International Speedway Corporation

Transcription

1 International Speedway Corporation November 2014

2 Statements made in this presentation that state the Company s or management s beliefs or expectations, and which are not historical facts or which apply prospectively, are forward-looking statements. It is important to note that the Company s actual results could differ materially from those contained in or implied by such forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company s SEC filings including, but not limited to, the 10-K and subsequent 10-Qs. Copies of those filings are available from the Company and the SEC. The Company undertakes no obligation to release publicly any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. The inclusion of any statement in this presentation does not constitute an admission by International Speedway or any other person that the events or circumstances described in such statement are material. 2

3 Forward Progress Recent Accomplishments Continuing Improvement in ISC Risk Profile 2015 Financial Guidance Broadcast Rights Revenue Largest Broadcast Rights Deal in NASCAR s Stabilizing to Improving Core Business EPS range between $1.10 to $1.30 (1) Hollywood Casino Continues to Provide +$20 to $22MM in Cash Flow Financial Position History provides Visibility for ISC s Largest Revenue Segment Through 2024 TV Rights Fees ~4% CAGR over 10 Year Term Growth Initiatives $159MM 2014 Ending Cash Balance (2) Sold Staten Island Property = $118MM Incremental Cash and Eliminated ~$4MM in Annual Costs Maintained Investment Grade Rating DAYTONA RISING On-Time and On-Budget NASCAR s Industry Action Plan generating renewed excitement for the Sport Encouraging results from Capacity Management Enterprise Exploring Ancillary Business and Real Estate Development Opportunities (1) Includes impact of Depreciation from DAYTONA RISING Assets Placed in Service before 2016 Grand Opening, reduces EPS by $0.15 to $0.18 (2) As of November 30, 2014; portion of cash balance used to fund DAYTONA Rising construction 3

4 Company Overview

5 The Undisputed Leader in Motorsports Entertainment Largest Promoter of NASCAR Most Prominent Motorsports Sanctioning Body Premier Motorsports Facilities and Events 13 Major Motorsports Facilities Over 831,500 Grandstand Seats and 527 Luxury Suites National Footprint -- 6 in the Top-12 Media Markets Highly Predictable and Recurring Revenue Base Broadcast Television Media Rights and Corporate Partnerships Strong Balance Sheet Providing Significant Financial Flexibility 5

6 86% of ISC Revenues Everything else is just a game Stable, Growth-Oriented Business Model NASCAR Industry Action Plan Stakeholder Initiative to Grow the Business Leading Sports Entertainment Second Highest-Rated Regular Season Sport on Television Outstanding Event Attendance and Fan Avidity Most Brand Loyal Fan Base in All of Sports More Fortune 500 companies in NASCAR than any other sport Valuable Sports Media Rights Fees NASCAR Broadcast Rights Secured Through

7 Increasing Sports Media Rights Fees $500 $450 $400 $350 $300 $250 $200 $150 $100 ISC Broadcast Rights Revenue Forecast Recognized Revenue per Year ($ in Millions) Average ~4% compound annual growth rate FOX Sports Media Group and NBC Sports Group Television Broadcast Rights Agreement 10-Year Terms $8.2 Billion total NASCAR Industry 65% / 25% / 10% - Distribution Remains (Promoter / Teams / NASCAR) TV Everywhere Rights Spanish-Language Rights (1) (1) $8.2BB is based on industry sources including Sports Business Journal 7

8 Unparalleled National Reach Auto Club Speedway Fontana, CA Chicagoland Speedway Joliet, IL Darlington Raceway Darlington, SC Daytona International Speedway Daytona Beach, FL Homestead-Miami Speedway Homestead, FL Kansas Speedway Kansas City, KS Martinsville Speedway Martinsville, VA Michigan International Raceway Brooklyn, MI Phoenix International Raceway Avondale, AZ Richmond International Raceway Richmond, VA Route 66 Raceway Joliet, IL Talladega Superspeedway Talladega, AL Watkins Glen International Watkins Glen, NY 8

9 Predictable and Recurring Revenue (1) 2014 Food, Beverage, and Merchandise 11% Other Motorsports Revenue 6% Other 2% Contracted Revenue = TV & Ancillary Media (2) and Corporate Partnerships (2) Admissions 20% Corporate Partnerships 14% TV & Ancillary Media 47% In 2014, ISC Contracted Revenue makes up more than 61% of ISC total Revenue New Industry NASCAR Broadcast Agreement ( 15 to 24) and ISC Strategic Initiatives to provide even greater Contracted Revenues (1) Percent of Total Revenue as of the fiscal year ended November 30, (2) The major components of Motorsports Related Revenue 9

10 Solid Financial Track Record (1) Revenues EBITDA EPS (in millions, except per share data) $630 $630 - $615 $217 $1.61 $1.51 $1.45 $1.42 $ $1.10 $625 $200 $194 $194 $195 - $185 $612 $ (2) (3) (2) (3) (2) (3) (1) Excludes discontinued operations. Certain financial information is presented using other than generally accepted accounting principals ( Non-GAAP ). Please refer to documents filed by International Speedway Corporation with the SEC, specifically the most recent reports on Form 10-K/Q for the GAAP to Non-GAAP reconciliation. (2) 2014 Revenue, EBITDA, and EPS are adjusted to exclude the effect of consolidating Motorsports Authentics for better comparability with prior and future periods (3) The range for 2015 revenue, EBITDA and EPS is considered only current as off January 27, 2015, includes depreciation impact related to Daytona Rising for assets placed in service during fiscal 2015, prior to 2016 grand opening and excludes consolidation of Motorsports Authentics. 10

11 Capital Allocation Strategy

12 Focused Capital Allocation Strategy Key Tenets of Strategy Strong Balance Sheet Manage within our $600MM Capital Expenditure Plan for FY FY2017 Return of Capital Guest Experience Maintain Prudent Cash Reserves Sustain Investment Grade Credit Rating Increase Dividend $0.02/Year Value Enhancing Projects 12

13 Maintaining a Strong Balance Sheet ($ in millions) Capitalization Maturity Rate 11/30/2014 Revenue Bonds % $0.3 Senior Notes % 65.0 Senior Notes % TIF Bonds (Kansas Speedway) % 56.9 Term Loan (HQ Term Loan) % 49.5 Credit Facility L ) % 0.0 Total Debt $271.7 Less: Cash $158.8 Key Metrics BBB Corporate Credit Rating Prudent Cash Reserves Manageable Debt Maturities Untapped Credit Facility Net Debt $112.9 Shareholders Equity $1,346.4 Total Capitalization $1,459.3 Strong Balance Sheet Total Debt to Capitalization 18.6% Return of Capital Guest Experience Value Enhancing Projects 13

14 Emotional Connection Model Improving the Guest Experience Targeted Capital Improvement Program Upgrading Facilities to Meet Changing Consumer Expectations Investing in the Fan Drives Direct / Indirect Financial Returns ISC Guest Experience Improving All Key Measures, Nearly All Touch-points and Most Attributes are Trending Higher Stronger Competitive Position Relative To Other Tracks Emotionally Connected Fans Buy More Tickets More Likely to Recommend More Likely to Become NASCAR Enthusiasts More Likely to Return Strong Balance Sheet Return of Capital Guest Experience Value Enhancing Projects 14

15 Value Enhancing Projects Hollywood Casino at Kansas Speedway Joint Venture ( JV ) with Penn National Gaming 95,000 Sq. Ft Casino with 2,000 Slots; 52 Table Games; and Dining/Entertainment Generating Solid Cash Flow $20MM to $22MM in Cash Flow to ISC in 2015 (1) JV exploring ancillary Hotel (1) Current as off January 27, ONE DAYTONA Proposed Mixed-Use and Entertainment Destination Located Across From Daytona International Speedway Bass Pro Shops and Cobb Theatres have both signed leases Shaner Hotels and Prime Hospitality Group to develop Marriott Autograph series Hotel Return of Capital Strong Balance Sheet Value Enhancing Projects Guest Experience 15

16 Returning Capital to Shareholders Return of Capital Opportunities Dividend Anticipated Annual Cash Dividend of $0.26 Per Share in 2015 (1) Increased $0.02/year since 2005 Share Repurchase Plan In Market with Opportunistic Parameters Purchased Since Inception Through FY2014: 7.1 Million Shares of Class A Common Shares for a Total of Approximately $268.3 Million Balanced with Business Investments to Maximize Value Creation Strong Balance Sheet Return of Capital Guest Experience (1) Subject to Board approval Value Enhancing Projects 16

17 Key Initiatives

18 Youth Product Relevance Driver Star Power Multicultural Ensure the Health and Growth of NASCAR Gen Y Social Media Event Experience 18

19 Improved Competition = Greater On-Track Excitement Announced Improvements for 2014 New rules package for non-restrictor plate tracks builds upon the Gen-6 car to allow for more side-by-side racing and passing / lead changes at 1.5 to 2 mile racetracks Restructure manufacturer points system more intense rivalries among auto makers New, more exciting group qualifying format ( Coors Light Pole Award ) for NASCAR s three national series enhance fan experience and broadcast / digital content Implement a new championship format for the Chase for the NASCAR Sprint Cup greater emphasis on winning races with a 16-driver grid and round-by-round elimination Enhanced NASCAR penalty structure and appeals process more effectively, and with greater transparency maintain the sports integrity and competitive balance 19

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21 Market Based Real Estate Strategies ISC Owns/Manages ~13,000 Acres Monetizing Value of Real Estate Through Complementary Ancillary Development Enhance and Extend the Guest Experience Leverage Existing Assets to Drive Year-Round Destination Developments Diversify Income Streams Through New Business Opportunities Current / Proposed and Future Potential Locations Hollywood Casino at Kansas Speedway ONE DAYTONA 21

22 The Undisputed Leader in Motorsports Entertainment NASCAR Strong and Profitable Sports Property #1 Spectator Sport #2 Rated Sport on Television Predictable and Recurring Revenue Base Media Rights and Corporate Partnerships Provide Strong Revenue Base Strong Balance Sheet Modest Debt Levels Generate Strong Cash Flows Focused Initiatives to Grow the Core Business Disciplined Capital Allocation Strategy Diversify Income Streams with New Opportunities 22

23 Appendix

24 Recent Financial Results (1) ($ in thousands except per share amounts) Fiscal Year Ended, November 30 th Revenues $612,367 $612,640 $651,301 Operating Income $122,277 $115,542 $115,127 EBITDA $200,147 $194,139 $194,362 Net Income $70,070 $67,185 $65,955 EPS $1.51 $1.44 $1.42 Major NASCAR Events: Sprint Cup Nationwide Camping World (1) Operating Income, EBITDA, Net Income and EPS are presented using other than generally accepted accounting principals ( Non-GAAP ). Please refer to the documents filed by International Speedway Corporation with the SEC, specifically the most recent reports on Form 10-K for the GAAP to Non-GAAP reconciliation. 24

25 NASCAR Fan Demographics (1) GENDER DISTRIBUTION The NASCAR fan base is 62% male, 38% female AGE DISTRIBUTION NASCAR fans are just as likely as the U.S. population to be (96 index vs. U.S population). INCOME DISTRIBUTION NASCAR fans are middle class and just as affluent as the U.S. population: 52% earn $50,000+ per year (102 index vs. U.S. population) PRESENCE OF CHILDREN NASCAR is a sport the whole family can enjoy: 2 out of 5 NASCAR fans have children under the age of 18 (97 index vs. U.S. population) GEOGRAPHIC DISTRIBUTION NASCAR fans live in regions that mirror the U.S. population. Multicultural 1 out of 5 NASCAR fans is a multicultural. (1) Source: Scarborough Research (USA+ Release 1, 2013) 25

26 2014 NASCAR Television Ratings Ranked among the top 2 sports of the weekend on television 21 out of 36 event weekends Average of 5.3 million viewers tuned in per event throughout the season Year over year viewership increased ~11% for the final 3 Chase events #2 Motorsports series on television NASCAR Xfinity Series averaged 1.7 million viewers per event weekend #3 Motorsports series on cable, behind only Sprint Cup and Xfinity Series NASCAR Camping World Truck Series averaged almost 700 thousand viewers per event weekend 26

27 First Family of NASCAR Founded ISC in % Economic Interest / 72% Voting Control Founded NASCAR in % owned by France Family 8 of 11 Board Members are Independent Directors Lesa France Kennedy ISC: CEO and Board Member NASCAR: Vice Chair/EVP James C. France ISC: Chairman NASCAR: Vice Chair/EVP Brian Z. France ISC: Board Member NASCAR: Chairman / CEO 27

28 THE LEADER IN MOTORSPORTS ENTERTAINMENT