SMI saw admission revenue down 4% in Q1, which it attributed to lower overall attendance for its two NASCAR national series weekends. SMI Vice Chair & CFO Bill Brooks reported Atlanta Motor Speedway is up year-over-year in attendance for its sole NASCAR national series weekend, while Las Vegas was down. Overall, revenue was down in three of the four segments SMI tracks. Admission revenue came in down 4%, from $15.4M in ’16 to $14.8M in ’17, largely due to lower aggregrate attendance between the two races year-over-year. The second revenue bucket -- event-related revenue, which includes advertising, food and beverage and merchandise sales -- saw a particularly large drop, down 12% from $21.7M in ’16 to $19.M in ’17. Brooks attributed this due in part to lower advertising revenue, which could be impacted by the title sponsor changeover from Sprint to Monster Energy, as Monster has less non-track-facing signage among other assets than Sprint had at most tracks. As expected, broadcast revenue rose 4% from $37.4M in ’16 to $38.8M in ’17, while the last bucket, other operating revenue, was down 9% from $8.6M to $7.8M. Total revenue came in this quarter at $80.3M, down 3% from $83.2M last year. SMI reported a $1.9M loss for the quarter overall, in part because of accelerated depreciation of retired assets, which in this case comes in the form of seating reductions at Charlotte, Kentucky and New Hampshire. The loss compares to a $861,000 net profit last year in Q1.
SUCCESS WITH TITLE SPONSORS: SMI President & CEO Marcus Smith said despite overall advertising trends, SMI is still seeing strength from an event entitlement perspective, as it is ahead of where the corporation was at this time last year. Smith said SMI has just one unsold entitlement at this point as well as one other that is sold but not yet announced. It also has one open Xfinity Series entitlement. Brooks said it appears so far this year that fans are spending about the same on food and beverage, but a tad less on merchandise. Smith and Brooks said they are only looking to reduce seating in areas where they have a plan on how to turn it into something more modern with premium seating. Smith cited last week’s unveiling of a new solar deck on Turn 4 at Charlotte Motor Speedway as an example.
EARNHARDT COULD BOOST ATTENDANCE: Brooks and Smith hit on a couple different topics during prepared remarks and the subsequent Q&A session. Smith was asked about yesterday’s announcement that Dale Earnhardt Jr. would retire from full-time Cup racing after this year, and said the company does expect that the news “will be inspiring to a lot of fans to come to races” this year, potentially providing a boost. Smith also confidently addressed how alternatively, that would seem to indicate a drop in interest next year when he’s not racing, saying that, “Dale also expressed his desire to stay involved in a significant way in NASCAR, so we think that that will continue to have a positive impact as well.” Smith dismissed concerns about how Las Vegas Motor Speedway would fare in light of the added competition of the NHL and NFL, saying, “When you look at Vegas now and the football announcement plus the NHL coming online, it certainly is a significant sports town. Las Vegas Motor Speedway is really a sports and entertainment facility that is extremely unique and used all the time, so as Vegas grows and more people enjoy -- whether it’s business travel or personal travel -- people are enjoying visiting, we think that’s good for Las Vegas Motor Speedway."
