Speedway Motorsports, Inc. (SMI) (NYSE:TRK) today reported second quarter 2011 total revenues of $153.1 million and adjusted non-GAAP income from continuing operations of $20.5 million or $0.49 per diluted share. Six month 2011 total revenues were $239.8 million and adjusted non-GAAP income from continuing operations was $23.7 million or $0.57 per diluted share. Also, SMI reaffirmed its full year 2011 earnings guidance of $0.90 to $1.20 per diluted share from continuing operations, excluding the 2011 charges described below. GAAP loss from continuing operations was $28.1 million and $29.3 million, or $0.68 and $0.71 per diluted share, for the three and six month 2011 periods.

The adjusted non-GAAP results exclude a first quarter 2011 charge for early debt redemption and refinancing and a non-cash second quarter 2011 impairment charge as further discussed and reconciled with comparable GAAP amounts below.

Second quarter and year-to-date 2011 results were also impacted by, among other factors, the following:
  • Atlanta Motor Speedway held a NASCAR Sprint Cup Series racing event in the first quarter 2010 that was realigned to Kentucky Speedway in the third quarter 2011
  • New Hampshire Motor Speedway held a NASCAR Sprint Cup and a Nationwide Series racing event in the second quarter 2010 that was held in the third quarter 2011
  • Charlotte Motor Speedway held a NHRA Nationals racing event in the first quarter 2010 that was held in the second quarter 2011
  • Kentucky Speedway held a NASCAR Nationwide Series racing event in the second quarter 2010 that was held in the third quarter 2011
  • Ongoing effects of challenging economic conditions, including high food and fuel prices, as well as high unemployment
  • Lower interest expense from first quarter 2011 debt refinancing transactions
  • Higher effective income tax rates in 2011

Second Quarter Comparison
  • Total revenues were $153.1 million in 2011 compared to $177.6 million in 2010
  • Goodwill impairment charge was $48.6 million or $1.17 per diluted share (with no tax benefit) in 2011
  • Loss from continuing operations was $28.1 million or $0.68 per diluted share in 2011 compared to income from continuing operations of $24.1 million or $0.57 per diluted share in 2010
  • After tax losses from discontinued operations were $179,000 or $0.00 per diluted share in 2011 compared to $1.0 million or $0.02 per diluted share in 2010
  • Net loss was $28.3 million or $0.68 per diluted share in 2011 compared to net income of $23.0 million or $0.55 per diluted share in 2010
  • Non-GAAP income from continuing operations was $20.5 million or $0.49 per diluted share in 2011 compared to $24.1 million or $0.57 per diluted share in 2010

Year-to-Date Comparison
  • Total revenues were $239.8 million in 2011 compared to $296.1 million in 2010
  • Goodwill impairment charge was $48.6 million or $1.17 per diluted share (with no tax benefit) in 2011
  • After tax loss on early debt redemption and refinancing was $4.5 million or $0.11 per diluted share in 2011
  • Loss from continuing operations was $29.3 million or $0.71 per diluted share in 2011 compared to income from continuing operations of $34.3 million or $0.81 per diluted share in 2010
  • After tax losses from discontinued operations were $453,000 or $0.01 per diluted share in 2011 compared to $2.3 million or $0.05 per diluted share in 2010
  • Net loss was $29.8 million or $0.72 per diluted share in 2011 compared to net income of $32.0 million or $0.76 per diluted share in 2010
  • Non-GAAP income from continuing operations was $23.7 million or $0.57 per diluted share in 2011 compared to $34.3 million or $0.81 per diluted share in 2010

The Company’s admissions and many event related and other revenue categories continue to be negatively impacted by declines in consumer and corporate spending due to weak economic conditions, including high fuel prices and unemployment. In 2011, similar to 2010, management has reduced many ticket prices and increased promotional spending to help foster fan support and mitigate any near-term demand weakness. Admissions revenue declines for the second quarter 2011 largely reflect lower average ticket prices, while for year-to-date reflect both lower average ticket prices and fewer fans attending our race events in the first quarter 2011. Because many revenues, such as admissions and corporate marketing arrangements, are sold well in advance of scheduled events, management believes it will take relatively longer for SMI’s results to reflect sales growth as economic conditions improve.

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