In a Tuesday morning conference call with shareholders, International Speedway Corporation — parent company of NASCAR — reported strong revenue growth for both the fourth quarter of 2014, as well as the full-year of fiscal 2014 ended Nov. 30, 2014.
“We are pleased to report solid financial performance for 2014, including results for our fourth quarter which exceeded our expectations.” ISC CEO Lesa France Kennedy said.
“With positive momentum from capacity management and consumer marketing strategies, coupled with strong corporate sales and excitement generated by the new Chase for the Sprint Cup Championship format, we achieved sellouts at Phoenix and Homestead-Miami as well as pleasing TV rating increases for the later Cup events of the season.
“2015 is shaping up nicely, entering the first year of the new 10 year TV broadcast agreements with Fox and NBC. We are optimistic that the sport can carry forward the fan enthusiasm that peaked during the final rounds of the Chase, and, with some tail wind from strengthening consumer confidence, translate it into solid consumer sales and TV ratings in the coming year.”
According to financial statements released Tuesday, ISC saw total revenues for the fourth quarter (ended Nov. 30, 2014) grow to $199.8 million, an increase of more than $11 million over revenue of $188.7 in the fourth quarter of fiscal 2013.
Total revenues for the entire 2014 fiscal year grew to $651.9 million, compared to $612.6 million in 2013.
Operating income was also up, growing from $29.5 million in Q4 of fiscal 2013 to $39.8 million in Q4 of fiscal 2014. Operating income for the fiscal year grew from $78.7 million in fiscal 2013 to $93.4 million in fiscal 2014.
There also were large gains in net income for both the fourth quarter and the 2014 fiscal year. Net income rose from $17,205,000 to $25,824,000 for the fourth quarter, and from $45,292,000 to $67,379,000 for the fiscal year.
“We’re pleased with our fiscal results,” ISC Chief Financial Officer Dan Houser said. “We had a strong fourth quarter that exceeded our expectations.”
In terms of capital expenditures, the ongoing $400 million Daytona Rising reconstruction of Daytona International Speedway remains on time and on budget, with the completion slated for Feb. 16, 2016.
One of the biggest things that the company can look forward to is its new 10-year relationship with Fox and NBC.
“2015 is the first year of new 10-year agreements with Fox and NBC for the three NASCAR touring series,” ISC President John Saunders said. “These agreements provide a solid foundation for our earnings and cash flow over the term (of the contracts). There are very few companies that have their top revenue source secured for the next 10 years.”
Another significant aspect of Tuesday’s report was in the area of title rights, otherwise known as entitlements, for race-naming. In 2014, ISC sold out all of its Sprint Cup and Xfinity (formerly Nationwide) series event entitlements.
Heading into the 2015 season, the company has one Sprint Cup and three of its 15 Xfinity Series race entitlements either still open or not announced, compared to this time in 2014, when it had three Sprint Cup and eight Nationwide race entitlements still open or not announced at that point.
ISC owns/operates 13 motorsports facilities that host more than 100 racing events annually.
Among other highlights of the conference call:
* ISC enjoyed sellouts of the last two 2014 Chase for the Sprint Cup races at Phoenix and Homestead. TV ratings were also up 10 percent for those two events from the previous year broadcasts of those races.
* In addition, TV viewership averaged 5.3 million viewers per race, with 62 million unique viewers.
* 2014 Hispanic viewership of telecasts continued double-digit increase (although the exact number was not given), this on the heels of a massive jump of 40 percent from 2012 to 2013.
* Admissions revenue for Q4 and 2014 was up over 10 percent over the prior year, with Talladega and Martinsville fall races showing significant increases, as well as the fall Chase races being sold out at Phoenix and Homestead.
* In addition, the average ticket price sold in the fourth quarter was $79.38, driven largely by Talladega, Martinsville and Homestead. For the year, the average ticket price increased more than one percent to $81.79.
* NASCAR.com enjoyed a record one-plus billion page views on its various platforms.
* Currently, advance ticket sales are ahead of last year.
* Approximately one in four Fortune 500 companies are involved in NASCAR, an increase of three percent in 2014, and an increase of 11 percent from 2008.
* Last week’s announcement of a 10-year deal with Fanatics for an enhanced experiential and shopping environment for NASCAR as well as trademarks and certain intellectual properties at all ISC tracks.
* Prize payouts for all 36 races in 2014 increased to $53.8 million.
* Plans are progressing on the massive One Daytona project, a 189-acre development across from Daytona International Speedway that will create an entertainment zone that will have up to 1.4 million square feet of retail/dining/entertainment, 2,500 seats in a movie theater, 660 hotel rooms, 1,350 units of residential, 567,000 square feet of additional office space and 500,000 square feet of commercial/industrial space.
As for 2015, Houser expects the company to continue moving towards more revenue growth in the $615 to $630 million range, as well as greater gains in at-track attendance and TV viewership. In addition, TV revenue will grow from $303 to $315 million.
“It’s a very upbeat outlook,” Houser said.
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