Dover MotorSports, Inc. Reports Results for the Fourth Quarter and Year Ended December 31, 2018
DOVER, Del.--(BUSINESS WIRE)--Jan 24, 2019--Dover Motorsports, Inc. (NYSE: DVD) today reported its results for the fourth quarter and year ended December 31, 2018.
Our fall 2018 NASCAR event weekend, which consisted of a K&N Pro Series East event, an XFINITY Series event, and a Monster Energy Cup Series event, was held entirely in the fourth quarter of 2018. The 2017 fall race weekend was held from September 29 to October 1, 2017, therefore, the 2017 K&N Pro Series East event and the XFINITY Series event were held during the third quarter of 2017 and only the Monster Energy Cup Series event was held in the fourth quarter of 2017.
Revenues for the fourth quarter of 2018 were $20,751,000 compared to $18,305,000 in the fourth quarter of 2017. Operating and marketing expenses were $12,293,000 in the fourth quarter of 2018 compared to $10,125,000 in the fourth quarter of 2017. Both increases were primarily from the timing of the K&N and XFINITY Series races previously mentioned.
The overall results for our fall 2018 race weekend were comparable with last year. Higher broadcast and sponsorship revenue was offset by lower admissions revenue and higher purses.
General and administrative expenses were $1,758,000 in the fourth quarter of 2018 compared to $1,757,000 in the fourth quarter of 2017.
Depreciation expense in the fourth quarter of 2018 decreased to $789,000 from $1,059,000 in the fourth quarter of 2017. The fourth quarter of 2017 includes $186,000 of accelerated depreciation expense as a result of the Company’s decision to not complete certain improvements at our Dover facility.
Provision for contingent obligation was $292,000 during the fourth quarter of 2018 compared to $117,000 in the fourth quarter of 2017 primarily due to the use of a lower discount rate.
Earnings before income taxes for the fourth quarter of 2018 were $5,551,000 compared to $5,233,000 in the fourth quarter of 2017.
Income tax expense was $1,479,000 for the fourth quarter of 2018 compared to a benefit of $2,410,000 in the fourth quarter of 2017. The Tax Cuts and Jobs Act was signed into law in December 2017. The fourth quarter of 2017 and full-year 2017 results reflect the impact of the new tax law which resulted in an income tax benefit of $4,531,000, or $.13 per share, primarily from revaluing the Company’s net deferred tax liabilities to reflect the enacted 21% federal corporate rate.
Net earnings for the fourth quarter of 2018 were $4,072,000 or $.11 per diluted share compared to $7,643,000 or $.21 per diluted share for the fourth quarter of 2017. Net earnings, excluding the tax benefit from the Tax Cuts & Jobs Act, were $3,112,000 or $.08 per diluted share in the fourth quarter of 2017.
For the year ended December 31, 2018, total revenues were $47,016,000 compared to $46,742,000 in the prior year. The increase was from higher broadcasting revenue, partially offset by lower admissions revenue.
As previously reported, we closed on the sale of a parcel of land in Nashville during the first quarter of 2018 for net proceeds of approximately $5 million after closing costs, resulting in a gain of $2,512,000. Currently, 225 acres of our Nashville Speedway property are under option for a total purchase price of approximately $12.4 million. The Company continues to hold over 1,000 acres of prime commercial real estate. Gain on sale of land also includes a $99,000 loss on sale of the last parcel of land we own near Gateway International Raceway. The sale closed in January 2019.
Net earnings for the year ended December 31, 2018 were $6,889,000 or $.19 per diluted share compared to $8,426,000 or $.23 per diluted share for the year ended December 31, 2017. Net earnings for 2018, excluding the aforementioned land sales, were $4,981,000 or $.14 per diluted share. Net earnings for 2017, excluding the aforementioned tax benefit, were $3,895,000 or $.10 per diluted share.
The Company’s financial position continued to strengthen during 2018. There were no outstanding borrowings and almost $4 million of available cash at December 31, 2018 compared to borrowings of $3,240,000 at December 31, 2017. The Company funded $1.75 million towards its pension obligations in 2018. During the fourth quarter this year, the Company repurchased 96,846 shares of its common stock on the open market at an average price of $2.06 per share, not including nominal brokerage commissions. Total repurchases for the year were 308,928 shares. In December 2018 the Company paid annual cash dividends on both classes of common stock of $.08 per share. Due to the seasonal nature of our business, we will evaluate dividends annually.
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.
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CONTACT: Timothy R. Horne - Sr. Vice President-Finance
KEYWORD: UNITED STATES NORTH AMERICA DELAWARE
INDUSTRY KEYWORD: MOTOR SPORTS ENTERTAINMENT GENERAL ENTERTAINMENT SPORTS
SOURCE: Dover Motorsports, Inc.
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PUB: 01/24/2019 06:55 AM/DISC: 01/24/2019 06:55 AM