SBD/Issue 142/Finance

Merchandise Trailer Cutbacks, Earnhardt Help MA Post Q1 Profit

Earnhardt Jr. Merchandise Helps Motorsports
Authentics Post First Profitable Quarter
Motorsports Authentics (MA) produced a Q1 FY '08 profit of $3.6M, the company's "first profitable quarter since it was formed in 2005," according to Michael Smith of SPORTSBUSINESS JOURNAL. MA President & CEO Mark Dyer said the profit was "due in large part to MA's significant cost-cutting, which included layoffs and reducing the number of trackside trailers that sell merchandise at NASCAR events." MA has reduced its count of trackside trailers from 51 to 27.  Dyer said that 27 trailers at Daytona Int'l Speedway this year "sold more than the 51 trailers" in '07. Smith notes the returning trailers' sales "were up 30[%] compared" to last year.  Dyer also said driver Dale Earnhardt Jr. accounted "for about half of all NASCAR-related sales in some of MA's distribution channels," though he did not cite specific numbers (SPORTSBUSINESS JOURNAL, 4/14 issue).

POSITIVE OUTLOOK: NASCAR SCENE's Bob Pockrass reported MA execs are "cautiously optimistic about breaking even this year." MA, "at least in part," reaped the benefits from Earnhardt's change from Budweiser to National Guard and Amp, "as well as the change in his team and number." MA lost $6.5M in Q1 '07 and "nearly $43[M]" total last year. Pockrass noted there are "still some merchandise haulers that are not making money and will be re-evaluated" (SCENEDAILY.com, 4/10).

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