Dover Motorsports, Inc. Reports Results for the Fourth Quarter and Year Ended December 31, 2012

  Dover Motorsports, Inc. Reports Results for the Fourth Quarter and Year
  Ended December 31, 2012

Business Wire

DOVER, Del. -- January 24, 2013

Dover Motorsports, Inc. (NYSE: DVD) today reported its results for the fourth
quarter and year ended December 31, 2012.

On an adjusted basis, earnings from continuing operations for the year
improved 81.1% to $4,381,000 from $2,419,000 in 2011.

Results for this quarter are not comparable to the prior year’s quarter due to
the timing of Dover’s fall NASCAR race weekend. Dover’s 2012 fall NASCAR race
weekend was held entirely in the third quarter of 2012 while the 2011 fall
NASCAR Nationwide Series and Sprint Cup Series races were held during the
fourth quarter of 2011. Also, the results for the year ended December 31, 2011
include the results of two NASCAR Nationwide Series and two NASCAR Truck
Series races at the Company’s Nashville facility. The Company did not promote
these races in 2012.

For the quarter ended December 31, 2012, revenues were $129,000 compared with
$22,443,000 in the fourth quarter of 2011. The decrease in revenues was due to
the schedule change discussed above.

Operating and marketing expenses were $985,000 in the fourth quarter of 2012
compared to $10,768,000 in the fourth quarter of 2011. The decrease is also
from the aforementioned changes.

General and administrative expenses of $2,102,000 in the fourth quarter of
2012 increased from $1,832,000 for the same quarter last year. The increase is
primarily due to higher employee related costs at Dover.

Net interest expense was $291,000 for the fourth quarter of 2012 compared to
$431,000 in the fourth quarter of 2011. The decrease is primarily due to lower
average outstanding borrowings and lower interest rates in the fourth quarter
of 2012 compared to 2011.

(Loss) earnings from continuing operations before tax benefit (expense) for
the fourth quarter of 2012 were ($4,019,000) compared with $8,562,000 for the
fourth quarter of 2011.

Net (loss) earnings for the fourth quarter of 2012 were ($2,356,000) or ($.07)
per diluted share compared to $5,061,000 or $.14 per diluted share for the
same period last year.

For the year ended December 31, 2012, total revenues were $46,747,000 compared
with $51,870,000 in the prior year. The decrease was primarily due to no
longer promoting the four NASCAR races at the Company’s Nashville facility.
Lower Dover NASCAR related revenues were partially offset by rental and
related revenues from the inaugural Firefly Music Festival held in July 2012
on the Company’s Dover parking grounds.

Net earnings were $4,571,000 or $.12 per diluted share for the year ended
December 31, 2012 compared to a net loss of ($9,185,000) or ($0.25) per
diluted share for 2011. The prior year’s annual results include a non-cash
impairment charge of $15,687,000 to write down the carrying value of the
Nashville facility to its fair value, a provision for contingent obligation of
$2,250,000 and a loss from discontinued operation of $71,000 while the results
for 2012 includes a credit of $321,000 related to the contingent obligation.
On an adjusted basis, earnings from continuing operations were $4,381,000 or
$.12 per diluted share for 2012 compared to $2,419,000 or $.07 per diluted
share for 2011.

The Company’s financial position has also improved during 2012. Total
borrowings outstanding were $19,700,000 at December 31, 2012 compared to
$29,160,000 at December 31, 2011. In December 2012, the Company paid an annual
cash dividend on both classes of common stock of $0.04 per share in the amount
of $1,475,000.

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 OPERATIONS
In Thousands, Except Per Share Amounts
(Unaudited)
                                                                   
                                                                   
                            Three Months Ended        Years Ended
                            December 31,              December 31,
                            2012         2011         2012         2011
Revenues:
Admissions                  $ -          $ 6,165      $ 10,428     $ 13,633
Event-related                 100          4,410        9,889        10,309
Broadcasting                  11           11,822       26,404       27,778
Other                        18         46         26         150     
                             129        22,443     46,747     51,870  
                                                                   
Expenses:
Operating and marketing       985          10,768       26,688       31,926
Impairment charge             -            -            -            15,687
General and                   2,102        1,832        7,560        8,329
administrative
Depreciation                 823        843        3,314      4,588   
                             3,910      13,443     37,562     60,530  
                                                                   
Operating (loss) earnings     (3,781 )     9,000        9,185        (8,660  )
                                                                   
Interest expense, net         (291   )     (431   )     (1,396 )     (2,245  )
Provision for contingent      53           (5     )     321          (2,250  )
obligation
Other (expense) income        -            (2     )     (48    )     15
Loss on extinguishment of    -          -          -          (67     )
debt
                                                                   
(Loss) earnings from
continuing operations         (4,019 )     8,562        8,062        (13,207 )
before income tax benefit
(expense)
                                                                   
Income tax benefit           1,663      (3,500 )    (3,491 )    4,093   
(expense)
                                                                   
(Loss) earnings from          (2,356 )     5,062        4,571        (9,114  )
continuing operations
                                                                   
Loss from discontinued
operation, net of income     -          (1     )    -          (71     )
tax benefit
                                                                   
Net (loss) earnings         $ (2,356 )   $ 5,061     $ 4,571     $ (9,185  )
                                                                   
Net (loss) earnings per
common share - basic:
Continuing operations       $ (0.07  )   $ 0.14       $ 0.12       $ (0.25   )
Discontinued operation       -          -          -          -       
Net (loss) earnings         $ (0.07  )   $ 0.14      $ 0.12      $ (0.25   )
                                                                   
Net (loss) earnings per
common share - diluted:
Continuing operations       $ (0.07  )   $ 0.14       $ 0.12       $ (0.25   )
Discontinued operation       -          -          -          -       
Net (loss) earnings         $ (0.07  )   $ 0.14      $ 0.12      $ (0.25   )
                                                                   
Weighted average shares
outstanding:
Basic                         36,300       36,195       36,299       36,194
Diluted                       36,300       36,195       36,299       36,194
                                                                   

                                                              
DOVER MOTORSPORTS, INC.
RECONCILIATION OF GAAP (LOSS) EARNINGS TO ADJUSTED (LOSS) EARNINGS
In Thousands, Except Per Share Amounts
(Unaudited)
                                                                   
                                                                   
                                Three Months Ended     Years Ended
                                December 31, ^ (1)     December 31,
                                2012         2011      2012        2011
                                                                   
GAAP (loss) earnings from
continuing operations before    $ (4,019 )   $ 8,562   $ 8,062     $ (13,207 )
income taxes
                                                                   
Non-cash impairment charge        -            -         -           15,687
^(2)
                                                                   
Provision for contingent         (53    )    5        (321  )    2,250   
obligation ^(2)
                                                                   
Adjusted (loss) earnings from
continuing operations before    $ (4,072 )   $ 8,567   $ 7,741    $ 4,730   
income taxes
                                                                   
GAAP (loss) earnings from       $ (2,356 )   $ 5,062   $ 4,571     $ (9,114  )
continuing operations
                                                                   
Non-cash impairment charge,       -            -         -           10,197
net of income taxes ^(2)
                                                                   
Provision for contingent
obligation, net of income        (31    )    3        (190  )    1,336   
taxes ^(2)
                                                                   
Adjusted (loss) earnings from   $ (2,387 )   $ 5,065   $ 4,381    $ 2,419   
continuing operations
                                                                   
GAAP (loss) earnings per
common share from continuing    $ (0.07  )   $ 0.14    $ 0.12      $ (0.25   )
operations - diluted
                                                                   
Non-cash impairment charge,       -            -         -           0.28
net of income taxes ^(2)
                                                                   
Provision for contingent
obligation, net of income        -          -        -         0.04    
taxes ^(2)
                                                                   
Adjusted (loss) earnings per
common share from continuing    $ (0.07  )   $ 0.14    $ 0.12     $ 0.07    
operations - diluted

     
^(1)   Our fall NASCAR Sprint Cup Series event was held in September of 2012
       compared to October of 2011.
       
       On August 3, 2011, we announced that our wholly-owned subsidiary
       Nashville Superspeedway notified NASCAR that it would not seek 2012
       sanction agreements and therefore we no longer promote NASCAR events at
       this facility. We continue to use the track for motorsports race team
       testing and are currently evaluating all of our options for the
       facility. We incurred a non-cash impairment charge of $15,687,000 in
^(2)   the third quarter of 2011 as a result of our decision to no longer
       promote NASCAR events at this facility. Additionally, we recorded a
       $2,245,000 provision for contingent obligation reflecting the present
       value of the estimated portion of the Wilson County bonds debt service
       that may not be covered by the projected sales and incremental property
       taxes from the facility. Due to changing interest rates, the provision
       for contingent obligation (decreased) increased by ($316,000) and
       $5,000 in 2012 and 2011, respectively.
       
       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 from continuing operations before income taxes, adjusted
       (loss) earnings from continuing operations and adjusted (loss) earnings
       per common share from continuing operations - diluted are derived by
       adjusting amounts determined in accordance with GAAP for the
       aforementioned non-cash impairment charge and the provision for
       contingent obligation. 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 from
       continuing operations before income taxes, (loss) earnings from
       continuing operations or diluted (loss) earnings per share from
       continuing operations, which are determined in accordance with GAAP.

                                                               
DOVER MOTORSPORTS, INC.
CONSOLIDATED BALANCE SHEETS
In Thousands
(Unaudited)
                                                                  
                                                                  
                                                   December 31,   December 31,
                                                   2012           2011
                                                                  
ASSETS
Current assets:
Cash                                               $  15          $  15
Accounts receivable                                   224            689
Inventories                                           124            115
Prepaid expenses and other                            1,222          1,255
Receivable from Dover Downs Gaming &                  -              11
Entertainment, Inc.
Deferred income taxes                                78           67      
Total current assets                                  1,663          2,152
                                                                  
Property and equipment, net                           92,896         96,380
Other assets                                          738            783
Deferred income taxes                                490          496     
Total assets                                       $  95,787     $  99,811  
                                                                  
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable                                   $  145         $  116
Accrued liabilities                                   2,903          2,584
Income taxes payable                                  132            145
Deferred revenue                                     2,719        3,129   
Total current liabilities                             5,899          5,974
                                                                  
Revolving line of credit                              19,700         29,160
Liability for pension benefits                        3,065          2,713
Other liabilities                                     1,934          2,250
Deferred income taxes                                17,096       14,765  
Total liabilities                                    47,694       54,862  
                                                                  
Stockholders' equity:
Common stock                                          1,836          1,828
Class A common stock                                  1,851          1,851
Additional paid-in capital                            102,166        101,888
Accumulated deficit                                   (55,256 )      (58,352 )
Accumulated other comprehensive loss                 (2,504  )     (2,266  )
Total stockholders' equity                           48,093       44,949  
Total liabilities and stockholders' equity         $  95,787     $  99,811  
                                                                  

                                                                
DOVER MOTORSPORTS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
In Thousands
(Unaudited)
                                                                   
                                                     Years Ended
                                                     December 31,
                                                     2012          2011
                                                                   
Operating activities:
Net earnings (loss)                                  $ 4,571       $ (9,185  )
Adjustments to reconcile net earnings (loss) to
net cash provided by operating activities:
Depreciation                                           3,314         4,588
Amortization of credit facility fees                   228           382
Stock-based compensation                               313           407
Deferred income taxes                                  2,489         (4,935  )
Provision for contingent obligation                    (321    )     2,250
Loss on sale of land                                   52            -
Impairment charge                                      -             15,687
Loss on extinguishment of debt                         -             67
Changes in assets and liabilities:
Accounts receivable                                    465           150
Inventories                                            (9      )     86
Prepaid expenses and other                             (3      )     174
Receivable from Dover Downs Gaming &                   11            (29     )
Entertainment, Inc.
Accounts payable                                       29            (30     )
Accrued liabilities                                    274           (965    )
Income taxes payable                                   (13     )     21
Deferred revenue                                       (410    )     (515    )
Other liabilities                                     (45     )    (295    )
Net cash provided by operating activities             10,945      7,858   
                                                                   
Investing activities:
Capital expenditures                                   (468    )     (258    )
Proceeds from the sale of property and equipment       585           1,875
Proceeds from the sale of available-for-sale           -             526
securities
Purchase of available-for-sale securities             (100    )    (532    )
Net cash provided by investing activities             17          1,611   
                                                                   
Financing activities:
Borrowings from revolving line of credit               21,300        60,700
Repayments on revolving line of credit                 (30,760 )     (69,740 )
Dividends paid                                         (1,475  )     -
Repurchase of common stock                             (27     )     (52     )
Credit facility fees                                  -           (431    )
Net cash used in financing activities                 (10,962 )    (9,523  )
                                                                   
Net decrease in cash                                   -             (54     )
Cash, beginning of period                             15          69      
Cash, end of period                                  $ 15         $ 15      
                                                                   

Contact:

Dover Motorsports, Inc.
Timothy R. Horne - Sr. Vice President-Finance
302-857-3292
 
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