Dover NASCAR track's TV revenues are strong despite the pandemic
Despite a canceled Firefly Music Festival and no fans at NASCAR races, Dover International Speedway appears to be piecing together its pandemic-addled finances this year through steadily rising TV revenues.
While the racetrack has been hampered by the pandemic, NASCAR overall has performed better financially than other professional sports whose seasons have been shortened, said Denis McGlynn, CEO of Dover Motorsports Inc, the parent company that owns and operates Delaware's NASCAR track.
"I got to give (NASCAR) a whole lot of credit for developing health protocols that allowed us to at least get through our August doubleheader weekend, albeit without fans," he said.
On Thursday, Dover Motorsports reported it took in $35.6 million in broadcasting money during the first nine months of 2020. While about $9 million of those revenues were recorded as profits, expenses over the final three months of the year will eat into the figure.
The company made $34.3 million from broadcasting contracts and another $11.5 million from other revenues in all of 2019. It recorded a profit of $5.5 million that year.
Asked whether 2020 is expected to be better or worse than 2019, CEO Denis McGlynn said "intuitively, an event without fans has to have an impact."
"But this is a conversation that will be much easier after our 4th quarter earnings come out," he said.
WANING INTEREST? Grandstands continue to shrink at NASCAR's Monster Mile in Delaware
The Dover company, one of Kent County's anchor employers in the private sector, is expected to report its fourth-quarter and full-year earnings next January.
In any year, money from TV accounts for the majority of revenues for the racetrack, also known as the Monster Mile.
McGlynn said Dover Motorsports' TV deal with NASCAR, which goes through 2024, ensures the company receives incrementally higher broadcasting revenues each year.
"By contract with NASCAR," he said, "it has to grow."
Thursday's earnings report provides a degree of financial clarity for Dover Motorsports, which suffered under a cloud of uncertainty last spring after races were postponed and Firefly festival officials pulled the plug on the four-day June event that attracts tens of thousands of young people to the speedway property.
"The health and safety of our fans and our country takes precedence over live sports and entertainment events," Mike Tatoian, CEO of Dover Motorsports' subsidiary Dover International Speedway, said at the time.
In April, the publicly traded company's stock price had fallen about 40% from the beginning of the year. It has regained about half of the lost value in the months since.
Thursday's report also follows years of waning attendance at NASCAR facilities across the country and comes after the Delaware racetrack suffered a localized blow last year when NASCAR announced that Dover's races would no longer be part of the final 10 that constitute the championship playoffs.
Also, last year, Dover Motorsports announced it would reduce seating at its grandstands to 54,000 from 83,000. Before 2009, capacity stood at 135,000.
Rebuilding the grandstand with fewer seats cost the company about $1.5 million. It was one of two major construction projects at the track last year, as the company also built a new $5.5 million race car garage.
Because of the smaller grandstands, Dover's third-quarter depreciation expenses, which represent a book value rather than real dollars flowing out, were less than half the amount paid the previous year.
Contact Karl Baker at email@example.com or (302) 324-2329. Follow him on Twitter @kbaker6.