FOR: International Speedway Corporation
APPROVED BY: Wes Harris
Director of Investor Relations
(386) 947-6465
CONTACT: Jonathan Schaffer/Betsy Brod
Brod Group
(212) 750-5800
INTERNATIONAL SPEEDWAY REPORTS 2003 FIRST QUARTER RESULTS
DAYTONA BEACH, FLORIDA – April 8, 2003 – International Speedway Corporation (“ISC”) (Nasdaq/NM: ISCA; OTC Bulletin Board: ISCB) today
reported results for the first quarter ended February 28, 2003.
Total revenues for the first quarter increased to a record $130.9 million compared to revenues of $125.8 million in the prior-year period. Operating income was $48.8 million during the period compared to $49.2 million in the first quarter of fiscal 2002. Net income for the first quarter of fiscal 2003 was $25.4 million, or $0.48 per diluted share, compared to income of $25.4 million, or $0.48 per diluted share, in the prior-year period before the cumulative effect of an accounting change. Fiscal 2002 first quarter results included a previously announced one-time, non-cash after-tax charge of $517.2 million, or $9.74 per diluted share, associated with the adoption of Statement of Financial Accounting Standards No. 142. Inclusive of this charge, the Company reported a 2002 first quarter net loss of $491.9 million, or $9.26 per diluted share.
Results for the first quarter of 2003 included a previously reported favorable impact of a non-recurring revenue contribution to ISC's Food, Beverage, and Merchandise Income of approximately $1.6 million, or less than $0.02 per diluted share in earnings, related to the Company's ongoing activities to audit third party vendors' sales reports for prior years.
In addition to record revenues for the first quarter, more than 29 million television viewers tuned in for the NASCAR Winston Cup Series Daytona 500, America's most watched motorsports event. Other highlights of the quarter included the second highest attended Budweiser Shootout in history, the signing of additional long-term corporate sponsorship agreements, and increased television viewership for several of the Company's events. As previously reported, the Company's performance in the period was impacted by a combination of inclement weather for events at Daytona and North Carolina and softer attendance-related revenues due to prevailing economic and geopolitical conditions.
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Inclement weather continued to play a significant role at events early in the Company's second quarter as rain impacted eight out of ten days of racing during Daytona's Bike Week. The Daytona 200 by Arai, Bike Week's finale and premier event, was scheduled for Sunday, March 9th but was postponed until the following day. Poor weather was also a major factor at Darlington's triple-header weekend, impacting attendance levels for the Winston Cup qualifying and NASCAR Craftsman Truck Series events held on Friday and postponing Saturday's NASCAR Busch Series race until the following Monday. Although attendance-related revenues for Darlington's Winston Cup event on Sunday were affected by inclement weather during race week, the event featured one of the most exciting finishes in Winston Cup history with Ricky Craven beating Kurt Busch by a margin of victory of only 0.002 of a second.
Other major events held to date in the second quarter included successful IRL IndyCar Series weekends at Homestead-Miami and Phoenix, with both event weekends posting double-digit increases in attendance over the prior year. In addition, Talladega hosted a NASCAR Winston Cup weekend including Busch Series and IROC racing events. While the weekend featured Dale Earnhardt, Jr.'s record-breaking fourth consecutive Winston Cup win at Talladega, results for the weekend were below Company expectations. Poor weather, a weaker economy and increased geopolitical uncertainty impacted the weekend's financial performance. In addition, fans attending Talladega's events travel further, on average, than for other ISC events, with the exception of the Daytona 500. As such, the Company believes travel costs, including higher fuel prices, also played a significant part in reducing attendance-related revenues at Talladega.
As a result of second quarter performance to date, the Company is revising its second quarter guidance for revenues to a range of $115 million to $120 million, and earnings to a range of $0.25 to $0.27 per diluted share. While overall advance ticket sales for remaining 2003 events are slightly behind 2002 levels, sales for many of the Company's remaining 2003 major events are ahead of the prior year. Therefore, the Company does not believe the results of Talladega's event weekend are representative of trends for the remainder of the year. The Company remains comfortable with its previously announced revenue and earnings guidance for the third and fourth quarters, including third quarter earnings of $0.70 to $0.72 per diluted share and $0.64 to $0.66 for the fourth quarter. Accordingly, ISC is adjusting its full year guidance to a range of $2.07 to $2.13 per diluted share.
"We are optimistic about our remaining events for 2003," commented Mr. James C. France, President and Chief Operating Officer of International Speedway Corporation. "We believe California's April Winston Cup race will sell out again this year and advanced ticket sales for its supporting Busch Series race are currently ahead of 2002. We also recently announced that Richmond's upcoming Winston Cup event in May has already sold out, including this year's expansion of 3,100 seats and six suites, and Kansas has once again sold out its entire facility on a season-ticket basis."
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Supporting its positive outlook on corporate spending, the Company continues to attract new sponsors and enhance and/or renew relationships with existing partners. Recognizing the benefits from a more high-profile position in the sport, Automobile Club of Southern California has increased its motorsports involvement and is now title sponsor of California's Winston Cup event. Automobile Club was previously title sponsor of California's Busch race. In addition, General Motors renewed its position for both of Richmond's Winston Cup events, and General Mills is returning as sponsor of North Carolina's Winston Cup and Busch events in the fall. Also, Funai renewed its fall Busch race sponsorship at Richmond, and Purex sponsored the IRL IndyCar event at Phoenix in March. Currently, ISC's only open Winston Cup entitlement for 2003 is Michigan's race in August, compared to four open Winston Cup title sponsorships at this time last year.
The Company has also been successful in securing sponsorships for official status positions and display rights, highlighted by multi-track agreements with DeWalt, Newell-Rubbermaid, U.S. Army, Labor Ready, Wachovia, Marlboro and Sony.
Mr. France continued, "We remain confident in our forecast for revenue and earnings growth in the remainder of 2003. Television broadcast rights fees are expected to increase 16% this year, corporate spending for both sponsorship and hospitality are growing, and overall ticket demand for our events remains solid. All of these factors point to a revenue mix that provides long-term growth as well as stability during challenging economic periods."
"We are constantly exploring ways to leverage our assets," concluded Mr. France. "We continue to invest in our business with the goal of enhancing both the fan experience and shareholder returns. Also, NASCAR recently informed track operators of possible schedule realignments of Winston Cup dates beginning in 2004, which we believe will enhance shareholder value. We are in the process of evaluating our portfolio of tracks and events in order to maximize the value of these assets for the Company, as well as for our broadcast partners and corporate sponsors. We look forward to working with NASCAR on this important initiative with a focus on opportunities beginning as early as 2004."
The management of ISC will host a conference call today with investors at 9:00 a.m. Eastern Time which may also be accessed via the Internet at the Company's Web site, www.iscmotorsports.com, under the "Investor Relations" section.
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International Speedway Corporation is a leading promoter of motorsports activities in the United States, currently promoting more than 100 events annually. The Company owns and/or operates 12 of the nation’s major motorsports 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; Homestead-Miami Speedway in Florida; North Carolina Speedway in Rockingham; Darlington Raceway in South Carolina; Watkins Glen International in New York; and Nazareth Speedway in Pennsylvania. Other track interests include an indirect 37.5% interest in Raceway Associates, LLC, which owns and operates Chicagoland Speedway and Route 66 Raceway near Chicago, Illinois.
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." For more information, visit the Company's Web site at 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-Q's. 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.
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