ý | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
¨ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
FLORIDA | 59-0709342 | |
(State or other jurisdiction of incorporation) | (I.R.S. Employer Identification No.) |
ONE DAYTONA BOULEVARD, DAYTONA BEACH, FLORIDA | 32114 | |
(Address of principal executive offices) | (Zip code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Class A Common Stock - $.01 par value | ISCA | NASDAQ/National Market System |
Large accelerated filer | ý | Accelerated filer | ¨ | ||
Non-accelerated filer | q | Smaller reporting company | ¨ | ||
Emerging growth company | ¨ |
Class A Common Stock | 23,861,482 shares | As of May 31, 2019 | ||
Class B Common Stock | 19,619,928 shares | As of May 31, 2019 |
TABLE OF CONTENTS | ||||
PART I. | FINANCIAL INFORMATION |
ITEM 1. | FINANCIAL STATEMENTS |
November 30, 2018 | May 31, 2019 | |||||||
(Unaudited) | ||||||||
(In Thousands, Except Share and Per Share Amounts) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | $ | ||||||
Receivables, less allowance of $1,000 in 2018 and 2019, respectively | ||||||||
Prepaid expenses and other current assets | ||||||||
Total Current Assets | ||||||||
Property and Equipment, net of accumulated depreciation of $1,129,378 and $1,186,715, respectively | ||||||||
Other Assets: | ||||||||
Equity investments | ||||||||
Intangible assets, net | ||||||||
Goodwill | ||||||||
Other | ||||||||
Total Assets | $ | $ | ||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Current portion of long-term debt | $ | $ | ||||||
Accounts payable | ||||||||
Deferred income | ||||||||
Income taxes payable | ||||||||
Other current liabilities | ||||||||
Total Current Liabilities | ||||||||
Long-Term Debt | ||||||||
Deferred Income Taxes | ||||||||
Long-Term Deferred Income | ||||||||
Other Long-Term Liabilities | ||||||||
Commitments and Contingencies | ||||||||
Shareholders’ Equity: | ||||||||
Class A Common Stock, $.01 par value, 80,000,000 shares authorized; 23,408,516 and 23,498,775 issued and outstanding in 2018 and 2019, respectively | ||||||||
Class B Common Stock, $.01 par value, 40,000,000 shares authorized; 19,644,581 and 19,619,928 issued and outstanding in 2018 and 2019, respectively | ||||||||
Additional paid-in capital | ||||||||
Retained earnings | ||||||||
Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
Total Shareholders’ Equity | ||||||||
Total Liabilities and Shareholders’ Equity | $ | $ |
Three Months Ended | ||||||||
May 31, 2018 | May 31, 2019 | |||||||
(Unaudited) | ||||||||
(In Thousands, Except Share and Per Share Amounts) | ||||||||
REVENUES: | ||||||||
Admissions, net | $ | $ | ||||||
Motorsports and other event related | ||||||||
Food, beverage and merchandise | ||||||||
Other | ||||||||
EXPENSES: | ||||||||
Direct: | ||||||||
NASCAR event management fees | ||||||||
Motorsports and other event related | ||||||||
Food, beverage and merchandise | ||||||||
Other operating expenses | ||||||||
General and administrative | ||||||||
Depreciation and amortization | ||||||||
Losses on asset retirements | ||||||||
Operating income | ||||||||
Interest income | ||||||||
Interest expense | ( | ) | ( | ) | ||||
Equity in net income from equity investments | ||||||||
Income before income taxes | ||||||||
Income tax expense | ||||||||
Net income | $ | $ | ||||||
Dividends per share | $ | $ | ||||||
Earnings per share: | ||||||||
Basic and diluted | $ | $ | ||||||
Basic weighted average shares outstanding | ||||||||
Diluted weighted average shares outstanding |
Six Months Ended | ||||||||
May 31, 2018 | May 31, 2019 | |||||||
(Unaudited) | ||||||||
(In Thousands, Except Share and Per Share Amounts) | ||||||||
REVENUES: | ||||||||
Admissions, net | $ | $ | ||||||
Motorsports and other event related | ||||||||
Food, beverage and merchandise | ||||||||
Other | ||||||||
EXPENSES: | ||||||||
Direct: | ||||||||
NASCAR event management fees | ||||||||
Motorsports and other event related | ||||||||
Food, beverage and merchandise | ||||||||
Other operating expenses | ||||||||
General and administrative | ||||||||
Depreciation and amortization | ||||||||
Losses on asset retirements | ||||||||
Operating income | ||||||||
Interest income | ||||||||
Interest expense | ( | ) | ( | ) | ||||
Equity in net income from equity investments | ||||||||
Other | ||||||||
Income before income taxes | ||||||||
Income tax (benefit) expense | ( | ) | ||||||
Net income | $ | $ | ||||||
Dividends per share | $ | $ | ||||||
Earnings per share: | ||||||||
Basic and diluted | $ | $ | ||||||
Basic weighted average shares outstanding | ||||||||
Diluted weighted average shares outstanding |
Three Months Ended | ||||||||
May 31, 2018 | May 31, 2019 | |||||||
(Unaudited) | ||||||||
(In Thousands) | ||||||||
Net income | $ | $ | ||||||
Other comprehensive income: | ||||||||
Amortization of terminated interest rate swap, net of tax benefit of $71 and $65, respectively | ||||||||
Comprehensive income | $ | $ | ||||||
Six Months Ended | ||||||||
May 31, 2018 | May 31, 2019 | |||||||
(Unaudited) | ||||||||
(In Thousands) | ||||||||
Net income | $ | $ | ||||||
Other comprehensive income: | ||||||||
Amortization of terminated interest rate swap, net of tax benefit of $152 and $132, respectively | ||||||||
Comprehensive income | $ | $ |
Class A Common Stock $.01 Par Value | Class B Common Stock $.01 Par Value | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total Shareholders’ Equity | |||||||||||||||||||
(Unaudited) (In Thousands) | ||||||||||||||||||||||||
Balance at November 30, 2018 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
Activity 12/1/18 — 5/31/19: | ||||||||||||||||||||||||
Net income | — | — | — | — | ||||||||||||||||||||
Comprehensive income | — | — | — | — | ||||||||||||||||||||
Cash dividend ($0.49 per share) | — | — | — | ( | ) | — | ( | ) | ||||||||||||||||
Other | — | ( | ) | — | — | ( | ) | |||||||||||||||||
Stock-based compensation | — | — | — | — | ||||||||||||||||||||
Balance at May 31, 2019 | $ | $ | $ | $ | $ | ( | ) | $ |
Six Months Ended | ||||||||
May 31, 2018 | May 31, 2019 | |||||||
(Unaudited) | ||||||||
(In Thousands) | ||||||||
OPERATING ACTIVITIES | ||||||||
Net income | $ | $ | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | ||||||||
Stock-based compensation | ||||||||
Amortization of financing costs | ||||||||
Deferred income taxes | ( | ) | ( | ) | ||||
Income from equity investments | ( | ) | ( | ) | ||||
Distribution from equity investee | ||||||||
Loss on retirements of long-lived assets, non-cash | ||||||||
Other, net | ( | ) | ( | ) | ||||
Changes in operating assets and liabilities: | ||||||||
Receivables, net | ( | ) | ||||||
Prepaid expenses and other assets | ( | ) | ( | ) | ||||
Accounts payable and other liabilities | ( | ) | ( | ) | ||||
Deferred income | ||||||||
Income taxes | ( | ) | ||||||
Net cash provided by operating activities | ||||||||
INVESTING ACTIVITIES | ||||||||
Capital expenditures | ( | ) | ( | ) | ||||
Distribution from equity investee | ||||||||
Proceeds from sale of assets | ||||||||
Acquisition of assets | ( | ) | ||||||
Other, net | ( | ) | ||||||
Net cash used in investing activities | ( | ) | ( | ) | ||||
FINANCING ACTIVITIES | ||||||||
Payment of long-term debt | ( | ) | ( | ) | ||||
Exercise of Class A common stock options | — | |||||||
Reacquisition of previously issued common stock | ( | ) | ( | ) | ||||
Net cash used in financing activities | ( | ) | ( | ) | ||||
Net increase in cash and cash equivalents | ||||||||
Cash and cash equivalents at beginning of period | ||||||||
Cash and cash equivalents at end of period | $ | $ |
Three Months Ended | Six Months Ended | |||||||||||||||
May 31, 2018 | May 31, 2019 | May 31, 2018 | May 31, 2019 | |||||||||||||
Admissions | $ | $ | ||||||||||||||
NASCAR Broadcasting | ||||||||||||||||
Corporate Sales and Other Event Related | ||||||||||||||||
Food, Beverage and Merchandise | ||||||||||||||||
Other | ||||||||||||||||
Total Revenues | $ | $ | $ | $ |
Balance sheet accounts impacted by changes in accounting policies: | ||||||
As reported | Adjustments | Balances without adoption of ASC 606 | ||||
Trade Receivables | ||||||
Impact of Total Assets | ||||||
Contract liability | ||||||
Other Liabilities | ||||||
Impact of Total Liabilities and Stockholders’ equity |
Cash flow items impacted by changes in accounting policies: | ||||||
As reported | Adjustments | Balances without adoption of ASC 606 | ||||
Operating activities | ||||||
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | ||||||
Receivables, net | ( | ) | ( | ) | ||
Accounts payable and other liabilities | ( | ) | ( | ) | ||
Deferred income | ||||||
Impact of net adjustments to cash (used in) provided by operating activities |
Three Months Ended | Six Months Ended | ||||||||||||||
May 31, 2018 | May 31, 2019 | May 31, 2018 | May 31, 2019 | ||||||||||||
Numerator: | |||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||
Denominator: | |||||||||||||||
Weighted average shares outstanding | |||||||||||||||
Effect of dilutive securities | |||||||||||||||
Diluted weighted average shares outstanding | |||||||||||||||
Basic and diluted earnings per share | $ | $ | $ | $ | |||||||||||
Anti-dilutive shares excluded in the computation of diluted earnings per share |
Six Months Ended | ||||||||
May 31, 2018 | May 31, 2019 | |||||||
Distribution from profits | $ | $ | ||||||
Distribution in excess of profits | ||||||||
Total Distributions | $ | $ |
As of January 4, 2019 | ||||
Inventory | $ | |||
Property and equipment | ||||
Trade names and trademarks | ||||
Track access rights | ||||
Goodwill | ||||
Purchase price consideration | $ |
November 30, 2018 | ||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||
Amortized intangible assets: | ||||||||||||
Other | ||||||||||||
Total amortized intangible assets | ||||||||||||
Non-amortized intangible assets: | ||||||||||||
NASCAR — sanction agreements | — | |||||||||||
Other | — | |||||||||||
Total non-amortized intangible assets | — | |||||||||||
Total intangible assets | $ | $ | $ | |||||||||
May 31, 2019 | ||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||
Amortized intangible assets: | ||||||||||||
Other | ||||||||||||
Total amortized intangible assets | ||||||||||||
Non-amortized intangible assets: | ||||||||||||
NASCAR — sanction agreements | — | |||||||||||
Other | — | |||||||||||
Total non-amortized intangible assets | — | |||||||||||
Total intangible assets | $ | $ | $ |
Amortization expense for the six months ended May 31, 2019 | $ | ||
Remaining estimated amortization expense for the year ending November 30: | |||
2019 | $ | ||
2020 | |||
2021 | |||
2022 | |||
2023 and thereafter |
November 30, 2018 | May 31, 2019 | |||||||||||||||
Principal | Unamortized Discount and Debt Issuance Costs | Principal | Unamortized Discount and Debt Issuance Costs | |||||||||||||
4.63 percent Senior Notes | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
3.95 percent Senior Notes | ( | ) | ( | ) | ||||||||||||
6.25 percent Term Loan | ||||||||||||||||
TIF bond debt service funding commitment | ( | ) | ( | ) | ||||||||||||
Revolving Credit Facility | ||||||||||||||||
( | ) | ( | ) | |||||||||||||
Less: current portion | ( | ) | ( | ) | ||||||||||||
$ | $ | ( | ) | $ | $ | ( | ) |
Three Months Ended | Six Months Ended | ||||||||||||||
May 31, 2018 | May 31, 2019 | May 31, 2018 | May 31, 2019 | ||||||||||||
Interest expense | $ | $ | $ | $ | |||||||||||
Less: capitalized interest | |||||||||||||||
Net interest expense | $ | $ | $ | $ |
• | Level 1 — observable market inputs that are unadjusted quoted prices for identical assets or liabilities in active markets |
• | Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, credit risk, etc.) |
• | Level 3 — significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments) |
• | Recurring (R) - measured at fair value on recurring basis, subsequent to initial recognition. |
• | Non-recurring (NR) - measured at fair value on nonrecurring basis, subsequent to initial recognition. |
November 30, 2018 | May 31, 2019 | ||||||||||||||
Assets | Level | Class | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||
Money market funds | 1 | R | $ | $ | $ | $ | |||||||||
Note Receivable | 2 | R | |||||||||||||
Liabilities (principal) | |||||||||||||||
Senior Notes | 2 | NR |
November 30, 2018 | May 31, 2019 | |||||||
Terminated interest rate swap, net of tax benefit of $1,050 and $918, respectively | $ | ( | ) | $ | ( | ) |
Three Months Ended May 31, 2018 | ||||||||||||
Motorsports Event | All Other | Total | ||||||||||
Revenues | $ | $ | $ | |||||||||
Depreciation and amortization | ||||||||||||
Operating income (loss) | ( | ) | ||||||||||
Capital expenditures | ||||||||||||
Total assets | ||||||||||||
Equity investments | — | |||||||||||
Three Months Ended May 31, 2019 | ||||||||||||
Motorsports Event | All Other | Total | ||||||||||
Revenues | $ | $ | $ | |||||||||
Depreciation and amortization | ||||||||||||
Operating income (loss) | ( | ) | ||||||||||
Capital expenditures | ||||||||||||
Total assets | ||||||||||||
Equity investments | — | |||||||||||
Six Months Ended May 31, 2018 | ||||||||||||
Motorsports Event | All Other | Total | ||||||||||
Revenues | $ | $ | $ | |||||||||
Depreciation and amortization | ||||||||||||
Operating income (loss) | ( | ) | ||||||||||
Capital expenditures | ||||||||||||
Six Months Ended May 31, 2019 | ||||||||||||
Motorsports Event | All Other | Total | ||||||||||
Revenues | $ | $ | $ | |||||||||
Depreciation and amortization | ||||||||||||
Operating income (loss) | ( | ) | ||||||||||
Capital expenditures |
PART I. | FINANCIAL INFORMATION |
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
• | Attract and retain new fans including young adults, youth and growth demographics; |
• | Grow fan engagement with richer content, consumption channels and memorable live-event experiences; |
• | Elevate/cultivate driver star power; and |
• | Maximize utilization of industry marketing assets and participation. |
• | Enhancements to NASCAR's playoffs, including elimination rounds leading up to the championship event for the three national touring series; |
• | Three stage racing format, similar to quarters or halves in other sports; |
• | Overtime rules to address races that previously ended while under caution; and |
• | Refined aerodynamic and downforce specifications that provide the driver greater control of the car. |
• | improved pricing power for our events; |
• | enticing more customers to renew or purchase tickets earlier in the sales cycle; |
• | increasing customer retention; |
• | driving greater attendance to our lead-in events, such as NASCAR's Xfinity and Gander Outdoors Truck Series events; |
• | ability to re-purpose and monetize certain areas of the facility to their highest and best use; |
• | generating stronger interest from corporate sponsors; and |
• | creating a more visually compelling event for the television audience. |
• | new content delivery platforms such as 'OTT' (over the top), digital media and applications; |
• | growth in use of mobile described as "ubiquitous access to sports content"; and |
• | rights holders establishing direct fan relationships via proprietary TV channels, social media, etc. |
• | Digital sites generated approximately 2.4 million race day visits, up approximately 54.0 percent compared to 2018 representing the highest product engagement digital has ever had on a race day |
• | On social channels, 1.2 million people engaged with content on race-day, with approximately 5.3 million video views generated by NASCAR Social content. |
• | Improve the fan experience to drive increased ticket sales; |
• | Match supply and demand and optimize our ticket pricing model; |
• | Strengthen our marketing partners' value proposition to grow sponsorship and hospitality sales, achieve longer contracted terms, and increase renewal rates; |
• | Solidify prospects for long-term growth in broadcast media rights fees agreements |
Three Months Ended May 31, 2018 | ||||||||||||
Income Before Taxes | Income Tax Effect | Net Income | Earnings Per Share | |||||||||
GAAP | $ | 21,440 | $ | 4,770 | $ | 16,670 | $ | 0.38 | ||||
Adjustments: | ||||||||||||
The ISM Raceway Project | 111 | 29 | 82 | 0.00 | ||||||||
Accelerated depreciation | 301 | 79 | 222 | 0.01 | ||||||||
Losses on retirements of long-lived assets | 132 | 33 | 99 | 0.00 | ||||||||
Capitalized interest | (844 | ) | (220 | ) | (624 | ) | (0.02 | ) | ||||
Non-GAAP | $ | 21,140 | $ | 4,691 | $ | 16,449 | $ | 0.37 | ||||
Three Months Ended May 31, 2019 | ||||||||||||
Income Before Taxes | Income Tax Effect | Net Income | Earnings Per Share | |||||||||
GAAP | $ | 19,551 | $ | 4,478 | $ | 15,073 | $ | 0.35 | ||||
Adjustments: | ||||||||||||
Losses on retirements of long-lived assets | 507 | 123 | 384 | 0.01 | ||||||||
Merger Agreement costs | 99 | 24 | 75 | 0.00 | ||||||||
Non-capitalized costs related to business combination | 35 | 9 | 26 | 0.00 | ||||||||
Terminated agreements | 389 | 94 | 295 | 0.00 | ||||||||
Non-GAAP | $ | 20,581 | $ | 4,728 | $ | 15,853 | $ | 0.36 | ||||
Six Months Ended May 31, 2018 | ||||||||||||
Income Before Taxes | Income Tax Effect | Net Income | Earnings Per Share | |||||||||
GAAP | $ | 55,893 | $ | (130,123 | ) | $ | 186,016 | $ | 4.21 | |||
Adjustments: | ||||||||||||
The ISM Raceway Project | 216 | 56 | 160 | 0.00 | ||||||||
Accelerated depreciation | 1,154 | 301 | 853 | 0.02 | ||||||||
Losses on retirements of long-lived assets | 1,248 | 325 | 923 | 0.02 | ||||||||
Capitalized interest | (1,672 | ) | (436 | ) | (1,236 | ) | (0.03 | ) | ||||
Net tax benefit | — | 143,900 | (143,900 | ) | (3.25 | ) | ||||||
Non-GAAP | $ | 56,839 | $ | 14,023 | $ | 42,816 | $ | 0.97 | ||||
Six Months Ended May 31, 2019 | ||||||||||||
Income Before Taxes | Income Tax Effect | Net Income | Earnings Per Share | |||||||||
GAAP | $ | 48,103 | $ | 11,475 | $ | 36,628 | $ | 0.84 | ||||
Adjustments: | ||||||||||||
Losses on retirements of long-lived assets | 782 | 193 | 589 | 0.02 | ||||||||
Accelerated depreciation | 943 | 231 | 712 | 0.02 | ||||||||
Merger Agreement costs | 2,903 | 710 | 2,193 | 0.05 | ||||||||
Non-capitalized costs related to business combination | 256 | 62 | 194 | 0.00 | ||||||||
Terminated agreements | 389 | 94 | 295 | 0.00 | ||||||||
Non-GAAP | $ | 53,376 | $ | 12,765 | $ | 40,611 | $ | 0.93 |
Three Months Ended | Six Months Ended | ||||||||||||||
May 31, 2018 | May 31, 2019 | May 31, 2018 | May 31, 2019 | ||||||||||||
(Unaudited) | |||||||||||||||
Net Income (GAAP) | $ | 16,670 | $ | 15,073 | $ | 186,016 | $ | 36,628 | |||||||
Adjustments: | |||||||||||||||
Income tax (benefit) expense | 4,770 | 4,478 | (130,123 | ) | 11,475 | ||||||||||
Interest income | (732 | ) | (1,339 | ) | (1,253 | ) | (2,572 | ) | |||||||
Interest expense | 2,900 | 3,716 | 5,785 | 7,438 | |||||||||||
Other | — | — | (15 | ) | — | ||||||||||
Equity in net income from equity investments | (6,351 | ) | (6,425 | ) | (10,659 | ) | (11,937 | ) | |||||||
Operating Income (GAAP) | $ | 17,257 | $ | 15,503 | $ | 49,751 | $ | 41,032 | |||||||
Adjustments: | |||||||||||||||
Depreciation and amortization | 26,859 | 28,809 | 53,598 | 58,068 | |||||||||||
Impairments/losses on retirements of long-lived assets | 195 | 640 | 1,357 | 1,021 | |||||||||||
Other Non-GAAP adjustments (1) | 111 | 523 | 216 | 3,548 | |||||||||||
Cash distributions from equity investments | 6,375 | 6,588 | 11,625 | 12,772 | |||||||||||
Adjusted EBITDA (non-GAAP) | $ | 50,797 | $ | 52,063 | $ | 116,547 | $ | 116,441 |
i. | 2018 adjustments for the three and six month periods relate to costs associated with The ISM Raceway Project of approximately $0.1 million and $0.2 million, respectively; and |
ii. | 2019 adjustments for the three and six month periods relate to costs associated with terminated agreements of approximately $0.4 million for both periods, the Merger Agreement of approximately $0.1 million and $2.9 million, respectively, and non-capitalized, non-recurring acquisition costs of Racing Electronics of approximately $35.0 thousand and $0.3 million, respectively. |
Three Months Ended | Six Months Ended | ||||||||||
May 31, 2018 | May 31, 2019 | May 31, 2018 | May 31, 2019 | ||||||||
(Unaudited) | |||||||||||
REVENUES: | |||||||||||
Admissions, net | 15.0 | % | 14.5 | % | 17.6 | % | 16.9 | % | |||
Motorsports and other event related | 77.7 | 75.4 | 74.6 | 73.2 | |||||||
Food, beverage and merchandise | 4.0 | 6.8 | 4.6 | 6.5 | |||||||
Other | 3.3 | 3.3 | 3.2 | 3.4 | |||||||
Total revenues | 100.0 | 100.0 | 100.0 | 100.0 | |||||||
EXPENSES: | |||||||||||
Direct: | |||||||||||
NASCAR event management fees | 29.2 | 31.1 | 25.0 | 26.1 | |||||||
Motorsports and other event related | 26.0 | 19.0 | 22.0 | 18.3 | |||||||
Food, beverage and merchandise | 3.0 | 4.8 | 3.4 | 4.6 | |||||||
Other operating expenses | 0.6 | 1.1 | 0.7 | 1.2 | |||||||
General and administrative | 15.4 | 17.2 | 16.2 | 18.4 | |||||||
Depreciation and amortization | 15.6 | 17.2 | 16.7 | 18.2 | |||||||
Losses on asset retirements | 0.1 | 0.4 | 0.5 | 0.3 | |||||||
Total expenses | 89.9 | 90.8 | 84.5 | 87.1 | |||||||
Operating income | 10.1 | 9.2 | 15.5 | 12.9 | |||||||
Interest income | 0.4 | 0.8 | 0.4 | 0.8 | |||||||
Interest expense | (1.7 | ) | (2.2 | ) | (1.8 | ) | (2.3 | ) | |||
Equity in net income from equity investments | 3.7 | 3.8 | 3.3 | 3.7 | |||||||
Other | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
Income before income taxes | 12.5 | 11.6 | 17.4 | 15.1 | |||||||
Income tax (benefit) expense | 2.8 | 2.6 | (40.6 | ) | 3.6 | ||||||
Net income | 9.7 | % | 9.0 | % | 58.0 | % | 11.5 | % |
• | In the first quarter of fiscal 2019, we were informed of a bankruptcy proceeding related to one of our marketing partners. During our second quarter of fiscal 2019, in accordance with our contracts, we terminated the sponsorship agreements and related sublease agreements with this entity. As a result, we experienced lower admissions and sponsorship revenues related to the sponsorship agreements and lower rental expense related to the sublease agreements during the six months ended May 31, 2019 as compared to the same period in fiscal 2018. |
• | In the second quarter of fiscal 2018, we hosted an IndyCar event at ISM Raceway, for which there was no comparable event in fiscal 2019; |
• | In the second quarter of fiscal 2018, we hosted the Country 500 music festival at Daytona, for which there was no comparable event in fiscal 2019; |
• | For the three and six months ended May 31, 2019, we recognized revenue and expenses recorded in the respective food, beverage and merchandise accounts related to the acquisition of Racing Electronics. There were no comparable costs for the three and six months ended May 31, 2018; |
• | For the three and six months ended May 31, 2019, we received certain lease rents, and incurred operating expenses, related to ONE DAYTONA as a result of certain tenants commencing operations in the current period, for which there was no comparable activity in the same period of the prior year (see "ONE DAYTONA"); |
• | During the three and six months ended May 31, 2019, we recognized approximately $0.1 million and $2.9 million, or less than $0.01 per diluted share and $0.05 per diluted share, respectively, of costs associated with the Merger Agreement (See Note 1). There were no comparable costs for the three and six months ended May 31, 2018; |
• | During the three and six months ended May 31, 2019, we incurred approximately $35.0 thousand and $0.3 million, or less than $0.01 per diluted share for both periods, respectively, of non-capitalized, non-recurring acquisition costs related to the purchase of certain assets from Racing Electronics. There were no comparable costs during the three and six months ended May 31, 2018; |
• | During the three and six months ended May 31, 2019, we incurred approximately $0.4 million, or less than $0.01 per diluted share for both periods, respectively, of one-time, non-cash charges related to terminated agreements associated with non motorsports operations. |
• | During the three months ended May 31, 2019, we recognized no costs associated with accelerated depreciation. During the six months months ended May 31, 2019, we recognized approximately $0.9 million, or $0.02 per diluted share, of accelerated depreciation due to shortening of the service lives of certain assets associated with the infield project at Talladega. During the three and six months ended May 31, 2018, we recognized $0.3 million and $1.2 million, or $0.01 per diluted share and $0.02 per diluted share, respectively, of accelerated depreciation due to shortening the service lives of certain assets associated with The ISM Raceway Project and the infield project at Richmond; |
• | During the three and six months ended May 31, 2019, we recognized approximately $0.5 million and $0.8 million, or $0.01 per diluted share and $0.02 per diluted share, respectively, of asset retirement losses primarily attributable to demolition and/or asset relocation costs in connection with the infield project at Talladega. During the three and six months ended May 31, 2018, we recognized approximately $0.1 million and $1.2 million, or less than $0.01 per diluted share and $0.02 per diluted share, respectively, of asset retirement losses primarily attributable to demolition and/or asset relocation costs in connection with ONE DAYTONA, facility optimization initiatives, and other capital improvements, including the infield project at Richmond; |
• | During the three and six months ended May 31, 2018, we recognized approximately $0.1 million and $0.2 million, respectively, or less than $0.01 per diluted share for both periods, in non-recurring costs that are included in general and administrative expense related to The ISM Raceway Project. There were no comparable costs during the three and six months ended May 31, 2019; |
• | During the three and six months ended May 31, 2018, we capitalized approximately $0.8 million and $1.7 million, respectively, or $0.02 and $0.03 per diluted share, respectively, of interest, primarily relating to The ISM Raceway Project, and to a lesser extent, ONE DAYTONA. We did not capitalize any interest related to these projects for the three and six months ended May 31, 2019; and |
• | In the first quarter of fiscal 2018 we recorded approximately $143.9 million, or $3.25 per diluted share, of a non-recurring, non-cash income tax benefit related to the Tax Cuts and Jobs Act (see "Note 12 - Income Taxes). There were no comparable benefits recorded in fiscal 2019. |
• | The decrease in the current three month period is substantially due to lower attendance and admissions for NASCAR and other events held during the period, some of which were impacted by inclement weather, the IndyCar event not held in fiscal 2019 and the sponsor tickets related to the aforementioned bankruptcy. Partially offsetting the reduction on admissions revenue were increased admissions for bike week events held at Daytona, and NASCAR events held at the newly renovated ISM Raceway. |
• | The decrease in the six month period is substantially due to lower attendance and admissions for NASCAR and other events held during Daytona Speedweeks and certain NASCAR events held in the current three month period, some of which were impacted by inclement weather, the IndyCar event and the aforementioned bankruptcy. Partially offsetting the reduction on admissions revenue were increased admissions for the Rolex 24 At DAYTONA, bike week events held at Daytona, and NASCAR events held at the newly renovated ISM Raceway. Attendance for the DAYTONA 500 was comparable to prior year due to the event's fourth consecutive sellout. |
• | The decrease in the current three month period is predominately due to the aforementioned Country 500 music festival at Daytona and IndyCar event at ISM Raceway not occurring in fiscal 2019 resulting in reductions of approximately $4.3 million and $1.1 million, respectively. Also contributing to the decrease were lower sponsorship, hospitality and |
• | The decrease in the current six month period is predominately due to the aforementioned Country 500 music festival at Daytona and IndyCar event at ISM Raceway not occurring in fiscal 2019 resulting in reductions of approximately $4.3 million and $1.1 million, respectively. Also contributing to the decrease were reductions in sponsorship, hospitality and advertising revenues of approximately $6.4 million, of which $5.1 million is related to the aforementioned bankruptcy, and ancillary rights fees of approximately $1.0 million. Partially offsetting the decrease was an increase in television broadcast revenue of approximately $6.6 million, as well as increases of approximately $0.5 million related to various event revenues. |
• | The increase in the three month period is substantially due to the aforementioned acquisition of assets from Racing Electronics contributing approximately $5.0 million of revenue. Also contributing to the increase were approximately $0.2 million of concessions and catering revenues for certain NASCAR and other events held during the period and approximately $0.1 million related to off-site catering. Partially offsetting the increase were concessions and catering to the aforementioned Country 500 music festival and IndyCar event at ISM Raceway not occurring in fiscal 2019 resulting in reductions of approximately $0.8 million. |
• | The increase in the six month period is substantially due to the aforementioned acquisition of assets from Racing Electronics contributing approximately $6.9 million of revenue. Also contributing to the increase were approximately $0.3 million related to off-site catering. Partially offsetting the increase were concessions and catering to the aforementioned Country 500 music festival and IndyCar event at ISM Raceway not occurring in fiscal 2019 resulting in reductions of approximately $0.8 million and lower concessions and catering revenues of approximately $0.6 million from the aforementioned lower attendance for certain NASCAR, and other events held during the period. |
• | The decrease in the three month period is predominately due to the receipt of insurance proceeds of approximately $1.8 million in fiscal 2018 for which there was no comparable event in fiscal 2019. Substantially offsetting the decrease was an in increase in lease revenue from ONE DAYTONA of approximately $1.0 million, as well as miscellaneous revenues of approximately $0.6 million. |
• | The increase in the six month period is predominately due to lease revenue from ONE DAYTONA of approximately $1.7 million, as well as miscellaneous revenues of approximately $1.0 million. Partially offsetting the increase was the receipt of insurance proceeds of approximately $1.8 million in fiscal 2018 for which there was no comparable event in fiscal 2019 and the reduction of revenue of approximately $0.4 million due to the sale of revenue generating assets in the first quarter of fiscal 2018 by a business unit for which there was no comparable event in fiscal 2019. |
• | The decrease in the three month period is predominately due to the aforementioned Country 500 music festival at Daytona and IndyCar event at ISM Raceway not occurring in fiscal 2019 resulting in reductions of approximately $6.9 million and $1.6 million, respectively. Also contributing to the decrease were approximately $3.3 million of costs for equipment rentals related to the aforementioned terminated sublease agreements and approximately $0.8 million of labor and purchased services for event related expenses associated with certain NASCAR events held during the period; |
• | The decrease in the six month period is predominately due to the aforementioned Country 500 music festival at Daytona and IndyCar event at ISM Raceway not occurring in fiscal 2019 resulting in reductions of approximately $6.9 million and $1.6 million, respectively. Also contributing to the decrease were approximately $2.8 million related to the aforementioned terminated sublease agreements and approximately $0.8 million of labor and purchased services for event related expenses associated with certain NASCAR events held during the period. Partially offsetting the |
• | Motorsports related expenses as a percentage of combined admissions and motorsports related revenue decreased for the three and six months ended May 31, 2019 to approximately 21.2 percent and 20.3 percent, as compared to 28.1 percent and 23.9 percent, respectively, for the same period in the prior year. The increase in margin for the three and six month periods are predominately due to the aforementioned Country 500 music festival at Daytona and IndyCar event at ISM Raceway not occurring in fiscal 2019. |
• | The increase in the current three month period is primarily due to increased expenses of approximately $3.2 million associated with the revenues generated during the quarter from the aforementioned acquisition of assets from Racing Electronics. Also contributing to the increase were approximately $0.1 million of concessions and catering expenses for certain NASCAR and other events held during the period. Partially offsetting the increase were concessions and catering to the aforementioned Country 500 music festival and IndyCar event at ISM Raceway not occurring in fiscal 2019 resulting in reductions of approximately $0.4 million; |
• | The increase in the six month period is primarily due to increased expenses of approximately $4.6 million associated with the revenues generated during the quarter from the aforementioned acquisition of assets from Racing Electronics. Partially offsetting the increase were concessions and catering to the aforementioned Country 500 music festival and IndyCar event at ISM Raceway not occurring in fiscal 2019 resulting in reductions of approximately $0.4 million and approximately $0.3 million of concessions and catering expenses for certain NASCAR and other events held during the period; and |
• | Food, beverage and merchandise expense as a percentage of food, beverage and merchandise revenue decreased for the three and six months ended May 31, 2019 to approximately 71.4 percent and 71.3 percent, as compared to 75.3 percent and 72.9 percent, respectively, for the same period in the prior year. The increase in margin for the three and six month periods are predominately due to the aforementioned Country 500 music festival at Daytona and IndyCar event at ISM Raceway not occurring in fiscal 2019. |
• | The increase in the current three month period is primarily due to approximately $1.1 million related to certain employee-related costs, approximately $1.0 million on increased property taxes, approximately $0.3 million related to certain purchased services, and approximately $0.1 million of one-time costs related to the aforementioned Merger Agreement; |
• | The increase in the six month period is primarily due to approximately $2.9 million of one-time costs related to the aforementioned Merger Agreement, approximately $2.1 million related to certain employee-related costs, approximately $1.0 million on increased property taxes, approximately $0.4 million related to certain purchased services and approximately $0.3 million related to the aforementioned acquisition of assets of Racing Electronics. Partially offsetting the increase were approximately $0.3 million related to the reduction of expenses from the sale of revenue generating assets by a business unit in the first quarter of fiscal 2018; and |
• | General and administrative expenses as a percentage of total revenues increased for the three and six months ended May 31, 2019, to 17.2 percent and 18.4 percent, as compared to 15.3 percent and 16.2 percent, for the same period in the prior year. The decreased margin for the period is predominately due to the one-time costs associated with the aforementioned Merger Agreement. |
• | The increase in the three and six month period is primarily due to assets placed in service related to projects at ISM Raceway, Richmond Raceway and ONE DAYTONA. Also contributing to the increase is the aforementioned |
• | The variances in the three and six months ended May 31, 2019 is predominately related to the timing of facility optimization initiatives incurred in the current and prior periods. |
• | The increase in the three and six months ended May 31, 2019 is substantially related to higher operating profits from the Hollywood Casino at Kansas Speedway, partially offset by operations in the Company's other equity investments. |
November 30, 2018 | May 31, 2019 | |||||||
(Unaudited) | ||||||||
Cash and cash equivalents | $ | 269,011 | $ | 338,747 | ||||
Working capital | 231,776 | 261,415 | ||||||
Total debt | 255,665 | 255,306 |
May 31, 2018 | May 31, 2019 | |||||||
(Unaudited) | ||||||||
Net cash provided by operating activities (1) | $ | 141,475 | $ | 121,906 | ||||
Capital expenditures (2) | (65,019 | ) | (42,562 | ) | ||||
Distribution from equity investee (3) | 11,625 | 12,772 | ||||||
Acquisition of assets (4) | — | (7,969 | ) | |||||
Net payments related to long-term debt | (473 | ) | (503 | ) | ||||
Reacquisition of previously issued common stock (5) | (7,175 | ) | (1,009 | ) |
• | Capital expenditures for existing facilities up to $500.0 million from fiscal 2017 through fiscal 2021. This allocation will fund reinvestments for impact capital projects, (see “The ISM Raceway Project”, "Richmond Raceway" and "Talladega Infield Project"), as well as all other maintenance and guest experience capital expenditures for the remaining existing facilities. While many components of these expected projects will exceed weighted average cost of capital, considerable maintenance capital expenditures, approximately $40.0 million to $60.0 million annually, will likely result in a blended return on this invested capital in the low-to-mid single digits; |
• | In addition to the aforementioned $500.0 million in capital expenditures for existing facilities, we expect we will have an additional approximate $111.0 million of capital expenditures, exclusive of capitalized interest and net of public incentives, related to ONE DAYTONA and the Shoppes at ONE DAYTONA (see "ONE DAYTONA"). We expect the returns of this investment to exceed our weighted average cost of capital; and |
• | Approximately $280.0 million return of capital to shareholders through dividends and share repurchases. In fiscal 2019 we increased our dividend approximately 4.3 percent to $0.49 per share. Concerning share repurchases, for the six months ended May 31, 2019, we did not repurchase any shares of ISCA on the open market. At May 31, 2019, we had approximately $138.7 million remaining repurchase authority under the current $530.0 million Stock Purchase Plan. We currently have no active Rule 10b5-1 plans. |
• | operations of our major motorsports facilities for the foreseeable future; |
• | ONE DAYTONA and the Shoppes at ONE DAYTONA ("Shoppes") (see "ONE DAYTONA"); |
• | the previously discussed capital allocation plans for our existing facilities; |
• | payments required in connection with the funding of the Unified Government's debt service requirements related to the TIF bonds; |
• | payments related to our other existing debt service commitments; |
• | contributions in connection with any future expansion of the Hollywood Casino at Kansas Speedway; and |
• | our annual dividend. |
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. |
ITEM 4. | CONTROLS AND PROCEDURES |
ITEM 1. | LEGAL PROCEEDINGS |
ITEM 1A. | RISK FACTORS |
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
Period | Total number of shares purchased | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs | Maximum number of shares (or approximate dollar value of shares) that may yet be purchased under the plans or programs (in thousands) | ||||||||||
March 1, 2019— March 31, 2019 | ||||||||||||||
Repurchase program (1) | — | $ | — | — | $ | 138,725 | ||||||||
April 1, 2019 — April 30, 2019 | ||||||||||||||
Repurchase program (1) | — | $ | — | — | $ | 138,725 | ||||||||
May 1, 2019 — May 31, 2019 | ||||||||||||||
Repurchase program (1) | — | $ | — | — | $ | 138,725 | ||||||||
Employee transactions (2) | 22,880 | $ | 44.12 | |||||||||||
22,880 | — |
(1) | We have a share repurchase program (“Stock Purchase Plan”) under which we are authorized to purchase up to $530.0 million of our outstanding Class A common shares. The timing and amount of any shares repurchased under the Stock Purchase Plan will depend on a variety of factors, including price, corporate and regulatory requirements, capital availability and other market conditions. The Stock Purchase Plan may be suspended or discontinued at any time without prior notice. We have no active 10b5-1 plans as of May 31, 2019. No shares have been or will be knowingly purchased from Company insiders or their affiliates. |
ITEM 3. | DEFAULTS UPON SENIOR SECURITIES |
ITEM 4. | MINE SAFETY DISCLOSURES |
ITEM 5. | OTHER INFORMATION |
ITEM 6. | EXHIBITS |
Exhibit Number | Description of Exhibit | |
Articles of Amendment of the Restated and Amended Articles of Incorporation of the Company, as filed with the Florida Department of State on July 26, 1999 (incorporated by reference from exhibit 3.1 of the Company’s Report on Form 8-K dated July 26, 1999) | ||
Conformed copy of Amended and Restated Articles of Incorporation of the Company, as amended as of July 26, 1999 (incorporated by reference from exhibit 3.2 of the Company’s Report on Form 8-K dated July 26, 1999) | ||
Amended and Restated By-Laws of the Company, as amended as of May 22, 2019 (incorporated by reference from exhibit 3.1 of the Company’s Report on Form 8-K dated May 22, 2019) | ||
Rule 13a-14(a) / 15d-14(a) Certification of Chief Executive Officer — filed herewith | ||
Rule 13a-14(a) / 15d-14(a) Certification of Chief Financial Officer — filed herewith | ||
Section 1350 Certification — filed herewith | ||
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase | |
101.LAB | XBRL Taxonomy Extension Label Linkbase | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
INTERNATIONAL SPEEDWAY CORPORATION (Registrant) | |||
Date: | July 8, 2019 | /s/ Gregory S. Motto | |
Gregory S. Motto | |||
Chief Financial Officer |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | 7/1/2019 |
/s/ Lesa France Kennedy | |
Lesa France Kennedy | |
Chief Executive Officer |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | 7/1/2019 |
/s/ Gregory S. Motto | |
Gregory S. Motto | |
Chief Financial Officer |
/s/ Lesa France Kennedy | |
Lesa France Kennedy Chief Executive Officer | |
/s/ Gregory S. Motto | |
Gregory S. Motto Chief Financial Officer |
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Document and Entity Information |
6 Months Ended |
---|---|
May 31, 2019
shares
| |
Document Information [Line Items] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | May 31, 2019 |
Document Fiscal Year Focus | 2019 |
Document Fiscal Period Focus | Q2 |
Entity Registrant Name | INTERNATIONAL SPEEDWAY CORP |
Entity Central Index Key | 0000051548 |
Current Fiscal Year End Date | --11-30 |
Entity Filer Category | Large Accelerated Filer |
Entity Current Reporting Status | Yes |
Entity Shell Company | false |
Entity Emerging Growth Company | false |
Entity Small Business | false |
Class A Common Stock | |
Document Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 23,861,482 |
Class B Common Stock | |
Document Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 19,619,928 |
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
May 31, 2019 |
Nov. 30, 2018 |
---|---|---|
Allowance for receivables | $ 1,000 | $ 1,000 |
Property and Equipment, accumulated depreciation | $ 1,186,715 | $ 1,129,378 |
Class A Common Stock $.01 Par Value | ||
Common Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common Stock, shares authorized (in shares) | 80,000,000 | 80,000,000 |
Common Stock, shares issued (in shares) | 23,498,775 | 23,408,516 |
Common Stock, shares outstanding (in shares) | 23,498,775 | 23,408,516 |
Class B Common Stock $.01 Par Value | ||
Common Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common Stock, shares authorized (in shares) | 40,000,000 | 40,000,000 |
Common Stock, shares issued (in shares) | 19,619,928 | 19,644,581 |
Common Stock, shares outstanding (in shares) | 19,619,928 | 19,644,581 |
Consolidated Statements of Operations - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
|
Revenues [Abstract] | ||||
Revenues | $ 168,084 | $ 171,679 | $ 318,635 | $ 320,554 |
Direct Expenses: | ||||
Other operating expenses | 1,862 | 1,038 | 3,770 | 2,247 |
General and administrative | 28,880 | 26,345 | 58,488 | 52,087 |
Depreciation and amortization | 28,809 | 26,859 | 58,068 | 53,598 |
Losses on asset retirements | 640 | 195 | 1,021 | 1,357 |
Costs and Expenses, Total | 152,581 | 154,422 | 277,603 | 270,803 |
Operating income | 15,503 | 17,257 | 41,032 | 49,751 |
Interest income | 1,339 | 732 | 2,572 | 1,253 |
Interest expense | (3,716) | (2,900) | (7,438) | (5,785) |
Equity in net income from equity investments | 6,425 | 6,351 | 11,937 | 10,659 |
Other | 0 | 15 | ||
Income before income taxes | 19,551 | 21,440 | 48,103 | 55,893 |
Income taxes | 4,478 | 4,770 | 11,475 | (130,123) |
Net income | $ 15,073 | $ 16,670 | $ 36,628 | $ 186,016 |
Dividends (in dollars per share) | $ 0.49 | $ 0.47 | $ 0.49 | $ 0.47 |
(Loss) earnings per share: | ||||
Basic and diluted (in dollars per share) | $ 0.35 | $ 0.38 | $ 0.84 | $ 4.21 |
Basic weighted average shares outstanding (shares) | 43,441,350 | 44,158,611 | 43,431,283 | 44,177,342 |
Diluted weighted average shares outstanding (shares) | 43,449,109 | 44,169,681 | 43,439,004 | 44,189,676 |
Admissions, net | ||||
Revenues [Abstract] | ||||
Revenues | $ 24,388 | $ 25,677 | $ 53,722 | $ 56,239 |
Motorsports and other event related | ||||
Revenues [Abstract] | ||||
Revenues | 126,783 | 133,328 | 233,424 | 239,114 |
Direct Expenses: | ||||
Direct Expenses | 31,993 | 44,607 | 58,381 | 70,642 |
Food, beverage and merchandise | ||||
Revenues [Abstract] | ||||
Revenues | 11,364 | 6,906 | 20,616 | 14,856 |
Direct Expenses: | ||||
Direct Expenses | 8,117 | 5,198 | 14,695 | 10,827 |
Other | ||||
Revenues [Abstract] | ||||
Revenues | 5,549 | 5,768 | 10,873 | 10,345 |
NASCAR event management fees | ||||
Direct Expenses: | ||||
Direct Expenses | $ 52,280 | $ 50,180 | $ 83,180 | $ 80,045 |
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 15,073 | $ 16,670 | $ 36,628 | $ 186,016 |
Other comprehensive income: | ||||
Amortization of terminated interest rate swap, net of tax benefit | 205 | 200 | 409 | 389 |
Comprehensive income | $ 15,278 | $ 16,870 | $ 37,037 | $ 186,405 |
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
|
Statement of Comprehensive Income [Abstract] | ||||
Amortization of interest rate swap, net of tax benefit | $ 65 | $ 71 | $ 132 | $ 152 |
Consolidated Statement of Shareholders' Equity - 6 months ended May 31, 2019 - USD ($) $ in Thousands |
Total |
Common Stock
Class A Common Stock $.01 Par Value
|
Common Stock
Class B Common Stock $.01 Par Value
|
Additional Paid-in Capital |
Retained Earnings |
Accumulated Other Comprehensive Loss |
---|---|---|---|---|---|---|
Balance at Nov. 30, 2018 | $ 1,635,958 | $ 234 | $ 196 | $ 425,233 | $ 1,211,499 | $ (1,204) |
Activity 12/1/18 — 5/31/19: | ||||||
Net income | 36,628 | 36,628 | ||||
Comprehensive income | 409 | 409 | ||||
Cash dividend ($0.49 per share) | (21,306) | (21,306) | ||||
Other | (1,009) | 1 | (1,010) | |||
Stock-based compensation | 1,663 | 1,663 | ||||
Balance at May. 31, 2019 | $ 1,652,343 | $ 235 | $ 196 | $ 425,886 | $ 1,226,821 | $ (795) |
Consolidated Statement of Shareholders' Equity (Parenthetical) - $ / shares |
1 Months Ended | 3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|---|
Apr. 30, 2019 |
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
|
Statement of Stockholders' Equity [Abstract] | |||||
Dividends (in dollars per share) | $ 0.49 | $ 0.49 | $ 0.47 | $ 0.49 | $ 0.47 |
Basis of Presentation |
6 Months Ended |
---|---|
May 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated interim financial statements have been prepared in compliance with Rule 10-01 of Regulation S-X and accounting principles generally accepted in the United States ("U.S. GAAP") for interim financial information but do not include all of the information and disclosures required for complete financial statements. The consolidated balance sheet at November 30, 2018, has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The statements should be read in conjunction with the consolidated financial statements and notes thereto included in the latest Annual Report on Form 10-K for International Speedway Corporation and its wholly owned subsidiaries (the “Company” or “ISC”). In management’s opinion, the statements include all adjustments which are necessary for a fair presentation of the results for the interim periods. All such adjustments are of a normal recurring nature. Because of the seasonal concentration of racing events, the results of operations for the three and six months ended May 31, 2018, and 2019, are not indicative of the results to be expected for the year. RECENT DEVELOPMENT On May 22, 2019, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with NASCAR Holdings, Inc. (“NASCAR”) and Nova Merger Sub, Inc. ("Merger Sub"), a wholly owned subsidiary of NASCAR, providing for the merger of Merger Sub with and into the Company (the “Merger”), with the Company surviving the merger as a wholly owned subsidiary of NASCAR. NASCAR, which sanctions many of the Company’s principal racing events, is wholly owned by certain members of the France Family Group, which also holds shares of ISC’s Class A common stock, par value $.01 par value per share (“Class A Common Stock”), and Class B common stock, par value $.01 par value per share (“Class B Common Stock,” and, collectively with the Class A Common Stock, the “Company Common Stock”) representing over 74.7 percent of the combined voting power of the Company’s outstanding stock. The France Family Group consists of James C. France (the Company’s Chairman of the Board), Lesa France Kennedy (the Company’s Vice Chairwoman and Chief Executive Officer) and Brian Z. France (a director of the Company), and members of their respective families and entities controlled by the natural person members of the group. At the effective time of the Merger (the “Effective Time”), subject to the satisfaction of the conditions set forth in the Merger Agreement, holders of Company Common Stock (other than holders who have elected to dissent from the Merger and seek appraisal rights under the Florida Business Corporations Act and holders of the Rollover Shares (as defined below)) will be entitled to receive $45.00 in cash for each share held, without interest (the “Merger Consideration”), subject to applicable withholding taxes. Prior to the Effective Time, the members of the France Family Group (other than Brian Z. France, his children, and certain related entities) (such members of the France Family Group, the “Rollover Shareholders”) will cause to be contributed pursuant to a rollover letter agreement between such shareholders and NASCAR, shares of Company Common Stock (the “Rollover Shares”) to NASCAR or a related entity and, as a result, such Rollover Shareholders will not receive the Merger Consideration. After the closing of the Merger, the Company will be a private company and wholly-owned subsidiary of NASCAR. The Merger is subject to the approval of the Merger Agreement by (i) the holders of at least a majority of the aggregate voting power of shares of Class A Common Stock and Class B Common Stock, voting together as a single class, and (ii) the holders of at least a majority of the aggregate voting power of all outstanding shares of Company Common Stock not held by NASCAR and its affiliates, the France Family Group and certain officers and directors of the Company. NASCAR has agreed in the Merger Agreement to cause the Rollover Shareholders to vote all of their shares of Company Common Stock in favor of the Merger. The Board of Directors of the Company (the “Board”), based upon the unanimous recommendation of a special committee of the Board, has unanimously approved and adopted the Merger Agreement, the Merger and the other transactions contemplated thereby and recommended to the shareholders of the Company that they approve the Merger Agreement. The Merger is also conditioned upon the satisfaction or waiver of certain customary closing conditions, including, among others, the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1986, as amended. If the Merger Agreement is terminated under certain specified circumstances, the Company could be required to pay NASCAR a termination fee of $78,000,000 or to reimburse certain expenses of NASCAR up to $15,000,000, and under other specified circumstances, NASCAR could be required to pay the Company a termination fee of $117,000,000. Subject to certain limitations, either party may terminate the Merger Agreement if the Merger has not been consummated by February 22, 2020. The foregoing description of the Merger Agreement and the transactions contemplated thereby is only a summary and does not purport to be complete. It is qualified in its entirety by reference to the full text of the Merger Agreement, which was filed as Exhibit 2.1 to the Company’s Report on Form 8-K filed on May 22, 2019.
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New Accounting Pronouncements |
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May 31, 2019 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements On January 5, 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-01, Clarifying the Definition of a Business (ASC 805). Under ASC 805, a business is defined as having a set of assets along with 3 elements or activities—inputs, processes, and outputs. However, confusion occurs when a business does not always have outputs. In addition, all the inputs and processes that a seller uses in operating a set are not required if market participants can acquire the set and continue to produce outputs, for example, by integrating the acquired set with their own inputs and processes. As a result, this definition of a business under ASC 805 led some transactions to be accounted for as a business combination (see Note 5). The update has refined the definition of a business. Now, to be considered a business, an acquisition would have to include an input and a substantive process that together significantly contributes to the ability to create outputs. Public business entities should apply the amendments in this update to annual periods beginning after December 15, 2017, including interim periods within those periods. The amendments in this update were adopted in the first quarter of fiscal 2019. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The main objective of this update is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in this update replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. For public business entities that are U.S. Securities and Exchange Commission (SEC) filers, the amendments in this update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For all other public business entities, the amendments in this update are effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company is currently evaluating the impact of adopting this new guidance on its financial position, results of operations, statement of comprehensive income, and cash flows, and will adopt the provisions of this statement in the first quarter of fiscal 2021. In May 2014, the FASB, in conjunction with the International Accounting Standards Board ("IASB"), issued Accounting Standards update ("ASU") No. 2014-09, "Revenue from Contracts with Customers" (ASC 606), which supersedes the existing revenue recognition requirements under U.S. GAAP and eliminates industry-specific guidance. The new revenue recognition standard provides a five step analysis of transactions to determine when and how revenue is recognized. The new model requires revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. The new guidance includes updated disclosure requirements regarding the qualitative and quantitative information of ISC’s nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. During 2016, the FASB issued additional interpretive guidance relating to the standard which covered the topics of principal versus agent considerations and identifying performance obligations and licensing. The standard, along with the subsequent clarifications issued, are effective for reporting periods beginning after December 15, 2017, including interim reporting periods, making it effective for our fiscal year beginning December 1, 2018. The guidance permits two methods of adoption: the full retrospective method, which applies to each prior reporting period presented, and the modified retrospective method, in which the cumulative effect of initially applying the new guidance is recognized as of the date of initial application as an adjustment to the opening balance of retained earnings. The Company has adopted ASC 606 and the related modifications as of December 1, 2018 using the modified retrospective transition and the impact of adopting this new guidance did not result in a material difference in its consolidated financial statements (see note 3). In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842): Leases". The objective of this update is to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. To meet that objective, the FASB is amending the FASB Accounting Standards Codification and creating Topic 842, Leases. This update, along with International Financial Reporting Standards 16, Leases, are the result of the FASB’s and the IASB’s efforts to meet that objective and improve financial reporting. For a public business entity, the amendments in this update are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the amendments in this update is permitted for all entities. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently evaluating the impact of adopting this new guidance on its financial position, results of operations, and cash flows, and will adopt the provisions of this statement in the first quarter of fiscal 2020. In August 2016, the FASB issued ASU No. 2016-15, "Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments". The objective of this update is to provide specific guidance on eight cash flow classification issues and reduce the existing diversity in practice. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The amendments in this update should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company adopted the provisions of this statement in the first quarter of fiscal 2019 and the impact of adopting this new guidance did not result in a material difference in its consolidated statement of cash flows. In January 2017, the FASB issued ASU No. 2017-04, "Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment". The objective of this update is to simplify the subsequent measurement of goodwill, eliminating Step 2 from the goodwill impairment test, which test is measuring goodwill impairment loss by comparing the implied fair value of a reporting unit's goodwill to the carrying amount of that goodwill. Instead, under the amendments in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. An entity should apply the amendments in this update on a prospective basis. An entity is required to disclose the nature of and reason for the change in accounting principle upon transition. That disclosure should be provided in the first annual period and in the interim period within the first annual period when the entity initially adopts the amendments in this update. A public business entity that is a U.S. Securities and Exchange Commission ("SEC") filer should adopt the amendments in this update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact of adopting this new guidance on its financial position, results of operations, and cash flows, and will adopt the provisions of this statement in the first quarter of fiscal 2021. In December 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin ("SAB") No. 118 (as further clarified by FASB ASU 2018-05, "Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118)" to provide guidance for companies that may not have completed their accounting for the income tax effects of the Tax Cuts and Jobs Act of 2017 (Tax Act) in the period of enactment, which is the period that includes December 22, 2017. SAB No. 118 provides for a provisional one year measurement period for entities to finalize their accounting for certain income tax effects related to the Tax Act. SAB No. 118 provides guidance where: (i) the accounting for the income tax effect of the Tax Act is complete and reported in the Tax Act's enactment period, (ii) the accounting for the income tax effect of the Tax Act is incomplete and reported as provisional amounts based on reasonable estimates (to the extent determinable) subject to adjustments during a limited measurement period until complete, and (iii) accounting for the income tax effect of the Tax Act is not reasonably estimable (no related provisional amounts are reported in the enactment period) and entities would continue to apply accounting based on tax law provisions in effect prior to the Tax Act enactment until provisional amounts are reasonably estimable. SAB No. 118 requires disclosure of the reasons for incomplete accounting additional information or analysis needed, among other relevant information. The Company finalized its provisional amounts in the fourth quarter of fiscal 2018 (see Note 12 - Income Taxes). In February 2018, the FASB issued ASU No. 2018-02, "Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income". The amendments in this update allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Act. Consequently, the amendments eliminate the stranded tax effects resulting from the Tax Act and will improve the usefulness of information reported to financial statement users. However, because the amendments only relate to the reclassification of the income tax effects of the Tax Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected. The amendments in this update also require certain disclosures about stranded tax effects. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption of the amendments in this update is permitted, including adoption in any interim period: (1) for public business entities for reporting periods for which financial statements have not yet been issued and (2) for all other entities for reporting periods for which financial statements have not yet been made available for issuance. The amendments in this update should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act is recognized. The Company is currently evaluating the impact of adopting this new guidance on its financial position, results of operations, statement of comprehensive income, and cash flows, and will adopt the provisions of this statement in the first quarter of fiscal 2020.
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Revenues with Customers |
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Revenues with Customer | Revenues with Customers The Company has applied the provisions of ASC 606 and all related appropriate guidance based on the modified retrospective method, which was applied only to the contracts which were not completed as of the date of initial application. As per the new guidance, the Company recognizes revenue under the core principle to depict the transfer of control to its customers in an amount reflecting the consideration to which it expects to be entitled. In order to achieve that core principle, the Company has applied the following five-step approach: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when a performance obligation is satisfied. The Company’s contracts with customers provide for multiple promised goods and services, including admissions, food, beverage and merchandise, corporate partnerships, television broadcast and radio programming content. The Company typically analyzes the contract and identifies the performance obligations by evaluating whether the promised goods and services are capable of being distinct within the context of the contract at contract inception. Promised goods and services that are not distinct at contract inception are combined. The next step after identifying the performance obligations is determining the transaction price, which includes the impact of variable consideration, based on contractually fixed amounts and an estimation of variable consideration. The Company allocates the transaction price to each performance obligation based on relative stand-alone selling price. Judgment is exercised to determine the stand-alone selling price of each distinct performance obligation. The Company estimates the standalone selling price by reference to the total transaction price less the sum of the observable stand-alone selling prices of other goods or services promised in the contract. In general, transaction price is determined by estimating the fixed amount of consideration to which we are entitled for transfer of goods and services and all relevant sources and components of variable consideration. Variable consideration is estimated by the Company based on the expected value approach. The Company will then estimate variable consideration for a particular type of performance obligation, such method is consistently applied. The Company will constrain estimates of variable consideration based on its expectation of recovery from the customer. Revenues are generally recognized when control of the promised goods or services is transferred to their customers either at a point in time or over time, in an amount that reflects the consideration it expects to be entitled to in exchange for those goods or services. Most of the Company’s contracts have one performance obligation, the promotion of a unique motorsport event, and all consideration is allocated to that performance obligation and recognized at a point in time contemporaneous with the date of the event. For advertising, revenue is recognized when the advertisement is broadcasted and the customer simultaneously receives and consumes benefits as the advertisements are broadcasted. The Company may enter into multiple contracts with a single counter party at or near the same time. The Company will combine contracts and account for them as a single contract when one or more of the following criteria are met: (i) the contracts are negotiated as a package with a single commercial objective, (ii) consideration to be paid in one contract depends on the price or performance of the other contract, and (iii) goods or services promised are a single performance obligation. Under ASC 606, the transaction price of a non-monetary exchange that has commercial substance is based on the fair value of the non-cash consideration received. Under ASC 606, consideration payable to a customer includes cash amounts that an entity pays, or expects to pay, to the customer. Consideration payable to a customer also includes credit or other items that can be applied against amounts owed to the entity. The Company accounts for consideration payable to a customer as a reduction of the transaction price and, therefore, of revenue unless the payment to the customer is in exchange for a distinct good or service that the customer transfers to the entity. The Company may have contracts where there is a significant timing difference between payment and the time when control of the goods or services is transferred to the customer. The Company has adopted the practical expedient and does not adjust for the promised amount of consideration for the effects of a significant financing component if it expects, at contract inception, that the period between when the entity transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. Nature of Goods and Services The following is a description of principal activities from which the Company generates its revenue: Event-related revenue The Company’s business consists principally of promoting racing events at its major motorsports entertainment facilities. The Company derives revenues primarily from (i) admissions to motorsports events and motorsports themed amusement activities held at our facilities, (ii) revenue generated in conjunction with or as a result of motorsports events and motorsports themed amusement activities conducted at our facilities, and (iii) catering, concession and merchandising services during or as a result of these events and amusement activities. “Admissions” revenue includes ticket sales for all of our racing events and other motorsports activities and amusements, net of any applicable taxes. Advance ticket sales and event-related revenues for future events are deferred until earned, which is generally once the events are conducted. “Motorsports and other event related” revenue primarily includes television and ancillary media rights fees, promotion and sponsorship fees, royalties from licenses of our trademarks, fees paid by third party promoters for management of non-motorsport events, hospitality rentals (including luxury suites, chalets and the hospitality portion of club seating), advertising revenues, parking and camping revenues, track rental fees, syndication of numerous racing events, and programs through our own radio network, MRN. “Food, beverage and merchandise” revenue includes revenues from concession stands, direct sales of souvenirs, hospitality catering, programs and other merchandise, and fees paid by third party vendors for the right to occupy space to sell souvenirs and concessions at our motorsports entertainment facilities. The delivery of MRN services is recognized utilizing the output method and the measure of progress is when the advertisements are aired over the MRN network. The delivery of all other event related services mentioned above are not considered as a separate performance obligation because our customers cannot receive the relevant benefits unless we also fulfill our obligation to deliver the event. Event related revenue is recognized on an event by event basis based on the fees allocated to the performance obligation within the underlying contractual arrangement. Other revenue Other revenue primarily includes revenues derived from leasing commercial space in our office and retail operations, including those at ONE DAYTONA and the Shoppes at ONE DAYTONA. Disaggregation of revenue In the following table, revenue is disaggregated by product line and timing of transfer of products and services. The table is in line with our reportable segments (see Note 15 - Segment Reporting).
Contract Balances The Company’s rights to consideration for work completed, but not billed at the reporting date, is classified as a receivable, as it has an unconditional right to payment or only conditional for the passage of time. The Company has no recorded contract assets as of May 31, 2019. Consideration received in advance from customers is recorded as a contract liability, if a contract exists under ASC 606, until services are delivered or obligations are met and revenue is earned. Contract liability represents the excess of amounts invoiced over amounts recognized as revenues. Contract liabilities to be recognized in the succeeding twelve-month period are classified as current contract liabilities and the remaining amounts, if any, are classified as non-current contract liabilities. Contract liabilities are predominately related to motorsports and other event related revenues, and to a lesser extent, Admissions and Food, Beverage and Merchandise revenues. Contract liabilities of approximately $78.0 million and $7.2 million are included in current and long-term deferred revenues, respectively, on the Consolidated Balance Sheets as of May 31, 2019. For the period ended May 31, 2019, we recognized revenue associated with contract liabilities of approximately $35.1 million that were included in the contract liabilities balance at the beginning of the period. Significant changes in the contract liabilities balances during the period are discussed below. Transaction price allocated to the remaining performance obligations The Company applies the optional exemptions and does not disclose: a) information about remaining performance obligations that have an original expected duration of one year or less or b) transaction price allocated to unsatisfied performance obligations for which variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation in accordance with the series guidance. The typical duration of all event related and other contracts is one year or less and, as a result, the Company applies the optional exemptions and does not disclose information about remaining performance obligations that have an original expected duration of one year or less. The Company has also elected to not disclose transaction price allocated to unsatisfied performance obligations for which variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service for event related promises for those contracts that contain percentage of the sales. The fees are variable for this type of contract, and the uncertainty related to the final fee, is resolved within the current year. Changes in Accounting Policies The Company adopted ASC 606 with an initial application as of the first quarter of fiscal year 2019, using the Modified Retrospective transition method, and applied ASC 606 to contracts with customers that were not completed as of the date of initial application. Comparative information has not been adjusted as the application of ASC 606 resulted in similar reportable activity as under ASC 605, "Revenue Recognition - Multiple-Deliverable Revenue Arrangements", except for that disclosed below. Unbilled Income and Deferred Income Recognition for Sponsorship Agreements The Company previously recognized a receivable for unbilled revenue and a liability in deferred income for an amount equal to the remaining performance obligation at any reporting period. Under ASC 606, the Company will recognize a receivable and a contract liability prior to performance by either party, only if the entity has an unconditional right to payment. The Company has determined it does not have an unconditional right to receive unbilled revenue for remaining performance obligations. Accordingly, the Company will net the amount of unbilled revenue and associated deferred income at any reporting date. Impact on the Consolidated Balance Sheet as of May 31, 2019:
There was no impact on the Consolidated Statement of Comprehensive Income. Impact on the Consolidated Statement of Cash Flows for the six months ended May 31, 2019:
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Earnings Per Share |
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Earnings Per Share | Earnings Per Share Basic earnings per share is calculated using the Company's weighted-average outstanding common shares. Diluted earnings per share is calculated using the Company's weighted-average outstanding common shares including the dilutive effect of stock awards as determined under the treasury stock method. In periods when the Company recognizes a net loss, it excludes the impact of outstanding stock awards from the diluted loss per share calculation as their inclusion would have an anti-dilutive effect. The following table sets forth the computation of basic and diluted earnings per share for the three and six months ended May 31, 2018 and 2019, respectively (in thousands, except share and per share amounts):
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Equity and Other Investments |
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Equity and Other Investments | Equity and Other Investments Hollywood Casino at Kansas Speedway Kansas Entertainment, LLC, (“Kansas Entertainment”) a 50/50 joint venture of Penn Hollywood Kansas, Inc. (“Penn”), a subsidiary of Penn National Gaming, Inc., and Kansas Speedway Development Corporation (“KSDC”), a wholly owned indirect subsidiary of ISC, operates the Hollywood-themed casino and branded destination entertainment facility overlooking turn two at Kansas Speedway. Penn, as the managing member of Kansas Entertainment, is responsible for the operations of the casino. The Company has accounted for Kansas Entertainment as an equity investment in the consolidated financial statements as of May 31, 2018 and 2019. The Company's 50.0 percent portion of Kansas Entertainment’s net income, which is before income taxes as the joint venture is a disregarded entity for income tax purposes, was approximately $6.2 million and $7.0 million for the three months ended May 31, 2018 and 2019, respectively, and approximately $10.6 million and $12.5 million for the six months ended May 31, 2018 and 2019, respectively, and is included in Equity in net income from equity investments in the Consolidated Statements of Operations. Pre-tax cash distributions from Kansas Entertainment for the six months ended May 31, 2018 and 2019, are recognized on the Company's Consolidated Statement of Cash Flows as follows (in thousands):
Fairfield Inn Hotel at ONE DAYTONA Daytona Hotel Two, LLC ("Fairfield"), a joint venture of Daytona Hospitality Group II, LLC ("DHGII"), a subsidiary of Prime-Shaner Groups, and Daytona Beach Property Holdings Retail, LLC ("DBR"), a wholly owned indirect subsidiary of ISC, was formed to own, construct and operate a Fairfield Inn hotel. The hotel is situated within the ONE DAYTONA development. In June 2016, DBR contributed land to the joint venture as per the agreement. Construction of the hotel was completed and operations commenced in December 2017. DHGII is the managing member of Fairfield. DHGII was responsible for the development of Fairfield and manages ongoing operations of the hotel. As per the partnership agreement, our 33.25 percent share of equity is limited to the Company's non-cash land contribution and it will share in the profits from the joint venture proportionately to its equity ownership. The Company has accounted for the joint venture in Fairfield as an equity investment in its consolidated financial statements as of May 31, 2019. The Company's 33.25 percent portion of Fairfield’s net income, which is before income taxes as the joint venture is a disregarded entity for income tax purposes, was approximately $0.1 million and none for the three months ended May 31, 2018 and 2019, respectively. For the six months ended May 31, 2019, the equity investment had losses in excess of its carrying value of approximately $0.1 million. The Company will resume application of the equity method only after its share of unrecognized net income equals the share of net losses not recognized during the period the equity method was suspended. For the six months ended May 31, 2018, the Company's share of net income was $0.1 million, and is included in net income from equity investments in the Company's Consolidated Statements of Operations. Pre-tax cash distributions from Fairfield for the six months ended May 31, 2018 and 2019, totaled approximately $0.1 million and $0.1 million, respectively. The DAYTONA Marriott Autograph Collection Hotel at ONE DAYTONA Daytona Hotel One, LLC ("The DAYTONA"), a joint venture of Daytona Hospitality Group, LLC ("DHG"), a subsidiary of Prime-Shaner Groups, and DBR, was formed to own, construct and operate The DAYTONA. The hotel is situated within the ONE DAYTONA development. DHG is the managing member of The DAYTONA. DHG is responsible for the development of The DAYTONA and will manage the operations of the hotel. As per the partnership agreement, our 34.0 percent share of equity is limited to the Company's non-cash land contribution and it will share in the profits from the joint venture proportionately to its equity ownership. The Company has accounted for the joint venture in The DAYTONA as an equity investment in the Company's consolidated financial statements as of May 31, 2019. The Company's 34.0 percent portion of The DAYTONA’s net loss, which is before income taxes as the joint venture is a disregarded entity for income tax purposes, was approximately $0.6 million for the three and six months ended May 31, 2019, respectively, which includes pre-opening costs of approximately $0.3 million, and is included in net income from equity investments in the Company's Consolidated Statements of Operations. There were no comparable amounts for the three and six months ended May 31, 2018 as the hotel commenced operations in April 2019. Residential Project at ONE DAYTONA Daytona Apartment Holdings, LLC, a joint venture of Daytona Residential Group, LLC, a subsidiary of Prime Group, and DBR, was formed to own, construct, and operate the residential component of the ONE DAYTONA project. The joint venture is structured similarly to the Fairfield and The DAYTONA joint ventures, where the Company's share of equity will be limited to the Company's non-cash land contribution and it will share in the profits from the joint venture proportionately to its equity ownership. In March 2019, the Company's land contribution of approximately $3.7 million towards the residential component was finalized. Vertical construction of the residential project has commenced and some units are expected to open in the fourth quarter of fiscal 2019. As per the partnership agreement, the Company's 31.0 percent share of equity will be limited to its non-cash land contribution and it will share in the profits from the joint venture proportionately to its equity ownership, which is before income taxes as the joint venture is a disregarded entity for income tax purposes. For the three and six months ended May 31, 2019 and May 31, 2018, the Company had no recorded costs included in net income from equity investments in the Company's Consolidated Statements of Operations. Other Investments A Community Development District ("CDD") has been established for the purpose of installing and maintaining public infrastructure at ONE DAYTONA (see "Future Liquidity - ONE DAYTONA"). The CDD is a local, special purpose government framework authorized by Chapter 190 of the Florida Statutes for managing and financing infrastructure to support community development. The CDD has negotiated agreements with the City of Daytona Beach and Volusia County for a total of up to $40.0 million in incentives to finance a portion of the infrastructure required for the ONE DAYTONA project. In October 2018, the CDD purchased certain infrastructure assets and specific easement rights from ONE DAYTONA. ONE DAYTONA received approximately $20.0 million of the total incentive amount in cash, with $10.5 million to be received in annual payments derived from a long-term note receivable issued by the CDD. The first payment of the note receivable is expected in fiscal 2019 with maturity no later than fiscal 2046. As of May 31, 2019, no payments have been received. The remainder of the incentives can be received based on certain criteria met by the project through fiscal 2046. The ISC Board of Directors approved the purchase of certain assets, including trademarks and certain other intellectual property, from Racing Electronics and certain other assets required to support the business services of Racing Electronics. The asset acquisitions were completed in January 2019 for a total cost of approximately $8.2 million in cash. The acquisition meets the criteria of a business combination in accordance with ASC 805, "Business Combinations". The following table summarizes the Company's preliminary acquisition accounting based on the fair values of the assets acquired (in thousands):
Acquisition accounting and valuation processes with respect to inventory (included in prepaid expenses and other current assets in the Consolidated Balance Sheets), property and equipment, intangible assets, and goodwill, related to the acquisition completed, are preliminary and subject to adjustments within the required one year period. The preliminary track access rights will be amortized over thirty years. The trade names and trademarks is an indefinite-lived intangible asset and is not amortized. The results of operations of Racing Electronics are included in the Company's unaudited condensed consolidated statements of operations subsequent to the closing date of the acquisition and included in the Motorsports Event segment. For the three and six months ended May 31, 2019, net revenues generated from the acquisition were approximately $5.0 million and $6.9 million, respectively, and operating income generated from the acquisition was approximately $0.3 million and $0.2 million, respectively, which includes approximately $0.3 million of non-recurring, non-capitalizable acquisition costs, recognized as an expense in general and administrative costs on the Consolidated Statement of Operations.
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Goodwill and Intangible Assets |
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Goodwill and Intangible Assets | Goodwill and Intangible Assets The gross carrying value, accumulated amortization and net carrying value of the major classes of intangible assets relating to the Motorsports Event segment are as follows (in thousands):
The increase of approximately $1.0 million in the net carrying amount of non-amortized intangible assets and $0.3 million in net carrying amount of amortized intangible assets, for the six months ended May 31, 2019, as compared to the fiscal year ended November 30, 2018, is primarily due to the acquisition of certain assets, including trademarks and other intellectual property from Racing Electronics. The following table presents current and expected amortization expense of the existing intangible assets for each of the following periods (in thousands):
The increase of approximately $0.5 million in the carrying value of goodwill during the six months ended May 31, 2019, relates to the acquisition of certain assets from Racing Electronics.
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Long-Term Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | Long-Term Debt Long-term debt consists of the following (in thousands):
The Company's $65.0 million principal amount of senior unsecured notes (“4.63 percent Senior Notes”) bear interest at 4.63 percent and are due January 2021. The 4.63 percent Senior Notes require semi-annual interest payments on January 18 and July 18 through their maturity. The 4.63 percent Senior Notes may be redeemed in whole or in part, at the Company’s option, at any time or from time to time at redemption prices as defined in the indenture. Certain of the Company’s wholly owned domestic subsidiaries are guarantors of the 4.63 percent Senior Notes. Certain restrictive covenants of the 4.63 percent Senior Notes require that the Company's ratio of its Consolidated Funded Indebtedness to its Consolidated EBITDA ("leverage ratio") does not exceed 3.50 to 1.0, and its Consolidated EBITDA to Consolidated Interest Expense ("interest coverage ratio") is not less than 2.0 to 1.0. In addition, the Company may not permit the aggregate of certain Priority Debt to exceed 15.0 percent of its Consolidated Net Worth. The 4.63 percent Senior Notes contain various other affirmative and negative restrictive covenants including, among others, limitations on liens, sales of assets, mergers and consolidations and certain transactions with affiliates. As of May 31, 2019, the Company was in compliance with its various restrictive covenants. At May 31, 2019, outstanding principal on the 4.63 percent Senior Notes was approximately $65.0 million. The Company's $100.0 million principal amount of senior unsecured notes (“3.95 percent Senior Notes”) bear interest at 3.95 percent and are due September 2024. The 3.95 percent Senior Notes require semi-annual interest payments on March 13 and September 13 through their maturity. The 3.95 percent Senior Notes may be redeemed in whole or in part, at the Company's option, at any time or from time to time at redemption prices as defined in the indenture. Certain of the Company's wholly owned domestic subsidiaries are guarantors of the 3.95 percent Senior Notes. Certain restrictive covenants of the 3.95 percent Senior Notes require that the Company's leverage ratio does not exceed 3.50 to 1.0, and its interest coverage ratio is not less than 2.0 to 1.0. In addition, the Company may not permit the aggregate of certain Priority Debt to exceed 15.0 percent of its Consolidated Net Worth. The 3.95 percent Senior Notes contain various other affirmative and negative restrictive covenants including, among others, limitations on liens, sales of assets, mergers and consolidations and certain transactions with affiliates. As of May 31, 2019, the Company was in compliance with its various restrictive covenants. At May 31, 2019, outstanding principal on the 3.95 percent Senior Notes was approximately $100.0 million. The term loan (“6.25 percent Term Loan”), related to the Company’s International Motorsports Center, has a 25 year term due October 2034, an interest rate of 6.25 percent, and a current monthly payment of approximately $323,000. At May 31, 2019, the outstanding principal on the 6.25 percent Term Loan was approximately $45.5 million. At May 31, 2019, the outstanding taxable special obligation revenue (“TIF”) bond, in connection with the financing of Kansas Speedway, totaled approximately $46.3 million, net of the unamortized discount, which is comprised of a $46.6 million principal amount, 6.75 percent term bond due December 1, 2027. The TIF bond is repaid by the Unified Government of Wyandotte County/Kansas City, Kansas (“Unified Government”) with payments made in lieu of property taxes (“Funding Commitment”) by the Company’s wholly owned subsidiary, Kansas Speedway Corporation (“KSC”). Principal (mandatory redemption) payments per the Funding Commitment are payable by KSC on October 1 of each year. The semi-annual interest component of the Funding Commitment is payable on April 1 and October 1 of each year. KSC granted a mortgage and security interest in the Kansas project for its Funding Commitment obligation. The Company's $300.0 million revolving credit facility (“2016 Credit Facility”) contains a feature that allows the Company to increase the credit facility to a total of $500.0 million, subject to certain conditions and provides for separate sub-limits of $25.0 million for standby letters of credit and $10.0 million for swing line loans. The 2016 Credit Facility is scheduled to mature five years from the date of inception, with two 1-year extension options, extending the maturity to September 2023. Interest accrues, at the Company's option, at either LIBOR plus 100.0 — 162.5 basis points or a base rate loan at the highest of: i) Wells Fargo Bank's prime lending rate, ii) the Federal Funds rate, as in effect from time to time, plus 0.5 percent, and iii) one month LIBOR plus 1.0 percent. The 2016 Credit Facility also contains a commitment fee ranging from 0.125 percent to 0.225 percent of unused amounts available for borrowing. The interest rate margin on the LIBOR borrowings and commitment fee are variable depending on the better of the Company's debt rating as determined by specified rating agencies or its leverage ratio. Certain of the Company's wholly owned domestic subsidiaries are guarantors on the 2016 Credit Facility. The 2016 Credit Facility requires that the Company's leverage ratio does not exceed 3.50 to 1.0 (4.0 to 1.0 for the four quarters ending after any Permitted Acquisition), and its interest coverage ratio is not less than 2.5 to 1.0. The 2016 Credit Facility also contains various other affirmative and negative restrictive covenants including, among others, limitations on indebtedness, investments, sales of assets, certain transactions with affiliates, entering into certain restrictive agreements and making certain restricted payments as detailed in the agreement. As of May 31, 2019, the Company was in compliance with its various restrictive covenants. At May 31, 2019, the Company had no outstanding borrowings under its credit facility. Financing costs related to the credit facility, net of accumulated amortization, of approximately $1.2 million, have been deferred and are included in other assets as of May 31, 2019. Financing costs are being amortized on a straight-line method, which approximates the effective yield method, over the life of the related financing. At November 30, 2018 and May 31, 2019, the Company recorded deferred financing costs of approximately $3.0 million and $2.7 million, respectively, net of accumulated amortization. Total interest expense incurred by the Company for the three and six months ended May 31, 2018 and 2019, respectively, is as follows (in thousands):
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Financial Instruments |
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Financial Instruments | Financial Instruments In accordance with the “Financial Instruments” Topic, ASC 825-10, and in accordance with the “Fair Value Measurements and Disclosures” Topic, ASC 820-10, additional clarification and disclosure is required about the use of fair value measurements. These topics discuss key considerations in determining fair value in such markets and expanding disclosures on recurring fair value measurements, using unobservable inputs (Level 3). Various inputs are considered when determining the carrying values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities. These items approximate fair value due to the short-term maturities of these assets and liabilities. The Company's note receivable is a variable-based financial instrument and, therefore, its carrying value approximates its fair value. The Company’s credit facilities approximate fair value as they bear interest rates that approximate market. Fair values of long-term debt are based on quoted market prices at the date of measurement and determined by quotes from financial institutions. There have been no changes or transfers between category levels or classes. These inputs are summarized in the three broad levels and two classes listed below:
The following table presents estimated fair values and categorization levels of the Company's financial instruments as of November 30, 2018 and May 31, 2019, respectively (in thousands):
The Company had no level 3 inputs as of May 31, 2019.
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Capital Stock |
6 Months Ended |
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May 31, 2019 | |
Equity [Abstract] | |
Capital Stock | Capital Stock Stock Purchase Plan The Company has a share repurchase program (“Stock Purchase Plan”), under which it is authorized to purchase up to $530.0 million of its outstanding Class A common shares. The timing and amount of any shares repurchased under the Stock Purchase Plan will depend on a variety of factors, including price, corporate and regulatory requirements, capital availability and other market conditions. The Stock Purchase Plan may be suspended or discontinued at any time without prior notice. The Company currently has no active 10b5-1 plans. No shares have been or will be knowingly purchased from Company insiders or their affiliates. Since inception of the Stock Purchase Plan, through May 31, 2019, the Company has purchased 10,566,002 shares of its Class A common shares, for a total of approximately $391.3 million. The Company did not purchase any shares of its Class A common shares during the six months ended May 31, 2019. At May 31, 2019, the Company had approximately $138.7 million remaining repurchase authority under the current Stock Purchase Plan. In April 2019, the Company's Board of Directors approved an annual dividend of $0.49 per share, for a total of approximately $21.3 million, paid on June 28, 2019, to common stockholders of record on May 31, 2019.
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Long-Term Stock Incentive Plan |
6 Months Ended |
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May 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Long-Term Incentive Plan | Long-Term Stock Incentive Plan In April 2017, the Company's Board of Directors approved the 2017 Long Term Incentive Plan (the "2017 Plan"), as its 2006 Long Term Incentive Plan had expired in 2016. The Company has reserved an aggregate of 1,500,000 shares (subject to adjustment for stock splits and similar capital changes) of Class A Common Stock for grants under the 2017 Plan. Awards under the 2017 Plan will contain such terms and conditions not inconsistent with the 2006 Long Term Incentive Plan. In May 2019, the Company awarded and issued a total of 83,298 restricted shares of the Company’s Class A common shares to certain officers and managers under the 2017 Plan. The shares of restricted stock awarded in May 2019, vest at the rate of 50.0 percent on the third anniversary of the award date and the remaining 50.0 percent on the fifth anniversary of the award date. The weighted average grant date fair value of these restricted share awards was $44.12 per share. In accordance with ASC 718, “Compensation — Stock Compensation” the Company is recognizing stock-based compensation on these restricted shares awarded on the accelerated method over the requisite service period.
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Comprehensive Income |
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Comprehensive Income | Comprehensive Income Comprehensive income is the change in equity of an enterprise except those resulting from shareholder transactions. Accumulated other comprehensive loss consists of the following (in thousands):
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Income Taxes |
6 Months Ended |
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May 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On December 22, 2017, new tax legislation, commonly referred to as the Tax Cuts and Jobs Act of 2017, was enacted, which significantly changed the existing U.S. tax laws. The Tax Act reduced the corporate Federal income tax rate from 35.0 percent to 21.0 percent, eliminated the corporate alternative minimum tax, allowed 100.0 percent expensing of certain qualified capital investments through 2022 (retroactive to September 27, 2017), and further limited the deductibility of certain executive compensation, among other provisions. Under current accounting guidance, the Company recognized the effects of the Tax Act as of the enactment date. During the first quarter of fiscal 2018, as a result of the Tax Act, the Company incurred a material, non-cash reduction of our deferred income tax liabilities and a corresponding material income tax benefit of approximately $143.9 million primarily due to the Federal income tax rate reduction from 35.0 percent to 21.0 percent. The Company's effective income tax rate was approximately 22.9 percent and 23.9 percent for the three and six months ended May 31, 2019, respectively, and approximately 22.2 percent and (232.8) percent for the three and six months ended May 31, 2018, respectively. The increase in the effective income tax rate for the six months ended May 31, 2019, as compared to the same period in the prior year, is substantially due to the material income tax benefit and income tax rate reduction associated with the Tax Act, including the aforementioned reduction in deferred income tax liability, in the first quarter of fiscal 2018. The slight increase in the three months ended May 31, 2019, as compared to the same period in the prior year, is predominately due to changes in state income tax rates. In March 2018, the Company was notified that its 2014 federal income tax return is under examination by the Internal Revenue Service.
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Related Party Disclosures and Transactions |
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May 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Disclosures and Transactions | Related Party Disclosures and Transactions All of the racing events that take place during the Company’s fiscal year are sanctioned by various racing organizations such as National Association for Stock Car Auto Racing (“NASCAR”), the American Historic Racing Motorcycle Association, the American Motorcyclist Association, the Automobile Racing Club of America ("ARCA"), the American Sportbike Racing Association — Championship Cup Series, the Federation Internationale de L’Automobile, the Federation Internationale Motocycliste, International Motor Sports Association (“IMSA”) - a wholly owned subsidiary of NASCAR, Historic Sportscar Racing, IndyCar Series, National Hot Rod Association, the Porsche Club of America, the Sports Car Club of America, the Sportscar Vintage Racing Association, the United States Auto Club and the World Karting Association. NASCAR and IMSA, which sanction many of the Company’s principal racing events, are members of the France Family Group, which controls approximately 74.7 percent of the combined voting power of the outstanding stock of the Company as of May 31, 2019, and some members of which serve as directors and officers of the Company. Under current agreements, NASCAR contracts directly with certain network providers for television rights to the entire Monster Energy NASCAR Cup, Xfinity and Gander Outdoors Truck series schedules. Under the terms of this arrangement, NASCAR retains 10.0 percent of the gross broadcast rights fees allocated to each Monster Energy NASCAR Cup, Xfinity and Gander Outdoors Truck series event as a component of its sanction fees. The Company, as the promoter, records 90.0 percent of the gross broadcast rights fees as revenue and then records 25.0 percent of the gross broadcast rights fees as part of its awards to the competitors, included in NASCAR event management fees (discussed below). Ultimately, the promoter retains 65.0 percent of the net cash proceeds from the gross broadcast rights fees allocated to the event. The Company’s television broadcast and ancillary rights fees received from NASCAR for the Monster Energy NASCAR Cup, Xfinity, and Gander Outdoors Truck series events conducted at its wholly owned facilities, and recorded as part of motorsports related revenue, were approximately $95.0 million and $97.7 million for the three months ended May 31, 2018 and 2019, respectively, and approximately $160.1 million and $165.7 million for the six months ended May 31, 2018 and 2019, respectively. The Company recorded prize money of approximately $25.9 million and $26.9 million for the three months ended May 31, 2018 and 2019, respectively, and approximately $43.9 million and $45.8 million for the six months ended May 31, 2018 and 2019, respectively, included in NASCAR event management fees (discussed below) related to the aforementioned 25.0 percent of gross broadcast rights fees ultimately paid to competitors. Standard NASCAR and IMSA sanction agreements require racetrack operators to pay event management fees (collectively "NASCAR event management or NEM fees"), which include prize and point fund monies for each sanctioned event conducted, as well as fees paid to NASCAR for sanctioning and officiating of the events. The prize and point fund monies are distributed by NASCAR to participants in the events. Total NEM fees paid by the Company were approximately $50.2 million and $52.3 million for the three months ended May 31, 2018 and 2019, respectively, and approximately $80.0 million and $83.2 million for the six months ended May 31, 2018 and 2019, respectively.
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Commitments and Contingencies |
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May 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies In October 2002, the Unified Government issued subordinate sales tax special obligation revenue bonds (“2002 STAR Bonds”) totaling approximately $6.3 million to reimburse the Company for certain construction already completed on the second phase of the Kansas Speedway project and to fund certain additional construction. The 2002 STAR Bonds, which require annual debt service payments and are due December 1, 2022, will be retired with state and local taxes generated within Kansas Speedway’s boundaries and are not the Company’s obligation. KSC has agreed to guarantee the payment of principal and any required premium and interest on the 2002 STAR Bonds. At May 31, 2019, the Unified Government had approximately $0.5 million outstanding on 2002 STAR Bonds. Under a keepwell agreement, the Company has agreed to provide financial assistance to KSC, if necessary, to support KSC’s guarantee of the 2002 STAR Bonds. In connection with the Company’s automobile and workers’ compensation insurance coverages and certain construction contracts, the Company has standby letter of credit agreements in favor of third parties totaling approximately $3.1 million at May 31, 2019. At May 31, 2019, there were no amounts drawn on the standby letters of credit. In September 2018, the Company announced a Comprehensive Ticket and Travel Protection Program that allows guests who purchase a grandstand ticket the ability to exchange tickets for a rescheduled NASCAR event at an ISC facility for a future NASCAR event within the ISC portfolio, certain restrictions apply. Should an event be rescheduled to a different date due to inclement weather, and a guest chooses to take advantage of ISC's Weather Protection Program, revenue related to that grandstand ticket would be deferred until earned, which is when the guest's selected event is conducted. At May 31, 2019, there were no events rescheduled due to inclement weather that would require the deferral of revenues. Current Litigation The Company is from time to time a party to routine litigation incidental to its business. Management does not believe that the resolution of any or all of such litigation will have a material adverse effect on the Company’s financial condition or results of operations. Mergers, such as the one proposed in the Merger Agreement, which the Company previously discussed in its report on Form 10-K for the fiscal year ended November 30, 2018, often attract litigation from minority shareholders. On December 14, 2018 a putative class-action shareholder lawsuit was filed in the Seventh Judicial Circuit of Volusia County, Florida by attorneys on behalf of the Firemen's Retirement System of St. Louis related to the Merger Agreement. The complaint names as defendants: the Company, its directors, its CFO, NASCAR Holdings, and certain of the Family Stockholders, and alleges breach of fiduciary duty and for aiding and abetting those breaches. The parties to the litigation have reached an agreement-in-principle to settle the litigation, subject to the negotiation of appropriate documentation. The Company currently maintains Directors & Officers Insurance. Applicable insurance policies contain certain customary limitations, conditions and exclusions and are subject to a self-insured retention amount. On April 13, 2019, SunTrust Equipment and Finance Leasing Corp. filed a complaint against the Company in the Northern District of Georgia for Declaratory Judgment, Breach of Contract and Possession of Personal Property. The complaint relates to subleases the Company entered into with DC Solar Distribution, Inc., which has subsequently filed for bankruptcy. ISC has filed a motion to dismiss the complaint. The motion has been fully briefed and is pending before the court.
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Segment Reporting |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting | Segment Reporting The general nature of the Company’s business is a motorsports themed amusement enterprise, furnishing amusement to the public in the form of motorsports themed entertainment. The Company’s motorsports event operations consist principally of racing events at its major motorsports entertainment facilities. The reporting units within the motorsports segment portfolio are reviewed together as the nature of the products and services, the production processes used, the type or class of customer using our products and services, and the methods used to distribute our products or provide their services are consistent in objectives and principles, and predominately uniform and centralized throughout the Company. The consolidated industry domestic media rights contract, which continues through the 2024 NASCAR season, continues to be the single-largest contributor to the Company's earnings. These media rights are allocated to specific events, are not facility based, and are derived through a corporate contract, which affects all of the motorsports event facilities within the motorsports event segment. Similarly, corporate sponsorship partnership revenue is primarily derived from corporate contracts, negotiated by the Company's corporate sales team, and allocated to multiple, or all, motorsports entertainment facilities depending on the specific arrangement. Thus, the disclosure of these revenue streams, as they relate to each reporting unit, is not practical. The Company’s remaining business units, which are comprised of the radio network production and syndication of numerous racing events and programs, non-motorsports events, certain souvenir merchandising operations not associated with the promotion of motorsports events at the Company’s facilities, construction management services, financing and licensing operations, equity investments and retail and commercial leasing operations are included in the “All Other” segment. The Company evaluates financial performance of the business units on operating profit after allocation of corporate general and administrative (“G&A”) expenses. Corporate G&A expenses are allocated to business units based on each business unit’s net revenues to total net revenues. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. Intersegment sales are accounted for at prices comparable to unaffiliated customers. The following tables provide segment reporting of the Company for the three and six months ended May 31, 2018 and 2019, respectively (in thousands):
Intersegment revenues were approximately $0.5 million and $0.6 million for the three months ended May 31, 2018 and 2019, respectively, and approximately $0.9 million and $0.9 million for the six months ended May 31, 2018 and 2019, respectively. During the three and six months ended May 31, 2019, revenues in the Motorsports Event segment included approximately $5.0 million and $6.9 million, respectively related to Racing Electronics, for which there was no comparable activity in the same periods of the prior year. During the three and six months ended May 31, 2019, revenues in the All Other segment have decreased by approximately $5.3 million and $4.8 million, respectively, as compared to the same periods in the prior year. The decrease in the current three and six month periods is predominantly related to the Country 500 music festival at Daytona event not occurring in fiscal 2019 offset by lease revenue from ONE DAYTONA, as new tenants opened during fiscal 2019. Capital expenditures related to the All Other segment decreased approximately $6.5 million for the three months ended May 31, 2019, and approximately $4.2 million for the six months ended May 31, 2019, as compared to the same periods in the prior year. The decrease is substantially related to the construction activity at The Shoppes at ONE DAYTONA. During the six months ended May 31, 2019, the Company recognized approximately $0.9 million, of accelerated depreciation, due to shortening the service lives of certain assets associated with the infield project at Talladega. The Company did not recognize any accelerated depreciation during the three months ended May 31, 2019. During the three and six months ended May 31, 2018, the Company recognized approximately $0.3 million and $1.2 million, respectively of accelerated depreciation due to shortening the service lives of certain assets, associated with The ISM Raceway Project and the infield project at Richmond. During the three and six months ended May 31, 2019, the Company recognized approximately $0.5 million and $0.8 million, respectively, of asset retirement losses attributable to demolition and/or asset relocation costs in connection with the infield project at Talladega. During the three and six months ended May 31, 2018, the Company recognized approximately $0.1 million and $1.2 million, respectively, of similar costs associated with ONE DAYTONA, facility optimization initiatives, and other capital improvements including the infield project at Richmond.
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New Accounting Pronouncements (Policies) |
6 Months Ended |
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May 31, 2019 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements On January 5, 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-01, Clarifying the Definition of a Business (ASC 805). Under ASC 805, a business is defined as having a set of assets along with 3 elements or activities—inputs, processes, and outputs. However, confusion occurs when a business does not always have outputs. In addition, all the inputs and processes that a seller uses in operating a set are not required if market participants can acquire the set and continue to produce outputs, for example, by integrating the acquired set with their own inputs and processes. As a result, this definition of a business under ASC 805 led some transactions to be accounted for as a business combination (see Note 5). The update has refined the definition of a business. Now, to be considered a business, an acquisition would have to include an input and a substantive process that together significantly contributes to the ability to create outputs. Public business entities should apply the amendments in this update to annual periods beginning after December 15, 2017, including interim periods within those periods. The amendments in this update were adopted in the first quarter of fiscal 2019. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The main objective of this update is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in this update replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. For public business entities that are U.S. Securities and Exchange Commission (SEC) filers, the amendments in this update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For all other public business entities, the amendments in this update are effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company is currently evaluating the impact of adopting this new guidance on its financial position, results of operations, statement of comprehensive income, and cash flows, and will adopt the provisions of this statement in the first quarter of fiscal 2021. In May 2014, the FASB, in conjunction with the International Accounting Standards Board ("IASB"), issued Accounting Standards update ("ASU") No. 2014-09, "Revenue from Contracts with Customers" (ASC 606), which supersedes the existing revenue recognition requirements under U.S. GAAP and eliminates industry-specific guidance. The new revenue recognition standard provides a five step analysis of transactions to determine when and how revenue is recognized. The new model requires revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. The new guidance includes updated disclosure requirements regarding the qualitative and quantitative information of ISC’s nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. During 2016, the FASB issued additional interpretive guidance relating to the standard which covered the topics of principal versus agent considerations and identifying performance obligations and licensing. The standard, along with the subsequent clarifications issued, are effective for reporting periods beginning after December 15, 2017, including interim reporting periods, making it effective for our fiscal year beginning December 1, 2018. The guidance permits two methods of adoption: the full retrospective method, which applies to each prior reporting period presented, and the modified retrospective method, in which the cumulative effect of initially applying the new guidance is recognized as of the date of initial application as an adjustment to the opening balance of retained earnings. The Company has adopted ASC 606 and the related modifications as of December 1, 2018 using the modified retrospective transition and the impact of adopting this new guidance did not result in a material difference in its consolidated financial statements (see note 3). In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842): Leases". The objective of this update is to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. To meet that objective, the FASB is amending the FASB Accounting Standards Codification and creating Topic 842, Leases. This update, along with International Financial Reporting Standards 16, Leases, are the result of the FASB’s and the IASB’s efforts to meet that objective and improve financial reporting. For a public business entity, the amendments in this update are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the amendments in this update is permitted for all entities. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently evaluating the impact of adopting this new guidance on its financial position, results of operations, and cash flows, and will adopt the provisions of this statement in the first quarter of fiscal 2020. In August 2016, the FASB issued ASU No. 2016-15, "Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments". The objective of this update is to provide specific guidance on eight cash flow classification issues and reduce the existing diversity in practice. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The amendments in this update should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company adopted the provisions of this statement in the first quarter of fiscal 2019 and the impact of adopting this new guidance did not result in a material difference in its consolidated statement of cash flows. In January 2017, the FASB issued ASU No. 2017-04, "Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment". The objective of this update is to simplify the subsequent measurement of goodwill, eliminating Step 2 from the goodwill impairment test, which test is measuring goodwill impairment loss by comparing the implied fair value of a reporting unit's goodwill to the carrying amount of that goodwill. Instead, under the amendments in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. An entity should apply the amendments in this update on a prospective basis. An entity is required to disclose the nature of and reason for the change in accounting principle upon transition. That disclosure should be provided in the first annual period and in the interim period within the first annual period when the entity initially adopts the amendments in this update. A public business entity that is a U.S. Securities and Exchange Commission ("SEC") filer should adopt the amendments in this update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact of adopting this new guidance on its financial position, results of operations, and cash flows, and will adopt the provisions of this statement in the first quarter of fiscal 2021. In December 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin ("SAB") No. 118 (as further clarified by FASB ASU 2018-05, "Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118)" to provide guidance for companies that may not have completed their accounting for the income tax effects of the Tax Cuts and Jobs Act of 2017 (Tax Act) in the period of enactment, which is the period that includes December 22, 2017. SAB No. 118 provides for a provisional one year measurement period for entities to finalize their accounting for certain income tax effects related to the Tax Act. SAB No. 118 provides guidance where: (i) the accounting for the income tax effect of the Tax Act is complete and reported in the Tax Act's enactment period, (ii) the accounting for the income tax effect of the Tax Act is incomplete and reported as provisional amounts based on reasonable estimates (to the extent determinable) subject to adjustments during a limited measurement period until complete, and (iii) accounting for the income tax effect of the Tax Act is not reasonably estimable (no related provisional amounts are reported in the enactment period) and entities would continue to apply accounting based on tax law provisions in effect prior to the Tax Act enactment until provisional amounts are reasonably estimable. SAB No. 118 requires disclosure of the reasons for incomplete accounting additional information or analysis needed, among other relevant information. The Company finalized its provisional amounts in the fourth quarter of fiscal 2018 (see Note 12 - Income Taxes). In February 2018, the FASB issued ASU No. 2018-02, "Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income". The amendments in this update allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Act. Consequently, the amendments eliminate the stranded tax effects resulting from the Tax Act and will improve the usefulness of information reported to financial statement users. However, because the amendments only relate to the reclassification of the income tax effects of the Tax Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected. The amendments in this update also require certain disclosures about stranded tax effects. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption of the amendments in this update is permitted, including adoption in any interim period: (1) for public business entities for reporting periods for which financial statements have not yet been issued and (2) for all other entities for reporting periods for which financial statements have not yet been made available for issuance. The amendments in this update should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act is recognized. The Company is currently evaluating the impact of adopting this new guidance on its financial position, results of operations, statement of comprehensive income, and cash flows, and will adopt the provisions of this statement in the first quarter of fiscal 2020.
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Revenues with Customers (Tables) |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | In the following table, revenue is disaggregated by product line and timing of transfer of products and services. The table is in line with our reportable segments (see Note 15 - Segment Reporting).
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Impact of Adopting ASC 606 on Financial Statements | Accordingly, the Company will net the amount of unbilled revenue and associated deferred income at any reporting date. Impact on the Consolidated Balance Sheet as of May 31, 2019:
There was no impact on the Consolidated Statement of Comprehensive Income. Impact on the Consolidated Statement of Cash Flows for the six months ended May 31, 2019:
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Earnings Per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share for the three and six months ended May 31, 2018 and 2019, respectively (in thousands, except share and per share amounts):
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Equity and Other Investments Equity and Other Investments (Tables) |
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Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Distributions from Equity Method Investments | Pre-tax cash distributions from Kansas Entertainment for the six months ended May 31, 2018 and 2019, are recognized on the Company's Consolidated Statement of Cash Flows as follows (in thousands):
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Schedule of Preliminary Purchase Price Allocation | The following table summarizes the Company's preliminary acquisition accounting based on the fair values of the assets acquired (in thousands):
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Goodwill and Intangible Assets (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Intangible Assets | The gross carrying value, accumulated amortization and net carrying value of the major classes of intangible assets relating to the Motorsports Event segment are as follows (in thousands):
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Current and Expected Amortization Expense of Intangible Assets | The following table presents current and expected amortization expense of the existing intangible assets for each of the following periods (in thousands):
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Long-Term Debt (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | Long-term debt consists of the following (in thousands):
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Schedule of Interest Expense | Total interest expense incurred by the Company for the three and six months ended May 31, 2018 and 2019, respectively, is as follows (in thousands):
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Financial Instruments Financial Instruments (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Estimated Fair Values and Categorization Levels of Financial Instruments, Assets and Liab | The following table presents estimated fair values and categorization levels of the Company's financial instruments as of November 30, 2018 and May 31, 2019, respectively (in thousands):
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Comprehensive Income (Tables) |
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Statement of Comprehensive Income [Abstract] | |||||||||||||||||||||||||||||||||||||
Schedule of Comprehensive Income | Comprehensive income is the change in equity of an enterprise except those resulting from shareholder transactions. Accumulated other comprehensive loss consists of the following (in thousands):
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Segment Reporting (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting | The following tables provide segment reporting of the Company for the three and six months ended May 31, 2018 and 2019, respectively (in thousands):
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Revenues with Customers - Additional Information (Details) - USD ($) $ in Thousands |
6 Months Ended | |
---|---|---|
May 31, 2019 |
Nov. 30, 2018 |
|
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Current deferred revenues | $ 79,436 | $ 36,801 |
Long-term deferred revenues | 7,182 | $ 7,575 |
Motorsport and other Event-related activity | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Current deferred revenues | 78,000 | |
Long-term deferred revenues | 7,200 | |
Revenue recognized associated with contract liabilities | $ 35,100 |
Revenues with Customers - Disaggregation of Revenues (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
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Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 168,084 | $ 171,679 | $ 318,635 | $ 320,554 |
Admissions, net | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 24,388 | 25,677 | 53,722 | 56,239 |
NASCAR Broadcasting | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 96,541 | 92,676 | 163,925 | 157,369 |
Corporate Sales and Other Event Related | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 30,242 | 40,652 | 69,499 | 81,745 |
Food, beverage and merchandise | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 11,364 | 6,906 | 20,616 | 14,856 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 5,549 | $ 5,768 | $ 10,873 | $ 10,345 |
Computation of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
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Numerator: | ||||
Net income | $ 15,073 | $ 16,670 | $ 36,628 | $ 186,016 |
Denominator: | ||||
Weighted average shares outstanding (shares) | 43,441,350 | 44,158,611 | 43,431,283 | 44,177,342 |
Effect of dilutive securities (shares) | 7,759 | 11,070 | 7,721 | 12,334 |
Diluted weighted average shares outstanding (shares) | 43,449,109 | 44,169,681 | 43,439,004 | 44,189,676 |
Basic and diluted earnings per share | ||||
Basic and diluted (in dollars per share) | $ 0.35 | $ 0.38 | $ 0.84 | $ 4.21 |
Anti-dilutive shares excluded in the computation of diluted earnings per share (shares) | 18,792 | 41,107 | 18,792 | 47,725 |
Equity and Other Investments - Distributions from Equity Method Investments (Details) - USD ($) $ in Thousands |
6 Months Ended | |
---|---|---|
May 31, 2019 |
May 31, 2018 |
|
Schedule of Equity Method Investments [Line Items] | ||
Distribution from profits | $ 12,650 | $ 11,138 |
Distribution from equity investee | 122 | 487 |
Kansas Entertainment | Cash Distribution | ||
Schedule of Equity Method Investments [Line Items] | ||
Distribution from profits | 12,650 | 11,138 |
Distribution from equity investee | 0 | 362 |
Total Distributions | $ 12,650 | $ 11,500 |
Equity and Other Investments - Schedule of Preliminary Purchase Price Allocation (Details) - USD ($) $ in Thousands |
May 31, 2019 |
Jan. 04, 2019 |
Nov. 30, 2018 |
---|---|---|---|
Business Acquisition [Line Items] | |||
Goodwill | $ 118,872 | $ 118,331 | |
Racing Electronics | |||
Business Acquisition [Line Items] | |||
Inventory | $ 2,340 | ||
Property and equipment | 4,097 | ||
Trade names and trademarks | 1,010 | ||
Track access rights | 260 | ||
Goodwill | 541 | ||
Purchase price consideration | $ 8,248 |
Current and Expected Amortization Expense of Intangible Assets (Detail) $ in Thousands |
6 Months Ended |
---|---|
May 31, 2019
USD ($)
| |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Amortization expense for the six months ended May 31, 2019 | $ 5 |
Remaining estimated amortization expense for the year ending November 30: | |
2019 | 5 |
2020 | 10 |
2021 | 10 |
2022 | 11 |
2023 and thereafter | $ 239 |
Goodwill and Intangible Assets - Additional Information (Detail) - USD ($) |
3 Months Ended | 6 Months Ended |
---|---|---|
May 31, 2019 |
May 31, 2019 |
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Indefinite-lived Intangible Assets [Line Items] | ||
Increase in carrying value of goodwill | $ 500,000 | |
Motorsports Event | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Increase in net carrying amount of non-amortized intangible assets | $ 1,000,000.0 | |
Increase in net carrying amount of amortized intangible assets | $ 300,000 |
Long-Term Debt - Non-printing (Detail) |
May 31, 2019 |
Nov. 30, 2018 |
---|---|---|
4.63 percent Senior Notes | ||
Debt Instrument [Line Items] | ||
Debt, interest rate | 4.63% | 4.63% |
3.95 percent Senior Notes | ||
Debt Instrument [Line Items] | ||
Debt, interest rate | 3.95% | 3.95% |
6.25 percent Term Loan | ||
Debt Instrument [Line Items] | ||
Debt, interest rate | 6.25% | 6.25% |
Long-Term Debt Schedule of Interest Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
|
Debt Disclosure [Abstract] | ||||
Interest expense | $ 3,781 | $ 3,849 | $ 7,566 | $ 7,702 |
Less: capitalized interest | 65 | 949 | 128 | 1,917 |
Net interest expense | $ 3,716 | $ 2,900 | $ 7,438 | $ 5,785 |
Capital Stock (Details) - USD ($) |
1 Months Ended | 3 Months Ended | 6 Months Ended | 150 Months Ended | ||
---|---|---|---|---|---|---|
Apr. 30, 2019 |
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
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Equity, Class of Treasury Stock [Line Items] | ||||||
Dividends (in dollars per share) | $ 0.49 | $ 0.49 | $ 0.47 | $ 0.49 | $ 0.47 | |
Cash dividends | $ 21,300,000 | $ 21,306,000 | ||||
Class A Common Stock | Stock Purchase Plan | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Authorized amount under Stock Purchase Plan | $ 530,000,000.0 | 530,000,000.0 | $ 530,000,000.0 | |||
Stock repurchased during the period (shares) | 10,566,002 | |||||
Stock repurchased during the period | $ 391,300,000 | |||||
Remaining repurchase authority under the Stock Purchase Plan | $ 138,700,000 | $ 138,700,000 | $ 138,700,000 |
Comprehensive Income (Details) - USD ($) $ in Thousands |
May 31, 2019 |
Nov. 30, 2018 |
---|---|---|
Statement of Comprehensive Income [Abstract] | ||
Terminated interest rate swap, net of tax benefit of $1,050 and $918, respectively | $ (795) | $ (1,204) |
Accumulated other comprehensive income (loss), terminated interest rate swap, tax | $ 918 | $ 1,050 |
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
|
Income Tax Disclosure [Abstract] | ||||
Income tax benefit resulting from the Tax Act | $ 143.9 | |||
Effective income tax rate (percent) | 22.90% | 22.20% | 23.90% | (232.80%) |
Commitments and Contingencies - Additional Information (Detail) - USD ($) |
1 Months Ended | |
---|---|---|
Oct. 31, 2002 |
May 31, 2019 |
|
Standby Letter of Credit | ||
Commitments and Contingencies Disclosure [Line Items] | ||
Standby letter of credit agreements in favor of third parties | $ 3,100,000 | |
Amounts drawn on standby letter of credit | 0 | |
2002 STAR Bonds | ||
Commitments and Contingencies Disclosure [Line Items] | ||
Proceeds from long-term debt | $ 6,300,000 | |
Frequency of periodic payment | annual | |
Long-term debt | $ 500,000 |
Segment Reporting (Detail) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2019 |
May 31, 2018 |
May 31, 2019 |
May 31, 2018 |
|
Segment Reporting Information [Line Items] | ||||
Revenues | $ 168,680 | $ 172,222 | $ 319,570 | $ 321,462 |
Depreciation and amortization | 28,809 | 26,859 | 58,068 | 53,598 |
Operating income (loss) | 15,503 | 17,257 | 41,032 | 49,751 |
Capital expenditures | 17,553 | 56,737 | 42,562 | 65,019 |
Total Assets | 2,321,528 | 2,320,981 | 2,321,528 | 2,320,981 |
Equity Investments | 82,018 | 85,234 | 82,018 | 85,234 |
Motorsports Event | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 160,469 | 158,674 | 305,402 | 302,452 |
Depreciation and amortization | 26,674 | 25,062 | 54,066 | 50,230 |
Operating income (loss) | 16,212 | 19,562 | 43,677 | 53,984 |
Capital expenditures | 14,258 | 46,946 | 32,444 | 50,681 |
Total Assets | 1,669,376 | 1,659,942 | 1,669,376 | 1,659,942 |
All Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 8,211 | 13,548 | 14,168 | 19,010 |
Depreciation and amortization | 2,135 | 1,797 | 4,002 | 3,368 |
Operating income (loss) | (709) | (2,305) | (2,645) | (4,233) |
Capital expenditures | 3,295 | 9,791 | 10,118 | 14,338 |
Total Assets | 652,152 | 661,039 | 652,152 | 661,039 |
Equity Investments | $ 82,018 | $ 85,234 | $ 82,018 | $ 85,234 |
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