Speedway Motorsports Inc. (TRK)
Q2 2010 Earnings Conference Call
Aug 04, 2010 10:00 am ET
Marcus Smith - President and COO
Bill Brooks - VC and CFO
Michael Walsh - Wells Fargo
Brandon Taylor - Raymond James
Edward Williams - BMO Capital Markets
Jamie Williams - Intrepid Capital Management
Michael Walsh - Wells Fargo
Previous Statements by TRK
» Speedway Motorsports Inc. Q1 2010 Earnings Call Transcript
» Speedway Motorsports Inc. Q4 2008 Earnings Call Transcript
» Speedway Motorsports, Inc. Q3 2008 (Quarter End 09/30/2008) Earnings Call Transcript
Good morning. My name is Stephanie, and I will be your conference operator today. At this time, I would like to welcome everyone to the Second Quarter Earnings Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions)
This conference call contains forward-looking statements particularly statements with regard to the company's future operations and financial results. There are many factors that affect future events and trends of the company's business including but not limited to economic factors, geopolitical conditions, weather, the success of NASCAR and other sanctioning bodies, the success of the company's Motorsports Authentics merchandising joint venture, capital projects, expansions, financing needs and a host of other factors both within and outside of management's control.
These factors and other factors including those contained in the company's annual report on Form 10-K and subsequently filed quarterly report on Form 10-Q involve certain risks and uncertainties that could cause actual results or events to differ materially from management's view and expectations.
Inclusion of any information or statement in this conference call does not necessarily imply that such information or statement is material. The company does not undertake any obligation to release publicly, revised or updated forward-looking information, and such information included in this conference call is based on information currently available and may not be reliable after this date.
I would now like to turn the conference over to Marcus Smith. Please go ahead.
Good morning, ladies and gentlemen. Thanks for joining us today as we announce second quarter 2010 results for Speedway Motorsports.
For the second quarter, we reported total revenues of $177.6 million and income from continuing operations of $24.1 million, or $0.57 per diluted share. Six-month 2010 total revenues were $296.1 million and income from continuing operations was $34.3 million, or $0.81 per diluted share.
During the second quarter, we hosted nine major in NASCAR sanctions at weekend, which was the same as last year.
At Texas Motor Speedway, we hosted the NASCAR Sprint Cup Series, Samsung Mobile 500, and a Nationwide Series O'Reilly Auto Parts 250, both events had to be postponed to Monday, because of adverse weather conditions.
At Charlotte Motor Speedway, we hosted the NASCAR Sprint Cup All-Star Race, and the NASCAR Camping World Truck Series, North Carolina Education Lottery 200 events, and then following weekend, the NASCAR Sprint Cup Series, Coca-Cola 600, and Nationwide Series TECH-NET Auto Service 300. The Nationwide Series event was delayed and shortened slightly due to rains at evening as well.
At Kentucky Speedway, NASCAR Nationwide Series Meijer 300, presented by Ritz was held, and at the Infineon Raceway, we held a NASCAR Sprint Cup Series, Toyota/Save Mart 350.
And New Hampshire, the NASCAR Sprint Cup Series LENOX Industrial Tools 301 and the Nationwide Series New England 200.
As we discussed in prior earnings calls, our ticket pricing philosophy of 2010 was to offer our fans with variety of affordable ticket options and fan affinity programs to help bolster fan support. You will continue to see these efforts, through remainder of the year and they were successful in generating fan excitement enthusiasm.
However, attendance and admission revenues have been trending down thus far. Throughout the first half of the season, we saw the consumers increase the purchasing activity within a three-week window prior to the events. However, our walk-up ticket sales were negatively impacted by inclement weather at several events during the period.
For TV ratings NASCAR has had some unique challenges this season as it relates to weather, some unusual increased competitions like airing up against events such as Olympics and the World Cup Soccer Tournament.
The important thing to look at is that NASCAR viewership is averaging 5 million households and 7 million viewers for each week, which is close to 2009 levels. NASCAR continuous to be the number two regular season sport on television and has been the number one or number two sport on television for 15 of the 20 event weekends since 2010 season.
NASCAR Sprint Cup Series on Fox earned an average of 4.8 and this is more than double of ABC's ratings for 2010 season and NBA, which is 2.3 and NASCAR on CMC average a 3.5 rating with 5 million viewers, which more than doubles the viewership of this year's World Cup Soccer Tournament on the ESPN and ESPN2, which averaged 2.1 million viewers.
We are pleased that all of our NASCAR Sprint Cup entitlement for 2010 are sold, some of our NASCAR Sprint Cup Nationwide and Camping World Truck Series event sponsorships for 2011 are sold and also beyond.
The business trends in corporate marketing continues to show some light at the end of the tunnel. We are working hard right now on what we call the selling season and planning with our corporate partners and new corporate partners to develop their plans and spending for years in 2011 and beyond.
At Motorsports Authentics, as many of you are probably aware, MA was unable to renegotiate its license agreements with certain licensees with the NASCAR teams. And in July, the industry the industry formed the NASCAR Teams Licensing Trust.