | 36,373 | 36,052 | 36,385 | ||||||||||||
DOVER MOTORSPORTS, INC.
CONSOLIDATED BALANCE SHEETS
In Thousands
(Unaudited)
| June 30, 2014 |
June 30, 2013 |
December 31, 2013 |
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| ASSETS |
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| Current assets: |
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| Cash |
$ | 49 | $ | 16 | $ | 4 | ||||||
| Accounts receivable |
11,930 | 12,430 | 28 | |||||||||
| Inventories |
117 | 183 | 114 | |||||||||
| Prepaid expenses and other |
1,070 | 1,138 | 1,050 | |||||||||
| Receivable from Dover Downs Gaming & Entertainment, Inc. |
- | 57 | 4 | |||||||||
| Prepaid income taxes |
- | - | 22 | |||||||||
| Deferred income taxes |
87 | 83 | 76 | |||||||||
| Assets held for sale |
26,000 | - | - | |||||||||
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| Total current assets |
39,253 | 13,907 | 1,298 | |||||||||
| Property and equipment, net |
58,270 | 91,454 | 85,591 | |||||||||
| Other assets |
945 | 826 | 919 | |||||||||
| Deferred income taxes |
310 | 464 | 336 | |||||||||
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| Total assets |
$ | 98,778 | $ | 106,651 | $ | 88,144 | ||||||
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| LIABILITIES AND STOCKHOLDERS’ EQUITY |
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| Current liabilities: |
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| Accounts payable |
$ | 458 | $ | 284 | $ | 25 | ||||||
| Accrued liabilities |
4,733 | 3,918 | 2,887 | |||||||||
| Payable to Dover Downs Gaming & Entertainment, Inc. |
39 | - | - | |||||||||
| Income taxes payable |
1,328 | 377 | - | |||||||||
| Deferred revenue |
4,035 | 4,976 | 1,743 | |||||||||
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| Total current liabilities |
10,593 | 9,555 | 4,655 | |||||||||
| Revolving line of credit |
16,920 | 23,180 | 14,820 | |||||||||
| Liability for pension benefits |
1,414 | 2,988 | 1,521 | |||||||||
| Provision for contingent obligation |
1,835 | 1,931 | 1,843 | |||||||||
| Deferred income taxes |
16,835 | 18,309 | 16,926 | |||||||||
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| Total liabilities |
47,597 | 55,963 | 39,765 | |||||||||
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| Stockholders’ equity: |
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| Common stock |
1,812 | 1,840 | 1,802 | |||||||||
| Class A common stock |
1,851 | 1,851 | 1,851 | |||||||||
| Additional paid-in capital |
101,394 | 102,094 | 101,362 | |||||||||
| Accumulated deficit |
(52,337 | ) | (52,632 | ) | (55,063 | ) | ||||||
| Accumulated other comprehensive loss |
(1,539 | ) | (2,465 | ) | (1,573 | ) | ||||||
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| Total stockholders’ equity |
51,181 | 50,688 | 48,379 | |||||||||
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| Total liabilities and stockholders’ equity |
$ | 98,778 | $ | 106,651 | $ | 88,144 | ||||||
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DOVER MOTORSPORTS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
In Thousands
(Unaudited)
| Six Months Ended June 30, |
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| 2014 | 2013 | |||||||
| Operating activities: |
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| Net earnings |
$ | 2,726 | $ | 2,624 | ||||
| Adjustments to reconcile net earnings to net cash used in operating activities: |
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| Depreciation |
1,643 | 1,649 | ||||||
| Amortization of credit facility fees |
48 | 121 | ||||||
| Stock-based compensation |
164 | 166 | ||||||
| Deferred income taxes |
(93 | ) | 1,024 | |||||
| Benefit for contingent obligation |
(8 | ) | (3 | ) | ||||
| Gain on sale of property and equipment |
- | (138 | ) | |||||
| Changes in assets and liabilities: |
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| Accounts receivable |
(11,902 | ) | (12,206 | ) | ||||
| Inventories |
(3 | ) | (59 | ) | ||||
| Prepaid expenses and other |
(64 | ) | (103 | ) | ||||
| Accounts payable |
433 | 139 | ||||||
| Accrued liabilities |
1,846 | 1,015 | ||||||
| Payable to/receivable from Dover Downs Gaming & Entertainment, Inc. |
43 | (57 | ) | |||||
| Income taxes payable/prepaid income taxes |
1,351 | 429 | ||||||
| Deferred revenue |
2,292 | 2,257 | ||||||
| Other liabilities |
(77 | ) | (30 | ) | ||||
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| Net cash used in operating activities |
(1,601 | ) | (3,172 | ) | ||||
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| Investing activities: |
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| Capital expenditures |
(322 | ) | (207 | ) | ||||
| Proceeds from sale of property and equipment |
- | 138 | ||||||
| Purchases of available-for-sale securities |
(45 | ) | (38 | ) | ||||
| Proceeds from sale of available-for-sale securities |
42 | 34 | ||||||
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| Net cash used in investing activities |
(325 | ) | (73 | ) | ||||
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| Financing activities: |
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| Borrowings from revolving line of credit |
16,540 | 14,180 | ||||||
| Repayments on revolving line of credit |
(14,440 | ) | (10,700 | ) | ||||
| Repurchase of common stock |
(129 | ) | (234 | ) | ||||
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| Net cash provided by financing activities |
1,971 | 3,246 | ||||||
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| Net increase in cash |
45 | 1 | ||||||
| Cash, beginning of period |
4 | 15 | ||||||
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| Cash, end of period |
$ | 49 | $ | 16 | ||||
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