DAYTONA BEACH, Fla.,
Jan. 26, 2016 /PRNewswire/ -- International Speedway
Corporation (NASDAQ Global Select Market: ISCA; OTC Bulletin Board:
ISCB) ("ISC") today reported financial results for its fiscal
fourth quarter and full-year ended November 30, 2015.
"2015 was an exceptional year for ISC, with financial results
exceeding expectations and growth in all areas of our core
business," stated Lesa France
Kennedy, ISC Chief Executive Officer. "In its second
year of the new Chase format, NASCAR again provided thrilling
competition culminating at Homestead-Miami Speedway in front of a
sold-out crowd that bid an emotional farewell to Jeff Gordon in his final season and cheered
Kyle Busch to victory lane for his
first NASCAR Sprint Cup Championship."
Ms. France Kennedy continued,
"2016 will mark a significant milestone for ISC and Daytona
International Speedway with the opening of DAYTONA Rising.
After 31 months of construction, the new stadium will be fully
operational, elevating the experience for all guests with improved
amenities throughout the facility. Fan response has been
overwhelmingly positive. Grandstand seats are nearly sold-out
for the DAYTONA 500 and we are experiencing unprecedented success
with corporate sales and partner activation."
"Across our business, we expect to see continued growth in 2016
from attendance related and corporate revenues as a result of our
capacity management and guest experience initiatives. Our
non-motorsports activities will complement growth from our core
business, including recently announced music festivals at Daytona
and Talladega, as well as continued growth from our investment in
the Hollywood Casino at Kansas Speedway."
"We continue progress on ONE DAYTONA, our mixed use real estate
development across from Daytona International Speedway. The
conceptual design of the project has been refined to include three
components; retail, dining and entertainment; hotels; and,
residential. We are targeting spring 2016 for commencement of
vertical construction. We expect our investment in phase one
of the project to meet or exceed our cost of capital."
Fourth Quarter Comparison
Total revenues for the fourth quarter ended November 30,
2015 were approximately $219.3
million, compared to revenues of approximately $199.8 million in the fourth quarter of fiscal
2014. Operating income was approximately $51.9 million during the period compared to
approximately $39.8 million in the
fourth quarter of fiscal 2014. Quarter-over-quarter
comparability was impacted by:
- The NASCAR Sprint Cup and Xfinity Series events held at
Darlington Raceway in the second quarter of fiscal 2014 were held
in the fourth quarter of fiscal 2015.
- On January 31, 2014, SMI
abandoned its interest and rights in our 50/50 partnership
Motorsports Authentics, LLC ("MA"), consequently bringing our
ownership of MA to 100.0 percent. MA's operations are included in
our consolidated operations subsequent to the date of SMI's
abandonment. Prior to January 31,
2014, MA was accounted for as an equity investment in our
financial statements. As a result of SMI's abandonment of their
interest in MA, during the fourth quarter of fiscal 2014, we
recognized tax benefits relating to MA of approximately
$0.2 million, or less than
$0.01 earnings per share. In
addition, we recognized an impairment of a long-lived intangible
asset, related to MA, of approximately $0.6
million, or $0.01 per diluted
share, in the fourth quarter of fiscal 2014. There was no
comparable event in the same period of fiscal 2015.
- During the fourth quarter of fiscal 2014, we received a
favorable settlement relating to a legal judgment of litigation
involving certain ancillary operations of approximately
$0.6 million, or $0.01 per diluted share. There was no comparable
item in the same period of fiscal 2015.
- During the fourth quarter of fiscal 2015, we recognized
approximately $1.9 million in
commissions related to merchandise sales, primarily related to
Fanatics. This compares to the fourth quarter of fiscal 2014, where
we recognized revenue and expense related to merchandise operations
of approximately $11.6 million and
$10.0 million, respectively, which
included direct sales of trackside merchandise.
- During the fourth quarter of fiscal 2015, we recognized
approximately $0.3 million, or less
than $0.01 per diluted share, in
marketing and consulting costs, that are included in general and
administrative expense, related to DAYTONA Rising. During the
fourth quarter of fiscal 2014, we recognized approximately
$0.2 million, or less than
$0.01 per diluted share, of similar
costs.
- During the fourth quarter of fiscal 2015, we recognized
accelerated depreciation of $0.1
million, or less than $0.01
per diluted share, due to shortening the service lives of certain
assets associated with DAYTONA Rising. During the fourth quarter of
fiscal 2014, we recognized approximately $2.4 million, or $0.03 per diluted share, due to shortening the
service lives of certain assets associated with DAYTONA Rising and
capacity management initiatives.
- During the fourth quarter of fiscal 2015, we recognized charges
of approximately $4.4 million, or
$0.06 per diluted share, for losses
associated with asset retirements including the removal of assets
not fully depreciated in connection with DAYTONA Rising. Included
in these losses were approximately $3.3
million of expenditures related to demolition and/or asset
relocation costs, the remaining charges were non-cash. In the
fourth quarter of fiscal 2014, we recognized approximately
$2.8 million, or $0.03 per diluted share, of similar charges, of
which approximately $0.8 million of
expenditures related to demolition and/or asset relocation costs,
the remaining charges were non-cash, which included an impairment
of a long-lived intangible asset related to MA, discussed
above.
- During the fourth quarter of fiscal 2014, we received a
settlement of interest income related to a long term receivable of
$1.8 million, or $0.02 per diluted share. There was no comparable
item in the same period of fiscal 2015.
- During the fourth quarter of fiscal 2015, we capitalized
approximately $1.0 million, or
$0.01 per diluted share, of interest
related to DAYTONA Rising. During the fourth quarter of fiscal
2014, we recognized $2.7 million or
$0.03 per diluted share, of similar
capitalized interest.
Net income for the fourth quarter was approximately $32.3 million, or $0.69 per diluted share, compared to net income
of approximately $25.8 million, or
$0.55 per diluted share, in the prior
year period. Excluding a legal settlement, marketing and
consulting costs incurred associated with DAYTONA Rising,
accelerated depreciation, impairment of MA long-lived intangible
asset, losses associated with the retirements of certain other
long-lived assets, settlement of interest income related to a
long-term receivable, DAYTONA Rising project capitalized interest
and a de minimis net gain on sale of certain assets, non-GAAP
(defined below) net income for the fourth quarter of 2015 was
$34.4 million, or $0.74 per diluted share. Non-GAAP net
income for the fourth quarter of fiscal 2014 was $26.1 million, or $0.56 per diluted share.
Full-Year Comparison
For the year ended November 30, 2015, total revenues were
$645.4 million, compared to
$651.9 million in 2014.
Operating income for the full-year period was $85.6 million compared to $93.4 million in the prior year.
Year-over-year comparability was impacted by:
- In the third quarter of fiscal 2015, we hosted the Phish
Magnaball music festival at Watkins Glen International, for which
there was no comparable event in the prior year. Also in the third
quarter of fiscal 2015, we hosted the third annual Faster Horses
music festival at Michigan International Speedway.
- During fiscal 2014, we received a favorable settlement relating
to a legal judgment of litigation involving certain ancillary
operations of approximately $0.6
million, or $0.01 per diluted
share. There was no comparable activity during fiscal 2015.
- On January 31, 2014, SMI
abandoned its interest and rights in our 50/50 partnership
Motorsports Authentics, LLC ("MA"), consequently bringing our
ownership of MA to 100.0 percent. MA's operations are included in
our consolidated operations subsequent to the date of SMI's
abandonment. Prior to January 31,
2014, MA was accounted for as an equity investment in our
financial statements. As a result of SMI's abandonment of their
interest in MA, we recorded other income of approximately
$5.4 million representing the fair
value of MA, over the carrying value, as of January 31, 2014. In addition we recognized tax
benefits relating to MA of approximately $4.0 million for fiscal 2014. There was no
comparable event in the same period of fiscal 2015.
- For fiscal 2015, we recognized revenue and expense related to
merchandise operations of approximately $16.5 million and $12.3
million, respectively, including the following:
- $5.1 million of commission from
third party merchandise sales, predominately from Fanatics,
- non-recurring transactions of approximately $10.4 million, which includes approximately
$6.4 million for inventory sold to
Fanatics and $4.0 million of
wholesale transactions by MA, and
- approximately $12.3 million in
expense including product costs associated with the non-recurring
transactions, non-recurring costs related to the transition of
trackside merchandise operations to Fanatics, as well as partial
period operating expenses incurred prior to the transition of
Americrown and MA merchandise operations, for which there was no
related revenue
This compares to fiscal 2014,
where we recognized revenue and expense related to merchandise
operations of approximately $44.1 million and $35.5 million, respectively, which included
direct sales of trackside merchandise and excluded the partial
period pre-consolidation operation of Motorsports Authentics prior
to SMI's abandonment of its MA interest.
- In fiscal 2015, we recognized approximately $1.4 million, or $0.02 per diluted share, in marketing and
consulting costs that are included in general and administrative
expense related to DAYTONA Rising. During fiscal 2014, we
recognized approximately $1.1
million, or $0.02 per diluted
share, of similar costs.
- During fiscal 2015, we recognized approximately $6.8 million, or $0.09 per diluted share, of accelerated
depreciation that was recorded due to the shortening the service
lives of certain assets associated with DAYTONA Rising and other
projects. During fiscal 2014, we recognized approximately
$11.1 million, or $0.14 per diluted share, of accelerated
depreciation that was recorded due to the shortening the service
lives of certain assets associated with DAYTONA Rising and capacity
management initiatives.
- In fiscal 2015, we recognized charges of approximately
$16.0 million, or $0.21 per diluted share, of losses associated
with asset retirements primarily attributable to demolition and/or
asset relocation costs in connection with DAYTONA Rising, capacity
management initiatives and other capital projects. Included in
these losses were approximately $12.5
million of expenditures related to demolition and/or asset
relocation costs, the remaining charges were non-cash charges.
During fiscal 2014, we recognized approximately $10.1 million, or $0.12 per diluted share, of similar charges, of
which approximately $7.5 million of
expenditures related to demolition and/or asset relocation costs,
the remaining charges were non-cash, which included an impairment
of a long-lived intangible asset related to MA, discussed
above.
- In fiscal 2014, we received a settlement of interest income
related to a long term receivable of $1.8
million, or $0.02 per diluted
share. There was no comparable item in the same period of fiscal
2015.
- In fiscal 2015, we recognized approximately $6.0 million, or $0.08 per diluted share, in capitalized interest
related to DAYTONA Rising. During fiscal 2014, we recognized
approximately $7.2 million, or
$0.09 per diluted share, of similar
capitalized interest.
- During fiscal 2015, we recognized approximately $14.1 million of income from equity investments
associated with our Hollywood Casino at Kansas Speedway. During
fiscal 2014, we recognized income of approximately $8.9 million from this equity investment.
Net income for the year-ended November 30, 2015, was
$56.6 million, or $1.21 per diluted share, compared to a net income
of $67.4 million, or $1.45 per diluted share in 2014. Excluding
adjustments for a legal settlement marketing and consulting costs
incurred associated with DAYTONA Rising, accelerated depreciation,
impairment of MA long-lived intangible asset, losses associated
with the retirements of certain other long-lived assets, settlement
of interest income related to a long-term receivable, DAYTONA
Rising project capitalized interest and a net gain on sale of
certain assets, non-GAAP (defined below) net income for fiscal
2015, was $67.3 million, or
$1.44 per diluted share. This
is compared to non-GAAP net income for fiscal 2014 of $65.9 million, or $1.42 per diluted share.
GAAP to Non-GAAP Reconciliation
The following financial information is presented below using
other than U.S. 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.
We believe such non-GAAP information is useful and meaningful,
and is used by investors to assess our core operations, which
consist of the ongoing promotion of racing events at our major
motorsports entertainment facilities. Such non-GAAP information
identifies and separately displays and adjusts for items that are
not considered to be reflective of our continuing core operations
at our motorsports entertainment facilities. We believe that such
non-GAAP information improves the comparability of the operating
results and provides a better understanding of the performance of
our core operations for the periods presented. We use this non-GAAP
information to analyze the current performance and trends and make
decisions regarding future ongoing 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. The
presentation of this non-GAAP financial information is not intended
to be considered independent of or as a substitute for results
prepared in accordance with GAAP. Management uses both GAAP and
non-GAAP information in evaluating and operating the business and,
as such, deemed it important to provide such information to
investors.
The adjustments for 2014 relate to a legal settlement, marketing
and consulting costs incurred associated with DAYTONA Rising,
accelerated depreciation, losses associated with the retirements of
certain other long-lived assets, impairment of MA long-lived
intangible asset, settlement of interest income related to
long-term receivable, DAYTONA Rising project capitalized interest,
MA fair value adjustment and income tax benefits, and net loss on
sale of certain assets.
The adjustments for 2015 relate to marketing and consulting
costs incurred associated with DAYTONA Rising, accelerated
depreciation, losses associated with the retirements of certain
other long-lived assets, DAYTONA Rising project capitalized
interest, and net gain on sale of certain assets.
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
November 30,
2014
|
|
November 30,
2015
|
|
November 30,
2014
|
|
November 30,
2015
|
|
|
|
|
(Unaudited)
|
|
|
|
|
( In Thousands,
Except Per Share Amounts )
|
Net income
|
|
$
|
25,824
|
|
|
$
|
32,282
|
|
|
$
|
67,379
|
|
|
$
|
56,634
|
|
Adjustments, net of
tax:
|
|
|
|
|
|
|
|
|
Legal
settlement
|
|
(386)
|
|
|
—
|
|
|
(386)
|
|
|
—
|
|
DAYTONA Rising
project
|
|
144
|
|
|
180
|
|
|
672
|
|
|
847
|
|
Accelerated
depreciation
|
|
1,480
|
|
|
(70)
|
|
|
6,758
|
|
|
4,153
|
|
Losses on retirements
of long-lived assets
|
|
1,362
|
|
|
2,668
|
|
|
5,802
|
|
|
9,735
|
|
Impairment of MA's
long lived intangible asset
|
|
605
|
|
|
—
|
|
|
605
|
|
|
—
|
|
Interest settlement
on long-term receivable
|
|
(1,116)
|
|
|
—
|
|
|
(1,116)
|
|
|
—
|
|
DAYTONA Rising
project capitalized interest
|
|
(1,650)
|
|
|
(601)
|
|
|
(4,387)
|
|
|
(3,652)
|
|
MA fair value
adjustment and income tax benefits
|
|
(183)
|
|
|
—
|
|
|
(9,455)
|
|
|
—
|
|
Net (gain) loss on
sale of certain assets
|
|
(2)
|
|
|
(66)
|
|
|
41
|
|
|
(444)
|
|
Non-GAAP net
income
|
|
$
|
26,078
|
|
|
$
|
34,393
|
|
|
$
|
65,913
|
|
|
$
|
67,273
|
|
Per share
data:
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
|
$
|
0.55
|
|
|
$
|
0.69
|
|
|
$
|
1.45
|
|
|
$
|
1.21
|
|
Adjustments, net of
tax:
|
|
|
|
|
|
|
|
|
Legal
settlement
|
|
(0.01)
|
|
|
—
|
|
|
(0.01)
|
|
|
—
|
|
DAYTONA Rising
project
|
|
0.00
|
|
|
0.00
|
|
|
0.02
|
|
|
0.02
|
|
Accelerated
depreciation
|
|
0.03
|
|
|
0.00
|
|
|
0.14
|
|
|
0.09
|
|
Losses on retirements
of long-lived assets
|
|
0.03
|
|
|
0.06
|
|
|
0.12
|
|
|
0.21
|
|
Impairment of MA's
long lived intangible asset
|
|
0.01
|
|
|
—
|
|
|
0.01
|
|
|
—
|
|
Interest settlement
on long-term receivable
|
|
(0.02)
|
|
|
—
|
|
|
(0.02)
|
|
|
—
|
|
DAYTONA Rising
project capitalized interest
|
|
(0.03)
|
|
|
(0.01)
|
|
|
(0.09)
|
|
|
(0.08)
|
|
MA fair value
adjustment and income tax benefits
|
|
0.00
|
|
|
—
|
|
|
(0.20)
|
|
|
—
|
|
Net (gain) loss on
sale of certain assets
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
(0.01)
|
|
Non-GAAP diluted
earnings per share
|
|
$
|
0.56
|
|
|
$
|
0.74
|
|
|
$
|
1.42
|
|
|
$
|
1.44
|
|
|
From a marketing partnership perspective, we sold all of our
2015 NASCAR Sprint Cup and Xfinity series event entitlements and
exceeded our gross marketing partnership revenue target for the
year, up approximately 3.1 percent from 2014. NASCAR is
a powerful brand with a loyal fan base that we believe is aware of,
appreciates and supports corporate participation to a greater
extent than fans of any other sports property. The combination
of brand power and fan loyalty provides an attractive platform for
robust corporate partnerships. The number of FORTUNE
500 companies invested in NASCAR remains higher than any other
sport. More than one-in-four FORTUNE 500 companies, and
one-in-two FORTUNE 100 companies, use NASCAR as part of
their marketing strategy and the trend is increasing. The number
of FORTUNE 500 companies investing in NASCAR increased seven
percent in 2015 versus prior year; and is a 20 percent improvement
versus 2008.
For fiscal 2016, we have agreements in place for approximately
75.0 percent of our gross marketing partnership revenue target,
which is projected to increase approximately 11.0 percent compared
to 2015, primarily related to DAYTONA Rising. We have one of
our available 20 NASCAR Sprint Cup Series event entitlements either
open or not announced and four of our fourteen NASCAR Xfinity
Series event entitlements either open or not announced. This
is compared to last year at this time when we had approximately
74.0 percent of our gross marketing partnership revenue target sold
and had entitlements for one NASCAR Sprint Cup and three NASCAR
Xfinity entitlements either open or not announced. With the
vast majority of our event entitlements secured, we can focus more
resources on official status categories, which will better position
us to meet our gross marketing partnership revenue target for
2016.
External Growth, Financing-Related and Other
Initiatives
Capital Allocation
We have established a long-term capital allocation plan to
ensure we generate sufficient cash flow from operations to fund our
working capital needs, capital expenditures at existing facilities,
and return of capital through payments of an annual cash dividend
and repurchase of our shares under our Stock Purchase Plan.
In addition, we have used the proceeds from offerings of our
Class A Common Stock, the net proceeds from the issuance of
long-term debt, borrowings under our credit facilities and state
and local mechanisms to fund acquisitions and development
projects.
The current capital allocation plan contemplates the
following:
- Capital expenditures remaining under the existing $600.0 million capital expenditure plan adopted
by our Board of Directors in June
2013, totals approximately $170.0
million for fiscal 2016 and 2017, consisting of remaining
payments to contractors for the completion of DAYTONA Rising and
certain planned capital projects at our remaining 12 motorsports
facilities (see "Capital Spending".) This plan will be evaluated
during 2016 and refined to include years subsequent to 2017 based
on business requirements;
- Additional capital expenditures related to phase I of the ONE
DAYTONA project, should it proceed, will be approximately
$120.0 million to $150.0 million in
fiscal 2016 through 2017. Sources of funds will include, in
addition to borrowings on our Credit Facility, the public
incentives discussed below and land to be contributed to the
project. Additional guidance will be provided as the project moves
toward groundbreaking; and
- Returning capital to shareholders is an important component of
the overall capital allocation strategy. At this time, we are
targeting a total payout of approximately $50.0 million in fiscal 2016 through a
combination of dividends and share repurchases. This compares to
approximately $10.2 million,
$11.2 million and $12.1 million in 2013, 2014 and 2015,
respectively. To facilitate our 2016 plan, during the upcoming open
trading window we will request special committee of our Board of
Directors to revise parameters under our Rule 10b-5 open market
share repurchase program. The objective of the revised parameters
is to buy back shares on an opportunistic, but consistent, basis in
2016. The open market program currently has $61.7 million remaining under the total
$330.0 million authorization. We will
review our return of capital programs and make adjustments, if
necessary, on a quarterly basis.
In addition to sources of working capital and available
borrowings, our ability to execute our capital allocation plans are
supported by the following:
- Federal tax legislation passed in December 2015 provides for extension of 7-year
depreciation for tax purposes on certain assets placed in service
during fiscal 2015 through 2016, and bonus depreciation on capital
expenditures placed in service 2015 through 2019. While the tax
legislation does not impact our overall tax liability, it does
impact the timing of the annual payment of cash taxes. Cash taxes
paid for federal and state taxes in fiscal 2014 and 2015 were
approximately $51.3 million and
$45.0 million, respectively. As a
result of this legislation, which was passed subsequent to our
fiscal 2015 year-end, but retroactive for all assets placed in
service during 2015, we currently estimate a net cash tax refund
for fiscal 2016 between approximately $10.0
million to $15.0 million, primarily attributable to
depreciation for assets placed in service related to DAYTONA
Rising, and cash tax payments for fiscal 2017 between approximately
$55.0 million to $60.0 million;
- Anticipated receipt of final payment of approximately
$66.4 million, plus interest, from
the outstanding note related to the sale of our Staten Island property;
The aforementioned represents certain components of our capital
allocation plan for 2016. This capital allocation plan is
reviewed annually, or more frequently, if necessary, based on
changes in business conditions.
Capital Spending
We compete for the consumers' discretionary dollar with many
entertainment options such as concerts and other major sporting
events, not just other motorsport events. To better meet our
customers' expectations, we are committed to improving the guest
experience at our facilities through on-going capital improvements
that position us for long-term growth.
In June 2013, our board of
directors endorsed a capital allocation plan for fiscal 2013
through fiscal 2017 to not exceed $600.0
million in capital expenditures over that period. The
five-year capital expenditure plan encompasses all capital
expenditures, excluding capitalized interest, for ISC's 13 major
motorsports facilities, including approximately $400.0 million for DAYTONA Rising.
Capital expenditures for projects at existing facilities,
including those related to DAYTONA Rising, were approximately
$155.0 million for our 2015 fiscal
year. In comparison, we spent approximately $183.9 million on capital expenditures for
projects at our existing facilities in fiscal 2014. Remaining
capital expenditures associated with the $600.0 million capital expenditure plan will
total approximately $170.0 million
for fiscal 2016 and 2017, of which approximately $67.2 million related to the timing of
remaining construction payments associated with the completion of
DAYTONA Rising in January 2016.
DAYTONA Rising: Reimagining an American Icon
DAYTONA Rising is the redevelopment of the frontstretch at
Daytona International Speedway ("Daytona"), ISC's 56-year-old
flagship motorsports facility, to enhance the event experience for
our fans, marketing partners, broadcasters and the motorsports
industry. The total cost for DAYTONA Rising is approximately
$400.0 million, excluding
capitalized interest, which has been funded from cash on hand and
cash from our operations.
As part of DAYTONA Rising, we entered into a Design-Build
Agreement with Barton Malow Company ("Barton Malow"), which obligates us to pay
Barton Malow approximately
$316.0 million for the completion of
the work described in the Design-Build Agreement. The amount is a
stipulated sum to be paid for the work, which may not change unless
we request a change in the scope of work. The Design-Build
Agreement contains certain provisions and representations usual and
customary for agreements of this type, including, among others,
provisions regarding liquidated damages to be assessed for work
that is not completed according to the agreed upon schedule,
provisions regarding payment schedules, and provisions regarding
bonding and liability insurance policies applicable to the work. In
addition, the Design-Build Agreement contains customary provisions
regarding termination, review and inspection of the work,
warranties and the use of subcontractors.
On January 12, 2016, we received
our temporary certificate of occupancy which allows us to begin
moving into the facility and fully prepare for the upcoming race
season. The world's first motorsports stadium will be ready for its
debut later this month at the Rolex 24 At DAYTONA Weekend.
The vision for DAYTONA Rising places an emphasis on enhancing
the complete fan experience, beginning with five expanded and
redesigned fan entrances, or injectors. Each injector will lead
directly to a series of escalators and elevators that will
transport fans to any of three different concourse levels, each
featuring spacious and strategically-placed social "neighborhoods"
along the nearly mile-long frontstretch.
A total of 11 neighborhoods, each measuring the size of a
football field, will enable fans to meet and socialize during
events without missing any on-track action, thanks to dozens of
strategically-placed video screens in every neighborhood. The
central neighborhood, dubbed the "World Center of Racing," features
open sight-lines enabling fans to catch all the on-track action
while celebrating the history of Daytona International Speedway and
its many unforgettable moments throughout more than 50 years of
racing.
Every seat in Daytona's frontstretch has been replaced with
wider, more comfortable seating that will provide pristine
sight-lines. There are twice as many restrooms and three times as
many concessions throughout the facility. During Budweiser
Speedweeks 2015, fans experienced some of DAYTONA Rising's new
amenities including first-ever vertical transportation,
approximately 40,000 new seats on the frontstretch near
Turn 1, and new concessions and restrooms. For the 2015
Coke Zero 400 in July, we opened an additional 10,000 new seats and
supporting amenities in Turn 4.
In addition to improving the overall fan experience, the
corporate entertainment platform at Daytona will be completely
transformed. Corporate hospitality will be moved into permanent
structures inside the new stadium, providing premier facilities for
entertaining throughout our events. Over 60 new trackside corporate
suites will provide our premium guests with breathtaking views and
first-class amenities befitting the "World Center of Racing."
Since commencement of construction, four Founding Partners have
been announced:
- Toyota;
- Florida Hospital;
- Chevrolet; and
- Sunoco.
With each partnerships extending over 10 years, the Founding
partners receive sponsorship rights for a dedicated injector, as
well as approximately 20,000 square feet of innovative fan
engagement space that will enhance the overall guest experience,
and nearly 50,000 square feet of interior and exterior branding
space.
In addition to the four Founding Partners, we have entered into
many additional corporate partnerships including:
- NextEra Energy Resources - includes the NASCAR Camping World
Truck Series race entitlement, extends our renewable energy credit
purchases designed to off-set the Speedway's carbon footprint and,
with the newly signed agreement with NextEra Energy and
Florida Power & Light, adds
three new on-site solar arrays;
- Rolex - extends the iconic Rolex brand's role as the title
sponsor of the annual Rolex 24 At DAYTONA sports car race and
Official Timepiece of Daytona International Speedway and receive
naming rights for the new DAYTONA Rising frontstretch lounge and
suite level as well as enhanced branding opportunities throughout
the redeveloped Speedway;
- Fifth Third Bank - will become the official bank of the "World
Center of Racing" and will integrate its ATMs into the redeveloped
Speedway beginning in 2016, provide Fifth Third Bank with fan
engagement and corporate hospitality opportunities for entertaining
guests at the Speedway, the ability to use certain marks and logos
in Fifth Third Bank promotions, and serve as an official partner of
the DAYTONA 500 and the Coke Zero 400 Powered By Coca-Cola;
- BRP - title sponsor for the 150-mile qualifying races for the
DAYTONA 500, Can-Am Duel At DAYTONA, which finalize the starting
lineup for the DAYTONA 500; and
- PowerShares QQQ - the multi-year partnership will serve as the
title sponsor for the NASCAR XFINITY Series season opener at
Daytona, a 120-lap, 300-mile race which will be known as the
PowerShares QQQ 300.
We expect that by providing our fans with a better experience as
well as an expansive platform for our marketing partners, including
an elevated hospitality experience, DAYTONA Rising, upon completion
in 2016, is expected to provide an immediate incremental lift in
Daytona's revenues of approximately $20.0
million, and earnings before interest, taxes, depreciation
and amortization ("EBITDA") lift of approximately $15.0 million, approximately $2.1 million of which was recognized in fiscal
2015, with a mid-single-digit growth rate. We also currently
anticipate the project to be accretive to our net income per share
within three years of completion. While these forward-looking
amounts are management's projections and we believe they are
reasonable, our actual results may vary from these estimates due to
unanticipated changes in projected attendance, lower than expected
ticket prices, and/or lower than forecasted corporate sponsorships.
We do not know whether these expectations will ultimately prove
correct and actual revenues and operating results may differ
materially from these estimates.
Despite not anticipating the need for additional long-term debt
to fund this project, accounting rules dictate that we capitalize a
portion of the interest on existing outstanding debt during the
construction period. Through November 30,
2015, we recorded approximately $14.0
million of capitalized interest associated with the DAYTONA
Rising project since inception.
Total spending incurred, exclusive of capitalized interest,
relating to DAYTONA Rising was approximately $120.1 million for fiscal 2015, and is
approximately $332.8 million
since the inception of the project. We have identified
existing assets that are expected to be impacted by the
redevelopment and that those assets required accelerated
depreciation, certain removal costs and losses on asset
retirements, over the approximate 31-month project time span.
During fiscal 2015, we recognized accelerated depreciation, certain
removal costs and losses on retirements of assets totaling
approximately $17.4 million,
with a total of approximately $45.4 million recognized since the inception
of the project.
As a result of opening approximately half of the new stadium in
fiscal 2015 for Speedweeks and the Coke Zero 400, our depreciation
expense, related directly to DAYTONA Rising, increased
incrementally by approximately $11.9
million, and is expected to increase an additional
$15.0 million to $16.0 million in fiscal 2016. Our total
depreciation expense beginning fiscal 2016 is estimated between
approximately $100.0 million to
$105.0 million annually, and
then decreasing to approximately $90.0
million to $100.0 million beginning in fiscal 2019.
In June 2014, House Bill 7095 was
signed in Florida creating the
Florida Sports Development Program, establishing a process for
distributing state tax revenue for the construction or improvement
of professional sports facilities. The DAYTONA Rising project was
among the eligible applicants to receive sales tax incentives based
on the project's capital investment and amount of sales tax
generated by the facility. In 2014, we filed our application and
received approval from the state's Department of Economic
Opportunity. Allocation of funds for the approved applications was
not considered during the 2015 session of the Florida
Legislature. We have re-submitted a detailed and thorough
sports incentive application to the Florida Department of Economic
Opportunity for consideration and will continue to pursue all
options to ensure the successful outcome of this process.
ONE DAYTONA
Since June 2013, we have pursued
development of ONE DAYTONA, the proposed premier mixed use and
entertainment destination across from Daytona International
Speedway.
We have approved land use entitlements for ONE DAYTONA to allow
for up to 1.4 million square feet of
retail/dining/entertainment, 2,500 seats in a movie theater, 660
hotel rooms, 1,350 units of residential, 567,000 square feet
of additional office space and 500,000 square feet of
commercial/industrial space.
A Community Development District ("CDD") has been established
for the purpose of installing and maintaining public infrastructure
at ONE DAYTONA. The CDD is a local, special purpose government
framework authorized by Chapter 190 of the Florida Statutes for
managing and financing infrastructure to support community
development.
The CDD has negotiated agreements with the City of Daytona Beach and Volusia County for a total of $40.0 million in incentives to finance a portion
of the estimated $53.0 million in
infrastructure required to move forward with the ONE DAYTONA
project. We are currently proceeding with the leasing phase of the
project while simultaneously completing the various necessary
requirements for the CDD to access the incentives to start
infrastructure work.
In March 2015, we announced Legacy
Development, a leading national development group, as development
consultant for ONE DAYTONA. Intensely focused on innovative
destination retail and mixed-use projects, Legacy Development will
work closely with ISC's development resources on the project. The
Legacy Development team is a natural fit for the project, having
served as the developer for Legends Outlets Kansas City, a
mixed-used retail destination across from our Kansas Speedway.
We have refined the conceptual design for the first phase of ONE
DAYTONA. This first phase will be comprised of three
components: retail, dining and entertainment ("RD&E"); hotels;
and residential.
The RD&E component of phase one will be owned and operated
100.0 percent by us. The expected total square footage for
the RD&E first phase is approximately 300,000 square
feet. We estimate the total cost for developing phase one to
be approximately $120.0 million to $150.0
million. Sources of funds will include, in addition to
borrowings on our Credit Facility, the public incentives discussed
above and land to be contributed to the project. Bass Pro
Shops, America's most popular outdoor store, and Cobb Theatres, the
highly respected Southeastern-based exhibitor, have executed leases
to anchor ONE DAYTONA. We are in active discussions with other
potential tenants for ONE DAYTONA and anticipate announcement of
additional leases in the near future.
Shaner Hotels and Prime Hospitality Group ("PHG") have been
selected as hotel partners. They have executed a franchise
agreement with Marriott International for an exclusive 145-room
full service Autograph Collection hotel at ONE DAYTONA. Shaner
Hotels and Prime Hospitality have also decided to move forward with
their option to build a limited service hotel within ONE
DAYTONA. As part of the partnership agreement, our portion of
equity will be limited to our land contribution and we will share
in the profits from the joint venture.
Prime Group has been selected as the partner for ONE DAYTONA's
residential development. Following an extensive request for
proposal process, ONE DAYTONA chose the Florida developer based on
their command of market demographics, development experience and
expert property management systems. Initial planning is already
underway for a 300-unit rental apartment community. Similar to the
hotel partnership, our portion of equity will be limited to our
land contribution and we will share in the profits from the joint
venture.
Vertical construction is expected to commence in the spring of
2016. We expect our investment in phase one of ONE DAYTONA to meet
or exceed our cost of capital. Any future phases will be
subject to prudent business considerations.
Hollywood Casino at Kansas Speedway
Kansas Entertainment, LLC, ("Kansas Entertainment") a 50/50
joint venture of Penn Hollywood Kansas, Inc. ("Penn"), a subsidiary
of Penn National Gaming, Inc. and Kansas Speedway Development
Corporation ("KSDC"), a wholly owned indirect subsidiary of ISC,
operates the Hollywood-themed
casino and branded destination entertainment facility, overlooking
turn two at Kansas Speedway. Penn is the managing member of Kansas
Entertainment and is responsible for the operations of the
casino.
We have accounted for Kansas Entertainment as an equity
investment in our financial statements as of November 30,
2015. Our 50.0 percent portion of Kansas Entertainment's
net income was approximately $8.9 million and $14.1 million for fiscal years 2014 and 2015,
respectively, and is included in equity in net income from equity
investments in our consolidated statements of operations.
We have received cash distributions from the casino totaling
$32.1 million and $22.0 million for fiscal years 2015 and 2014,
respectively. Included in cash distributions for fiscal 2015
was approximately $4.5 million
related to a change from quarterly to monthly distributions.
Subsequent to November 30, 2015, we received an additional
$0.6 million distribution from
Kansas Entertainment. For fiscal 2016, cash distributions
from the casino joint venture will be approximately $27.0 million to $28.0 million.
Fiscal 2016 Financial Outlook
Fiscal 2016 will feature certain activities and business changes
that will significantly impact the comparability to the prior
year. These changes include:
- Completion and grand opening of the DAYTONA Rising
project;
- Our, and the industry's, strategic change in the business model
for merchandising officially licensed apparel and souvenirs;
and
- The NASCAR Xfinity series event at Chicagoland Speedway held in
the third quarter of 2015 will not return in 2016.
As noted above, the DAYTONA Rising project will be fully
operational in fiscal 2016, with a ceremonial ribbon cutting slated
for Wednesday, January 27th, prior to
the Rolex 24 at DAYTONA. The project will contribute
approximately $20.0 million and
$15.0 million in incremental revenue
and EBITDA, respectively, approximately $2.1 million of which was recognized in
fiscal 2015. We will also recognize incremental depreciation
in fiscal 2016 of approximately $15.0
million to $16.0 million related to the completion of the
project.
In fiscal 2015, we completed our transition of merchandising
operations to Fanatics. In fiscal 2015, we recorded
merchandise revenue and expense of $10.4
million and $11.0 million,
respectively, and $1.3 million of
general and administrative costs related to the transition.
Comparable revenue and expense will not be recorded or incurred in
fiscal 2016. Going forward, we will receive a percentage of
merchandise sales from Fanatics for the right to operate at our
properties. Food, Beverage and Merchandise revenue and
expense will also continue to include concessions and catering
businesses we operate.
After considering the aforementioned business changes, for
fiscal 2016, we anticipate total revenues to range between
$660.0 million and $670.0
million. We expect revenue related to admissions,
food, beverage and merchandise to increase approximately 3.0
percent to 4.0 percent, and corporate sales to increase
approximately 15.0 percent to 16.0 percent. Contributing
significantly to these increases are the contributions from DAYTONA
Rising. Broadcast rights for NASCAR's top three racing series
are expected to increase approximately 3.1 percent to approximately
$322.0 million. Partially
impacting anticipated results is the elimination of one NASCAR
Xfinity race at Chicagoland Speedway, offset by increases related
to two new music festivals at Daytona and Talladega.
We expect certain expense increases for the year, including an
approximate 3.5 percent increase in NASCAR's Event Management
Fees, resulting from an approximate 3.1 percent increase in
broadcast revenue and an approximate 4.0 percent increase from
recently contracted five-year sanction agreements, partially offset
by the previously discussed discontinued Xfinity event at
Chicagoland. Also, contributing to the increase in operating
expenses is an approximately 2.3 percent net increase to
motorsports and general and administrative expenses, primarily
personnel related costs, strategic spend supporting consumer
marketing initiatives, and the aforementioned operating expenses
associated with the opening of DAYTONA Rising. We continue to
invest in strategies that target the younger demographics and
social media, as well as improving the guest experience at live
events, including enhanced data connectivity and multi-media
content distribution on mobile devices and high-definition video
screens.
As a result, we currently expect our fiscal 2016 non-GAAP EBITDA
to be between $215.0 million and
$225.0 million, and EBITDA margin to
range between 32.5 percent and 33.5 percent of total
revenues. This compares to fiscal 2015 EBITDA and margin of
approximately $197.8 million and 30.6
percent, respectively. Depreciation and amortization expense
is expected to be approximately $100.0
million to $105.0 million, on a non-GAAP basis, which
includes an incremental approximately $15.0
million to $16.0 million related to assets placed in service
for DAYTONA Rising. We currently expect our 2016 operating
margin to range between 16.5 percent and 18.0 percent of
total revenues, on a non-GAAP basis. Our non-GAAP effective
tax rate in 2015 will be approximately 38.5 percent to 39.0
percent.
We expect our fiscal 2016 cash distributions from the casino
joint venture will be approximately $27.0 million to $28.0 million. Equity income from the
casino is expected to be approximately $14.5
million to $15.5 million for the year.
As previously mentioned, for 2016, we are targeting a payout of
approximately $50.0 million in return
of capital to shareholders through a combination of dividends and
stock repurchase.
Based on all of the above assumptions, we expect fiscal 2016
non-GAAP earnings to be between $1.45 and
$1.60 per diluted share. From an earnings perspective
the fourth quarter will be our most significant, followed by the
first, second and third quarters, respectively. DAYTONA
Rising will have a significant impact on first quarter, and to a
lesser extent third quarter, revenues and EBITDA.
Our fiscal 2016 non-GAAP earnings per share guidance excludes
approximately $1.2 million of
non-capitalized costs attributable to the completion of the DAYTONA
Rising project, partially offset by approximately $0.4 million in capitalized interest
expense. Also excluded are potential non-capitalized costs or
charges that could be recognized related to our ONE DAYTONA
development, start up and/or financing costs should our Hollywood
Casino at Kansas Speedway joint venture pursue construction of an
adjacent hotel, any costs related to legal settlements; gain or
loss on sale of fixed assets; and accelerated depreciation and
future loss on retirements or relocation of certain long-lived
assets which could be recorded as part of capital improvements
other than DAYTONA Rising resulting in removal of assets prior to
the end of their actual useful life.
Event Schedule
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
Full Fiscal
Year
|
Series
Name
|
2016
|
2015
|
|
2016
|
2015
|
|
2016
|
2015
|
|
2016
|
2015
|
|
2016
|
2015
|
NASCAR Sprint
Cup
|
|
3
|
|
3
|
|
|
6
|
|
6
|
|
|
4
|
|
4
|
|
|
8
|
|
8
|
|
|
21
|
|
21
|
NASCAR
Xfinity
|
|
1
|
|
1
|
|
|
4
|
|
4
|
|
|
3
|
|
4
|
|
|
6
|
|
6
|
|
|
14
|
|
15
|
NASCAR Camping
World
|
|
1
|
|
1
|
|
|
2
|
|
2
|
|
|
1
|
|
1
|
|
|
5
|
|
5
|
|
|
9
|
|
9
|
IndyCar
Series
|
|
0
|
|
0
|
|
|
1
|
|
0
|
|
|
0
|
|
1
|
|
|
0
|
|
0
|
|
|
1
|
|
1
|
ARCA Racing
Series
|
|
1
|
|
1
|
|
|
1
|
|
1
|
|
|
1
|
|
2
|
|
|
2
|
|
1
|
|
|
5
|
|
5
|
IMSA Weather Tech
SportsCar Championship
Series
|
|
1
|
|
1
|
|
|
0
|
|
0
|
|
|
1
|
|
1
|
|
|
0
|
|
0
|
|
|
2
|
|
2
|
AMA
Superbike/Supercross
|
|
0
|
|
0
|
|
|
1
|
|
1
|
|
|
0
|
|
0
|
|
|
0
|
|
0
|
|
|
1
|
|
1
|
|
|
7
|
|
7
|
|
|
15
|
|
14
|
|
|
10
|
|
13
|
|
|
21
|
|
20
|
|
|
53
|
|
54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NASCAR Xfinity Series and ARCA Racing Series
The NASCAR Xfinity Series at Chicagoland Speedway previously
held in the third quarter of fiscal 2015 will not be held in fiscal
2016. The ARCA Racing Series event at Chicagoland Speedway
will move to the fourth quarter fiscal 2016, accompanying the
NASCAR Sprint Cup Weekend.
IndyCar Series
IndyCar will be held at Phoenix International Raceway in the
second quarter of fiscal 2016, this event was held in at Auto Club
Speedway in California in the
third quarter of fiscal 2015.
In closing, Ms. France Kennedy
stated, "We maintain a solid financial position, developed over
many years, that affords us the ability to follow our disciplined
capital allocation strategy and maintain our leadership position in
the motorsports industry. As promised, we have delivered
DAYTONA Rising on time, on budget and on track to meet incremental
revenue and EBITDA commitments. For the future, we are well
positioned to balance the strategic capital needs of our business
with returning capital to our shareholders."
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 (888) 694-4641
five to ten minutes prior to the scheduled start time and request
to be connected to the ISC earnings call, ID number 55810739.
A live Webcast will also be available at that time on the
Company's Web site, www.internationalspeedwaycorporation.com, under
the "Investor Relations" section. A replay will be available
two hours after the end of the call through midnight Tuesday, February 9, 2016. To access, dial
(855) 859-2056 and enter the code 55810739, 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; Auto Club Speedway of
Southern CaliforniaSM
near Los Angeles; Kansas Speedway®
in Kansas City, Kansas; Phoenix
International Raceway® in Arizona;
Chicagoland Speedway® and Route 66 RacewaySM near
Chicago, Illinois;
Homestead-Miami SpeedwaySM in Florida; Martinsville Speedway® in
Virginia; Darlington Raceway® in
South Carolina; and Watkins Glen
International® in New York.
The Company also owns and operates Motor Racing
NetworkSM, the nation's largest independent sports radio
network and Americrown Service CorporationSM, a
subsidiary that provides catering services, and food and beverage
concessions. In addition, the Company has a 50.0 percent
interest in the Hollywood Casino at Kansas Speedway. For more
information, visit the Company's Web site at
www.internationalspeedwaycorporation.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.
(Tables Follow)
Consolidated
Statements of Operations
|
(In Thousands, Except
Share and Per Share Amounts)
|
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
|
November 30,
2014
|
|
November 30,
2015
|
|
November 30,
2014
|
|
November 30,
2015
|
|
|
(Unaudited)
|
REVENUES:
|
|
|
|
|
|
|
|
|
Admissions,
net
|
|
$
|
37,667
|
|
|
$
|
42,312
|
|
|
$
|
129,688
|
|
|
$
|
130,154
|
|
Motorsports and other
event related
|
|
138,134
|
|
|
162,695
|
|
|
433,738
|
|
|
451,838
|
|
Food, beverage and
merchandise
|
|
19,447
|
|
|
10,452
|
|
|
72,880
|
|
|
47,282
|
|
Other
|
|
4,505
|
|
|
3,859
|
|
|
15,630
|
|
|
16,096
|
|
|
|
199,753
|
|
|
219,318
|
|
|
651,936
|
|
|
645,370
|
|
EXPENSES:
|
|
|
|
|
|
|
|
|
Direct:
|
|
|
|
|
|
|
|
|
NASCAR event
management fees
|
|
53,761
|
|
|
63,819
|
|
|
162,988
|
|
|
167,841
|
|
Motorsports and other
event related
|
|
36,421
|
|
|
39,018
|
|
|
128,229
|
|
|
131,109
|
|
Food, beverage and
merchandise
|
|
16,177
|
|
|
7,813
|
|
|
58,265
|
|
|
38,484
|
|
General and
administrative
|
|
28,358
|
|
|
30,635
|
|
|
108,563
|
|
|
111,617
|
|
Depreciation and
amortization
|
|
22,353
|
|
|
21,737
|
|
|
90,352
|
|
|
94,727
|
|
Losses on retirements
of long-lived assets
|
|
2,845
|
|
|
4,389
|
|
|
10,148
|
|
|
16,015
|
|
|
|
159,915
|
|
|
167,411
|
|
|
558,545
|
|
|
559,793
|
|
Operating
income
|
|
39,838
|
|
|
51,907
|
|
|
93,391
|
|
|
85,577
|
|
Interest
income
|
|
2,005
|
|
|
72
|
|
|
2,107
|
|
|
157
|
|
Interest
expense
|
|
(1,386)
|
|
|
(2,844)
|
|
|
(9,182)
|
|
|
(9,582)
|
|
Other
|
|
3
|
|
|
109
|
|
|
5,380
|
|
|
730
|
|
Equity in net income
from equity investments
|
|
2,172
|
|
|
2,828
|
|
|
8,916
|
|
|
14,060
|
|
Income before income
taxes
|
|
42,632
|
|
|
52,072
|
|
|
100,612
|
|
|
90,942
|
|
Income
taxes
|
|
16,808
|
|
|
19,790
|
|
|
33,233
|
|
|
34,308
|
|
Net income
|
|
$
|
25,824
|
|
|
$
|
32,282
|
|
|
$
|
67,379
|
|
|
$
|
56,634
|
|
|
|
|
|
|
|
|
|
|
Dividends per
share
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.24
|
|
|
$
|
0.26
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
$
|
0.55
|
|
|
$
|
0.69
|
|
|
$
|
1.45
|
|
|
$
|
1.21
|
|
|
|
|
|
|
|
|
|
|
Basic weighted
average shares outstanding
|
|
46,592,816
|
|
|
46,649,980
|
|
|
46,559,232
|
|
|
46,621,211
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
|
46,606,009
|
|
|
46,664,753
|
|
|
46,573,038
|
|
|
46,635,830
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
income
|
|
$
|
25,989
|
|
|
$
|
32,447
|
|
|
$
|
68,036
|
|
|
$
|
57,292
|
|
Consolidated
Balance Sheets
|
(In Thousands, Except
Share and Per Share Amounts)
|
|
|
|
November 30,
2014
|
|
November 30,
2015
|
|
|
(Unaudited)
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
158,847
|
|
|
$
|
160,548
|
|
Receivables, less
allowance
|
|
27,598
|
|
|
42,112
|
|
Inventories
|
|
4,030
|
|
|
1,639
|
|
Income taxes
receivable
|
|
6,202
|
|
|
572
|
|
Deferred income
taxes
|
|
2,789
|
|
|
—
|
|
Prepaid expenses and
other current assets
|
|
8,099
|
|
|
60,673
|
|
Total Current
Assets
|
|
207,565
|
|
|
265,544
|
|
|
|
|
|
|
Property and
Equipment, net
|
|
1,381,190
|
|
|
1,448,964
|
|
Other
Assets:
|
|
|
|
|
Equity
investments
|
|
122,565
|
|
|
103,249
|
|
Intangible assets,
net
|
|
178,629
|
|
|
178,626
|
|
Goodwill
|
|
118,791
|
|
|
118,791
|
|
Other
|
|
68,911
|
|
|
7,025
|
|
|
|
488,896
|
|
|
407,691
|
|
Total
Assets
|
|
$
|
2,077,651
|
|
|
$
|
2,122,199
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
Current portion of
long-term debt
|
|
$
|
3,435
|
|
|
$
|
3,408
|
|
Accounts
payable
|
|
41,491
|
|
|
56,968
|
|
Deferred
income
|
|
33,043
|
|
|
38,243
|
|
Other current
liabilities
|
|
18,813
|
|
|
20,344
|
|
Total Current
Liabilities
|
|
96,782
|
|
|
118,963
|
|
|
|
|
|
|
Long-Term
Debt
|
|
268,311
|
|
|
264,964
|
|
Deferred Income
Taxes
|
|
354,276
|
|
|
336,232
|
|
Long-Term Deferred
Income
|
|
9,548
|
|
|
6,969
|
|
Other Long-Term
Liabilities
|
|
2,302
|
|
|
1,856
|
|
Commitments and
Contingencies
|
|
—
|
|
|
—
|
|
Shareholders'
Equity:
|
|
|
|
|
Class A Common
Stock, $.01 par value, 80,000,000 shares authorized
|
|
262
|
|
|
263
|
|
Class B Common
Stock, $.01 par value, 40,000,000 shares authorized
|
|
200
|
|
|
199
|
|
Additional paid-in
capital
|
|
447,518
|
|
|
449,136
|
|
Retained
earnings
|
|
902,433
|
|
|
946,940
|
|
Accumulated other
comprehensive loss
|
|
(3,981)
|
|
|
(3,323)
|
|
Total Shareholders'
Equity
|
|
1,346,432
|
|
|
1,393,215
|
|
Total Liabilities and
Shareholders' Equity
|
|
$
|
2,077,651
|
|
|
$
|
2,122,199
|
|
Consolidated
Statements of Cash Flows
|
(In
Thousands)
|
|
|
|
Year Ended
|
|
|
November 30,
2014
|
|
November 30,
2015
|
|
|
(Unaudited)
|
OPERATING
ACTIVITIES
|
|
|
|
|
Net income
|
|
$
|
67,379
|
|
|
$
|
56,634
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Gain on assumption of
controlling interest in equity investee
|
|
(5,447)
|
|
|
—
|
|
Depreciation and
amortization
|
|
90,352
|
|
|
94,727
|
|
Stock-based
compensation
|
|
2,826
|
|
|
2,944
|
|
Amortization of
financing costs
|
|
1,779
|
|
|
1,787
|
|
Interest received on
Staten Island note receivable
|
|
5,087
|
|
|
4,648
|
|
Deferred income
taxes
|
|
(12,346)
|
|
|
(15,678)
|
|
Income from equity
investments
|
|
(8,916)
|
|
|
(14,060)
|
|
Distribution from
equity investee
|
|
10,076
|
|
|
15,209
|
|
Losses on retirements
of long-lived assets, non-cash
|
|
2,644
|
|
|
3,490
|
|
Other, net
|
|
380
|
|
|
(702)
|
|
Changes in operating
assets and liabilities
|
|
|
|
|
Receivables,
net
|
|
(1,776)
|
|
|
(14,514)
|
|
Inventories, prepaid
expenses and other assets
|
|
1,977
|
|
|
4,466
|
|
Accounts payable and
other liabilities
|
|
(517)
|
|
|
5,128
|
|
Deferred
income
|
|
(1,692)
|
|
|
2,621
|
|
Income
taxes
|
|
11,041
|
|
|
5,287
|
|
Net cash provided by
operating activities
|
|
162,847
|
|
|
151,987
|
|
INVESTING
ACTIVITIES
|
|
|
|
|
Capital
expenditures
|
|
(183,936)
|
|
|
(155,016)
|
|
Distribution from
equity investee and affiliate
|
|
11,924
|
|
|
16,841
|
|
Equity investments
and advances to affiliate
|
|
(1,322)
|
|
|
—
|
|
Proceeds from sale of
Staten Island property
|
|
6,100
|
|
|
—
|
|
Proceeds from sale of
assets
|
|
—
|
|
|
4,442
|
|
Cash included in
assumption of ownership interest in equity investee
|
|
4,686
|
|
|
—
|
|
Other, net
|
|
32
|
|
|
(5)
|
|
Net cash used in
investing activities
|
|
(162,516)
|
|
|
(133,738)
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
Payment of long-term
debt
|
|
(2,807)
|
|
|
(3,437)
|
|
Cash dividends
paid
|
|
(11,181)
|
|
|
(12,127)
|
|
Reacquisition of
previously issued common stock
|
|
(323)
|
|
|
(984)
|
|
Net cash used in
financing activities
|
|
(14,311)
|
|
|
(16,548)
|
|
Net (decrease)
increase in cash and cash equivalents
|
|
(13,980)
|
|
|
1,701
|
|
Cash and cash
equivalents at beginning of year
|
|
172,827
|
|
|
158,847
|
|
Cash and cash
equivalents at end of year
|
|
$
|
158,847
|
|
|
$
|
160,548
|
|
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SOURCE International Speedway Corporation