Canterbury Park Holding Corporation (NASDAQ:CPHC) today
announced results for the third quarter and nine months ended
September 30, 2011.
Canterbury Park Holding Corporation (the “Company”) reported net
income of $230,132 on revenues of $10,917,762 for the three months
ended September 30, 2011, compared to a net loss of $132,875 on
revenues of $12,011,366 for the same period in 2010. For the nine
months ended September 30, 2011, net income was $92,631 on revenues
of $30,891,092 compared to a net loss of $1,153,485 on revenues of
$31,253,858 for the same nine-month period in 2010. Diluted
earnings per share for the 2011 third quarter were $.06 compared to
a diluted loss per share of $.03 for the third quarter of 2010, and
diluted earnings per share for the nine months ended September 30,
2011 were $.02 compared to a diluted loss per share of $.29 for the
same nine month period in 2010. The Company’s net loss and diluted
loss per share in the 2010 nine month period reflect a non-cash
expense of $906,940 related to disposal of assets in connection
with the renovation of the Company’s card room in 2010.
For the 2011 third quarter, we recorded a tax benefit of
$528,489 against our pre-tax loss of $298,357 because of a revision
to our expected income for 2011. For the nine months ended
September 30, 2011, our tax expense of $222,511 against our pre-tax
income of $315,142 reflects a tax rate greater than the statutory
tax rate because the significant lobbying expenses we incur in our
efforts to gain legislative approval for a Racino at Canterbury
Park are not deductible for tax purposes.
Net revenues declined 9.1% in the 2011 third quarter compared to
the same period in 2010 primarily due to the suspension of our
operations from July 1 to July 20 because a political deadlock at
that time delayed enactment of a budget for the State of Minnesota
and closed the state agency that regulates our operations.
Primarily for this reason, we experienced a decrease of 7.7% in
Card Casino revenues and a 16.9% percent decrease in pari-mutuel
revenues when compared to the 2010 third quarter. Net revenues for
the nine months ended September 30, 2011 were also impacted by the
suspension of operations in July which declined 1.2% as compared to
the same period in 2010. This overall decrease reflected a 9.5%
decrease in pari-mutuel revenues when compared to the 2010 nine
month period, which was offset somewhat by a 2.3% increase in card
casino revenues when compared to the 2010 nine month period.
Operating expenses decreased in both the third quarter and nine
month periods, decreasing $942,130, or 7.7%, and $2,147,995, or
6.6%, as compared to respective periods in 2010. Further results
for the third quarter and first nine months of 2011 are presented
in the accompanying table, and additional information regarding the
Company’s financial results will be provided in the Company’s Form
10-Q Report that will be filed on November 14, 2011 with the
Securities and Exchange Commission.
Randy Sampson, Canterbury Park’s President and CEO commented:
“As expected, Canterbury Park’s third quarter and nine month
results were severely impacted by the government imposed suspension
of our operations from July 1 to July 20, 2011. The shutdown was
the result of an impasse that delayed the enactment of a budget for
the State of Minnesota and forced a partial shutdown of state
government.”
Mr. Sampson continued: “Because the shutdown occurred during the
heart of our live racing season, we estimate that Canterbury Park
lost as much as $1 million in revenue each week. While it’s
impossible to determine the full effect of the shutdown, we do know
that the financial impact was significant as the pre-tax loss of
nearly $300,000 was the worst third quarter for Canterbury since
our card room opened in 2000.”
Sampson added: “I would like to express my appreciation to our
loyal employees, horsemen, and others who supported us during this
difficult period. In addition, we were able to reschedule several
race days by extending the live meet through September 11, and
finished the 2011 meet with strong fan support, achieving record
average daily attendance of 6,143.”
“We also continue to be encouraged by strong business in our
remodeled Card Casino, and are particularly enthusiastic about
growth in our table games revenues. Bolstered by our strong balance
sheet and positive cash flow, we have the resources to sustain us
as we endeavor to grow our revenues and improve profitability.”
Sampson concluded: “Due to the challenges faced by Canterbury
Park under our current business model, we will continue to advocate
for Racino legislation that would authorize slot machines at the
Racetrack. Studies have shown that a Racino would generate much
needed revenues for the State of Minnesota, while creating a
significant number of jobs in the racing, hospitality, and equine
industries. A Racino would also enable Minnesota’s horse racing
industry, which already employs several thousand individuals, to
remain competitive and viable. While we incurred substantial
expense in lobbying for a Racino this year without positive results
at the Legislature, we believe these efforts have increased support
for a Racino at Canterbury Park, both among the public and
lawmakers in St. Paul. We will, therefore, continue to vigorously
pursue adoption of Racino legislation at the earliest possible
time.”
About Canterbury Park:Canterbury Park Holding Corporation
owns and operates Canterbury Park Racetrack, Minnesota’s only
thoroughbred and quarter horse racing facility. The Company’s 2011
live race meet began on May 20th and ended September 11th. 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: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 that could cause results to vary materially. Please
refer to the Company’s SEC filings for a discussion of such
factors.
NOTE: Financial summary on following page.
CANTERBURY PARK
HOLDING CORPORATION’S
SUMMARY OF
OPERATING RESULTS
(UNAUDITED)
Three Months Three Months
Nine Months Nine Months Ended Ended Ended
Ended Sept. 30, 2011 Sept. 30, 2010
Sept. 30, 2011 Sept. 30, 2010 Operating
Revenues, (net) $10,917,762 $12,011,366 $30,891,092 $31,253,858
Operating Expenses $11,217,248 $12,159,378 $30,579,109
$32,727,104 Non-Operating Income, (net) $1,129 $8,437 $3,159
$12,861 (Loss) Income before Income Tax Benefit (Expense)
($298,357
)
($139,575
)
$315,142
($1,460,385
)
Income Tax Benefit (Expense) $528,489 $6,700 ($222,511 )
$306,900 Net Income (Loss) $230,132 ($132,875 ) $92,631
($1,153,485 ) Basic Net Income (Loss) Per Common Share
$0.06
($0.03
)
$0.02
($0.29
)
Diluted Net Income (Loss) Per Common Share
$0.06
($0.03
)
$0.02
($0.29
)
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