EXHIBIT 99.1

 

 

 

FOR IMMEDIATE RELEASE For further information, call:
  Timothy R. Horne – Sr. Vice President - Finance
Dover, Delaware, October 29, 2020 (302) 883-6592

 

DOVER MOTORSPORTS, INC.

REPORTS RESULTS FOR THE THIRD QUARTER OF 2020

 

Dover Motorsports, Inc. (NYSE: DVD) today reported results for the three months ended September 30, 2020.

 

As previously disclosed, the COVID-19 pandemic caused the postponement of the Company’s scheduled May NASCAR weekend.  The three NASCAR events originally scheduled for May were instead held in combination with our scheduled August NASCAR events.  All six of the races were held without fans.  No major events were held during the third quarter of 2019.  Accordingly, the results for the third quarter of 2020 are not comparable to last year.

 

Revenues for the third quarter of 2020 were $38,044,000 compared to $202,000 for the third quarter of 2019.

 

Operating and marketing expenses were $22,425,000 compared to $1,347,000 in the third quarter of 2019.

 

General and administrative expenses of $1,878,000 in the third quarter of 2020 were comparable to $1,888,000 in the third quarter of 2019.

 

Depreciation expense decreased to $756,000 from $1,669,000 in the third quarter of 2019. The decrease is primarily due to our decision during the third quarter of 2019 to remove grandstand seats at our Dover facility after our 2019 race season. We changed the estimated useful lives of the impacted assets resulting in $879,000 of accelerated depreciation expense in the third quarter of 2019.

 

As previously disclosed, in July of 2020 we sold approximately 97 acres of land in Nashville for proceeds less closing costs of approximately $6,460,000, resulting in a gain of $4,843,000.  The purchaser had previously paid to us a $500,000 deposit that was credited to the purchase price.

 

During the third quarter of 2019, we closed on the sale of approximately 133 acres of land in Nashville for net proceeds of approximately $6,397,000 after closing costs, resulting in a gain of $4,186,000.

 

The adjustment to the contingent obligation was a benefit of $128,000 in the third quarter of 2020 compared to an expense of $121,000 in the third quarter of 2019, primarily the result of lower estimated interest rates.

 

 

 

Earnings before income taxes for the third quarter of 2020 were $18,025,000 compared to loss before income taxes of ($588,000) in the third quarter of 2019. The 2020 results include the $4,843,000 gain on sale, and the 2019 results include the $4,186,000 gain on sale and $879,000 of accelerated depreciation. On an adjusted basis, excluding these items, earnings before income taxes were $13,182,000 for the third quarter of 2020 compared to a loss before income tax benefit of ($3,895,000) for the third quarter of 2019.

 

Net earnings for the third quarter of 2020 were $13,190,000 or $.36 per diluted share compared to net loss of ($414,000) or ($.01) per diluted share for the third quarter of 2019. Net earnings, adjusted for the aforementioned items, were $9,364,000 in 2020 compared to net loss of ($3,087,000) in 2019.

 

As of September 30, 2020, the Company had no outstanding indebtedness and approximately $21.3 million in available cash.

 

The Company announced yesterday that its Board of Directors declared an annual cash dividend on both classes of common stock of $.07 per share. The dividend will be payable on December 10, 2020 to shareholders of record at the close of business on November 10, 2020.

 

* * *

 

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 (LOSS)

In Thousands, Except Per Share Amounts

(Unaudited)

 

   Three Months Ended   Nine Months Ended 
   September 30,   September 30, 
   2020   2019   2020   2019 
Revenues:                    
Admissions  $-   $-   $-   $2,502 
Event-related   2,394    202    2,708    3,784 
Broadcasting   35,646    -    35,646    18,878 
Other   4    -    4    5 
    38,044    202    38,358    25,169 
                     
Expenses:                    
Operating and marketing   22,425    1,347    24,225    16,986 
General and administrative   1,878    1,888    5,742    5,630 
Depreciation   756    1,669    2,289    3,256 
Cost to remove long-lived assets   -    -    341    - 
    25,059    4,904    32,597    25,872 
                     
Gain on sale of land   4,843    4,186    4,843    4,325 
                     
Operating earnings (loss)   17,828    (516)   10,604    3,622 
                     
Interest (expense) income   (21)   20    (34)   4 
Benefit (provision) for contingent obligation   128    (121)   112    (367)
Other income   90    29    115    218 
                     
Earnings (loss) before income taxes   18,025    (588)   10,797    3,477 
                     
Income tax (expense) benefit   (4,835)   174    (1,436)   (880)
                     
Net earnings (loss)  $13,190   $(414)  $9,361   $2,597 
                     
Net earnings (loss) per common share:                    
    Basic  $0.36   $(0.01)  $0.26   $0.07 
    Diluted  $0.36   $(0.01)  $0.26   $0.07 
                     
Weighted average shares outstanding:                    
Basic   35,836    35,952    35,836    35,998 
Diluted   35,836    35,952    35,836    35,998 

 

 

 

DOVER MOTORSPORTS, INC.

RECONCILIATION OF GAAP EARNINGS (LOSS) BEFORE INCOME TAXES

TO ADJUSTED EARNINGS (LOSS) BEFORE INCOME TAXES

AND RECONCILIATION OF GAAP NET EARNINGS (LOSS) TO ADJUSTED NET EARNINGS (LOSS)

In Thousands, Except Per Share Amounts

(Unaudited)

 

   Three Months Ended   Nine Months Ended 
   September 30,   September 30, 
   2020   2019   2020   2019 
GAAP earnings (loss) before income taxes  $18,025   $(588)  $10,797   $3,477 
                     
Gain on sale of land (1)   (4,843)   (4,186)   (4,843)   (4,325)
                     
Cost to remove long-lived assets (2)   -    -    341    - 
                     
Accelerated depreciation (3)   -    879    -    879 
                     
Adjusted earnings (loss) before income taxes  $13,182   $(3,895)  $6,295   $31 
                     
GAAP net earnings (loss)  $13,190   $(414)  $9,361   $2,597 
                     
Gain on sale of land, net of income taxes (1)   (3,826)   (3,307)   (3,826)   (3,417)
                     
Cost to remove long-lived assets, net of income taxes (2)   -    -    246    - 
                     
Accelerated depreciation, net of income taxes (3)   -    634    -    634 
                     
Adjusted net earnings (loss)  $9,364   $(3,087)  $5,781   $(186)
                     
                     
GAAP net earnings (loss) per common share - basic and diluted  $0.36   $(0.01)  $0.26   $0.07 
                     
Gain on sale of land, net of income taxes (1)   (0.11)   (0.09)   (0.11)   (0.09)
                     
Cost to remove long-lived assets, net of income taxes (2)   -    -    0.01    - 
                     
Accelerated depreciation, net of income taxes (3)   -    0.02    -    0.02 
                     
Adjusted net earnings (loss) per common share - basic and diluted(4)  $0.26   $(0.09)  $0.16   $(0.01)

 

 

(1)During the third quarter of 2020, we closed on the sale of a parcel of land at our Nashville Superspeedway facility resulting in a gain of $4,843,000.

 

During the third quarter of 2019, we closed on the sale of parcels of land at our Nashville Superspeedway facility resulting in a gain of $4,186,000.  During the first quarter of 2019, we closed on sale of a parcel of land at our Nashville Superspeedway facility resulting in a gain of $139,000.

 

These transactions were tax effected using our federal statutory rate as we had available state net operating losses.

 

(2)Related to the decision to remove grandstand seats at Dover International Speedway, we incurred $341,000 of costs to remove these assets in the first quarter of 2020.  This amount was tax effected using our federal and state statutory rates.

 

(3)During the third quarter of 2019, we made the decision to remove certain grandstand seating at our Dover International Speedway facility at the end of the 2019 race season.  As a result, we shortened the service lives of these assets which resulted in $879,000 of  accelerated depreciation being recorded in the third quarter of 2019. This amount was tax effected using our federal and state statutory rates.

(4)

The components of the GAAP net earnings (loss)  per common share for the three months ended September 30, 2020 and nine months ended September 30, 2019 do not add to the adjusted net earnings (loss) per common share due to rounding.

 

The above financial information is presented using other than generally accepted accounting principles ("non-GAAP"), and is reconciled to comparable information presented using GAAP.  Non-GAAP adjusted earnings (loss) before income taxes, adjusted net earnings (loss) and adjusted net earnings (loss) per common share - basic and diluted are derived by adjusting amounts determined in accordance with GAAP for the aforementioned gains on sale of land, costs to remove long-lived assets and accelerated depreciation.  We believe such non-GAAP information is useful and meaningful to investors, and is used by investors and us to assess core operations.  This non-GAAP financial information may not be comparable to similarly titled measures used by other entities and should not be considered as an alternative to earnings (loss) before income taxes, net earnings (loss) or net earnings (loss) per common share - basic and diluted, which are determined in accordance with GAAP.    

 

 

 

DOVER MOTORSPORTS, INC.

CONSOLIDATED BALANCE SHEETS

In Thousands

(Unaudited)

 

   September 30,   September 30,   December 31, 
   2020   2019   2019 
ASSETS               
Current assets:               
Cash  $21,327   $4,784   $7,577 
Accounts receivable   1,232    1,866    645 
Inventories   18    20    18 
Prepaid expenses and other   994    6,184    1,186 
Income taxes receivable   -    95    283 
Total current assets   23,571    12,949    9,709 
                
Property and equipment, net   68,125    72,035    71,357 
Right of use asset   131    206    188 
Other assets   1,205    1,170    1,212 
Total assets  $93,032   $86,360   $82,466 
                
LIABILITIES AND STOCKHOLDERS' EQUITY               
Current liabilities:               
Accounts payable  $793   $1,631   $119 
Accrued liabilities   3,559    3,184    3,710 
Income taxes payable   2,674    -    - 
Contract liabilities   1,425    4,526    976 
Total current liabilities   8,451    9,341    4,805 
                
Revolving line of credit   -    -    - 
Liability for pension benefits   786    614    1,016 
Lease liability   53    131    112 
Non-refundable deposit   -    500    500 
Provision for contingent obligation   3,276    2,751    3,389 
Deferred income taxes   6,888    7,743    8,676 
Total liabilities   19,454    21,080    18,498 
                
Stockholders' equity:               
Common stock   1,786    1,793    1,782 
Class A common stock   1,851    1,851    1,851 
Additional paid-in capital   101,152    101,143    100,994 
Accumulated deficit   (27,607)   (36,229)   (36,968)
Accumulated other comprehensive loss   (3,604)   (3,278)   (3,691)
Total stockholders' equity   73,578    65,280    63,968 
Total liabilities and stockholders' equity  $93,032   $86,360   $82,466 

 

 

 

 

DOVER MOTORSPORTS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

In Thousands

(Unaudited)

 

   Nine Months Ended 
   September 30, 
   2020   2019 
Operating activities:          
Net earnings  $9,361   $2,597 
Adjustments to reconcile net earnings to          
  net cash provided by (used in) operating activities:          
Depreciation   2,289    3,256 
Amortization of credit facility fees   42    47 
Stock-based compensation   256    243 
Deferred income taxes   (1,822)   (659)
(Benefit) Provision for contingent obligation   (112)   367 
Gains on equity investments   (4)   (125)
Gain on sale of land   (4,843)   (4,325)
Changes in assets and liabilities:          
Accounts receivable   (587)   (1,190)
Inventories   -    1 
Prepaid expenses and other   171    (5,159)
Income taxes receivable/payable   2,957    (213)
Accounts payable   658    129 
Accrued liabilities   (266)   38 
Payable to Dover Downs Gaming & Entertainment, Inc.   -    (9)
Contract liabilities   449    3,386 
Liability for pension benefits   (109)   (48)
Net cash used in operating activities   8,440    (1,664)
           
Investing activities:          
Capital expenditures   (545)   (4,651)
Proceeds from sale of land and equipment, net   5,960    7,224 
Non-refundable deposit received   -    500 
Purchases of equity investments   (316)   (14)
Proceeds from sale of equity investments   305    1 
Net cash provided by investing activities   5,404    3,060 
           
Financing activities:          
Borrowings from revolving line of credit   3,880    4,120 
Repayments on revolving line of credit   (3,880)   (4,120)
Repurchase of common stock   (94)   (528)
Credit facility fees   -    (35)
Net cash used in financing activities   (94)   (563)
           
Net increase in cash   13,750    833 
Cash, beginning of period   7,577    3,951 
Cash, end of period  $21,327   $4,784 

 

 

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