Dover Motorsports, Inc. (NYSE: DVD) today reported its results for the
quarter ended March 31, 2015.
The Company historically reports a loss in the first quarter due to the
seasonality of our motorsports business. No major events were promoted
during the first quarter of 2015 or 2014; therefore, our revenues were
minimal.
Operating and marketing expenses of $1,109,000 in the first quarter of
2015 increased slightly from $1,035,000 in the first quarter of 2014
primarily due to increased employee costs from the increase in the
number of events hosted on our property.
General and administrative expenses of $1,940,000 in the first quarter
of 2015 increased slightly from $1,860,000 in the first quarter of 2014
primarily due to professional fees and pension related costs.
Loss on disposal of long-lived assets represents the costs to remove
certain grandstand structures in the first quarter of 2015.
Depreciation expense increased to $1,545,000 in the first quarter of
2015 compared to $825,000 in the first quarter of 2014. The increase is
due to our first quarter 2015 decision to remove additional grandstand
seats and structures after our 2015 race season. We changed the
estimated useful lives of the impacted assets resulting in a $729,000
increase in our first quarter 2015 depreciation expense.
Income from assets held for sale of $427,000 represents payments made by
Nexovation in 2015 to extend the closing date under our agreement to
sell our Nashville facility. The payments received are non-refundable
and will not be applied against the purchase price.
Net interest expense was $147,000 in the first quarter of 2015 compared
to $165,000 in the first quarter of 2014. The decrease is primarily due
to lower average outstanding borrowings.
Loss before income tax benefit was $4,366,000 for the first quarter of
2015 compared to $3,621,000 for the first quarter of 2014. The results
for 2015 include the $729,000 of accelerated depreciation, the $40,000
loss on disposal of long-lived assets and the $427,000 income from
assets held for sale. On an adjusted basis, excluding these items, loss
before income tax benefit for the first quarter of 2015 was $4,024,000.
The effective income tax rate was a benefit of 40.4% for the first
quarter of 2015 compared to a benefit of 41.5% for the first quarter of
2014.
Net loss for the first quarter of 2015 was $2,604,000 or $.07 per
diluted share compared with a loss of $2,118,000 or $.06 per diluted
share in the first quarter of 2014. Net loss, adjusted for the
aforementioned items, was $2,425,000 or $.07 per diluted share for the
first quarter of 2015.
At March 31, 2015, the Company’s total indebtedness was $11,780,000
compared with $15,540,000 at March 31, 2014.
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 OPERATIONS
|
|
In Thousands, Except Per Share Amounts
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2015
|
|
2014
|
|
Revenues:
|
|
|
|
|
|
Event-related
|
|
$
|
10
|
|
|
$
|
173
|
|
|
Other
|
|
|
-
|
|
|
|
10
|
|
|
|
|
|
10
|
|
|
|
183
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
Operating and marketing
|
|
|
1,109
|
|
|
|
1,035
|
|
|
General and administrative
|
|
|
1,940
|
|
|
|
1,860
|
|
|
Loss on disposal of long-lived assets
|
|
|
40
|
|
|
|
-
|
|
|
Depreciation
|
|
|
1,545
|
|
|
|
825
|
|
|
|
|
|
4,634
|
|
|
|
3,720
|
|
|
|
|
|
|
|
|
Income from assets held for sale
|
|
|
427
|
|
|
|
-
|
|
|
|
|
|
|
|
|
Operating loss
|
|
|
(4,197
|
)
|
|
|
(3,537
|
)
|
|
|
|
|
|
|
|
Interest expense, net
|
|
|
(147
|
)
|
|
|
(165
|
)
|
|
(Provision) benefit for contingent obligation
|
|
|
(23
|
)
|
|
|
78
|
|
|
Other income
|
|
|
1
|
|
|
|
3
|
|
|
|
|
|
|
|
|
Loss before income taxes
|
|
|
(4,366
|
)
|
|
|
(3,621
|
)
|
|
|
|
|
|
|
|
Income tax benefit
|
|
|
1,762
|
|
|
|
1,503
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(2,604
|
)
|
|
$
|
(2,118
|
)
|
|
|
|
|
|
|
|
Net loss per common share:
|
|
|
|
|
|
Basic
|
|
$
|
(0.07
|
)
|
|
$
|
(0.06
|
)
|
|
Diluted
|
|
$
|
(0.07
|
)
|
|
$
|
(0.06
|
)
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
Basic
|
|
|
36,153
|
|
|
|
36,049
|
|
|
Diluted
|
|
|
36,153
|
|
|
|
36,049
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DOVER MOTORSPORTS, INC.
|
|
RECONCILIATION OF GAAP LOSS BEFORE INCOME TAXES TO ADJUSTED LOSS
BEFORE INCOME TAXES
|
|
AND RECONCILIATION OF GAAP NET LOSS TO ADJUSTED NET LOSS
|
|
In Thousands, Except Per Share Amounts
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
GAAP loss before income taxes
|
|
$
|
(4,366
|
)
|
|
$
|
(3,621
|
)
|
|
|
|
|
|
|
|
Accelerated depreciation (1)
|
|
|
729
|
|
|
|
-
|
|
|
|
|
|
|
|
|
Income from assets held for sale (2)
|
|
|
(427
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
Loss on disposal of long-lived assets (3)
|
|
|
40
|
|
|
|
-
|
|
|
|
|
|
|
|
|
Adjusted loss before income taxes
|
|
$
|
(4,024
|
)
|
|
$
|
(3,621
|
)
|
|
|
|
|
|
|
|
GAAP net loss
|
|
$
|
(2,604
|
)
|
|
$
|
(2,118
|
)
|
|
|
|
|
|
|
|
Accelerated depreciation, net of income taxes (1)
|
|
|
433
|
|
|
|
-
|
|
|
|
|
|
|
|
|
Income from assets held for sale, net of income taxes (2)
|
|
|
(278
|
)
|
|
|
|
|
|
|
|
|
|
Loss on disposal of long-lived assets, net of income taxes (3)
|
|
|
24
|
|
|
|
-
|
|
|
|
|
|
|
|
|
Adjusted net loss
|
|
$
|
(2,425
|
)
|
|
$
|
(2,118
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net loss per common share - diluted
|
|
$
|
(0.07
|
)
|
|
$
|
(0.06
|
)
|
|
|
|
|
|
|
|
Accelerated depreciation, net of income taxes (1)
|
|
|
0.01
|
|
|
|
-
|
|
|
|
|
|
|
|
|
Income from assets held for sale, net of income taxes (2)
|
|
|
(0.01
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
Loss on disposal of long-lived assets, net of income taxes (3)
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
Adjusted net loss per common share - diluted
|
|
$
|
(0.07
|
)
|
|
$
|
(0.06
|
)
|
|
_________________________
|
|
(1)
|
|
During the first quarter of 2015, we made the decision to remove
certain grandstand seating at our Dover International Speedway
facility. These assets will remain in service until the end of
the 2015 race season. As a result, we shortened the service lives
of these assets which resulted in accelerated depreciation being
recorded in the first quarter of 2015.
|
|
|
|
|
|
(2)
|
|
On May 29, 2014, we entered into a definitive agreement to sell
our Nashville Superspeedway facility. In the first quarter of
2015, we received two payments of $200,000 each to extend closing
under the agreement, which amounts will not be applied against the
purchase price. We also received an additional $400,000 to
further extend closing under the agreement, and depending on when
closing occurs, a prorated portion of this amount will be applied
against the purchase price.
|
|
|
|
|
|
(3)
|
|
Loss on disposal of long-lived assets is attributable to the
decision to remove and dispose of certain grandstand seating at
our Dover International Speedway facility.
|
|
|
|
|
|
|
|
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 before income taxes, adjusted net
loss and adjusted net loss per common share - diluted are derived
by adjusting amounts determined in accordance with GAAP for the
aforementioned accelerated depreciation, income from assets held
for sale and loss on disposal of long-lived assets. 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 before income taxes, net loss
or net loss per common share - diluted, which are determined in
accordance with GAAP.
|
|
|
|
|
|
|
|
DOVER MOTORSPORTS, INC.
|
|
CONSOLIDATED BALANCE SHEETS
|
|
In Thousands
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
March 31,
|
|
December 31,
|
|
|
|
2015
|
|
2014
|
|
2014
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash
|
|
$
|
114
|
|
|
$
|
297
|
|
|
$
|
24
|
|
|
Accounts receivable
|
|
|
1,699
|
|
|
|
1,340
|
|
|
|
139
|
|
|
Inventories
|
|
|
71
|
|
|
|
114
|
|
|
|
70
|
|
|
Prepaid expenses and other
|
|
|
1,715
|
|
|
|
1,119
|
|
|
|
1,042
|
|
|
Prepaid income taxes
|
|
|
170
|
|
|
|
22
|
|
|
|
170
|
|
|
Deferred income taxes
|
|
|
1,606
|
|
|
|
1,453
|
|
|
|
79
|
|
|
Assets held for sale
|
|
|
26,000
|
|
|
|
-
|
|
|
|
26,000
|
|
|
Total current assets
|
|
|
31,375
|
|
|
|
4,345
|
|
|
|
27,524
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
|
56,757
|
|
|
|
84,882
|
|
|
|
58,236
|
|
|
Other assets
|
|
|
928
|
|
|
|
933
|
|
|
|
925
|
|
|
Deferred income taxes
|
|
|
569
|
|
|
|
309
|
|
|
|
580
|
|
|
Total assets
|
|
$
|
89,629
|
|
|
$
|
90,469
|
|
|
$
|
87,265
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
322
|
|
|
$
|
10
|
|
|
$
|
889
|
|
|
Accrued liabilities
|
|
|
4,342
|
|
|
|
1,981
|
|
|
|
4,944
|
|
|
Payable to Dover Downs Gaming & Entertainment, Inc.
|
|
|
11
|
|
|
|
-
|
|
|
|
22
|
|
|
Deferred revenue
|
|
|
6,721
|
|
|
|
6,695
|
|
|
|
1,348
|
|
|
Total current liabilities
|
|
|
11,396
|
|
|
|
8,686
|
|
|
|
7,203
|
|
|
|
|
|
|
|
|
|
|
Revolving line of credit
|
|
|
11,780
|
|
|
|
15,540
|
|
|
|
10,760
|
|
|
Liability for pension benefits
|
|
|
4,145
|
|
|
|
1,439
|
|
|
|
4,231
|
|
|
Provision for contingent obligation
|
|
|
1,836
|
|
|
|
1,765
|
|
|
|
1,813
|
|
|
Deferred income taxes
|
|
|
14,887
|
|
|
|
16,778
|
|
|
|
15,163
|
|
|
Total liabilities
|
|
|
44,044
|
|
|
|
44,208
|
|
|
|
39,170
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
|
|
Common stock
|
|
|
1,822
|
|
|
|
1,812
|
|
|
|
1,812
|
|
|
Class A common stock
|
|
|
1,851
|
|
|
|
1,851
|
|
|
|
1,851
|
|
|
Additional paid-in capital
|
|
|
101,562
|
|
|
|
101,336
|
|
|
|
101,508
|
|
|
Accumulated deficit
|
|
|
(56,353
|
)
|
|
|
(57,181
|
)
|
|
|
(53,749
|
)
|
|
Accumulated other comprehensive loss
|
|
|
(3,297
|
)
|
|
|
(1,557
|
)
|
|
|
(3,327
|
)
|
|
Total stockholders' equity
|
|
|
45,585
|
|
|
|
46,261
|
|
|
|
48,095
|
|
|
Total liabilities and stockholders' equity
|
|
$
|
89,629
|
|
|
$
|
90,469
|
|
|
$
|
87,265
|
|
|
|
|
|
|
|
|
|
|
|
|
DOVER MOTORSPORTS, INC.
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
In Thousands
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
Operating activities:
|
|
|
|
|
|
Net loss
|
|
$
|
(2,604
|
)
|
|
$
|
(2,118
|
)
|
|
Adjustments to reconcile net loss to net cash used in operating
activities:
|
|
|
|
|
|
Depreciation
|
|
|
1,545
|
|
|
|
825
|
|
|
Amortization of credit facility fees
|
|
|
24
|
|
|
|
24
|
|
|
Stock-based compensation
|
|
|
136
|
|
|
|
106
|
|
|
Deferred income taxes
|
|
|
(1,762
|
)
|
|
|
(1,503
|
)
|
|
Provision (benefit) for contingent obligation
|
|
|
23
|
|
|
|
(78
|
)
|
|
Income from assets held for sale
|
|
|
(427
|
)
|
|
|
-
|
|
|
Changes in assets and liabilities:
|
|
|
|
|
|
Accounts receivable
|
|
|
(1,560
|
)
|
|
|
(1,312
|
)
|
|
Inventories
|
|
|
(1
|
)
|
|
|
-
|
|
|
Prepaid expenses and other
|
|
|
(681
|
)
|
|
|
(94
|
)
|
|
Accounts payable
|
|
|
120
|
|
|
|
(15
|
)
|
|
Accrued liabilities
|
|
|
(975
|
)
|
|
|
(906
|
)
|
|
Payable to/receivable from Dover Downs Gaming & Entertainment, Inc.
|
|
|
(11
|
)
|
|
|
4
|
|
|
Deferred revenue
|
|
|
5,373
|
|
|
|
4,952
|
|
|
Liability for pension benefits
|
|
|
(55
|
)
|
|
|
(67
|
)
|
|
Net cash used in operating activities
|
|
|
(855
|
)
|
|
|
(182
|
)
|
|
|
|
|
|
|
|
Investing activities:
|
|
|
|
|
|
Capital expenditures
|
|
|
(753
|
)
|
|
|
(116
|
)
|
|
Purchases of available-for-sale securities
|
|
|
(6
|
)
|
|
|
-
|
|
|
Proceeds from sale of available-for-sale securities
|
|
|
5
|
|
|
|
-
|
|
|
Non-refundable payments received related to assets held for sale
|
|
|
800
|
|
|
|
-
|
|
|
Net cash provided by (used in) investing activities
|
|
|
46
|
|
|
|
(116
|
)
|
|
|
|
|
|
|
|
Financing activities:
|
|
|
|
|
|
Borrowings from revolving line of credit
|
|
|
3,580
|
|
|
|
2,620
|
|
|
Repayments on revolving line of credit
|
|
|
(2,560
|
)
|
|
|
(1,900
|
)
|
|
Repurchase of common stock
|
|
|
(121
|
)
|
|
|
(129
|
)
|
|
Net cash provided by financing activities
|
|
|
899
|
|
|
|
591
|
|
|
|
|
|
|
|
|
Net increase in cash
|
|
|
90
|
|
|
|
293
|
|
|
Cash, beginning of period
|
|
|
24
|
|
|
|
4
|
|
|
Cash, end of period
|
|
$
|
114
|
|
|
$
|
297
|
|
|
|
|
|
|
|
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