DETROIT (February 23, 2001) - Championship Auto Racing Teams, Inc. (NYSE: MPH) today announced revenues, expenses, net income and earnings per share for the fourth quarter and year-ended December 31, 2000. The number of events held in a...
DETROIT (February 23, 2001) - Championship Auto Racing Teams, Inc. (NYSE: MPH) today announced revenues, expenses, net income and earnings per share for the fourth quarter and year-ended December 31, 2000.
The number of events held in a particular quarter will effect the comparability of earnings information from quarter to quarter. CART conducted three events in the fourth quarter of 2000 compared to two events in the same period in the prior year.
Total revenues for the fourth quarter of 2000 were $14.5 million, an increase of $3.5 million, or 32%, from the comparable quarter of 1999.
Total expenses for the fourth quarter of 2000 were $17.9 million, an increase of $10.6 million, or 144%, from the comparable quarter of 1999. Included in this increase was a pre-tax non-recurring charge of $6.3 million.
The $6.3 million charge resulted from a minimum guarantee commitment from ISL Marketing AG (ISL) for 2000, which was payable in January 2001. In 1998, ISL signed a nine (9) year contract to become CART's exclusive marketing agent for solicitation of sponsorship agreements. The contract guaranteed CART a minimum amount of sponsorship revenue for each year of the agreement. Following recent discussions with ISL, it has been determined that ISL does not intend to fulfill its commitment with respect to the remaining years of the agreement under its original terms and collectability of the guarantee for 2000 is uncertain.
Net loss for the fourth quarter of 2000 was ($754,000) compared to net income of $3.2 million in the fourth quarter of 1999. On a diluted per common share basis, the loss is ($0.05) in 2000 compared to earnings of $0.20 in the fourth quarter of 1999.
For the year ended December 31, 2000, revenues increased 9% to $75.0 million from $68.8 million. Total expenses increased 33% to $58.8 million from $44.3 million. The increase was partially attributable to the charge regarding the ISL minimum guarantee as described previously and a $2.8 million pre-tax non-recurring charge related to a severance agreement with the Company's former President and CEO. Net income decreased 20% to $15.2 million from $18.9 million. On a diluted per common share basis, earnings were $0.97 compared to $1.19 for the year-ended December 31, 1999.
CART has added one additional race to the CART FedEx Championship Series schedule and will have four inaugural races in 2001. The inaugural races will be held in Mexico, Germany, England and Dallas, Texas. In addition, CART expects to have 30 or more cars racing for the championship in 2001, an increase of 20% from an average of 25 cars for the 2000 season.
"The addition of four inaugural race venues, additional teams, cars and drivers show the increase in popularity and demand for CART races both domestically and worldwide. We believe that this increased demand can provide the impetus to expand CART's television presence on a worldwide basis and attract new domestic and international sponsors," stated Joe Heitzler, the Company's President/CEO. "As the worldwide appeal of our product continues to expand, we remain confident that we have a strong base on which to grow our sport and business in the future."
Championship Auto Racing Teams, Inc. (NYSE: MPH) owns, operates and markets the FedEx Championship Series. Champions Michael Andretti, Gil de Ferran, Alex Zanardi and Jimmy Vasser are among the drivers who battle for the FedEx Championship Series title on oval circuits as well as temporary and permanent road courses. CART also owns and operates its top two development series, the Dayton Indy Lights Championship and the Toyota Atlantic Championship. Learn more about CART's open-wheel racing series at www.cart.com.
Statements made in this release that state the Company's or management's beliefs or expectations and which are not historical facts or which apply prospectively are forward-looking statements. It is important to note that the Company's actual results could differ materially from those contained or implied by such forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company's SEC filings including, but not limited to, the 10-K and subsequent 10-Q's. Copies of those filings are available from the Company and the SEC.
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