Dover Motorsports, Inc. (NYSE: DVD) today reported results for
the three months ended June 30, 2020.
The COVID-19 pandemic caused the postponement of the Company’s
scheduled May NASCAR weekend and the cancelation of the Firefly
Music Festival (“Firefly”). The three NASCAR events originally
scheduled to be held in May will now be held without fans in
combination with our already scheduled August NASCAR weekend
events. Firefly will not be rescheduled in 2020, though it is
expected to return in 2021. The Company promoted a NASCAR
triple-header and hosted Firefly in Dover during the second quarter
of 2019. Accordingly, the results for the second quarter of 2020
are not comparable to last year.
Revenues for the second quarter of 2020 were $110,000 compared
to $24,838,000 for the second quarter of 2019. The decrease is
primarily from the schedule changes described above.
Operating and marketing expenses decreased to $812,000 in the
second quarter of 2020 from $14,584,000 in the second quarter of
2019. The decrease is also from the schedule changes and cost
cutting efforts implemented at the onset of the pandemic.
General and administrative expenses were $1,877,000 in the
second quarter of 2020 compared to $1,826,000 in the second quarter
of 2019.
The adjustment to the contingent obligation was a benefit of
$353,000 in the second quarter of 2020 compared to an expense of
$135,000 during the second quarter of 2019, primarily from changed
sales tax assumptions associated with the planned reopening of
Nashville Superspeedway.
Other income increased to $163,000 in the second quarter of 2020
from $57,000 in the second quarter of 2019, primarily from higher
gains on equity investments.
Loss before income taxes for the second quarter of 2020 was
($2,844,000) compared to earnings before income taxes of $7,546,000
for the second quarter of 2019.
The Company’s effective income tax rate was a benefit of 75.8%
in the second quarter of 2020 and is the result of reversing a
portion of a previously booked valuation allowance on Tennessee
state deferred tax assets, which we now expect to realize with the
reopening of the Nashville Superspeedway next year.
Net loss for the second quarter of 2020 was ($689,000) or
($0.02) per diluted share compared to net earnings for the second
quarter of 2019 of $5,501,000 or $0.15 per diluted share.
On July 29, 2020, we closed on the sale of approximately 97
acres of property near our Nashville Superspeedway pursuant to an
option agreement with an entity owned by Panattoni Development
Company. Proceeds from the sale, less closing costs, were
approximately $6.5 million. The purchaser had previously paid to us
a $500,000 deposit that was credited to the purchase price. Net
proceeds after taxes are estimated to be approximately $5.3
million. None of the acreage sold extends to the land on which our
superspeedway is sited and the Company continues to hold
approximately 1,000 acres of commercial real estate, including the
superspeedway.
At June 30, 2020, the Company had no outstanding indebtedness
and almost $2.9 million in available cash.
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 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 EARNINGS In
Thousands, Except Per Share Amounts (Unaudited) Three
Months Ended Six Months Ended June 30, June 30,
2020
2019
2020
2019
Revenues: Admissions
$
-
$
2,502
$
-
$
2,502
Event-related
110
3,453
314
3,582
Broadcasting
-
18,878
-
18,878
Other
-
5
-
5
110
24,838
314
24,967
Expenses: Operating and marketing
812
14,584
1,800
15,639
General and administrative
1,877
1,826
3,864
3,742
Depreciation
765
794
1,533
1,587
Cost to remove long-lived assets
-
-
341
-
3,454
17,204
7,538
20,968
Gain on sale of land
-
-
-
139
Operating (loss) earnings
(3,344
)
7,634
(7,224
)
4,138
Interest expense, net
(16
)
(10
)
(13
)
(16
)
Benefit (provision) for contingent obligation
353
(135
)
(16
)
(246
)
Other income, net
163
57
25
189
(Loss) earnings before income taxes
(2,844
)
7,546
(7,228
)
4,065
Income tax benefit (expense)
2,155
(2,045
)
3,399
(1,054
)
Net (loss) earnings
$
(689
)
$
5,501
$
(3,829
)
$
3,011
Net (loss) earnings per common share: Basic
$
(0.02
)
$
0.15
$
(0.11
)
$
0.08
Diluted
$
(0.02
)
$
0.15
$
(0.11
)
$
0.08
Weighted average shares outstanding: Basic
35,836
36,010
35,835
36,021
Diluted
35,836
36,010
35,835
36,021
DOVER MOTORSPORTS, INC. CONSOLIDATED BALANCE SHEETS In Thousands
(Unaudited) June 30, June 30, December 31,
2020
2019
2019
ASSETS Current assets: Cash
$
2,886
$
8,989
$
7,577
Accounts receivable
1,035
1,449
645
Inventories
18
20
18
Prepaid expenses and other
1,493
933
1,186
Income taxes receivable
353
-
283
Assets held for sale
1,622
2,203
-
Total current assets
7,407
13,594
9,709
Property and equipment, net
68,398
69,881
71,357
Right of use asset
150
231
188
Other assets
1,156
1,169
1,212
Total assets
$
77,111
$
84,875
$
82,466
LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities:
Accounts payable
$
26
$
712
$
119
Accrued liabilities
2,948
3,053
3,710
Income taxes payable
-
1,149
-
Contract liabilities
3,676
2,008
976
Non-refundable deposit
500
-
-
Total current liabilities
7,150
6,922
4,805
Liability for pension benefits
863
666
1,016
Lease liability
73
157
112
Non-refundable deposit
-
500
500
Provision for contingent obligation
3,404
2,630
3,389
Deferred income taxes
5,300
8,074
8,676
Total liabilities
16,790
18,949
18,498
Stockholders' equity: Common stock
1,788
1,809
1,782
Class A common stock
1,851
1,851
1,851
Additional paid-in capital
101,112
101,388
100,994
Accumulated deficit
(40,797
)
(35,815
)
(36,968
)
Accumulated other comprehensive loss
(3,633
)
(3,307
)
(3,691
)
Total stockholders' equity
60,321
65,926
63,968
Total liabilities and stockholders' equity
$
77,111
$
84,875
$
82,466
DOVER MOTORSPORTS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS In
Thousands (Unaudited) Six Months Ended June 30,
2020
2019
Operating activities: Net (loss) earnings
$
(3,829
)
$
3,011
Adjustments to reconcile net (loss) earnings to net cash (used in)
provided by operating activities: Depreciation
1,533
1,587
Amortization of credit facility fees
28
31
Stock-based compensation
218
176
Deferred income taxes
(3,399
)
(317
)
Provision for contingent obligation
16
246
Losses (gains) on equity investments
50
(113
)
Gain on sale of land
-
(139
)
Changes in assets and liabilities: Accounts receivable
(390
)
(773
)
Inventories
-
1
Prepaid expenses and other
(321
)
58
Accounts payable
(93
)
555
Accrued liabilities
(762
)
(104
)
Payable to Dover Downs Gaming & Entertainment, Inc.
-
(9
)
Income taxes payable/receivable
(70
)
1,031
Contract liabilities
2,700
868
Liability for pension benefits
(73
)
(36
)
Net cash (used in) provided by operating activities
(4,392
)
6,073
Investing activities: Capital expenditures
(196
)
(2,154
)
Proceeds from sale of land and equipment, net
-
827
Non-refundable deposit received
-
500
Purchases of equity investments
(240
)
(9
)
Proceeds from sale of equity investments
231
1
Net cash used in investing activities
(205
)
(835
)
Financing activities: Borrowings from revolving line of
credit
180
4,060
Repayments on revolving line of credit
(180
)
(4,060
)
Repurchase of common stock
(94
)
(200
)
Net cash used in financing activities
(94
)
(200
)
Net (decrease) increase in cash
(4,691
)
5,038
Cash, beginning of period
7,577
3,951
Cash, end of period
$
2,886
$
8,989
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200730005175/en/
Timothy R. Horne – Sr. Vice President - Finance (302)
883-6592
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