International Speedway Discontinues Pursuit of Speedway Development on Staten Island; Will Explore Alternative Strategies for Pr
December 04 2006 - 4:29PM
PR Newswire (US)
~ Company Remains Committed to a Metro New York Speedway
Development ~ ~ Will Record Non-Cash, Pre-Tax Charge Of $75 - $85
Million in the Fiscal 2006 Fourth Quarter ~ DAYTONA BEACH, Fla.,
Dec. 4 /PRNewswire-FirstCall/ -- International Speedway Corporation
(NASDAQ:ISCA)(OTC:ISCB) (BULLETIN BOARD: ISCB) ("ISC") today
announced its decision to discontinue pursuit of a speedway
development on Staten Island. The Company will explore alternative
strategies for the 676- acre parcel of land it currently owns in
the borough. Strategic Rationale ISC had been evaluating the
feasibility of developing a motorsports entertainment facility on
Staten Island since late 2004. This study focused on a number of
key project components such as: - Evaluating the potential for
securing the necessary land-use change and permitting approvals; -
Analyzing the potential requirements and related costs that would
be imposed on the project as conditions of any approvals received;
- Further analyzing the potential economic model for the speedway
development, including construction and other costs; and, -
Determining the level of available public incentives for the
development. The decision to discontinue speedway development
efforts has been driven by a variety of factors, including: - The
inability to secure the critical local political support that is
necessary to secure the required land-use change approvals for a
speedway development; - Even if ISC had secured the necessary
political support, it became apparent that the Company would have
been faced with unacceptable approval requirements, including
operational restrictions that would have made the facility
difficult to operate and a significant challenge to market; - The
increased risk that these unacceptable approval requirements could
result in higher construction spending and annual operating costs,
which would have a significant negative impact on the financial
model for the speedway development. "While we are disappointed that
we could not complete the speedway development on Staten Island,
our enthusiasm for the metropolitan New York market is in no way
dampened and we continue to view the region as a prime location for
a major motorsports facility," said ISC President Lesa France
Kennedy. "We clearly believe that if we had been able to proceed
through the full public process, the significant benefits this
project represents would have generated a more positive reaction.
However, based on the results of our feasibility study,
specifically the lack of political support and unacceptable
land-use approval requirements, we have determined it is in the
best long-term interest of ISC to discontinue the Staten Island
speedway development and pursue other strategic alternatives for
the property." Alternative Strategies for Staten Island Property
The Company will immediately begin to research and develop market
demand studies to assist in the evaluation of various alternative
strategies, including potentially selling the property in whole or
in parts, or developing the property with a third party for some
other use. ISC believes the value of the property will be in excess
of $100 million once it is filled and ready for sale. Given that
the property is the largest undeveloped acreage of land in the five
boroughs of New York City, ISC believes it will be attractive to a
wide range of developers and users. The site is currently zoned
as-of-right for industrial use and could provide ease of access
through a deep-water dock located on site. Also, the property can
be easily accessed from the local highway system. Financial Impact
The decision to discontinue the speedway development efforts on
Staten Island will result in a non-cash, pre-tax charge in the
Company's fiscal 2006 fourth quarter results of approximately $75
to $85 million, or $0.90 to $1.02 per diluted share after-tax.
Accounting rules generally accepted in the US require that the
property be valued on a current, as is basis, which is estimated
between $65 and $75 million. The Company has capitalized spending
of approximately $150 million through November 30, 2006, including:
(1) $123 million for land and related improvements, (2) $11 million
for costs related solely to the development of the speedway, and
(3) $16 million for capitalized interest and property taxes.
"Despite the political challenges we experienced," continued
Kennedy, "we appreciate the support from a variety of groups on
Staten Island including the business, civic and residential
communities to bring a speedway to the area. Due to the
considerable interest and support for NASCAR racing in the region,
we remain committed to the pursuit of a motorsports entertainment
facility development in the nation's number one media market. We
believe a facility in this area represents a significant long-term
opportunity for our company, and is one component of several
broader strategic growth opportunities ahead for ISC. We look
forward to our continued success in achieving these opportunities
and sharing our progress in the future." International Speedway
Corporation is a leading promoter of motorsports activities,
currently promoting more than 100 racing events annually as well as
numerous other motorsports-related activities. The Company owns
and/or operates 11 of the nation's major motorsports entertainment
facilities, including Daytona International Speedway in Florida
(home of the Daytona 500); Talladega Superspeedway in Alabama;
Michigan International Speedway located outside Detroit; Richmond
International Raceway in Virginia; California Speedway near Los
Angeles; Kansas Speedway in Kansas City, Kansas; Phoenix
International Raceway in Arizona; Homestead-Miami Speedway in
Florida; Martinsville Speedway in Virginia; Darlington Raceway in
South Carolina; and Watkins Glen International in New York. Other
motorsports entertainment facility ownership includes an indirect
37.5 percent interest in Raceway Associates, LLC, which owns and
operates Chicagoland Speedway and Route 66 Raceway near Chicago,
Illinois. In addition, ISC is a limited partner with Group Motorise
International in the organization and promotion of certain events
at Circuit Gilles Villeneuve in Montreal, Canada. The Company also
owns and operates MRN Radio, the nation's largest independent
sports radio network; DAYTONA USA, the "Ultimate Motorsports
Attraction" in Daytona Beach, Florida, the official attraction of
NASCAR; and subsidiaries which provide catering services, food and
beverage concessions, and produce and market motorsports-related
merchandise under the trade name "Americrown." In addition, ISC has
an indirect 50 percent interest in a business called Motorsports
Authentics, which markets and distributes motorsports-related
merchandise licensed by certain competitors in NASCAR racing. For
more information, visit the Company's Web site at
http://www.iscmotorsports.com/. Statements made in this release
that express the Company's or management's beliefs or expectations
and which are not historical facts or which are applied
prospectively are forward-looking statements. It is important to
note that the Company's actual results could differ materially from
those contained in or implied by such forward-looking statements.
The Company's results could be impacted by risk factors, including,
but not limited to, weather surrounding racing events, government
regulations, economic conditions, consumer and corporate spending,
military actions, air travel and national or local catastrophic
events. Additional information concerning factors that could cause
actual results to differ materially from those in the forward-
looking statements is contained from time to time in the Company's
SEC filings including, but not limited to, the 10-K and subsequent
10-Qs. Copies of those filings are available from the Company and
the SEC. The Company undertakes no obligation to release publicly
any revisions to these forward-looking statements that may be
needed to reflect events or circumstances after the date hereof or
to reflect the occurrence of unanticipated events. The inclusion of
any statement in this release does not constitute an admission by
International Speedway or any other person that the events or
circumstances described in such statement are material. DATASOURCE:
International Speedway Corporation CONTACT: Wes Harris, Senior
Director, Corporate and Investor Communications of International
Speedway Corporation, +1-386-947-6465 Web site:
http://www.iscmotorsports.com/
Copyright