SMI profits down, but still huge
Speedway Motorsports' ticket revenue for the year dropped 15.6 percent through September and its operating profits dropped 41.4 percent, according to its third quarter financial statement released Wednesday.
For the last three months – which primarily were Sprint Cup weekends at Bristol, Atlanta and New Hampshire – the ticket revenues dropped 13.5 percent from $45.8 million to $39.7 million.
The financial results through September include virtually all of the SMI races this season with the exception of the Charlotte race weekend in October and Texas this weekend. SMI owns tracks at Bristol, Atlanta, New Hampshire, Texas, Sonoma (Calif.), Kentucky, Las Vegas and Charlotte.
SMI officials remain optimistic even though total revenues for the year through Sept. 30 have dropped from 8.8 percent from $460.0 million to $419.3 million.
“We believe more than ever that SMI’s first-class venues continue to provide broadcasters and advertisers outstanding long-term promotional opportunities and significant untapped potential for earnings growth,” SMI Chairman Bruton Smith said in a statement.
SMI hopes that attendance and ticket sales at least stabilize in 2011.
Admissions revenue has dropped this year from $139.7 million to $117.9 million. SMI attributes 49 percent of the admissions revenue decline to lower ticket prices.
But for the three months July-September, 64 percent of the admissions revenue decline was because of lower ticket prices, SMI chief financial officer Bill Brooks said in a teleconference with financial analysts.
“Attendance is kind of stabilizing, pricing is down a good bit – we hope to be more stable in both areas for 2011,” Brooks said.
Net income for 2010 through Sept. 30 was $38.5 million, compared to $4.9 million in 2009. But that $4.9 million includes a $62 million loss in the devaluation Motorsports Authentics.
SMI lists its operating income as $41.3 million in 2010, compared to $70.4 million in 2009. From July-September, it made $7.0 million in 2010, down 43.4 percent from $12.4 million in 2009.
“Despite our recent meager results, Speedway Motorsports remains profitable; our cash flow is positive,” Brooks said. “We’ve reduced our debt by $20 million in the [third] quarter. Since September of last year, we’ve reduced our long-term debt by more than $70 million, more than 10 percent.”
SMI stock dropped 4.09 percent in trading Wednesday as it went from $15.64 to $15.00 a share.
In other items from SMI’s financial statement:
• SMI broadcasting revenue from NASCAR’s television contract has increased 2.8 percent.
• Its NASCAR purse and sanction fees for the first nine months of 2010 have decreased 2.2 percent.
• Motorsports Authentics, which is now mainly an at-track seller of merchandise, has made $2 million in 2010, compared to a loss of $20.1 million in 2009 when it also was responsible for obtaining licenses and manufacturing diecasts and apparel.
• SMI plans to spend $40 million on improvements and grandstand expansion to Kentucky Speedway with $20 million spent in 2010 and $20 million in 2011. Kentucky will have its first Sprint Cup race next year.