DVD Dover Motorsports Inc

Dover Motorsports, Inc. (NYSE: DVD) today reported results for the three months ended September 30, 2017.

Our fall NASCAR event weekend, which consists of a K&N Pro Series East event, an XFINITY Series event, and a Monster Energy Cup Series event was held on September 29, 2017 to October 1, 2017 and September 30, 2016 to October 2 in 2016. As a result, the XFINITY Series event was held during the third quarter of 2017 and the fourth quarter of 2016.

Revenues for the third quarter of 2017 were $2,740,000 compared with $369,000 in the third quarter of 2016. Operating and marketing expenses were $3,485,000 in the third quarter of 2017 compared to $1,387,000 in the third quarter of 2016. Both increases were primarily from the timing of the XFINITY Series races previously mentioned.

General and administrative expenses of $1,770,000 in the third quarter of 2017 were comparable to $1,799,000 in the third quarter of 2016.

Depreciation expense increased to $863,000 in the third quarter of 2017 compared to $828,000 in the third quarter of 2016.

Net interest expense of $34,000 in the third quarter of 2017 was comparable to $41,000 in the third quarter of 2016.

Loss before income taxes for the third quarter of 2017 was ($3,396,000) compared to ($3,679,000) in the third quarter of 2016.

Net loss for the third quarter of 2017 was ($2,015,000) or ($0.06) per diluted share compared to ($2,167,000) or ($0.06) per diluted share for the third quarter of 2016.

At September 30, 2017, the Company’s total indebtedness was $5,880,000 compared with $8,060,000 at September 30, 2016.

On August 17, 2017, we entered into an agreement with an entity owned by Panattoni Development Company, an international commercial real estate development company, relative to the sale of approximately 150 acres at our Nashville Superspeedway at a purchase price of $35,000 per acre. Closing under this agreement is scheduled to occur by the end of the year, subject to extension if certain milestones have been met (which could delay closing until the first quarter of 2018). Additionally, we granted the prospective buyer a three-year option on an additional 87 acres at $55,000 per acre. We will continue with our effort to sell the approximately 1,150 acres of Nashville Superspeedway property that would remain after these transactions.

The Company announced yesterday that its Board of Directors declared an annual cash dividend on both classes of common stock of $.08 per share. The dividend will be payable on December 10, 2017 to shareholders of record at the close of business on November 10, 2017. Due to the seasonal nature of our business, we will evaluate dividends annually.

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 (LOSS) EARNINGS In Thousands, Except Per Share Amounts (Unaudited)     Three Months Ended Nine Months Ended September 30, September 30,   2017     2016     2017     2016   Revenues: Admissions $ 425 $ 82 $ 3,871 $ 3,764 Event-related 995 285 5,739 5,098 Broadcasting 1,319 - 18,824 16,890 Other   1     2     3     9     2,740     369     28,437     25,761     Expenses: Operating and marketing 3,485 1,387 18,639 16,440 General and administrative 1,770 1,799 5,561 5,573 Costs to remove long-lived assets - - 286 - Depreciation   863     828     2,507     2,591     6,118     4,014     26,993     24,604     Operating (loss) earnings (3,378 ) (3,645 ) 1,444 1,157   Interest expense, net (34 ) (41 ) (150 ) (166 ) Benefit (provision) for contingent obligation 11 (17 ) (41 ) (73 ) Other income   5     24     51     16     (Loss) earnings before income taxes (3,396 ) (3,679 ) 1,304 934   Income tax benefit (expense)   1,381     1,512     (521 )   (378 )   Net (loss) earnings $ (2,015 ) $ (2,167 ) $ 783   $ 556     Net (loss) earnings per common share: Basic $ (0.06 ) $ (0.06 ) $ 0.02   $ 0.02   Diluted $ (0.06 ) $ (0.06 ) $ 0.02   $ 0.02     Weighted average shares outstanding: Basic 36,282 36,216 36,299 36,238 Diluted 36,282 36,216 36,299 36,238           DOVER MOTORSPORTS, INC. RECONCILIATION OF GAAP (LOSS) EARNINGS BEFORE INCOME TAXES TO ADJUSTED (LOSS) EARNINGS BEFORE INCOME TAXES AND RECONCILIATION OF GAAP NET (LOSS) EARNINGS TO ADJUSTED NET (LOSS) EARNINGS In Thousands, Except Per Share Amounts (Unaudited)     Three Months Ended Nine Months Ended September 30, September 30,   2017     2016     2017     2016     GAAP (loss) earnings before income taxes $ (3,396 ) $ (3,679 ) $ 1,304 $ 934   Accelerated depreciation (1) - 25 - 184   Costs to remove long-lived assets (2)   -     -     286     -     Adjusted (loss) earnings before income taxes $ (3,396 ) $ (3,654 ) $ 1,590   $ 1,118     GAAP net (loss) earnings $ (2,015 ) $ (2,167 ) $ 783 $ 556   Accelerated depreciation, net of income taxes (1) - 15 - 109   Costs to remove long-lived assets, net of income taxes (2)   -     -     167     -     Adjusted net (loss) earnings $ (2,015 ) $ (2,152 ) $ 950   $ 665       GAAP net (loss) earnings per common share - basic and diluted $ (0.06 ) $ (0.06 ) $ 0.02 $ 0.02   Accelerated depreciation, net of income taxes (1) - - - -   Costs to remove long-lived assets, net of income taxes (2)   -     -     -     -     Adjusted net (loss) earnings per common share - basic and diluted (3) $ (0.06 ) $ (0.06 ) $ 0.03   $ 0.02  

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(1)  

During the first quarter of 2016, we began a renovation project of certain track related assets at our Dover International Speedway facility which was completed in the first quarter of 2017. As a result, we shortened the service lives of these assets which resulted in accelerated depreciation being recorded in the first nine months of 2016.

 

(2)

Costs to remove long-lived assets represents costs incurred to remove and dispose of certain grandstand seating at our Dover International Speedway facility.

 

(3)

The components of GAAP net earnings per common share for the nine months ended September 30, 2017 do not add to the adjusted net earnings per common share due to rounding.

   

The above financial information is presented using other than generally accepted accounting principles ("non-GAAP"), and is reconciled to comparable information presented using GAAP. Non-GAAP adjusted (loss) earnings before income taxes, adjusted net (loss) earnings and adjusted net (loss) earnings per common share - basic and diluted are derived by adjusting amounts determined in accordance with GAAP for the aforementioned accelerated depreciation and costs to remove long-lived assets. Income taxes are based on our approximate statutory tax rates applicable to each of these items. We believe such non-GAAP information is useful and meaningful to investors, and is used by investors and us to assess core operations. This non-GAAP financial information may not be comparable to similarly titled measures used by other entities and should not be considered as an alternative to (loss) earnings before income taxes, net (loss) earnings or net (loss) earnings per common share - basic and diluted, which are determined in accordance with GAAP.

      DOVER MOTORSPORTS, INC. CONSOLIDATED BALANCE SHEETS In Thousands (Unaudited)     September 30, September 30, December 31,   2017     2016     2016     ASSETS Current assets: Cash $ 146 $ 215 $ 1 Accounts receivable 2,420 521 419 Inventories 16 16 17 Prepaid expenses and other 4,352 5,692 1,104 Receivable from Dover Downs Gaming & Entertainment, Inc. 27 - - Prepaid income taxes 982 1,600 - Assets held for sale   2,555     2,555     2,555   Total current assets 10,498 10,599 4,096   Property and equipment, net 51,968 53,393 52,723 Nashville Superspeedway facility 23,445 23,445 23,445 Other assets   1,065     976     1,022   Total assets $ 86,976   $ 88,413   $ 81,286     LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 129 $ 574 $ 347 Accrued liabilities 3,176 2,804 2,858 Payable to Dover Downs Gaming & Entertainment, Inc. - 44 7 Income taxes payable - - 218 Deferred revenue   4,702     5,314     1,355   Total current liabilities 8,007 8,736 4,785   Revolving line of credit, net 5,880 8,060 3,840 Liability for pension benefits 3,765 3,650 4,143 Provision for contingent obligation 1,843 1,800 1,802 Deferred income taxes   12,778     13,477     12,911   Total liabilities   32,273     35,723     27,481     Stockholders' equity: Common stock 1,830 1,829 1,828 Class A common stock 1,851 1,851 1,851 Additional paid-in capital 101,887 101,806 101,858 Accumulated deficit (47,557 ) (49,745 ) (48,340 ) Accumulated other comprehensive loss   (3,308 )   (3,051 )   (3,392 ) Total stockholders' equity   54,703     52,690     53,805   Total liabilities and stockholders' equity $ 86,976   $ 88,413   $ 81,286       DOVER MOTORSPORTS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS In Thousands (Unaudited)   Nine Months Ended September 30,   2017     2016     Operating activities: Net earnings $ 783 $ 556

Adjustments to reconcile net earnings to net cash provided by operating activities:

Depreciation 2,507 2,591 Amortization of credit facility fees 48 71 Stock-based compensation 305 233 Excess tax benefits from stock-based compensation - (27 ) Deferred income taxes (272 ) (328 ) Provision for contingent obligation 41 73 Changes in assets and liabilities: Accounts receivable (2,001 ) (348 ) Inventories 1 56 Prepaid expenses and other (3,302 ) (4,567 ) Receivable from/payable to Dover Downs Gaming & Entertainment, Inc. (34 ) 88 Prepaid income taxes/income taxes payable (1,119 ) (1,594 ) Accounts payable (191 ) (82 ) Accrued liabilities 318 (411 ) Deferred revenue 3,347 4,036 Liability for pension benefits   (265 )   (48 ) Net cash provided by operating activities   166     299     Investing activities: Capital expenditures (1,779 ) (1,923 ) Purchases of available-for-sale securities (142 ) (267 ) Proceeds from sale of available-for-sale securities   134     185   Net cash used in investing activities   (1,787 )   (2,005 )   Financing activities: Borrowings from revolving line of credit 20,660 22,500 Repayments on revolving line of credit (18,620 ) (20,340 ) Repurchase of common stock (274 ) (189 ) Excess tax benefits from stock-based compensation - 27 Credit facility fees   -     (78 ) Net cash provided by financing activities   1,766     1,920     Net increase in cash 145 214 Cash, beginning of period   1     1   Cash, end of period $ 146   $ 215  

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Dover Motorsports, Inc.Timothy R. Horne – Sr. Vice President - Finance302-857-3292