Championship Auto Racing Teams, Inc. Reports First Quarter 2001 Results

Apr 25, 2001, 01:00 ET from Championship Auto Racing Teams, Inc.

    DETROIT, April 25 /PRNewswire/ -- Championship Auto Racing Teams, Inc.
 (NYSE:   MPH) today announced revenues, expenses, net income and earnings per
 share for the first quarter ended March 31, 2001.
     The number of events held in a particular quarter will affect the
 comparability of earnings information from quarter to quarter.  CART conducted
 one event in the first quarter of 2001 and 2000.  Indy Lights conducted one
 race in the first quarter of 2001 compared to zero races in the same period in
 the prior year.  Toyota Atlantics conducted zero races in the first quarter of
 2001 compared to two races in the same period in the prior year.
     Total revenues for the first quarter of 2001 were $6.4 million, a decrease
 of $1.4 million, or 18%, from the comparable quarter of 2000.  "While our
 revenue performance was hindered by the loss of guaranteed income from our
 former sponsor partner, we are building our infrastructure in order to produce
 additional sponsorship revenue," said Thomas L. Carter, CART CFO.  "Sanction
 fee revenues, however, showed a significant increase due to our successful
 inaugural race in Monterrey, Mexico, where a record 318,000 spectators
 experienced our racing product over the three day race weekend."
     Total expenses for the first quarter of 2001 were $8.3 million, an
 increase of $2.1 million, or 34%, from the comparable quarter of 2000.
 Included in this increase was a pre-tax non-recurring charge of $386,000 that
 resulted from an employee severance agreement.  Net income for the first
 quarter of 2001 was $81,000 compared to net income of $2.0 million in the
 first quarter of 2000.  On a diluted per common share basis, earnings were
 $0.01 in 2001 compared to $0.13 in the first quarter of 2000.  The
 non-recurring severance expense resulted in a $.02 per diluted share charge,
 net of taxes, for the three-month period.
     "Our first quarter results reflect, in part, our effort to more frequently
 and effectively reach out to our consumers through expanded marketing
 activity," said Joseph F. Heitzler, CART President/CEO.  "We're going to
 continue to accomplish this by investing in our company, investing in our
 people and investing in programs that will increase our branding awareness."
     Championship Auto Racing Teams, Inc. will hold a teleconference today at
 11:00 a.m. EDT. Those interested in participating in the conference call
 should dial 888-769-8789 from both the United States and Canada.
 International participants should call 312-470-7412.  The password for the
 call is "Championship" and the leader is Thomas Carter.  Callers are asked to
 dial in approximately five minutes prior to the starting time.  An instant
 replay of the call will be available until close of business May 2, 2001, by
 dialing 800-284-8674 from both the United States and Canada.  International
 callers should call 402-998-1135.
 
     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
 http://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 Form 10-K and subsequent Forms
 10-Q.  Copies of those filings are available from the Company and the SEC.
 
                      Championship Auto Racing Teams, Inc.
                       Consolidated Statements of Income
               For the Three Months Ended March 31, 2001 and 2000
                   (In Thousands, Except Earnings Per Share)
 
                                                       (Unaudited)
                                               Qtr ended         Qtr ended
                                             March 31, 2001    March 31, 2000
 
     Revenues
 
     Sanction fees                                   $2,590            $1,433
     Sponsorship revenue                              2,954             4,901
     TV revenue                                         259               260
     Engine leases, rebuilds and wheel sales            271               451
     Other                                              365               803
 
     Total revenues                                   6,439             7,848
 
     Expenses
 
     Race distributions                                 741               820
     Race expenses                                    1,826             1,428
     Cost of engine rebuilds and wheel sales             99               136
     Administrative and indirect expenses             4,834             3,527
     Severance expense                                  386                --
     Depreciation and amortization                      402               287
 
     Total expenses                                   8,288             6,198
 
     Operating income (loss)                         (1,849)            1,650
     Interest income (net)                            1,975             1,495
 
     Income before income taxes                         126             3,145
     Income tax expense                                  45             1,132
 
     Net income                                         $81            $2,013
 
     Earnings per share:
          Basic                                       $0.01             $0.13
          Diluted                                     $0.01             $0.13
 
     Weighted average shares outstanding:
          Basic                                      15,765            15,587
          Diluted                                    15,766            15,731
 
 
                      Championship Auto Racing Teams, Inc.
                          Consolidated Balance Sheets
                   As of March 31, 2001 and December 31, 2000
                                 (In Thousands)
 
                                              (Unaudited)
                                             March 31, 2001   December 31, 2000
     Assets
 
     Current Assets
        Cash and cash equivalents                   $40,311            $19,504
        Short-term investments                       93,153             98,206
        Accounts receivable -- net                    6,060              5,578
        Current portion of notes receivable           1,832              2,535
        Prepaid expenses                                946                567
        Inventory                                       135                151
        Deferred income taxes                         2,395              2,485
 
     Total current assets                           144,832            129,026
 
     Notes receivable                                   134                147
 
 
     Property and equipment -- net                    7,206              7,327
 
     Goodwill -- net                                  7,199              7,248
 
     Other Assets                                       348                353
 
     Total Assets                                  $159,719           $144,101
 
     Liabilities and stockholders' equity
 
     Current liabilities
        Accounts payable                             $2,444             $1,975
        Accrued liabilities:
           Race Expenses and Point Awards               165                 --
           Royalties                                     93                162
           Payroll                                      481              1,571
           Taxes                                        525                819
           Other                                      1,934              1,316
        Deferred revenue                             18,523              2,452
        Deposits                                         --                778
 
     Total current liabilities                       24,165              9,073
 
     Deferred income taxes                            1,113              1,134
 
 
     Stockholders' equity
        Capital stock                                   158                158
        Additional paid-in capital                  103,130            103,130
        Retained earnings                            30,059             29,978
        Unrealized gain on investments                1,094                628
 
     Total stockholders' equity                     134,441            133,894
 
     Total liabilities and stockholders' equity    $159,719           $144,101
 
 
                     MAKE YOUR OPINION COUNT -- Click Here
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SOURCE Championship Auto Racing Teams, Inc.
    DETROIT, April 25 /PRNewswire/ -- Championship Auto Racing Teams, Inc.
 (NYSE:   MPH) today announced revenues, expenses, net income and earnings per
 share for the first quarter ended March 31, 2001.
     The number of events held in a particular quarter will affect the
 comparability of earnings information from quarter to quarter.  CART conducted
 one event in the first quarter of 2001 and 2000.  Indy Lights conducted one
 race in the first quarter of 2001 compared to zero races in the same period in
 the prior year.  Toyota Atlantics conducted zero races in the first quarter of
 2001 compared to two races in the same period in the prior year.
     Total revenues for the first quarter of 2001 were $6.4 million, a decrease
 of $1.4 million, or 18%, from the comparable quarter of 2000.  "While our
 revenue performance was hindered by the loss of guaranteed income from our
 former sponsor partner, we are building our infrastructure in order to produce
 additional sponsorship revenue," said Thomas L. Carter, CART CFO.  "Sanction
 fee revenues, however, showed a significant increase due to our successful
 inaugural race in Monterrey, Mexico, where a record 318,000 spectators
 experienced our racing product over the three day race weekend."
     Total expenses for the first quarter of 2001 were $8.3 million, an
 increase of $2.1 million, or 34%, from the comparable quarter of 2000.
 Included in this increase was a pre-tax non-recurring charge of $386,000 that
 resulted from an employee severance agreement.  Net income for the first
 quarter of 2001 was $81,000 compared to net income of $2.0 million in the
 first quarter of 2000.  On a diluted per common share basis, earnings were
 $0.01 in 2001 compared to $0.13 in the first quarter of 2000.  The
 non-recurring severance expense resulted in a $.02 per diluted share charge,
 net of taxes, for the three-month period.
     "Our first quarter results reflect, in part, our effort to more frequently
 and effectively reach out to our consumers through expanded marketing
 activity," said Joseph F. Heitzler, CART President/CEO.  "We're going to
 continue to accomplish this by investing in our company, investing in our
 people and investing in programs that will increase our branding awareness."
     Championship Auto Racing Teams, Inc. will hold a teleconference today at
 11:00 a.m. EDT. Those interested in participating in the conference call
 should dial 888-769-8789 from both the United States and Canada.
 International participants should call 312-470-7412.  The password for the
 call is "Championship" and the leader is Thomas Carter.  Callers are asked to
 dial in approximately five minutes prior to the starting time.  An instant
 replay of the call will be available until close of business May 2, 2001, by
 dialing 800-284-8674 from both the United States and Canada.  International
 callers should call 402-998-1135.
 
     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
 http://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 Form 10-K and subsequent Forms
 10-Q.  Copies of those filings are available from the Company and the SEC.
 
                      Championship Auto Racing Teams, Inc.
                       Consolidated Statements of Income
               For the Three Months Ended March 31, 2001 and 2000
                   (In Thousands, Except Earnings Per Share)
 
                                                       (Unaudited)
                                               Qtr ended         Qtr ended
                                             March 31, 2001    March 31, 2000
 
     Revenues
 
     Sanction fees                                   $2,590            $1,433
     Sponsorship revenue                              2,954             4,901
     TV revenue                                         259               260
     Engine leases, rebuilds and wheel sales            271               451
     Other                                              365               803
 
     Total revenues                                   6,439             7,848
 
     Expenses
 
     Race distributions                                 741               820
     Race expenses                                    1,826             1,428
     Cost of engine rebuilds and wheel sales             99               136
     Administrative and indirect expenses             4,834             3,527
     Severance expense                                  386                --
     Depreciation and amortization                      402               287
 
     Total expenses                                   8,288             6,198
 
     Operating income (loss)                         (1,849)            1,650
     Interest income (net)                            1,975             1,495
 
     Income before income taxes                         126             3,145
     Income tax expense                                  45             1,132
 
     Net income                                         $81            $2,013
 
     Earnings per share:
          Basic                                       $0.01             $0.13
          Diluted                                     $0.01             $0.13
 
     Weighted average shares outstanding:
          Basic                                      15,765            15,587
          Diluted                                    15,766            15,731
 
 
                      Championship Auto Racing Teams, Inc.
                          Consolidated Balance Sheets
                   As of March 31, 2001 and December 31, 2000
                                 (In Thousands)
 
                                              (Unaudited)
                                             March 31, 2001   December 31, 2000
     Assets
 
     Current Assets
        Cash and cash equivalents                   $40,311            $19,504
        Short-term investments                       93,153             98,206
        Accounts receivable -- net                    6,060              5,578
        Current portion of notes receivable           1,832              2,535
        Prepaid expenses                                946                567
        Inventory                                       135                151
        Deferred income taxes                         2,395              2,485
 
     Total current assets                           144,832            129,026
 
     Notes receivable                                   134                147
 
 
     Property and equipment -- net                    7,206              7,327
 
     Goodwill -- net                                  7,199              7,248
 
     Other Assets                                       348                353
 
     Total Assets                                  $159,719           $144,101
 
     Liabilities and stockholders' equity
 
     Current liabilities
        Accounts payable                             $2,444             $1,975
        Accrued liabilities:
           Race Expenses and Point Awards               165                 --
           Royalties                                     93                162
           Payroll                                      481              1,571
           Taxes                                        525                819
           Other                                      1,934              1,316
        Deferred revenue                             18,523              2,452
        Deposits                                         --                778
 
     Total current liabilities                       24,165              9,073
 
     Deferred income taxes                            1,113              1,134
 
 
     Stockholders' equity
        Capital stock                                   158                158
        Additional paid-in capital                  103,130            103,130
        Retained earnings                            30,059             29,978
        Unrealized gain on investments                1,094                628
 
     Total stockholders' equity                     134,441            133,894
 
     Total liabilities and stockholders' equity    $159,719           $144,101
 
 
                     MAKE YOUR OPINION COUNT -- Click Here
                http://tbutton.prnewswire.com/prn/11690X48676773
 
 SOURCE   Championship Auto Racing Teams, Inc.