SPEEDWAY MOTORSPORTS INC, 10-Q filed on 4/28/2017
Quarterly Report
Document And Entity Information
3 Months Ended
Mar. 31, 2017
Apr. 28, 2017
Document Information [Line Items]
 
 
Entity Registrant Name
SPEEDWAY MOTORSPORTS INC 
 
Entity Central Index Key
0000934648 
 
Trading Symbol
trk 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Accelerated Filer 
 
Entity Current Reporting Status
Yes 
 
Entity Voluntary Filers
No 
 
Entity Well-known Seasoned Issuer
No 
 
Entity Common Stock, Shares Outstanding (in shares)
 
41,064,116 
Document Type
10-Q 
 
Document Period End Date
Mar. 31, 2017 
 
Document Fiscal Year Focus
2017 
 
Document Fiscal Period Focus
Q1 
 
Amendment Flag
false 
 
Consolidated Balance Sheets (Current Period Unaudited) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Dec. 31, 2016
Current Assets:
 
 
Cash and cash equivalents
$ 53,585 
$ 79,342 
Accounts receivable, net
65,763 
29,444 
Prepaid and refundable income taxes
9,638 
7,384 
Inventories, net
8,549 
8,212 
Prepaid expenses
3,412 
3,527 
Total Current Assets
140,947 
127,909 
Notes Receivable
1,102 
1,143 
Other Assets
23,381 
23,142 
Property and Equipment, Net (Note 2)
992,253 
1,000,230 
Other Intangible Assets, Net
298,383 
298,383 
Goodwill
47,342 
47,342 
Total
1,503,408 
1,498,149 
Current Liabilities:
 
 
Current maturities of long-term debt
7,662 
7,657 
Accounts payable
16,128 
13,497 
Deferred race event and other income, net
69,548 
44,782 
Accrued income taxes
496 
   
Accrued interest
1,718 
4,311 
Accrued expenses and other current liabilities
16,698 
24,424 
Total Current Liabilities
112,250 
94,671 
Long-term Debt
251,540 
254,398 
Deferred Income
3,617 
3,742 
Deferred Income Taxes, Net
329,029 
329,398 
Other Liabilities
18,455 
18,157 
Total Liabilities
714,891 
700,366 
Commitments and Contingencies
   
   
Stockholders ’ Equity:
 
 
Preferred Stock, $.10 par value, shares authorized – 3,000,000, no shares issued
   
   
Common Stock, $.01 par value, shares authorized – 200,000,000, issued and outstanding – 41,066,000 in 2017 and 41,098,000 in 2016
460 
459 
Additional Paid-in Capital
259,688 
258,880 
Retained Earnings
636,132 
644,308 
Treasury Stock at cost, shares – 4,923,000 in 2017 and 4,830,000 in 2016
(107,763)
(105,864)
Total Stockholders ’ Equity
788,517 
797,783 
Total
$ 1,503,408 
$ 1,498,149 
Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) (USD $)
Mar. 31, 2017
Dec. 31, 2016
Preferred stock par value (in dollars per share)
$ 0.10 
$ 0.10 
Preferred stock, shares authorized (in shares)
3,000,000 
3,000,000 
Preferred stock, shares issued (in shares)
Common Stock, par value (in dollars per share)
$ 0.01 
$ 0.01 
Common Stock, shares authorized (in shares)
200,000,000 
200,000,000 
Common Stock, shares issued (in shares)
41,066,000 
41,098,000 
Common Stock, shares outstanding (in shares)
41,066,000 
41,098,000 
Treasury Stock at cost, shares (in shares)
4,923,000 
4,830,000 
Consolidated Statements of Operations (Unaudited) (USD $)
Share data in Thousands, except Per Share data, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Revenues:
 
 
Admissions
$ 14,750,000 
$ 15,439,000 
Event related revenue
18,959,000 
21,730,000 
NASCAR broadcasting revenue
38,811,000 
37,447,000 
Other operating revenue
7,805,000 
8,560,000 
Total Revenues
80,325,000 
83,176,000 
Expenses and Other:
 
 
Direct expense of events
12,457,000 
13,060,000 
NASCAR event management fees
23,060,000 
22,298,000 
Other direct operating expense
5,140,000 
5,589,000 
General and administrative
22,586,000 
24,074,000 
Depreciation and amortization (Note 2)
17,505,000 
13,371,000 
Interest expense, net
3,005,000 
3,339,000 
Other expense, net
578,000 
68,000 
Total Expenses and Other
84,331,000 
81,799,000 
(Loss) Income Before Income Taxes
(4,006,000)
1,377,000 
Benefit (Provision) for Income Taxes
2,071,000 
(516,000)
Net (Loss) Income
$ (1,935,000)
$ 861,000 
Basic (Loss) Earnings Per Share (Note 6) (in dollars per share)
$ (0.05)
$ 0.02 
Weighted Average Shares Outstanding (in shares)
41,087 
41,227 
Diluted (Loss) Earnings Per Share (Note 6) (in dollars per share)
$ (0.05)
$ 0.02 
Weighted Average Shares Outstanding (in shares)
41,108 
41,244 
Consolidated Statement of Stockholders' Equity (Unaudited) (USD $)
Common Stock [Member]
Additional Paid-in Capital [Member]
Retained Earnings [Member]
Treasury Stock [Member]
Total
Balance at Dec. 31, 2016
$ 459,000 
$ 258,880,000 
$ 644,308,000 
$ (105,864,000)
$ 797,783,000 
Balance (in shares) at Dec. 31, 2016
41,098,000 
 
 
 
 
Net loss
 
 
(1,935,000)
 
(1,935,000)
Share-based compensation (in shares)
61,000 
 
 
 
 
Share-based compensation
1,000 
808,000 
 
 
809,000 
Quarterly cash dividends of $0.15 per share of common stock
 
 
(6,241,000)
 
(6,241,000)
Repurchases of common stock (in shares)
(93,000)
 
 
 
 
Repurchases of common stock
 
 
 
(1,899,000)
(1,899,000)
Balance at Mar. 31, 2017
$ 460,000 
$ 259,688,000 
$ 636,132,000 
$ (107,763,000)
$ 788,517,000 
Balance (in shares) at Mar. 31, 2017
41,066,000 
 
 
 
 
Consolidated Statement of Stockholders' Equity (Unaudited) (Parentheticals)
3 Months Ended
Mar. 31, 2017
Retained Earnings [Member]
Cash dividends, per share of common stock (in dollars per share)
$ 0.15 
Consolidated Statements of Cash Flows (Unaudited) (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Cash Flows from Operating Activities:
 
 
Net loss
$ (1,935)
$ 861 
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
 
 
Deferred loan cost amortization
387 
373 
Loss (gain) on disposals of property and equipment
477 
(12)
Depreciation and amortization
17,505 
13,371 
Amortization of deferred income
(182)
(193)
Deferred income tax provision
(288)
415 
Share-based compensation
809 
867 
Changes in operating assets and liabilities:
 
 
Accounts receivable
(36,599)
(15,405)
Prepaid, refundable and accrued income taxes
(1,758)
(50)
Inventories
(337)
(1,027)
Prepaid expenses
115 
(236)
Increase (Decrease) in Accounts Payable
92 
681 
Deferred race event and other income
24,774 
34,765 
Accrued interest
(2,593)
(2,567)
Accrued expenses and other liabilities
(8,171)
(5,973)
Deferred income
49 
16 
Other assets and liabilities
(115)
(155)
Net Cash (Used) Provided By Operating Activities
(7,770)
25,731 
Cash Flows from Financing Activities:
 
 
Principal payments on long-term debt
(3,157)
(2,177)
Dividend payments on common stock
(6,241)
(6,249)
Repurchases of common stock
(1,899)
(1,726)
Net Cash Used By Financing Activities
(11,297)
(10,152)
Cash Flows from Investing Activities:
 
 
Payments for capital expenditures
(7,054)
(18,355)
Proceeds from sales of property and equipment
43 
   
Repayment of notes and other receivables
321 
39 
Net Cash Used By Investing Activities
(6,690)
(18,316)
Net Decrease in Cash and Cash Equivalents
(25,757)
(2,737)
Cash and Cash Equivalents at Beginning of Period
79,342 
82,010 
Cash and Cash Equivalents at End of Period
53,585 
79,273 
Supplemental Cash Flow Information:
 
 
Cash paid for interest, net of amounts capitalized
5,846 
5,949 
Supplemental Non-Cash Investing and Financing Activities Information:
 
 
Increase in accounts payable for capital expenditures
$ 2,502 
$ 3,540 
Note 1 - Description of Business
Nature of Operations [Text Block]
1.
DESCRIPTION OF BUSINESS
 
Basis of Presentation
– The consolidated financial statements include the accounts of Speedway Motorsports, Inc. and all of its wholly-owned and operating subsidiaries: Atlanta Motor Speedway LLC (AMS), Bristol Motor Speedway LLC (BMS), Charlotte Motor Speedway LLC (CMS), Kentucky Raceway LLC d/b/a Kentucky Speedway (KyS), Nevada Speedway LLC d/b/a Las Vegas Motor Speedway (LVMS), New Hampshire Motor Speedway, Inc. (NHMS), North Wilkesboro Speedway, Inc. (NWS), Speedway Sonoma LLC (Sonoma Raceway or SR), Texas Motor Speedway, Inc. (TMS), SMISC Holdings, Inc. d/b/a SMI Properties (SMI Properties), US Legend Cars International, Inc. (Legend Cars), Oil-Chem Research Corporation (Oil-Chem), SMI Trackside LLC (SMI Trackside), Speedway Funding LLC, Speedway Properties Company LLC a/k/a Performance Racing Network (PRN), Speedway Media LLC a/k/a Racing Country USA (RCU), and TSI Management Company LLC d/b/a The Source International LLC (TSI) (collectively, the Company, SMI, we, our or us). Hereafter, references to “the Company’s” or
“eight”
speedways exclude NWS, which presently has no significant operations and assets consist primarily of real estate which has no significant fair value. See Notes
1
and
2
to the Consolidated Financial Statements in our
2016
Annual Report on Form
10
-K
(2016
Annual Report) for further description of our business operations, properties and scheduled events.
 
In early
2017,
the NASCAR Sprint Cup Series became the Monster Energy NASCAR Cup Series and that naming convention is used throughout this document.
 
Racing Events
– In
2017
, we plan to hold
24
major annual racing events sanctioned by the National Association for Stock Car Auto Racing, Inc. (NASCAR), including
13
Monster Energy Cup and
11
Xfinity Series racing events. We also plan to hold
eight
NASCAR Camping World Truck Series,
three
NASCAR K&N Pro Series,
four
NASCAR Whelen Modified Tour,
two
IndyCar Series,
six
major National Hot Rod Association (NHRA),
one
Automobile Racing Club of America (ARCA) and
three
World of Outlaws (WOO) racing events.
In
2016,
we held
24
major annual racing events sanctioned by NASCAR, including
13
Monster Energy Cup and
11
Xfinity Series racing events. We also held
eight
NASCAR Camping World Truck Series,
three
NASCAR K&N Pro Series,
four
NASCAR Whelen Modified Tour,
two
IndyCar Series,
six
major National Hot Rod Association,
one
Automobile Racing Club of America and
three
World of Outlaws racing events.
Note 2 - Significant Accounting Policies and Other Disclosures
Significant Accounting Policies [Text Block]
2.
SIGNIFICANT ACCOUNTING
POLICIES
AND OTHER DISCLOSURES
 
These unaudited consolidated financial statements should be read in conjunction with
our consolidated financial statements included in our
2016
Annual Report. In management's opinion, these unaudited consolidated financial statements contain all adjustments necessary for their fair statement at interim periods in accordance with accounting principles generally accepted in the United States. All such adjustments are of a normal recurring nature unless otherwise noted. The results of operations for interim periods are not necessarily indicative of operating results that
may
be expected for the entire year due to the seasonal nature of the Company's motorsports business. See Note
2
to the Consolidated Financial Statements in our
2016
Annual Report for further discussion of significant accounting policies.
 
Quarterly
Reporting
– We recognize revenues and operating expenses for all events in the calendar quarter in which conducted. Changes in race schedules at our speedways from time to time, including speedway acquisitions, can lessen the comparability of operating results between quarterly financial statements of successive years and increase or decrease the seasonal nature of our motorsports business.
There were no significant racing schedule changes for the
three
months ended
March
31,
2017
as compared to
2016.
 
 
Consolidated Statements of Cash Flows
– 
Before
December
31,
2016,
cash we collected and temporarily held on behalf of our
third
-party food and beverage concessionaire, and not remitted until after period end, was presented separately from cash flows from operating activities. We now include such amounts in cash flows from operating activities for both periods, increasing cash flow from operations, and the change in accounts payable, by
$90,000
for the
three
months ended
March
31,
2016.
There was no impact on the Consolidated Balance Sheets or Statements of Operations.
 
Income Tax
es
– We provide for income taxes at the end of each interim period based on management’s best estimate of the annual estimated effective income tax rate. Cumulative adjustments to our annual estimated effective income tax rate are recorded in the interim period in which a change in the annual estimated effective income tax rate is determined. Cash paid for income taxes excludes any previous overpayments the Company
may
have elected to apply to income tax liabilities. The Company has no undistributed foreign earnings or cash or cash equivalents held outside of the US.
See Notes
2
and
8
to
the Consolidated Financial Statements in our
2016
Annual Report for additional information on our accounting for income taxes.
 
The effective income tax rate for the
three
months ended
March
31,
2017
and
2016
was
51.7%
and
37.5%,
respectively. 
The
2017
tax rate reflects reduced deferred income tax liabilities of
$1,310,000
for anticipated lower state income tax rates associated with race date realignments, partially offset by reduced deferred tax assets associated with
certain state net operating loss carryforwards of
$515,000.
W
e paid cash of
$0
and
$200,000
for income taxes in the
three
months ended
March
31,
2017
and
2016.
Accounting for Uncertainty in Income Taxes
– Income tax liabilities for unrecognized tax benefits approximate
$12,006,000
at
March
31,
2017
and
December
31,
2016,
$11,746,000
of which relates to our discontinued operation (see Note
1
to the Consolidated Financial Statements in our
2016
Annual Report). Of those amounts,
$11,794,000
is included in noncurrent other liabilities, all of which would favorably impact our effective tax rate if recognized
,
and
$212,000
is included in deferred tax liabilities, at both
March
31,
2017
and
December
31,
2016.
As of
March
31,
2017
and
December
31,
2016,
management believes
$260,000
of unrecognized tax benefits will be recognized within the next
twelve
months. Interest and penalties associated with unrecognized tax benefits were insignificant for 
the
three
months ended
March
31,
2017
and
2016.
 
As of
March
31,
2017
and
December
31,
2016,
we had
$145,000
and
$140,000
accrued for the payment of interest and penalties on uncertain tax positions, which is included in other noncurrent liabilities. The tax years that remain open to examination include
2006
through
2008,
and
2012
through
2016,
by the California Franchise Tax Board,
2013
through
2016
by the Internal Revenue Service, and
2013
through
2016
by most, and
2012
through
2016
 by other, state taxing jurisdictions to which we are subject. Our
2014
federal income tax return is under examination by the Internal Revenue Service, which began in
July
2016.
Income Tax Benefit From Equity Interest Abandonment
– On
January
31,
2014,
we abandoned our interest and rights in Motorsports Authentics (former
50%
owned, non-controlling interest, merchandising equity investment joint venture) (MA) to focus management resources in areas that
may
be profitable and more productive. Our carrying value of the investment was reduced to
$0
through sizable impairment charges prior to
2010
and MA’s historical operating results. We recognized no concurrent tax benefits as valuation allowances were provided against associated deferred tax assets. As a result of abandonment, we recognized a material income tax benefit of
$48.1
million at
December
31,
2013
for the reversal of previously recorded valuation allowances under applicable accounting guidance, and recognized tax losses reported on our
2014
income tax returns. Management believes there is or will be sufficient taxable income in carryback or carryforward periods under tax law for full utilization of these tax losses. We have reduced income taxes payable by amounts approximating that tax benefit through
March
31,
2017
by utilization of deferred income tax assets, including net operating losses, related to abandonment.
 
W
e believe it is more likely than not that our filing position would be sustained based on its technical merits upon examination with taxing authorities that have full knowledge of all relevant information. We reached this conclusion based on the use of outside legal counsel and other tax consultants and the potential to utilize tax losses. We believe we will fully utilize the associated tax losses. Should our tax position not be fully sustained upon examination, reestablishment of material income tax liabilities and acceleration of cash income taxes payable could occur. Any differences between the final tax outcome and amounts recorded would affect our income tax provision in the period in which such determination was made.
 
Other Income Tax Benefits
– Applicable accounting guidance
may
require establishing valuation allowances for certain deferred tax assets or income tax liabilities for unrecognized tax benefits, notwithstanding management believes associated tax filing positions are sustainable and are or will be reflected in its tax filings. At
March
31,
2017,
liabilities for unrecognized tax benefits totaled
$12.0
million. Should those tax positions not be fully sustained if examined, an acceleration of material income taxes payable could occur. Where no net income tax benefit had been previously reflected because of providing a valuation allowance on related deferred tax assets, our future results of operations might not be significantly impacted. However, resulting cash required for payments of income taxes could be material in the period in which such determination is made.
 
Taxes Collected from Customers
– The Company reports sales, admission and other taxes collected from customers on both a gross and net basis in operations. Such taxes reported on a gross basis for the
three
months ended
March
31,
2017
and
2016
amounted to
$411,000
and
$366,000.
 
Advertising Expenses
– Event specific advertising costs are expensed when an associated event is held and included principally in direct expense of events. Non-event related advertising costs are expensed as incurred and included principally in other direct operating expense. Advertising expense amounted to
$1,604,000
and
$1,927,000
in the
three
months ended
March
31,
2017
and
2016.
There were no deferred direct-response advertising costs at
March
31,
2017
or
December
31,
2016.
 
TMS Mineral Rights Lease Receipts
– We recognized royalty revenue of
$448,000
and
$627,000
in the
three
months ended
March
31,
2017
and
2016
under a natural gas mineral rights lease agreement and a joint exploration agreement entitling TMS to stipulated stand-alone and shared royalties, as further described in Note
2
to the Consolidated Financial Statements in our
2016
Annual Report. Such revenues have declined from associated market declines, volatility in natural gas price levels and common diminishing well production. The agreements stipulate that TMS distribute
25%
of production royalty revenues to the lessee, and obligate TMS to spend amounts equal to royalties received on TMS facility and road infrastructure improvements beginning in
2017,
up to specified cumulative amounts. However, at this time, management believes
2017
revenues will not differ significantly from
2016,
and that our infrastructure spending will continue to exceed anticipated future royalties.
As of
March
31,
2017
and
December
31,
2016,
there was no deferred income associated with these agreements.
 
Fair Value of Financial Instruments
– We follow applicable authoritative guidance which requires that financial and non-financial assets and liabilities measured and reported on a fair value basis be classified, disclosed and categorized as further described below. Fair value estimates are based on relevant market information and single broker quoted market prices where available at a specific point in time, and changes in assumptions or market conditions could significantly affect estimates. The carrying values of cash and cash equivalents, accounts receivable, certain other assets and accounts payable approximate fair value because of the short maturity of these financial instruments. Cash surrender values are carried at fair value based on binding broker quoted market prices. Notes receivable and bank revolving credit facility and term loan borrowings are variable interest rate financial instruments and, therefore, carrying values approximate fair value. The fixed rate senior notes payable are publicly traded and estimated fair values are based on single broker quoted market prices. Other long-term debt bears interest approximating market rates or where non-interest bearing is discounted based on estimated current cost of borrowings; therefore, carrying values approximate market value. There have been no changes or transfers between category levels or classes.
The following table presents estimated fair values and categorization levels of our financial instruments as of
March
31,
2017
and
December
31,
2016
(in thousands):
 
            2017     2016  
    Level   Class  
Carrying
Value
   
Fair Value
   
Carrying
Value
   
Fair Value
 
                                           
Assets
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
   
1
 
R
  $
53,585
    $
53,585
    $
79,342
    $
79,342
 
Notes receivable
   
2
 
NR
   
1,102
     
1,102
     
1,143
     
1,143
 
Cash surrender values
   
2
 
NR
   
9,174
     
9,174
     
8,919
     
8,919
 
                                           
Liabilities
(principal)
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Floating rate revolving Credit Facility, including Term Loan
   
2
 
NR
   
63,000
     
63,000
     
66,000
     
66,000
 
5.125% Senior Notes Payable due 2023
   
2
 
NR
   
200,000
     
202,000
     
200,000
     
202,500
 
Other long-term debt
   
2
 
NR
   
1,049
     
1,049
     
1,206
     
1,206
 
 
Level
 
1:
Quoted market prices in active markets for identical assets or liabilities.
Level
2:
Observable market-based inputs or unobservable inputs that are corroborated by market data.
Level
3:
Unobservable inputs that are not corroborated
by market data.
Class
 R:
Measured at fair value on recurring basis, subsequent to initial recognition.
Class
 NR:
Measured at fair value on nonrecurring basis, subsequent to initial recognition.
 
Property and Equipment
– From time to time, we
may
decide to repurpose various seating, suites and others areas at our speedways for modernizing our facilities, alternative marketing or development purposes such as offering expanded premium hospitality, RV camping and advertising areas, or wider seating and improved sight lines. 
When management decides on repurpose and removal, depreciation is accelerated and recorded prospectively over shortened estimated remaining useful lives of the assets, and accounted for as a change in estimate, beginning when management contracts and begins removal. In the
first
quarter
2017,
we contracted and began removing approximately
7,000
seats at CMS,
17,000
seats at KyS and
12,000
seats at NHMS, which is expected to be completed in the
first
half of
2017.
As such, we recorded pre-tax charges for accelerated depreciation and costs of removal (included in other expense, net) aggregating approximately 
$4,597,000
, before income tax benefits of
$1,700,000,
in the
first
quarter
2017.
These charges are included in our "motorsports event related" reporting segment (see Note
10).
 
Recently Issued Accounting Standards
– The Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 
2014
-
09
"Revenue from Contracts with Customers (Topic
606):
Section A - Summary and Amendments That Create Revenue from Contracts with Customers and Other Assets and Deferred Costs - Contracts with Customers (Subtopic
340
-
40)"
which enhances comparability and clarifies principles of revenue recognition arising from contracts with customers that supersedes most current revenue recognition guidance. The guidance includes the core principle that entities recognize revenue to depict transfers of promised goods or services to customers in amounts that reflect the consideration entities expect to be entitled in exchange for those goods or services, and expands required financial statement disclosures regarding revenue recognition. The FASB has recently issued several amendments to the new standard, including Update No.
2016
-
08
"Revenue from Contracts with Customers (Topic
606)
- Principal versus Agent Considerations" clarifying implementation guidance for those considerations in Update No.
2014
-
09,
and Update No.
2016
-
10
"Revenue from Contracts with Customers (Topic 
606)
- Identifying Performance Obligations and Licensing" amending the guidance in Update No.
2014
-
09
related to those items. The FASB issued Update No.
2015
-
14
approving deferral of Update No.
2014
-
09
for
one
year, with such guidance now effective for annual reporting periods beginning after
December
15,
2017,
including interim periods within that reporting period. Early application is permitted as of annual reporting periods beginning after
December
15,
2016,
including interim reporting periods within that reporting period. The guidance
may
be applied retrospectively to each prior period presented or retrospectively with cumulative effects recognized as of the date of adoption. The Company plans to adopt this new guidance in the
first
quarter
2018.
The Company has begun preliminary evaluation of the potential impact that adoption
may
have on its financial statements, as well as expected method of adoption, including associated accounting policies, processes, and system requirements to enable timely and accurate reporting.  
 
The FASB issued Accounting Standards Update No.
2015
-
11
"Inventory (Topic
330):
Simplifying the Measurement of Inventory”
which requires measuring inventory at the lower of cost and net realizable value based on estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation (changed from the previous guidance of lower of cost or market). This update also clarified various other inventory measurement and disclosure requirements. The update does not apply to inventory measured using the LIFO or retail inventory methods. The guidance is effective for annual reporting periods beginning after
December
15,
2016,
including interim periods within that reporting period, and applied prospectively. The Company’s adoption of this guidance as of
January
1,
2017
had no significant impact on its financial statements or disclosures
.
 
The FASB issued Accounting Standards Update No.
2016
-
02
Leases (Subtopic
842)”
which replaces all current US GAAP guidance on this topic, and requires lessees to recognize assets and liabilities arising from leases as well as extensive quantitative and qualitative disclosures. Lessees will need to recognize on their balance sheets right-of-use assets and lease liabilities for the majority of their leases (other than leases meeting the definition of a short-term lease). Right-of-use assets will be measured at lease liability amounts, adjusted for lease prepayments, lease incentives received and lessee’s initial direct costs. Lease liabilities will equal the present value of lease payments. Assets will be based on the liability, subject to adjustment, such as for initial direct costs. Operating leases
may
typically result in straight-line expense, while finance leases similar to front-loaded expense pattern. Classification will be based on criteria largely similar to those applied in current lease accounting. The guidance is effective for fiscal years beginning after
December
15,
2018,
and interim periods within those fiscal years. Early adoption is permitted. The guidance is required to be applied using the modified retrospective approach for all leases existing as of the effective date, requires application at the beginning of the earliest comparative period presented, and provides for certain practical expedients. The Company is currently evaluating the potential impact that adoption
may
have on its financial statements.
 
The FASB issued Accounting Standards Update No.
2016
-
15
Statement of Cash Flows (Topic
23)
- Classification of Certain Cash Receipts and Cash Payments” which provides specific guidance on
eight
cash flow classification issues. The guidance is effective for fiscal years beginning after
December
15,
2017,
and interim periods within those fiscal years, and should be applied using a retrospective transition method to each period presented. Early adoption is permitted, and any amendments must be adopted in the same period. At this time, the Company believes adoption will have no significant impact on its financial statements, and plans to apply this guidance to future classifications when applicable.
 
The FASB issued Accounting Standards Update No.
2017
-
04
Intangibles – Goodwill and Other (Topic
350):
Simplifying the Test of Goodwill Impairment” which simplifies how an entity is required to test goodwill for impairment by eliminating Step
2
(measuring goodwill impairment loss by comparing implied fair value of a reporting unit’s goodwill to the carrying amount of that goodwill) from the impairment test. Under this update, entities should perform goodwill impairment testing by comparing the fair value of a reporting unit with its carrying amount, and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The same impairment assessment applies to all reporting units, and entities still have the option to perform qualitative assessment for a reporting unit to determine if quantitative impairment testing is necessary. This update modifies the concept of impairment from the condition that exists when the carrying amount of goodwill exceeds its implied fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value. Entities will no longer determine goodwill impairment by calculating the implied fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination. The Company is required to adopt this guidance for its annual or any interim goodwill impairment tests in fiscal years beginning after
December
15,
2019,
and should be applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after
January
1,
2017.
The Company is currently evaluating the potential impact that adoption
may
have on its impairment testing (annually in the
second
quarter) and financial statements.
Note 3 - Inventories
Inventory Disclosure [Text Block]
3.
INVENTORIES
 
Inventories
, net consist of the following components (in thousands):
 
   
March 31,
   
December 31,
 
   
2017
   
2016
 
Finished race cars, parts and accessories
  $
5,085
    $
5,263
 
Souvenirs and apparel
   
2,687
     
2,131
 
Micro-lubricant
®
and other
   
777
     
818
 
Total
  $
8,549
    $
8,212
 
Note 4 - Goodwill and Other Intangible Assets
Goodwill and Intangible Assets Disclosure [Text Block]
4.
G
OODWILL
AND
O
THER
I
NTANGIBLE ASSET
S
 
Annual
Impairment
Assessment
The Company
evaluates goodwill and other intangible assets for possible impairment annually in the
second
quarter, or when events or circumstances indicate possible impairment
may
have occurred. See Notes
2
and
5
to the Consolidated Financial Statements in our
2016
Annual Report for additional information on the Company’s goodwill and other intangible assets and assessment methodology and evaluation.
 
Management's latest annual assessment in the
second
quarter
2016
was based predominately on management's best estima
te of future discounted operating cash flows and profitability attributable to such assets for all individual reporting units. Management also considered that the estimated market value for comparable NASCAR race event sanction and renewal agreements (we had agreements with NASCAR to annually conduct
thirteen
Monster Energy Cup,
eleven
Xfinity and
eight
Camping World Truck Series races as of the evaluation date), combined with the estimated fair value for all other Company net assets, substantially exceeds its current market capitalization. The inputs for measuring fair value are considered "Level
3"
or unobservable inputs that are not corroborated by market data under applicable fair value authoritative guidance, as quoted market prices are not available.
Management believes the methods used to determine fair value and evaluate impairment were appropriate, relevant, and represent methods customarily available and used for such purposes and are the best available estimate of fair value. Among other factors, the latest assessment assumes projected cash flow and profitability recovery, using modest annual inflationary growth rates for projected revenue streams and operating costs (other than NASCAR broadcasting revenues and event management fees), and strategic amounts of planned capital expenditures. Management projected annual increases in contracted NASCAR broadcasting rights revenues, and associated NASCAR event management fees, based on historical and anticipated rates which are supported by recently negotiated multi-year contracts. NASCAR event management fees for years after
2020
have not been negotiated, and future annual fees could differ substantially from those assumed in management’s impairment assessment.
 
Our
2016
annual assessment found the estimated fair value of each reporting unit and each indefinite-lived race-date intangible asset substantially exceeded its associated carrying value except for NHMS and TMS race date agreements. As of
March
31,
2017
and
December
31,
2016,
the carrying values of non-amortizable race date event sanctioning and renewal agreements associated with NHMS and TMS were approximately
$199.6
million and
$98.8
million. The estimated excess of fair value of identified intangible assets associated with NHMS and TMS, while more than nominal at this time, have heightened sensitivity to management’s assumptions used in estimating future discounted cash flows and profitability and associated risk of failing impairment testing. Management’s assumptions considered the following factors and conditions. NHMS was acquired in
2008,
largely before the severe economic recession, which has resulted in long-term operating challenges for many major sports. The
2016
evaluation reflects continuing lowered estimated future cash flows because the economic recovery has been slower and weaker than previous forecasts, and ongoing lower than anticipated revenues for various major racing events. The evaluation also reflects, similar to challenges faced by many major sports, reduced visibility on profit recovery due to factors such as changing demographics, evolving entertainment choices for fans, appealing “at-home viewing” experiences and retirement of popular long-standing “megastars”. We have lowered our expectations for forecasted growth rates for certain revenues and profit recovery. However, those expectations and forecasts are based on many factors out of our control, and could be found unachievable. Such ultimate outcome could adversely impact our estimates of fair values, particularly for NHMS and TMS race date intangible assets.
 
There have since been no other events or circumstances that indicate possible impairment, and management believes our operational and cash flow forecasts support our conclusion
s that
no
unrecognized impairment exists as of
March
31,
2017.
Different economic or industry conditions or assumptions, and changes in projected cash flows or profitability, if significantly negative or unfavorable, could have a material adverse effect on the impairment evaluation and our future financial condition or results of operations. The evaluations are subjective and based on conditions, trends and assumptions existing at the time of evaluation.
 
Other Information
There were no changes in the gross carrying value of goodwill or other intangible assets during the
three
months ended
March
31,
2017.
The carrying amounts for goodwill and other intangible assets include accumulated impairments of
$148.6
million and
$99.9
million at both
March
31,
2017
and
December
31,
2016.
The gross carrying values and accumulated amortization by class of intangible asset are as follows (dollars in thousands):
 
   
March 31, 2017
   
December 31,
2016
             
   
Gross
Carrying
Value
   
Accumulated
Amortization
   
Net
   
Gross
Carrying
Value
   
Accumulated
Amortization
   
Net
   
Estimated
Amortization
Period
(Years)
 
Nonamortizable race event sanctioning and renewal agreements
  $
298,383
     
    $
298,383
    $
298,383
     
    $
298,383
     
 
 
 
Amortizable race event sanctioning and renewal agreements
   
100
    $
(100
)
   
     
100
    $
(100
)
   
     
5
-
6
 
Total
  $
298,483
    $
(100
)
  $
298,383
    $
298,483
    $
(100
)
  $
298,383
     
 
 
 
 
Note 5 - Long-term Debt
Long-term Debt [Text Block]
5
.
LONG-TERM DEBT
 
Bank Credit
Facility
Our Credit Facility, among other things: (i) provides for a
five
-year
$100,000,000
senior secured revolving credit facility, with separate sub-limits of
$50,000,000
for standby letters of credit and
$10,000,000
for swing line loans; (ii) provides for a
five
-year
$150,000,000
senior secured term loan (which was fully drawn) and a
five
-year delayed draw term loan of up to
$50,000,000
(which was fully drawn in
March
2015
and repaid in the
second
quarter
2015)
(the Term Loan or Term Loans); (iii) matures in
December
2019;
(iv) contains an accordion feature allowing the Company to increase revolving commitments or establish a term loan up to an aggregate additional
$100,000,000
or
$200,000,000,
respectively (or a combined aggregate additional amount of up to
$250,000,000)
with certain lender commitment conditions; (v) allows for annual aggregate payments of dividends and repurchases of SMI securities of up to
$50,000,000,
increasing up to
$75,000,000
subject to maintaining certain financial covenants; and (vi) limits annual capital expenditures to
$75,000,000
and provides for motor speedway acquisitions and related businesses. Term Loans require equal minimum quarterly principal payments of at least
5%
of initial amounts drawn on an annualized basis
($7,500,000
for fiscal
2017).
 
Interest is based, at the Company
’s option, upon the Eurodollar Rate plus
1.25%
to
2.00%
or a base rate defined as the higher of Bank of America’s prime rate, the Federal Funds Rate plus
0.5%
or the Eurodollar Rate plus
1%,
plus
0.25%
to
1.00%.
The Credit Facility also contains a commitment fee ranging from
0.25%
to
0.40%
of unused amounts available for borrowing. The interest rate margins on borrowings and the commitment fee are adjustable periodically based upon certain consolidated total leverage ratios. The Credit Facility contains a number of affirmative and negative financial covenants, including requirements that we maintain certain consolidated total leverage ratios and consolidated interest coverage ratios.
 
During the
three
months ended
March
31,
2017
and
2016,
the Company repaid
$3,000,000
and
$2,000,000
of Term Loan borrowings, and there were no borrowings under the Credit Facility.
At
March
31,
2017
and
December
31,
2016,
outstanding borrowings under the Credit Facility were
$63,000,000
and
$66,000,000
(all Term Loan borrowings), and outstanding letters of credit amounted to
$605,000
at both dates. As of
March
31,
2017,
we had availability for borrowing up to an additional
$99,395,000,
including up to an additional
$49,395,000
in letters of credit, under the revolving Credit Facility, and
$50,000,000
under the delayed draw term loan provision.
 
2023
Senior Notes
– We completed a private placement of
5.125%
Senior Notes due
2023
in aggregate principal amount of
$200.0
million in
January
2015
(the
2023
Senior Notes), and an exchange offer for substantially identical
2023
Senior Notes registered under the Securities Act in the
second
quarter
2015.
The
2023
Senior Notes were issued at par, and net proceeds were used to redeem a portion of our former
2019
Senior Notes as further described in Note
6
to the Consolidated Financial Statements in our
2016
Annual Report. The
2023
Senior Notes mature in
February
2023
and interest payments are due semi-annually on
February
 
1
and
August
 
1.
 
Other Notes Payable
– At
March
31,
2017
and
December
31,
2016,
long-term debt includes a
3%
interest bearing debt obligation of
$1,049,000
and
$1,206,000
associated with the purchase of real property at BMS, payable in
eight
annual installments of
$194,000
beginning
January
2016.
 
Deferred Financing Costs
– Deferred financing costs associated with our revolving Credit Facility are reported in other noncurrent assets, and those associated with the
2023
Senior Notes and bank Term Loan are reflected as a reduction of long-term debt. As of
March
31,
2017
and
December
31,
2016,
long-term debt reflects deferred financing costs, net of accumulated amortization, of
$4
,
847,000
and
$5
,
151
,000.
 
 
Other
General
Terms and Conditions
– The Credit Facility and
2023
Senior Notes contain specific requirements and restrictive financial covenants and limits or prohibits various financial and transactional activities, and also contain cross-default and change of control provisions. We were in compliance with all applicable covenants under these debt agreements as of
March
31,
2017
.
See Note
6
to the Consolidated Financial Statements included in our
2016
Annual Report for additional information on these debt agreements, including dividend, redemption, and right of payment provisions, pledged security and financial and restrictive covenants.
 
Subsidiary Guarantees
Amounts outstanding under the Credit Facility and
2023
Senior Notes are guaranteed by all of SMI’s material operative subsidiaries except for Oil-Chem and its subsidiaries (which are presently minor). These guarantees are full and unconditional and joint and several with the
2023
Senior Notes on a senior unsecured basis. The parent company has no independent assets or operations. There are no restrictions on the subsidiaries’ ability to pay dividends or advance funds to the parent company.
 
Interest Expense, Net
Interest expense, interest income and capitalized interest costs are summarized as follows (in thousands):
 
   
Three Months Ended
 
   
March 31:
 
   
2017
   
2016
 
Gross interest costs
  $
3,308
    $
3,564
 
Less: capitalized interest costs
   
(55
)
   
(182
)
Interest expense
   
3,253
     
3,382
 
Interest income
   
(248
)
   
(43
)
Interest expense, net
  $
3,005
    $
3,339
 
Weighted-average interest rate on Credit Facility borrowings
   
2.1
%
   
1.9
%
Note 6 - Per Share and Other Equity Information
Stockholders Equity and Earnings Per Share [Text Block]
6.
PER SHARE AND OTHER EQUITY INFORMATION
 
 
The following schedule reconciles basic and diluted
(loss) income per share (where computations are anti-dilutive, reported basic and diluted per share amounts are the same) (in thousands except per share amounts):
 
   
 
Three Months Ended
 
   
March 31:
 
   
2017
   
2016
 
Net
(loss) income applicable to common stockholders and assumed conversions
  $
(1,935
)
  $
861
 
                 
Weighted average common shares outstanding
   
41,087
     
41,227
 
Dilution effect of assumed conversions:
               
Common stock equivalents
—stock awards
   
21
     
17
 
Weighted average common shares outstanding and assumed conversions
   
41,108
     
41,244
 
                 
Basic
(loss) income per share
  $
(0.05
)
  $
0.02
 
Diluted
(loss) income per share
  $
(0.05
)
  $
0.02
 
Anti-dilutive common stock equivalents excluded in computing diluted earnings per share
   
9
     
134
 
 
Stock Repurchase Program
– Our
Board of Directors has approved a stock repurchase program authorizing SMI to repurchase up to an aggregate of
5,000,000
shares of our outstanding common stock from time to time, depending on market conditions, share price, applicable limitations under our debt agreements (see Note
5),
and other factors the Board of Directors or its designees, in their sole discretion,
may
consider relevant. The purchases can be in the open market or private transactions. The stock repurchase program is presently funded using available cash and cash equivalents and
may
be suspended or discontinued at any time.
 
During the
three
months ended
March
31,
2017,
we repurchased
62,000
shares of common stock for
$1,301,000.
As of
March
31,
2017,
we could repurchase up to an additional
380,000
shares under the current authorization. During the
three
months ended
March
31,
2017,
we repurchased
31,000
shares of common stock for
$597,000
from management employees to settle income taxes on
64,000
restricted shares that vested during the period. As of and through
March
31,
2017,
treasury stock includes
303,000
shares of common stock delivered to the Company for such purposes.
 
Declaration of Cash Dividends
– On
February
 
15,
2017,
our Board of Directors declared a quarterly cash dividend of
$0.15
per share of common stock aggregating
$6,241,000,
which was paid on
March
 
17,
2017
to shareholders of record as of
March
1,
2017
.
On
April
19,
2017,
our Board of Directors declared a quarterly cash dividend of
$0.15
per share of common stock aggregating approximately
$6.2
million payable on
June
5,
2017
to shareholders of record as of
May
15,
2017.
These quarterly cash dividends are being paid using available cash and cash equivalents on hand.
Note 9 - Stock Compensation Plans
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]
9.
STOCK COMPENSATION PLANS
 
 
 
See Note
11
to the Consolidated Financial Statements in our
2016
Annual Report for additional informati
on and terms of the Company’s stock compensation plans.
 
2013
Stock Incentive Plan, Amended and Restated as of
April
19,
2017
– 
In
February
2017,
our Board of Directors adopted an amended and restated
2013
Stock Incentive Plan which was approved by the stockholders on
April
19,
2017
at the
2017
Annual Meeting. The amendment and restatement does not increase the number of shares re
served for issuance or any of the award limits under the
2013
Stock Incentive Plan. The primary changes include: (a) additions to the permissible criteria upon which performance goals for performance-based compensation can be based; and (b) revisions and additions to the types of items and events that
may
be used for adjustments in determining whether an objective performance goal for performance-based compensation has been met. 
The Compensation Committee of the Company’s Board of Directors approved grants of
35,000
restricted stock units to the Company’s Chief Executive Officer and President and
35,000
shares of restricted stock to the Company’s Vice Chairman and Chief Financial Officer in each of the
three
months ended
March
31,
2017
and
2016.
These grants are to be settled in shares of common stock, vest in equal installments over
three
years and are subject to reaching certain defined full year earnings targets established at the beginning of each year by the Compensation Committee. Forfeitures in any given year result from differences between the Company’s actual results for the previous year as compared to the defined full year earnings target.
The following is a summary
of restricted stock and restricted stock units granted, vested and forfeited under the Stock Incentive Compensation Plan for the indicated periods (shares in thousands):
 
   
Three Months Ended March 31:
 
   
2017
   
2016
 
                         
   
Restricted
Stock
   
Restricted
Stock
Units
   
Restricted
Stock
   
Restricted
Stock
Units
 
Outstanding, beginning of period
   
68
     
129
     
67
     
132
 
Granted
   
35
     
35
     
35
     
35
 
Vested
   
(32
)
   
(32
)
   
(32
)
   
(32
)
Forfeited
   
(5
)
   
(5
)
   
(2
)
   
(6
)
Outstanding, end of period
   
66
     
127
     
68
     
129
 
 
In each of the
three
months ended
March
31,
2017
and
2016,
the Company repurchased
31,000
shares of common stock for
$597,000
and
$588,000,
respectively, from executive management employees to settle income taxes on
64,000
shares that vested during each
period.
 
2008
Formula Restricted Stock Plan, Amended and Restated as of
April
17,
2012
– 
The Company awarded
3,893
shares of restricted stock to each of the Company’s
four
non-employee directors in
April
2017.
An aggregate of
15,976
shares granted to non-employee directors in
April
2016
vested in
April
2017,
and
12,816
shares granted in
April
2015
vested in
April
2016.
All restricted stock awards were granted and vested in accordance with plan provisions.
Share-Based Payments
–There were no significant changes in the characteristics of restricted stock or restricted stock units granted in
2017
or
2016
as compared to prior grants and no modifications of the terms of any share-based payment arrangements. There were no significant changes in estimates, assumptions or valuation methods used to estimate the fair value of share-based payment awards.
No
stock options were granted or exercised under any of the Company’s stock compensation plans during the
three
months ended
March
31,
2017
or
2016.
Share-based compensation cost for the
three
months ended
March
31,
2017
and
2016
totaled
$809,000
and
$867,000,
before income taxes of $
299,000
and
$325,000,
respectively, and is included in general and administrative expense. There were
no
capitalized share-based compensation costs at
March
31,
2017
or
December
31,
2016.
As of
March
31,
2017,
there was approximately
$4,561,000
of total unrecognized compensation cost related to non-vested restricted stock and restricted stock units granted under the
2013
Plan and the
2008
Formula Plan that is expected to be recognized over a weighted average period of
1.1
years. As of
March
31,
2017,
all stock options were vested and there was
no
unrecognized compensation cost related to stock options granted under any of the Company’s stock compensation plans.
Note 10 - Segment Disclosures
Segment Reporting Disclosure [Text Block]
10
.
SEGMENT DISCLOSURES
 
Our operations are predominately comprised of promoting, marketing and sponsoring motorsports racing events, merchandising and other related activities conducted at our various major speedway facilities located in the United States. Our business activitie
s, including those of our subsidiaries, are further described in Notes 
1
and
2
to the Consolidated Financial Statements in our
2016
Annual Report. Our “motorsports event related” segment consists of revenues and expenses associated with all admissions, event related, NASCAR broadcasting and event motorsports merchandising activities. The segment includes motorsports related events and operations for all Company speedways, NASCAR broadcasting and ancillary media rights, PRN and RCU motorsports radio programming, and SMI Properties and SMI Trackside motorsports merchandising at Company and non-Company speedways. These operating segments have been aggregated into the motorsports related reportable segment as each share similar types and classes of customers, similar methods for providing or distributing motorsports related services, souvenirs and other merchandise, and other similar economic characteristics. Our “all other” operations consist of SMIP subsidiary non-event motorsports and non-motorsports merchandising, Legend Cars non-event merchandising and sanctioning body activities, Oil-Chem micro-lubricant activities, TMS natural gas mineral rights lease and related revenues, and office rentals at certain Company speedways.  
 
Segment information as presented
below comports with information our chief operating decision maker and management use and focus on when assessing segment performance and allocating resources. Segment operating income or loss excludes interest, income taxes, other income or expense and specified non-recurring items, if any, and corporate general and administrative and depreciation costs are allocated to operating segments based on their respective revenues relative to consolidated revenues. The following tables present our segment information (in thousands):
 
 
   
Three Months Ended March 31:
 
   
2017
   
2016
 
   
Motorsports
Event
Related
   
 
All
Other
   
 
Consolidated
   
Motorsports
Event
Related
   
All
Other
   
 
Consolidated
 
Revenues
  $
75,098
    $
5,227
    $
80,325
    $
77,276
    $
5,900
    $
83,176
 
Depreciation and amortization
   
17,467
     
38
     
17,505
     
13,328
     
43
     
13,371
 
Segment operating
(loss) income
   
(1,525
)
   
1,102
     
(423
)
   
3,381
     
1,403
     
4,784
 
Capital expenditures
   
7,049
     
5
     
7,054
     
18,329
     
26
     
18,355
 
 
   
 
March 31, 2017
   
December 31, 2016
 
Other intangibles
  $
298,383
     
    $
298,383
    $
298,383
     
    $
298,383
 
Goodwill
   
47,342
     
     
47,342
     
47,342
     
     
47,342
 
Total assets
   
1,479,228
    $
24,180
     
1,503,408
     
1,474,127
    $
24,022
     
1,498,149
 
 
The following table reconciles segment operating income or loss above to consolidated income or loss before income taxes (in thousands):
 
   
Three Months Ended
 
   
March 31:
 
   
2017
   
2016
 
Total segment operating (loss) income
  $
(423
)
  $
4,784
 
Adjusted for:
               
Interest expense, net
   
(3,005
)
   
(3,339
)
Other expense, net
   
(578
)
   
(68
)
Consolidated (loss) income before income taxes
  $
(4,006
)
  $
1,377
 
Significant Accounting Policies (Policies)
Quarterly
Reporting
– We recognize revenues and operating expenses for all events in the calendar quarter in which conducted. Changes in race schedules at our speedways from time to time, including speedway acquisitions, can lessen the comparability of operating results between quarterly financial statements of successive years and increase or decrease the seasonal nature of our motorsports business.
There were no significant racing schedule changes for the
three
months ended
March
31,
2017
as compared to
2016.
 
Consolidated Statements of Cash Flows
– 
Before
December
31,
2016,
cash we collected and temporarily held on behalf of our
third
-party food and beverage concessionaire, and not remitted until after period end, was presented separately from cash flows from operating activities. We now include such amounts in cash flows from operating activities for both periods, increasing cash flow from operations, and the change in accounts payable, by
$90,000
for the
three
months ended
March
31,
2016.
There was no impact on the Consolidated Balance Sheets or Statements of Operations.
Income Tax
es
– We provide for income taxes at the end of each interim period based on management’s best estimate of the annual estimated effective income tax rate. Cumulative adjustments to our annual estimated effective income tax rate are recorded in the interim period in which a change in the annual estimated effective income tax rate is determined. Cash paid for income taxes excludes any previous overpayments the Company
may
have elected to apply to income tax liabilities. The Company has no undistributed foreign earnings or cash or cash equivalents held outside of the US.
See Notes
2
and
8
to
the Consolidated Financial Statements in our
2016
Annual Report for additional information on our accounting for income taxes.
 
The effective income tax rate for the
three
months ended
March
31,
2017
and
2016
was
51.7%
and
37.5%,
respectively. 
The
2017
tax rate reflects reduced deferred income tax liabilities of
$1,310,000
for anticipated lower state income tax rates associated with race date realignments, partially offset by reduced deferred tax assets associated with
certain state net operating loss carryforwards of
$515,000.
W
e paid cash of
$0
and
$200,000
for income taxes in the
three
months ended
March
31,
2017
and
2016.
Accounting for Uncertainty in Income Taxes
– Income tax liabilities for unrecognized tax benefits approximate
$12,006,000
at
March
31,
2017
and
December
31,
2016,
$11,746,000
of which relates to our discontinued operation (see Note
1
to the Consolidated Financial Statements in our
2016
Annual Report). Of those amounts,
$11,794,000
is included in noncurrent other liabilities, all of which would favorably impact our effective tax rate if recognized
,
and
$212,000
is included in deferred tax liabilities, at both
March
31,
2017
and
December
31,
2016.
As of
March
31,
2017
and
December
31,
2016,
management believes
$260,000
of unrecognized tax benefits will be recognized within the next
twelve
months. Interest and penalties associated with unrecognized tax benefits were insignificant for 
the
three
months ended
March
31,
2017
and
2016.
 
As of
March
31,
2017
and
December
31,
2016,
we had
$145,000
and
$140,000
accrued for the payment of interest and penalties on uncertain tax positions, which is included in other noncurrent liabilities. The tax years that remain open to examination include
2006
through
2008,
and
2012
through
2016,
by the California Franchise Tax Board,
2013
through
2016
by the Internal Revenue Service, and
2013
through
2016
by most, and
2012
through
2016
 by other, state taxing jurisdictions to which we are subject. Our
2014
federal income tax return is under examination by the Internal Revenue Service, which began in
July
2016.
Income Tax Benefit From Equity Interest Abandonment
– On
January
31,
2014,
we abandoned our interest and rights in Motorsports Authentics (former
50%
owned, non-controlling interest, merchandising equity investment joint venture) (MA) to focus management resources in areas that
may
be profitable and more productive. Our carrying value of the investment was reduced to
$0
through sizable impairment charges prior to
2010
and MA’s historical operating results. We recognized no concurrent tax benefits as valuation allowances were provided against associated deferred tax assets. As a result of abandonment, we recognized a material income tax benefit of
$48.1
million at
December
31,
2013
for the reversal of previously recorded valuation allowances under applicable accounting guidance, and recognized tax losses reported on our
2014
income tax returns. Management believes there is or will be sufficient taxable income in carryback or carryforward periods under tax law for full utilization of these tax losses. We have reduced income taxes payable by amounts approximating that tax benefit through
March
31,
2017
by utilization of deferred income tax assets, including net operating losses, related to abandonment.
 
W
e believe it is more likely than not that our filing position would be sustained based on its technical merits upon examination with taxing authorities that have full knowledge of all relevant information. We reached this conclusion based on the use of outside legal counsel and other tax consultants and the potential to utilize tax losses. We believe we will fully utilize the associated tax losses. Should our tax position not be fully sustained upon examination, reestablishment of material income tax liabilities and acceleration of cash income taxes payable could occur. Any differences between the final tax outcome and amounts recorded would affect our income tax provision in the period in which such determination was made.
 
Other Income Tax Benefits
– Applicable accounting guidance
may
require establishing valuation allowances for certain deferred tax assets or income tax liabilities for unrecognized tax benefits, notwithstanding management believes associated tax filing positions are sustainable and are or will be reflected in its tax filings. At
March
31,
2017,
liabilities for unrecognized tax benefits totaled
$12.0
million. Should those tax positions not be fully sustained if examined, an acceleration of material income taxes payable could occur. Where no net income tax benefit had been previously reflected because of providing a valuation allowance on related deferred tax assets, our future results of operations might not be significantly impacted. However, resulting cash required for payments of income taxes could be material in the period in which such determination is made.
Taxes Collected from Customers
– The Company reports sales, admission and other taxes collected from customers on both a gross and net basis in operations. Such taxes reported on a gross basis for the
three
months ended
March
31,
2017
and
2016
amounted to
$411,000
and
$366,000.
Advertising Expenses
– Event specific advertising costs are expensed when an associated event is held and included principally in direct expense of events. Non-event related advertising costs are expensed as incurred and included principally in other direct operating expense. Advertising expense amounted to
$1,604,000
and
$1,927,000
in the
three
months ended
March
31,
2017
and
2016.
There were
no
deferred direct-response advertising costs at
March
31,
2017
or
December
31,
2016.
TMS Mineral Rights Lease Receipts
– We recognized royalty revenue of
$448,000
and
$627,000
in the
three
months ended
March
31,
2017
and
2016
under a natural gas mineral rights lease agreement and a joint exploration agreement entitling TMS to stipulated stand-alone and shared royalties, as further described in Note
2
to the Consolidated Financial Statements in our
2016
Annual Report. Such revenues have declined from associated market declines, volatility in natural gas price levels and common diminishing well production. The agreements stipulate that TMS distribute
25%
of production royalty revenues to the lessee, and obligate TMS to spend amounts equal to royalties received on TMS facility and road infrastructure improvements beginning in
2017,
up to specified cumulative amounts. However, at this time, management believes
2017
revenues will not differ significantly from
2016,
and that our infrastructure spending will continue to exceed anticipated future royalties.
As of
March
31,
2017
and
December
31,
2016,
there was no deferred income associated with these agreements.
Fair Value of Financial Instruments
– We follow applicable authoritative guidance which requires that financial and non-financial assets and liabilities measured and reported on a fair value basis be classified, disclosed and categorized as further described below. Fair value estimates are based on relevant market information and single broker quoted market prices where available at a specific point in time, and changes in assumptions or market conditions could significantly affect estimates. The carrying values of cash and cash equivalents, accounts receivable, certain other assets and accounts payable approximate fair value because of the short maturity of these financial instruments. Cash surrender values are carried at fair value based on binding broker quoted market prices. Notes receivable and bank revolving credit facility and term loan borrowings are variable interest rate financial instruments and, therefore, carrying values approximate fair value. The fixed rate senior notes payable are publicly traded and estimated fair values are based on single broker quoted market prices. Other long-term debt bears interest approximating market rates or where non-interest bearing is discounted based on estimated current cost of borrowings; therefore, carrying values approximate market value. There have been no changes or transfers between category levels or classes.
The following table presents estimated fair values and categorization levels of our financial instruments as of
March
31,
2017
and
December
31,
2016
(in thousands):
 
            2017     2016  
    Level   Class  
Carrying
Value
   
Fair Value
   
Carrying
Value
   
Fair Value
 
                                           
Assets
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
   
1
 
R
  $
53,585
    $
53,585
    $
79,342
    $
79,342
 
Notes receivable
   
2
 
NR
   
1,102
     
1,102
     
1,143
     
1,143
 
Cash surrender values
   
2
 
NR
   
9,174
     
9,174
     
8,919
     
8,919
 
                                           
Liabilities
(principal)
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Floating rate revolving Credit Facility, including Term Loan
   
2
 
NR
   
63,000
     
63,000
     
66,000
     
66,000
 
5.125% Senior Notes Payable due 2023
   
2
 
NR
   
200,000
     
202,000
     
200,000
     
202,500
 
Other long-term debt
   
2
 
NR
   
1,049
     
1,049
     
1,206
     
1,206
 
 
Level
 
1:
Quoted market prices in active markets for identical assets or liabilities.
Level
2:
Observable market-based inputs or unobservable inputs that are corroborated by market data.
Level
3:
Unobservable inputs that are not corroborated
by market data.
Class
 R:
Measured at fair value on recurring basis, subsequent to initial recognition.
Class
 NR:
Measured at fair value on nonrecurring basis, subsequent to initial recognition.
Property and Equipment
– From time to time, we
may
decide to repurpose various seating, suites and others areas at our speedways for modernizing our facilities, alternative marketing or development purposes such as offering expanded premium hospitality, RV camping and advertising areas, or wider seating and improved sight lines. 
When management decides on repurpose and removal, depreciation is accelerated and recorded prospectively over shortened estimated remaining useful lives of the assets, and accounted for as a change in estimate, beginning when management contracts and begins removal. In the
first
quarter
2017,
we contracted and began removing approximately
7,000
seats at CMS,
17,000
seats at KyS and
12,000
seats at NHMS, which is expected to be completed in the
first
half of
2017.
As such, we recorded pre-tax charges for accelerated depreciation and costs of removal (included in other expense, net) aggregating approximately 
$4,597,000
, before income tax benefits of
$1,700,000,
in the
first
quarter
2017.
These charges are included in our "motorsports event related" reporting segment (see Note
10).
Recently Issued Accounting Standards
– The Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 
2014
-
09
"Revenue from Contracts with Customers (Topic
606):
Section A - Summary and Amendments That Create Revenue from Contracts with Customers and Other Assets and Deferred Costs - Contracts with Customers (Subtopic
340
-
40)"
which enhances comparability and clarifies principles of revenue recognition arising from contracts with customers that supersedes most current revenue recognition guidance. The guidance includes the core principle that entities recognize revenue to depict transfers of promised goods or services to customers in amounts that reflect the consideration entities expect to be entitled in exchange for those goods or services, and expands required financial statement disclosures regarding revenue recognition. The FASB has recently issued several amendments to the new standard, including Update No.
2016
-
08
"Revenue from Contracts with Customers (Topic
606)
- Principal versus Agent Considerations" clarifying implementation guidance for those considerations in Update No.
2014
-
09,
and Update No.
2016
-
10
"Revenue from Contracts with Customers (Topic 
606)
- Identifying Performance Obligations and Licensing" amending the guidance in Update No.
2014
-
09
related to those items. The FASB issued Update No.
2015
-
14
approving deferral of Update No.
2014
-
09
for
one
year, with such guidance now effective for annual reporting periods beginning after
December
15,
2017,
including interim periods within that reporting period. Early application is permitted as of annual reporting periods beginning after
December
15,
2016,
including interim reporting periods within that reporting period. The guidance
may
be applied retrospectively to each prior period presented or retrospectively with cumulative effects recognized as of the date of adoption. The Company plans to adopt this new guidance in the
first
quarter
2018.
The Company has begun preliminary evaluation of the potential impact that adoption
may
have on its financial statements, as well as expected method of adoption, including associated accounting policies, processes, and system requirements to enable timely and accurate reporting.  
 
The FASB issued Accounting Standards Update No.
2015
-
11
"Inventory (Topic
330):
Simplifying the Measurement of Inventory”
which requires measuring inventory at the lower of cost and net realizable value based on estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation (changed from the previous guidance of lower of cost or market). This update also clarified various other inventory measurement and disclosure requirements. The update does not apply to inventory measured using the LIFO or retail inventory methods. The guidance is effective for annual reporting periods beginning after
December
15,
2016,
including interim periods within that reporting period, and applied prospectively. The Company’s adoption of this guidance as of
January
1,
2017
had no significant impact on its financial statements or disclosures
.
 
The FASB issued Accounting Standards Update No.
2016
-
02
Leases (Subtopic
842)”
which replaces all current US GAAP guidance on this topic, and requires lessees to recognize assets and liabilities arising from leases as well as extensive quantitative and qualitative disclosures. Lessees will need to recognize on their balance sheets right-of-use assets and lease liabilities for the majority of their leases (other than leases meeting the definition of a short-term lease). Right-of-use assets will be measured at lease liability amounts, adjusted for lease prepayments, lease incentives received and lessee’s initial direct costs. Lease liabilities will equal the present value of lease payments. Assets will be based on the liability, subject to adjustment, such as for initial direct costs. Operating leases
may
typically result in straight-line expense, while finance leases similar to front-loaded expense pattern. Classification will be based on criteria largely similar to those applied in current lease accounting. The guidance is effective for fiscal years beginning after
December
15,
2018,
and interim periods within those fiscal years. Early adoption is permitted. The guidance is required to be applied using the modified retrospective approach for all leases existing as of the effective date, requires application at the beginning of the earliest comparative period presented, and provides for certain practical expedients. The Company is currently evaluating the potential impact that adoption
may
have on its financial statements.
 
The FASB issued Accounting Standards Update No.
2016
-
15
Statement of Cash Flows (Topic
23)
- Classification of Certain Cash Receipts and Cash Payments” which provides specific guidance on
eight
cash flow classification issues. The guidance is effective for fiscal years beginning after
December
15,
2017,
and interim periods within those fiscal years, and should be applied using a retrospective transition method to each period presented. Early adoption is permitted, and any amendments must be adopted in the same period. At this time, the Company believes adoption will have no significant impact on its financial statements, and plans to apply this guidance to future classifications when applicable.
 
The FASB issued Accounting Standards Update No.
2017
-
04
Intangibles – Goodwill and Other (Topic
350):
Simplifying the Test of Goodwill Impairment” which simplifies how an entity is required to test goodwill for impairment by eliminating Step
2
(measuring goodwill impairment loss by comparing implied fair value of a reporting unit’s goodwill to the carrying amount of that goodwill) from the impairment test. Under this update, entities should perform goodwill impairment testing by comparing the fair value of a reporting unit with its carrying amount, and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The same impairment assessment applies to all reporting units, and entities still have the option to perform qualitative assessment for a reporting unit to determine if quantitative impairment testing is necessary. This update modifies the concept of impairment from the condition that exists when the carrying amount of goodwill exceeds its implied fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value. Entities will no longer determine goodwill impairment by calculating the implied fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination. The Company is required to adopt this guidance for its annual or any interim goodwill impairment tests in fiscal years beginning after
December
15,
2019,
and should be applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after
January
1,
2017.
The Company is currently evaluating the potential impact that adoption
may
have on its impairment testing (annually in the
second
quarter) and financial statements.
Note 2 - Significant Accounting Policies and Other Disclosures (Tables)
Fair Value Measurements, Recurring and Nonrecurring [Table Text Block]
            2017     2016  
    Level   Class  
Carrying
Value
   
Fair Value
   
Carrying
Value
   
Fair Value
 
                                           
Assets
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
   
1
 
R
  $
53,585
    $
53,585
    $
79,342
    $
79,342
 
Notes receivable
   
2
 
NR
   
1,102
     
1,102
     
1,143
     
1,143
 
Cash surrender values
   
2
 
NR
   
9,174
     
9,174
     
8,919
     
8,919
 
                                           
Liabilities
(principal)
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Floating rate revolving Credit Facility, including Term Loan
   
2
 
NR
   
63,000
     
63,000
     
66,000
     
66,000
 
5.125% Senior Notes Payable due 2023
   
2
 
NR
   
200,000
     
202,000
     
200,000
     
202,500
 
Other long-term debt
   
2
 
NR
   
1,049
     
1,049
     
1,206
     
1,206
 
Note 3 - Inventories (Tables)
Schedule of Inventory, Current [Table Text Block]
   
March 31,
   
December 31,
 
   
2017
   
2016
 
Finished race cars, parts and accessories
  $
5,085
    $
5,263
 
Souvenirs and apparel
   
2,687
     
2,131
 
Micro-lubricant
®
and other
   
777
     
818
 
Total
  $
8,549
    $
8,212
 
Note 4 - Goodwill and Other Intangible Assets (Tables)
Schedule of Finite Lived and Indefinite Lived Intangible Assets [Table Text Block]
   
March 31, 2017
   
December 31,
2016
             
   
Gross
Carrying
Value
   
Accumulated
Amortization
   
Net
   
Gross
Carrying
Value
   
Accumulated
Amortization
   
Net
   
Estimated
Amortization
Period
(Years)
 
Nonamortizable race event sanctioning and renewal agreements
  $
298,383
     
    $
298,383
    $
298,383
     
    $
298,383
     
 
 
 
Amortizable race event sanctioning and renewal agreements
   
100
    $
(100
)
   
     
100
    $
(100
)
   
     
5
-
6
 
Total
  $
298,483
    $
(100
)
  $
298,383
    $
298,483
    $
(100
)
  $
298,383
     
 
 
 
 
Note 5 - Long-term Debt (Tables)
Interest Income and Interest Expense Disclosure [Table Text Block]
   
Three Months Ended
 
   
March 31:
 
   
2017
   
2016
 
Gross interest costs
  $
3,308
    $
3,564
 
Less: capitalized interest costs
   
(55
)
   
(182
)
Interest expense
   
3,253
     
3,382
 
Interest income
   
(248
)
   
(43
)
Interest expense, net
  $
3,005
    $
3,339
 
Weighted-average interest rate on Credit Facility borrowings
   
2.1
%
   
1.9
%
Note 6 - Per Share and Other Equity Information (Tables)
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]
   
 
Three Months Ended
 
   
March 31:
 
   
2017
   
2016
 
Net
(loss) income applicable to common stockholders and assumed conversions
  $
(1,935
)
  $
861
 
                 
Weighted average common shares outstanding
   
41,087
     
41,227
 
Dilution effect of assumed conversions:
               
Common stock equivalents
—stock awards
   
21
     
17
 
Weighted average common shares outstanding and assumed conversions
   
41,108
     
41,244
 
                 
Basic
(loss) income per share
  $
(0.05
)
  $
0.02
 
Diluted
(loss) income per share
  $
(0.05
)
  $
0.02
 
Anti-dilutive common stock equivalents excluded in computing diluted earnings per share
   
9
     
134
 
Note 9 - Stock Compensation Plans (Tables)
Share-based Compensation, Stock Options, Activity [Table Text Block]
   
Three Months Ended March 31:
 
   
2017
   
2016
 
                         
   
Restricted
Stock
   
Restricted
Stock
Units
   
Restricted
Stock
   
Restricted
Stock
Units
 
Outstanding, beginning of period
   
68
     
129
     
67
     
132
 
Granted
   
35
     
35
     
35
     
35
 
Vested
   
(32
)
   
(32
)
   
(32
)
   
(32
)
Forfeited
   
(5
)
   
(5
)
   
(2
)
   
(6
)
Outstanding, end of period
   
66
     
127
     
68
     
129
 
Note 10 - Segment Disclosures (Tables)
   
Three Months Ended March 31:
 
   
2017
   
2016
 
   
Motorsports
Event
Related
   
 
All
Other
   
 
Consolidated
   
Motorsports
Event
Related
   
All
Other
   
 
Consolidated
 
Revenues
  $
75,098
    $
5,227
    $
80,325
    $
77,276
    $
5,900
    $
83,176
 
Depreciation and amortization
   
17,467
     
38
     
17,505
     
13,328
     
43
     
13,371
 
Segment operating
(loss) income
   
(1,525
)
   
1,102
     
(423
)
   
3,381
     
1,403
     
4,784
 
Capital expenditures
   
7,049
     
5
     
7,054
     
18,329
     
26
     
18,355
 
   
Three Months Ended
 
   
March 31:
 
   
2017
   
2016
 
Total segment operating (loss) income
  $
(423
)
  $
4,784
 
Adjusted for:
               
Interest expense, net
   
(3,005
)
   
(3,339
)
Other expense, net
   
(578
)
   
(68
)
Consolidated (loss) income before income taxes
  $
(4,006
)
  $
1,377
 
   
 
March 31, 2017
   
December 31, 2016
 
Other intangibles
  $
298,383
     
    $
298,383
    $
298,383
     
    $
298,383
 
Goodwill
   
47,342
     
     
47,342
     
47,342
     
     
47,342
 
Total assets
   
1,479,228
    $
24,180
     
1,503,408
     
1,474,127
    $
24,022
     
1,498,149
 
Note 1 - Description of Business (Details Textual)
3 Months Ended 12 Months Ended
Mar. 31, 2017
Dec. 31, 2016
NASCAR [Member]
 
 
Number of Racing Events
24 
24 
NASCAR [Member] |
Monster Energy Cup [Member]
 
 
Number of Racing Events
13 
13 
NASCAR [Member] |
Xfinity Series Events [Member]
 
 
Number of Racing Events
11 
11 
NASCAR [Member] |
Camping World Trucks Series Events [Member]
 
 
Number of Racing Events
NASCAR [Member] |
K and N Pro Series Events [Member]
 
 
Number of Racing Events
NASCAR [Member] |
Whelen Modified Tour [Member]
 
 
Number of Racing Events
Indy Car Series [Member]
 
 
Number of Racing Events
National Hot Rod Association [Member]
 
 
Number of Racing Events
Automobile Racing Club of America [Member]
 
 
Number of Racing Events
World of Outlaws [Member]
 
 
Number of Racing Events
Note 2 - Significant Accounting Policies and Other Disclosures (Details Textual) (USD $)
3 Months Ended 12 Months Ended 3 Months Ended 3 Months Ended
Mar. 31, 2017
Mar. 31, 2016
Dec. 31, 2013
Dec. 31, 2016
Mar. 31, 2017
Texas Motor Speedway Inc. [Member]
Mar. 31, 2016
Texas Motor Speedway Inc. [Member]
Mar. 31, 2017
Charlotte Motor Speedway LLC [Member]
Mar. 31, 2017
Kentucky Speedway [Member]
Mar. 31, 2017
New Hampshire Motor Speedway, Inc. [Member]
Jan. 31, 2014
Motorsports Authentics [Member]
Mar. 31, 2017
Other Noncurrent Liabilities [Member]
Dec. 31, 2016
Other Noncurrent Liabilities [Member]
Mar. 31, 2017
Deferred Tax Liabilities [Member]
Dec. 31, 2016
Deferred Tax Liabilities [Member]
Mar. 31, 2017
Discontinued Operations [Member]
Dec. 31, 2016
Discontinued Operations [Member]
Mar. 31, 2016
Restatement Adjustment [Member]
Net Cash Provided by (Used in) Operating Activities
$ (7,770,000)
$ 25,731,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 90,000 
Effective Income Tax Rate Reconciliation, Percent
51.70% 
37.50% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deferred Tax Liabilities, Net
1,310,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deferred Tax Assets, Operating Loss Carryforwards, State and Local
515,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income Taxes Paid
200,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unrecognized Tax Benefits
12,006,000 
 
 
12,006,000 
 
 
 
 
 
 
11,794,000 
11,794,000 
212,000 
212,000 
11,746,000 
11,746,000 
 
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Amount of Unrecorded Benefit
260,000 
 
 
260,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued
145,000 
 
 
140,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity Method Investment, Ownership Percentage
 
 
 
 
 
 
 
 
 
50.00% 
 
 
 
 
 
 
 
Equity Method Investments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income Tax Expense (Benefit)
(2,071,000)
516,000 
48,100,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Excise and Sales Taxes
411,000 
366,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Advertising Expense
1,604,000 
1,927,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Royalty Revenue
 
 
 
 
448,000 
627,000 
 
 
 
 
 
 
 
 
 
 
 
Royalty Revenue, Distribution, Percentage
 
 
 
 
25.00% 
 
 
 
 
 
 
 
 
 
 
 
 
Number of Seats Removed
 
 
 
 
 
 
7,000 
17,000 
12,000 
 
 
 
 
 
 
 
 
Accelerated Depreciation and Removal Costs, Before Tax
4,597,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income Tax Expense (Benefit), Accelerated Depreciation and Removal Costs
(1,700,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Increase (Decrease) in Accounts Payable
92,000 
681,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
90,000 
Deferred Advertising Costs
$ 0 
 
 
$ 0 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note 2 - Significant Accounting Policies and Other Disclosures - Estimated Fair Values and Categorization Levels of Financial Instruments (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Dec. 31, 2016
Mar. 31, 2016
Dec. 31, 2015
Cash and cash equivalents
$ 53,585 
$ 79,342 
$ 79,273 
$ 82,010 
Reported Value Measurement [Member] |
Fair Value, Inputs, Level 2 [Member]
 
 
 
 
Cash and cash equivalents
53,585 
79,342 
 
 
Notes receivable
1,102 
1,143 
 
 
Cash surrender values
9,174 
8,919 
 
 
Floating rate revolving Credit Facility, including Term Loan
63,000 
66,000 
 
 
5.125% Senior Notes Payable due 2023
200,000 
200,000 
 
 
Other long-term debt
1,049 
1,206 
 
 
Estimate of Fair Value Measurement [Member] |
Fair Value, Inputs, Level 2 [Member]
 
 
 
 
Cash and cash equivalents
53,585 
79,342 
 
 
Notes receivable
1,102 
1,143 
 
 
Cash surrender values
9,174 
8,919 
 
 
Floating rate revolving Credit Facility, including Term Loan
63,000 
66,000 
 
 
5.125% Senior Notes Payable due 2023
202,000 
202,500 
 
 
Other long-term debt
$ 1,049 
$ 1,206 
 
 
Note 2 - Significant Accounting Policies and Other Disclosures - Estimated Fair Values and Categorization Levels of Financial Instruments (Details) (Parentheticals)
Dec. 31, 2016
Debt Instrument, Interest Rate, Stated Percentage
5.125% 
Note 3 - Inventories - Inventories Components (Details) (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2017
Dec. 31, 2016
Inventories, net
$ 8,549 
$ 8,212 
Finished Vehicles Parts and Accessories [Member]
 
 
Inventories, net
5,085 
5,263 
Souvenirs and Apparel [Member]
 
 
Inventories, net
2,687 
2,131 
Micro Lubricant and Other [Member]
 
 
Inventories, net
$ 777 
$ 818 
Note 4 - Goodwill and Other Intangible Assets (Details Textual) (USD $)
3 Months Ended
Mar. 31, 2017
Dec. 31, 2016
Mar. 31, 2017
Unrecognized [Member]
Mar. 31, 2017
Nonamortizable Race Event Sanctioning and Renewal Agreements [Member]
Dec. 31, 2016
Nonamortizable Race Event Sanctioning and Renewal Agreements [Member]
Mar. 31, 2017
NHMS and TMS [Member]
Nonamortizable Race Event Sanctioning and Renewal Agreements [Member]
Dec. 31, 2016
NHMS and TMS [Member]
Nonamortizable Race Event Sanctioning and Renewal Agreements [Member]
Indefinite-Lived Intangible Assets (Excluding Goodwill)
 
 
 
$ 298,383,000 
$ 298,383,000 
$ 199,600,000 
$ 98,800,000 
Goodwill, Impaired, Accumulated Impairment Loss
148,600,000 
148,600,000 
 
 
 
 
 
Other Intangible Assets, Impaired, Accumulated Impairment Loss
99,900,000 
99,900,000 
 
 
 
 
 
Goodwill, Impairment Loss
 
 
$ 0 
 
 
 
 
Note 4 - Goodwill and Other Intangible Assets - Gross Carrying Values and Accumulated Amortization by Class of Intangible Asset (Details) (USD $)
3 Months Ended
Mar. 31, 2017
Dec. 31, 2016
Mar. 31, 2017
Amortizable Race Event Sanctioning and Renewal Agreements [Member]
Dec. 31, 2016
Amortizable Race Event Sanctioning and Renewal Agreements [Member]
Mar. 31, 2017
Amortizable Race Event Sanctioning and Renewal Agreements [Member]
Minimum [Member]
Mar. 31, 2017
Amortizable Race Event Sanctioning and Renewal Agreements [Member]
Maximum [Member]
Mar. 31, 2017
Nonamortizable Race Event Sanctioning and Renewal Agreements [Member]
Dec. 31, 2016
Nonamortizable Race Event Sanctioning and Renewal Agreements [Member]
Indefinite-Lived Intangible Assets (Excluding Goodwill)
 
 
 
 
 
 
$ 298,383,000 
$ 298,383,000 
Amortizable race event sanctioning and renewal agreements
 
 
100,000 
100,000 
 
 
 
 
Amortizable race event sanctioning and renewal agreements
(100,000)
(100,000)
(100,000)
(100,000)
 
 
 
 
Amortizable race event sanctioning and renewal agreements (Year)
 
 
 
 
5 years 
6 years 
 
 
Total
298,483,000 
298,483,000 
 
 
 
 
 
 
Other intangibles
$ 298,383,000 
$ 298,383,000 
 
 
 
 
 
 
Note 5 - Long-term Debt (Details Textual) (USD $)
3 Months Ended 3 Months Ended 3 Months Ended 3 Months Ended 15 Months Ended
Mar. 31, 2017
Dec. 31, 2016
Mar. 31, 2017
Eurodollar [Member]
Mar. 31, 2017
Eurodollar [Member]
Minimum [Member]
Mar. 31, 2017
Eurodollar [Member]
Maximum [Member]
Mar. 31, 2017
Federal Funds Effective Swap Rate [Member]
Mar. 31, 2017
Prime Rate [Member]
Minimum [Member]
Mar. 31, 2017
Prime Rate [Member]
Maximum [Member]
Mar. 31, 2017
Revolving Credit Facility [Member]
Dec. 31, 2016
Revolving Credit Facility [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Minimum [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Maximum [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Term Loan [Member]
Mar. 31, 2016
The 2014 Amendment of Bank Credit Facility [Member]
Term Loan [Member]
Dec. 31, 2016
The 2014 Amendment of Bank Credit Facility [Member]
Term Loan [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Subject to Maintaining Certain Financial Covenants [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Senior Secured Revolving Credit Facility [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Revolving Credit Facility [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Standby Letters of Credit [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Swing Line Loans [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Senior Secured Term Loan [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Delayed Draw Term Loan [Member]
Mar. 31, 2017
The 2014 Amendment of Bank Credit Facility [Member]
Letter of Credit [Member]
Mar. 31, 2017
The 2019 Senior Notes [Member]
Delayed Draw Term Loan [Member]
Jan. 31, 2015
The 2023 Senior Notes [Member]
Mar. 31, 2017
Interest Bearing Debt Associated With BMS Purchase [Member]
Dec. 31, 2016
Interest Bearing Debt Associated With BMS Purchase [Member]
Debt Instrument, Term
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5 years 
 
 
 
5 years 
5 years 
 
 
 
 
 
Line of Credit Facility, Maximum Borrowing Capacity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 100,000,000 
$ 50,000,000 
$ 10,000,000 
 
$ 50,000,000 
 
 
 
 
 
Debt Instrument, Face Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
150,000,000 
 
 
 
200,000,000 
 
 
Revolving Credit Facility Accordion Feature
 
 
 
 
 
 
 
 
 
 
100,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Term Loan, Maximum Borrowing Capacity
 
 
 
 
 
 
 
 
 
 
200,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Agreement, Maximum Borrowing Capacity
 
 
 
 
 
 
 
 
 
 
250,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument Covenant, Maximum Dividends Payments and Repurchases of Securities
 
 
 
 
 
 
 
 
 
 
50,000,000 
 
 
 
 
 
75,000,000 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument Covenant Annual Capital Expenditures
 
 
 
 
 
 
 
 
 
 
75,000,000