~Company Reiterates Full-Year Financial Guidance~ DAYTONA BEACH,
Fla., April 3 /PRNewswire-FirstCall/ -- International Speedway
Corporation (NASDAQ:ISCA)(OTC:ISCB) (BULLETIN BOARD: ISCB) ("ISC")
today reported results for the fiscal first quarter ended February
28, 2007. "We are pleased to report solid revenue and earnings for
the first quarter, despite the year-over-year decline in broadcast
revenue due to the start of NASCAR's new eight-year combined
television agreements," said ISC President Lesa France Kennedy. "We
hosted several successful events during the first quarter, and
posted a nearly double-digit increase in corporate sponsorship
revenue." First Quarter Comparison Total revenues for the first
quarter decreased to $185.2 million, compared to revenues of $193.9
million in the prior-year period. Operating income was $65.8
million during the period compared to $78.5 million in the first
quarter of fiscal 2006. Net income was $35.8 million, or $0.67 per
diluted share, compared to net income of $44.1 million, or $0.83
per diluted share, in the prior year. Results for the first quarter
of fiscal 2007 include additional depreciation of $2.6 million, or
$0.03 per diluted share after tax, associated with a building
located in the ISC's office complex in Daytona Beach, which the
Company is not currently using and does not intend to use in the
future. GAAP to Non-GAAP Reconciliation The following financial
information is presented below using other than generally accepted
accounting principles ("non-GAAP"), and is reconciled to comparable
information presented using GAAP. Non-GAAP net income and diluted
earnings per share below are derived by adjusting amounts
determined in accordance with GAAP for certain items presented in
the accompanying selected operating statement data, net of taxes.
The adjustment relates to the additional depreciation in the first
quarter associated with a building structure located in the
Company's office complex in Daytona Beach, which the Company is not
currently using and does not intend to use in the future. The
Company believes such non-GAAP information is useful and meaningful
to investors, and is used by investors and ISC 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 operating income, net
income or diluted earnings per share, which are determined in
accordance with GAAP. (In Thousands, Except Per Share Amounts)
(Unaudited) Three Months Ended February 28, 2006 February 28, 2007
Net income $44,053 $35,819 Net loss, net of tax, from: Discontinued
operations 78 20 Income from continuing operations 44,131 35,839
Adjustments, net of tax: Additional depreciation - 1,612 Non-GAAP
net income $44,131 $37,451 Per share data: Diluted earnings per
share $0.83 $0.67 Net loss, net of tax, from: Discontinued
operations - - Income from continuing operations 0.83 0.67
Adjustments, net of tax: Additional depreciation - 0.03 Non-GAAP
diluted earnings per share $0.83 $0.70 2007 First Quarter
Highlights An overview of the significant major event weekends held
in the first quarter of 2007 includes: -- Speedweeks 2007 kicked
off in exciting fashion with the Grand American Road Racing Series
Rolex 24 at Daytona. World-class competitors from several prominent
racing series competed in the country's premier sports car
endurance race. The on-track competition was outstanding and the
margin of victory was the third closest in the event's history.
Notably, the 2007 Rolex 24 at Daytona posted a double-digit
percentage increase in attendance over the prior year. --
Attendance for the 29th Annual Budweiser Shootout was comparable to
the prior year. Unfortunately, unseasonably cold weather impacted
walk-up sales for several events later during Speedweeks, most
notably the Chevy Silverado HD 250 NASCAR Craftsman Truck Series
race. Attendance for the Orbitz 300 NASCAR Busch Series race was
flat with the prior year. -- A sold-out crowd was on hand once
again for the 49th annual Daytona 500. This year's event featured
one of the most exciting finishes in recent history. Kevin Harvick
captured the checkered flag by a margin of 0.02 seconds over Mark
Martin, registering the closest finish since the advent of computer
scoring in 1993. -- California Speedway hosted an exciting weekend
of NEXTEL Cup, Busch and Craftsman Truck racing highlighted by
back-to-back wins by Matt Kenseth on Saturday and Sunday.
Grandstand attendance for the Auto Club 500 was slightly up over
the prior year, and the weekend also enjoyed increased corporate
sponsorship. During the first fiscal quarter, ISC completed the
acquisition of the remaining 62.5 percent of Raceway Associates,
LLC, owner and operator of Chicagoland Speedway and Route 66
Raceway in Joliet, Illinois. While the acquisition is accretive to
full year fiscal 2007 revenue and earnings, the facility did not
host any events in the fiscal first quarter. The Company continues
to see strong growth in corporate sponsorship revenue, posting a
nearly double-digit percentage increase over the prior year period.
Contributing to the growth was a new relationship with DirecTV as
the first ever presenting sponsor for Speedweeks. Also, ISC signed
Citizens Bank, a subsidiary of Michigan-based Citizens Republic
Bancorp, as title sponsor of Michigan Speedway's June NEXTEL Cup
race. ISC currently has three open entitlements for its NEXTEL Cup
events and two in each of the Busch, IRL IndyCar and Craftsman
Truck series for 2007. The Company expects to announce additional
agreements over the coming months. "Interest from corporate
advertisers looking to tap into the business- building
opportunities in major motorsports continues to grow, and we are
developing unique and innovative marketing platforms to meet their
needs," Ms. France Kennedy continued. "We were very excited to
announce our first ever presenting sponsorship with DirecTV this
past quarter, and we look forward to working closely with existing
and future partners to drive continued growth in corporate
sponsorship revenues." Recent Developments To date in the fiscal
second quarter, Daytona hosted Bike Week in early March highlighted
by the AMA Supercross and Daytona 200, both presented by Honda. In
addition, Homestead-Miami Speedway held a very successful IndyCar,
Grand American and USAC racing weekend, posting a double-digit
percentage increase in attendance. Most recently, Martinsville
Speedway hosted a weekend of Craftsman Truck and NEXTEL Cup racing,
highlighted by a near sold-out crowd for the Goody's Cool Orange
500. Fans were treated to outstanding on-track competition and the
second NEXTEL Cup race with NASCAR's new Car of Tomorrow. For the
remainder of the second quarter, ISC will host four consecutive
weekends of NEXTEL Cup and Busch series racing at Phoenix
International Raceway, Talladega Superspeedway, Richmond
International Raceway and Darlington Raceway. During the first
quarter, the Company announced it is exploring the possibility of
pursuing a public-private partnership in Colorado to develop a
motorsports entertainment facility in Adams County near Denver
International Airport. ISC is currently evaluating a number of land
parcels, and looks forward to working with public officials to
explore the feasibility of a public/private partnership that will
bring considerable economic impact to the metro-Denver region. In
Washington, on April 2, 2007, ISC announced that despite agreeing
to substantial changes to the required legislation to help fund the
speedway development, it has recently become apparent that
additional modifications would be proposed to the bill. Due to the
increased risk that the collective modifications would have a
significant negative impact on the project's financial model, ISC
felt it was in its best long-term interest to discontinue its
efforts at the site located in Kitsap County. As a result, the
Company will record a non-cash pre-tax charge in the fiscal 2007
second quarter of approximately $5.5 million to $6.5 million, or
$0.07 to $0.08 per diluted share after-tax, to reflect the
write-off of certain capitalized costs including legal, consulting,
capitalized interest and other project-specific costs. The Company
still believes the Pacific Northwest represents an attractive
long-term opportunity, and remains interested in a speedway
development project in the region. ISC continues to search for a
suitable site for a potential speedway development in the
metropolitan New York area. The Company strongly believes a premier
facility in the nation's number one media market is a significant
long-term opportunity. In addition, ISC continues to evaluate
alternatives for the 676 acres currently owned on Staten Island,
including the sale of the acreage in parcels or as a whole, or the
potential development of the property with a third party. The New
York State Department of Environmental Conservation ("DEC") has
directed ISC to prepare a fill removal plan for the fill containing
constituents above the regulatory thresholds. The Company is in the
early stages of preparing the plan in partnership with the DEC.
Cost estimates for the fill removal can not be reasonably estimated
at this time, but ISC does not expect them to be material.
Regarding the Kentucky Speedway, LLC civil action filed in July
2005 against NASCAR and ISC, the Company is proceeding with the
preparation of its defense. For 2007, ISC expects litigation costs
related to its defense to range between $4.5 million and $5.5
million, or $0.05 to $0.06 per diluted share. Based upon the
materials produced during the discovery process, ISC continues to
believe that the vague allegations of the complaint are totally
without merit, and the Company will defend itself vigorously in
this matter. As previously announced, the Company is pursuing a
commercial mixed-use development project on its acreage owned
across from Daytona International Speedway. If results from an
ongoing study and other considerations are favorable and the
Company proceeds with the project, it is expected that several
existing corporate headquarter offices and other buildings, which
are not fully depreciated, will be razed during the next six to 24
months. This will result in a non-cash charge relating to
additional depreciation of approximately $12 million in total, or
$0.14 per diluted share after tax, over the remaining three
quarters of fiscal 2007. Outlook ISC reiterates its previous full
year guidance range of revenues between $800 and $820 million, and
non-GAAP earnings of $3.10 to $3.20 per diluted share. In addition,
the Company expects second quarter earnings before interest, taxes,
depreciation and amortization ("EBITDA")(1) and operating margins
to range from 36 to 37 percent and 27 to 28 percent, respectively.
It is important to note that the financial guidance does not
include the additional depreciation recorded in the fiscal first
quarter, the second quarter non-cash charge related to the
Company's decision to discontinue pursuit of a speedway development
project in Kitsap County, Washington, and any additional
depreciation associated with the potential Daytona redevelopment
project. "We expect to post another solid year for ISC in fiscal
2007," Ms. France Kennedy concluded. "We recently finalized the
acquisition of Chicagoland Speedway and Route 66 Raceway, and we
look forward to their immediate contribution to the Company's
success. We also anticipate corporate sponsorship-related revenues
to remain strong, and believe that the category will maintain its
momentum over the next several years. We are, however, closely
monitoring the current and future economic trends and their
potential impact on consumer discretionary spending. We believe we
are well-positioned to weather any near-term economic challenges
due to our nationwide reach, strength in corporate sponsorship and
significant revenue visibility related to the broadcast rights
agreements. Lastly, our proven business plan allows us to
capitalize on both external and internal growth opportunities to
generate long-term shareholder value." (1) EBITDA is a non-GAAP
financial measure used by the Company as an important indicator of
its operating margin. Conference Call Details The management of ISC
will host a conference call today with investors at 9:00 a.m.
Eastern Time. To participate, dial toll free (800) 418-7236 five to
ten minutes prior to the scheduled start time and request to be
connected to the ISC earnings call, identification number 8622695.
A live Webcast will also be available at that time on the Company's
Web site, http://www.iscmotorsports.com/, under the "Investor
Relations" section. A replay will be available one hour after the
end of the call through midnight Tuesday, April 10, 2007. To
access, dial (877) 519-4471 and enter the code 8622695, or visit
the "Investor Relations" section of the Company's Web site.
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 13 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;
Chicagoland Speedway and Route 66 Raceway near Chicago, Illinois;
Homestead-Miami Speedway in Florida; Martinsville Speedway in
Virginia; Darlington Raceway in South Carolina; and Watkins Glen
International in New York. 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.
Consolidated Statements of Operations (In Thousands, Except Per
Share Amounts) Three Months Ended February 28, 2006 February 28,
2007 (Unaudited) REVENUES: Admissions, net $55,520 $55,310
Motorsports related 114,323 108,433 Food, beverage and merchandise
21,863 19,164 Other 2,228 2,272 193,934 185,179 EXPENSES: Direct
expenses: Prize and point fund monies and NASCAR sanction fees
34,536 32,462 Motorsports related 30,814 30,943 Food, beverage and
merchandise 13,165 10,849 General and administrative 23,493 27,248
Depreciation and amortization 13,463 17,907 115,471 119,409
Operating income 78,463 65,770 Interest income 934 1,358 Interest
expense (4,068) (4,040) Equity in net loss from equity investments
(2,497) (4,317) Income from continuing operations before income
taxes 72,832 58,771 Income taxes 28,701 22,932 Income from
continuing operations 44,131 35,839 Loss from discontinued
operations, net of income tax benefits of $83 and $48 (78) (20) Net
income $44,053 $35,819 Basic earnings per share: Income from
continuing operations $0.83 $0.67 Loss from discontinued operations
- - Net income $0.83 $0.67 Diluted earnings per share: Income from
continuing operations $0.83 $0.67 Loss from discontinued operations
- - Net income $0.83 $0.67 Dividends per share $- $- Basic weighted
average shares outstanding 53,144,014 53,093,944 Diluted weighted
average shares outstanding 53,249,635 53,216,404 Consolidated
Balance Sheets (In Thousands) November 30, February 28, 2006 2007
(Unaudited) ASSETS Current Assets: Cash and cash equivalents
$59,681 $98,626 Short-term investments 78,000 200 Receivables, less
allowance of $1,000 in 2006 and 2007 52,699 122,346 Inventories
3,976 6,583 Deferred income taxes 995 1,125 Prepaid expenses and
other current assets 8,251 16,373 Total Current Assets 203,602
245,253 Property and Equipment, net of accumulated depreciation of
$371,219 and $388,222, respectively Other Assets: Equity
investments 175,915 129,623 Intangible assets, net 149,314 195,070
Goodwill 99,507 99,507 Deposits with Internal Revenue Service
110,813 117,936 Other 25,595 27,849 561,144 569,985 Total Assets
$1,922,059 $2,117,691 LIABILITIES AND SHAREHOLDERS' EQUITY Current
Liabilities: Current portion of long-term debt $770 $2,584 Accounts
payable 29,577 23,012 Deferred income 124,254 197,413 Income taxes
payable 22,477 31,651 Other current liabilities 19,226 23,445 Total
Current Liabilities 196,304 278,105 Long-Term Debt 367,324 441,641
Deferred Income Taxes 191,642 196,308 Long-Term Deferred Income
10,808 16,075 Other Long-Term Liabilities 866 4,663 Commitments and
Contingencies - - Shareholders' Equity: Class A Common Stock, $.01
par value, 80,000,000 shares authorized; 31,078,307 and 31,011,622
issued and outstanding at November 30, 2006 and February 28, 2007,
respectively 311 310 Class B Common Stock, $.01 par value,
40,000,000 shares authorized; 22,100,263 and 21,963,363 issued and
outstanding at November 30, 2006 and February 28, 2007,
respectively 221 220 Additional paid-in capital 698,396 688,363
Retained earnings 456,187 492,006 Total Shareholders' Equity
1,155,115 1,180,899 Total Liabilities and Shareholders' Equity
$1,922,059 $2,117,691 Consolidated Statements of Cash Flows (In
Thousands) Three Months Ended February 28, 2006 February 28, 2007
(Unaudited) OPERATING ACTIVITIES Net income $44,053 $35,819
Adjustments to reconcile net income to net cash provided by
operating activities: Depreciation and amortization 13,463 17,907
Stock-based compensation 620 695 Amortization of financing costs
141 128 Deferred income taxes 5,674 4,536 Loss from equity
investments 2,497 4,317 Other, net - 42 Changes in operating assets
and liabilities: Receivables, net (82,749) (67,775) Inventories,
prepaid expenses and other assets (7,476) (10,217) Deposits with
Internal Revenue Service - (7,123) Accounts payable and other
liabilities 12,154 8,260 Deferred income 54,282 63,614 Income taxes
14,466 9,188 Net cash provided by operating activities 57,125
59,391 INVESTING ACTIVITIES Capital expenditures (22,811) (37,107)
Proceeds from asset disposals 49 - Purchase of equity investments
(124,476) - Acquisition of businesses, net of cash acquired -
(87,002) Proceeds from affiliate - 67 Proceeds from short-term
investments 28,000 83,250 Purchases of short-term investments
(20,000) (5,450) Other, net 523 (8) Net cash used in investing
activities (138,715) (46,250) FINANCING ACTIVITIES Proceeds under
credit facility 80,000 65,000 Payments under credit facility
(30,000) - Payment of long-term debt - (28,452) Exercise of Class A
common stock options 43 256 Reacquisition of previously issued
common stock - (11,000) Net cash provided by financing activities
50,043 25,804 Net (decrease) in cash and cash equivalents (31,547)
38,945 Cash and cash equivalents at beginning of period 130,758
59,681 Cash and cash equivalents at end of period $99,211 $98,626
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/
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