Exhibit 99.1

 

LOGO

 

FOR IMMEDIATE RELEASE        For further information, call:
       Timothy R. Horne – Sr. Vice President - Finance
Dover, Delaware, October 25, 2018        (302) 857-3292

DOVER MOTORSPORTS, INC.

REPORTS RESULTS FOR THE THIRD QUARTER OF 2018

Dover Motorsports, Inc. (NYSE: DVD) today reported results for the three months ended September 30, 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 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 the Monster Energy Cup Series event was held in the fourth quarter of 2017.

As a result of the schedule change, revenues for the third quarter of 2018 were $227,000 compared with $2,740,000 in the third quarter of 2017.

Operating and marketing expenses were $1,599,000 in the third quarter of 2018 compared to $3,485,000 in the third quarter of 2017. The decrease was the result of the schedule change, offset by the timing of advertising expenses for the fall weekend.

General and administrative expenses of $1,798,000 in the third quarter of 2018 were comparable to $1,774,000 in the third quarter of 2017.

Depreciation expense decreased to $793,000 in the third quarter of 2018 from $863,000 in the third quarter of 2017.

Loss on sale of land represents the estimated loss on the pending sale of the last parcel of land we own near Gateway International Raceway. We expect to close on the land sale in the fourth quarter of 2018.

Net interest decreased to $2,000 in the third quarter of 2018 compared to $34,000 in the third quarter of 2017 due to lower borrowings.

Loss before income taxes for the third quarter of 2018 was ($4,014,000) compared to ($3,396,000) in the third quarter of 2017.

Net loss for the third quarter of 2018 was ($2,699,000) or ($.07) per diluted share compared to ($2,015,000) or ($.06) per diluted share in the third quarter of 2017. A lower effective tax rate in the third quarter of 2018 reduced the tax benefit on the loss in 2018 compared to 2017.


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.

During the third quarter this year, the Company repurchased 65,038 shares of its common stock on the open market at an average price of $2.12 per share, not including nominal brokerage commissions. We have repurchased 212,082 shares during the first nine months of this year.

As of September 30, 2018, the Company had $600,000 of outstanding indebtedness. During the first nine months of 2018, the Company contributed $1,750,000 to its frozen defined benefit pension plan.

The Company announced yesterday that its Board of Directors declared an annual cash dividend on both classes of common stock of $.08 per share. The dividend will be payable on December 10, 2018 to shareholders of record at the close of business on November 12, 2018. 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.


DOVER MOTORSPORTS, INC.

CONSOLIDATED STATEMENTS OF (LOSS) EARNINGS

In Thousands, Except Per Share Amounts

(Unaudited)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2018     2017     2018     2017  

Revenues:

        

Admissions

   $ —       $ 425     $ 2,853     $ 3,871  

Event-related

     227       995       5,283       5,739  

Broadcasting

     —         1,319       18,128       18,824  

Other

     —         1       1       3  
  

 

 

   

 

 

   

 

 

   

 

 

 
     227       2,740       26,265       28,437  
  

 

 

   

 

 

   

 

 

   

 

 

 

Expenses:

        

Operating and marketing

     1,599       3,485       16,984       18,639  

General and administrative

     1,798       1,774       5,552       5,590  

Depreciation

     793       863       2,496       2,507  

Costs to remove long-lived assets

     —         —         —         286  
  

 

 

   

 

 

   

 

 

   

 

 

 
     4,190       6,122       25,032       27,022  
  

 

 

   

 

 

   

 

 

   

 

 

 

(Loss) gain on sale of land

     (99     —         2,413       —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating (loss) earnings

     (4,062     (3,382     3,646       1,415  

Interest expense, net

     (2     (34     (75     (150

Benefit (provision) for contingent obligation

     4       11       (132     (41

Other income

     46       9       77       80  
  

 

 

   

 

 

   

 

 

   

 

 

 

(Loss) earnings before income taxes

     (4,014     (3,396     3,516       1,304  

Income tax benefit (expense)

     1,315       1,381       (699     (521
  

 

 

   

 

 

   

 

 

   

 

 

 

Net (loss) earnings

   $ (2,699   $ (2,015   $ 2,817     $ 783  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net (loss) earnings per common share:

        

Basic

   $ (0.07   $ (0.06   $ 0.08     $ 0.02  
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

   $ (0.07   $ (0.06   $ 0.08     $ 0.02  
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares outstanding:

        

Basic

     36,102       36,282       36,165       36,299  

Diluted

     36,102       36,282       36,165       36,299  


DOVER MOTORSPORTS, INC.

RECONCILIATION OF GAAP (LOSS) EARNINGS BEFORE INCOME TAXES

TO ADJUSTED (LOSS) EARNINGS BEFORE INCOME TAXES

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

In Thousands, Except Per Share Amounts

(Unaudited)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2018     2017     2018     2017  

GAAP (loss) earnings before income taxes

   $ (4,014   $ (3,396   $ 3,516     $ 1,304  

Loss (gain) on sale of land (1)

     99       —         (2,413     —    

Costs to remove long-lived assets (2)

     —         —         —         286  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted (loss) earnings before income taxes

   $ (3,915   $ (3,396   $ 1,103     $ 1,590  
  

 

 

   

 

 

   

 

 

   

 

 

 

GAAP net (loss) earnings

   $ (2,699   $ (2,015   $ 2,817     $ 783  

Loss (gain) on sale of land, net of income taxes (1)

     76       —         (1,908     —    

Costs to remove long-lived assets, net of income taxes (2)

     —         —         —         167  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted net (loss) earnings

   $ (2,623   $ (2,015   $ 909     $ 950  
  

 

 

   

 

 

   

 

 

   

 

 

 

GAAP net (loss) earnings per common share - basic and diluted

   $ (0.07   $ (0.06   $ 0.08     $ 0.02  

Loss (gain) on sale of land, net of income taxes (1)

     —         —         (0.05     —    

Costs to remove long-lived assets, net of income taxes (2)

     —         —         —         —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted net (loss) earnings per common share - basic and diluted (3)

   $ (0.07   $ (0.06   $ 0.02     $ 0.02  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(1)

During the thrid quarter of 2018, we entered negotiations to sell a parcel of land we own near St. Louis, Missouri. We adjusted the book value of the land to reflect the expected sale price resulting in a $99,000 loss.

During the first quarter of 2018, we closed on the sale of a parcel of land at our Nashville Superspeedway facility resulting in a gain on sale.

 

(2)

Costs to remove long-lived assets represents costs incurred to remove and dispose of certain grandstand seating at our Dover International Speedway facility.

 

(3)

The components of GAAP net earnings per common share for the nine months ended September 30, 2017 do not add to the adjusted net earnings 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 (loss) earnings before income taxes, adjusted net (loss) earnings and adjusted net (loss) earnings per common share - basic and diluted are derived by adjusting amounts determined in accordance with GAAP for the aforementioned gain on sale of land and costs to remove long-lived assets. Income taxes are based on our approximate statutory tax rates applicable to each of these items. 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 (loss) earnings before income taxes, net (loss) earnings or net (loss) earnings 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,  
     2018     2017     2017  

ASSETS

      

Current assets:

      

Cash

   $ 187     $ 146     $ 1  

Accounts receivable

     733       2,420       476  

Inventories

     19       16       15  

Prepaid expenses and other

     5,827       4,352       1,119  

Receivable from Dover Downs Gaming & Entertainment, Inc.

     —         27       —    

Income taxes receivable

     1,456       982       562  

Assets held for sale

     531       2,455       2,455  
  

 

 

   

 

 

   

 

 

 

Total current assets

     8,753       10,398       4,628  

Property and equipment, net

     48,764       51,968       51,000  

Nashville Superspeedway facility

     23,567       23,545       23,545  

Other assets

     1,108       1,065       1,107  
  

 

 

   

 

 

   

 

 

 

Total assets

   $ 82,192     $ 86,976     $ 80,280  
  

 

 

   

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

      

Current liabilities:

      

Accounts payable

   $ 738     $ 129     $ 61  

Accrued liabilities

     2,904       3,237       3,049  

Payable to Dover Downs Gaming & Entertainment, Inc.

     6       —         7  

Contract liabilities

     4,528       4,702       1,249  
  

 

 

   

 

 

   

 

 

 

Total current liabilities

     8,176       8,068       4,366  

Revolving line of credit, net

     600       5,880       3,240  

Liability for pension benefits

     896       3,704       2,819  

Provision for contingent obligation

     2,092       1,843       1,960  

Deferred income taxes

     8,618       12,778       8,673  
  

 

 

   

 

 

   

 

 

 

Total liabilities

     20,382       32,273       21,058  
  

 

 

   

 

 

   

 

 

 

Stockholders’ equity:

      

Common stock

     1,814       1,830       1,825  

Class A common stock

     1,851       1,851       1,851  

Additional paid-in capital

     101,545       101,887       101,844  

Accumulated deficit

     (39,968     (47,557     (42,858

Accumulated other comprehensive loss

     (3,432     (3,308     (3,440
  

 

 

   

 

 

   

 

 

 

Total stockholders’ equity

     61,810       54,703       59,222  
  

 

 

   

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 82,192     $ 86,976     $ 80,280  
  

 

 

   

 

 

   

 

 

 


DOVER MOTORSPORTS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

In Thousands

(Unaudited)

 

     Nine Months Ended  
     September 30,  
     2018     2017  

Operating activities:

    

Net earnings

   $ 2,817     $ 783  

Adjustments to reconcile net earnings to net cash (used in) provided by operating activities:

 

Depreciation

     2,496       2,507  

Amortization of credit facility fees

     47       48  

Stock-based compensation

     237       305  

Deferred income taxes

     (690     (272

Provision for contingent obligation

     132       41  

Gains on equity investments

     (15     —    

Gain on sale of land

     (2,413     —    

Changes in assets and liabilities:

    

Accounts receivable

     (257     (2,001

Inventories

     (4     1  

Prepaid expenses and other

     (4,731     (3,302

Receivable from/payable to Dover Downs Gaming & Entertainment, Inc.

     (1     (34

Income taxes receivable/payable

     (290     (1,119

Accounts payable

     549       (191

Accrued liabilities

     (145     379  

Contract liabilities

     3,279       3,347  

Liability for pension benefits

     (1,811     (326
  

 

 

   

 

 

 

Net cash (used in) provided by operating activities

     (800     166  
  

 

 

   

 

 

 

Investing activities:

    

Capital expenditures

     (762     (1,779

Proceeds from sale of land, net

     4,945       —    

Purchases of equity investments

     (100     (142

Proceeds from sale of equity investments

     90       134  
  

 

 

   

 

 

 

Net cash provided by (used in) investing activities

     4,173       (1,787
  

 

 

   

 

 

 

Financing activities:

    

Borrowings from revolving line of credit

     10,200       20,660  

Repayments on revolving line of credit

     (12,840     (18,620

Repurchase of common stock

     (547     (274
  

 

 

   

 

 

 

Net cash (used in) provided by financing activities

     (3,187     1,766  
  

 

 

   

 

 

 

Net increase in cash

     186       145  

Cash, beginning of period

     1       1  
  

 

 

   

 

 

 

Cash, end of period

   $ 187     $ 146  
  

 

 

   

 

 

 

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