Dover Motorsports, Inc. reported lower earnings in the second quarter as expenses rose and revenues dropped.
The race promoter reported lower revenues from the June Firefly Music Festival. That is in keeping with reports from vendors and others of lower attendance.
In the second quarter, the company promoted a NASCAR triple-header and hosted the Firefly Music Festival in Dover during the second quarter of both 2019 and 2018. The Company leases a portion of its facility to the promoter of Firefly, provides logistical assistance and handles concessions for which the company retains a percentage of the gross sales.
Revenues for the second quarter of 2019 were $24,838,000 compared to $25,812,000 for the second quarter of 2018.
The decrease is primarily from lower corporate spending and admissions revenue at the rain-delayed spring NASCAR weekend and lower commissions from Firefly. The declines were partially offset by the scheduled increase in broadcasting revenue.
Operating and marketing expenses increased to $14,584,000 in the second quarter of 2019 from $14,234,000 in the second quarter of 2018. The increase was primarily due to the scheduled increase in purse and sanction fees for the NASCAR weekend.
Net earnings for the second quarter of 2019 were $5,501,000 or $0.15 per diluted share compared to $6,508,000 or $0.18 per diluted share in the second quarter of 2018.
The company closed on the sale of a parcel of land in Nashville during the first quarter of 2018 for net proceeds of approximately $5 million after closing costs, resulting in a gain of $2,512,000. 225 acres of the Nashville Superspeedway property was under option for a total purchase price of approximately $12.4 million. The company sold 7.6 acres of the option land during the first quarter.
During June 2019, we amended the option agreement and the buyer exercised its option to purchase two of the parcels, comprising approximately 133 acres, for gross proceeds of approximately $6,400,000. Closing on these parcels is expected to occur by the end of July. In addition, the option for the remaining parcel of approximately 97 acres was extended until March 1, 2022. The buyer has paid $500,000 for the extension which would be credited to the purchase price at closing. The company continues to hold approximately 1,000 acres of commercial real estate in Nashville.
At June 30, 2019, the company had no outstanding indebtedness and almost $9 million in available cash.
Dover Motorsports, Inc. has two NASCAR weekends each year. The Nashville track no longer hosts NASCAR races.