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SMI Unable To Stop NASCAR Admissions Declines In Q4

SMI this morning released Q4 and full-year ’17 earnings, which showed that the track operator was not able to fully stem NASCAR admissions declines during the period despite that being offset by upticks in TV money and decreases in expenses. Total revenue for Q4 was $76.4M, down 4% from $79.5M in ’16. That included a 3% quarterly drop in the all-important admissions revenue category -- $15.868M in '17 compared to $15.416M this year. That gives the industry the best gauge on attendance. For the entire year, SMI noted that looking at ’16 versus ’17 is not fully comparable, because Bristol Motor Speedway held the Battle at Bristol college football game in ’16. That event provided a $5M profit lift to SMI’s coffers, but it also forced an irregularly high amount of revenue coming in and expenses going out onto SMI’s balance sheet in ’16 that was not matched in ‘17. SMI is working on adding more football games at BMS, but it held none last year. SMI Vice Chair & CFO Bill Brooks said that if one excluded the financials related to the Battle at Bristol football game, SMI’s adjusted non-GAAP revenue for ’17 increased over ’16. The corporation also noted that it had a non-recurring benefit from the U.S. income tax law changes of $119.4M, and Brooks said that SMI’s corporate tax rate should now be closer to 25% as a result of the tax law change, after being closer to 37% in recent years. Total revenue for the year was $453.6M, down 7% from ’16. Looking ahead to ’18, SMI is giving guidance of $450-475M. Because of the recorded benefits from the tax change, profit for SMI during Q4 was $113.7M, compared to $271,000 last year. Profit for the year was $148.2M, up 275% from $39.5M last year. In terms of renovations or other capital expenditures, SMI said that it expects to spend $20-30M this year, which Brooks called “somewhat consistent” with SMI’s spending in prior years.

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