When Speedway Motorsports Inc. bought New Hampshire Motor Speedway in January 2008 for $340 million in cash, it was an indication of what a track that hosted NASCAR races was worth then.
A little less than eight years later, despite increased television revenues, the track-operating company founded by Bruton Smith devalued the 1.058-mile racetrack by approximately $100 million as part of its 2015 second quarter financial report that was released Wednesday.
"If we had to do it again, obviously we wouldn't pay quite so much," SMI chief financial officer Bill Brooks said in a conference call Wednesday with financial analysts.
With the facility having two Sprint Cup dates and an avid fan base, SMI agreed to the deal in September 2007 just prior to the financial downturn. For comparison, it bought Kentucky Speedway, a 1.5-mile facility with no Sprint Cup dates at the time, for $78.3 million in December 2008.
Brooks said of the $340 million purchase price for the New Hampshire track, approximately $300 million was for the two Sprint Cup race weekends the facility had at the time. He said the approximate $100 million devaluation of the facility relates to the worth of the events to the track.
The seating capacity at New Hampshire was recently reduced from 95,000 to 88,000. SMI reported Wednesday that the track has had ongoing lower-than-anticipated revenues for its major racing events, and its chance to recoup those revenues were limited "similar to challenges faced by many major sports" of increased entertainment options and more people preferring to watch the events at home.
SMI recorded a non-cash charge of $98.9 million on its latest financial statement and will get an income tax benefit of $38.4 million as a result. In documents filed Thursday night, SMI listed the devaluation of New Hampshire at $96.53 million and change in goodwill of $2.338 million resulting from NASCAR's transition to selling merchandise from a centrally located tent and not primarily through haulers and kiosks at the track.
The operator of eight tracks that have Sprint Cup races (Atlanta, Bristol, Charlotte, Kentucky, Las Vegas, New Hampshire, Sonoma and Texas), SMI reported that ticket revenue was down 3.2 percent through June but that includes a weather-plagued Atlanta weekend in February -- its 2014 event was in August -- and does not include Kentucky, which last year had its race in June but this year was in July. Brooks said many of the 2015 race weekends are showing increased revenues over 2014.