International Speedway Corporation Announces Settlement With the Internal Revenue Service
03 6월 2009 - 7:50PM
PR Newswire (US)
~Company to Reactivate Open Market Share Repurchase Program~
DAYTONA BEACH, Fla., June 3 /PRNewswire-FirstCall/ -- International
Speedway Corporation (NASDAQ Global Select Market: ISCA; OTC
Bulletin Board: ISCB) ("ISC") announced today that it has entered
into a definitive settlement agreement (the "Settlement") with the
Internal Revenue Service (the "Service") in connection with the
previously disclosed federal income tax examination for its 1999
through 2005 fiscal years. In order to prevent incurring additional
interest, beginning in fiscal 2005 ISC deposited corporate funds
with the United States Treasury relating to this examination. As a
result of the Settlement, the Company expects the Service will
return to ISC approximately $97 million of its $118 million
deposit. Settlement Details In addition, the Company expects to
receive approximately $14 million in cash for interest earned on
the deposited funds to be returned. In its fiscal 2009 second
quarter results, ISC will record the interest income net of
applicable taxes and related adjustments through income tax
expense. The Company currently estimates that this will result in a
net tax benefit of approximately $9 million, or $0.18 per diluted
share after tax. ISC expects to receive its deposit, in excess of
the amount owed, and applicable interest within 30 days. The
Settlement concludes an examination process the Service opened in
fiscal 2002 that challenged the tax depreciation treatment of a
significant portion of ISC's motorsports entertainment facility
assets. Under Section 168 of the Internal Revenue Code and
applicable IRS guidance, there is a particular Asset Class and
corresponding depreciation period for theme and amusement parks and
other similar combinations of entertainment attractions. The
Company has consistently applied that Asset Class to its
motorsports entertainment facility assets. Under this
classification, assets are considered seven-year property for tax
purposes (i.e., depreciated over a seven-year period). The Service
disputed that the Asset Class applied to certain of the Company's
assets which were placed in service prior to October 23, 2004. The
Settlement reaches an appropriate compromise of this issue. It is
important to note in October 2008, legislation was passed that
provided a two-year extension of a provision in the tax code passed
by Congress in the Federal American Jobs Creation Act of 2004,
providing owners of motorsports entertainment facility assets a
seven-year recovery period for tax depreciation purposes. As such,
the provision currently applies to motorsports entertainment
facility assets placed into service by ISC from October 23, 2004
through December 31, 2009. As a result of the Settlement, the
Company is currently pursuing settlements on similar terms with the
appropriate state tax authorities. Under these terms, ISC expects
to pay between $6 million and $9 million in total to finalize the
settlements with the various states. It is important to note that
the Company has been providing adequate reserves related to these
state matters including interest charges. As such, ISC does not
expect any settlements will have a material adverse impact on
results of operations. Reactivation of Share Repurchase Program ISC
plans to immediately reactivate its previously authorized open
market share repurchase programs (the "Stock Purchase Plans") and
begin to purchase under certain parameters, which includes price,
corporate and regulatory requirements, capital availability and
other market conditions. The Stock Purchase Plans may be suspended
or discontinued at any time without prior notice. No shares will be
knowingly purchased from Company insiders or their affiliates. ISC
suspended purchases under the collective $250 million Stock
Purchase Plans in September 2008 as a result of its desire to build
cash balances due to the challenges facing the credit markets.
Currently, there is approximately $42 million in remaining
repurchase authority under the Stock Purchase Plans. The Company
views the prudent repurchase of shares as an important component of
its long-term capital allocation strategy designed to build
shareholder value. International Speedway Corporation is a leading
promoter of motorsports activities, currently promoting more than
100 racing events annually as well as numerous other
motorsports-related activities. The Company owns and/or operates 13
of the nation's major motorsports entertainment facilities,
including Daytona International Speedway(R) in Florida (home of the
Daytona 500(R)); Talladega Superspeedway(R) in Alabama; Michigan
International Speedway(R) located outside Detroit; Richmond
International Raceway(R) in Virginia; Auto Club Speedway of
Southern California(SM) near Los Angeles; Kansas Speedway(R) in
Kansas City, Kansas; Phoenix International Raceway(R) in Arizona;
Chicagoland Speedway(R) and Route 66 Raceway(SM) near Chicago,
Illinois; Homestead-Miami Speedway(SM) in Florida; Martinsville
Speedway(R) in Virginia; Darlington Raceway(R) in South Carolina;
and Watkins Glen International(R) in New York. In addition, ISC
promotes major motorsports activities in Montreal, Quebec, through
its wholly owned subsidiary, Stock-Car Montreal. The Company also
owns and operates MRN(R) Radio, the nation's largest independent
sports radio network; the Daytona 500 Experience(SM), the "Ultimate
Motorsports Attraction" in Daytona Beach, Florida, and official
attraction of NASCAR(R); and Americrown Service Corporation(SM), a
subsidiary that provides catering services, food and beverage
concessions, and produces and markets motorsports-related
merchandise. In addition, ISC has an indirect 50 percent interest
in Motorsports Authentics(R), which markets and distributes
motorsports-related merchandise licensed by certain competitors in
NASCAR racing. For more information, visit the Company's Web site
at http://www.iscmotorsports.com/. Statements made in this release
that express the Company's or management's beliefs or expectations
and which are not historical facts or which are applied
prospectively are forward-looking statements. It is important to
note that the Company's actual results could differ materially from
those contained in or implied by such forward-looking statements.
The Company's results could be impacted by risk factors, including,
but not limited to, weather surrounding racing events, government
regulations, economic conditions, consumer and corporate spending,
military actions, air travel and national or local catastrophic
events. 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-Qs. Copies of those filings are available from the
Company and the SEC. The Company undertakes no obligation to
release publicly any revisions to these forward-looking statements
that may be needed to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.
The inclusion of any statement in this release does not constitute
an admission by International Speedway or any other person that the
events or circumstances described in such statement are material.
DATASOURCE: International Speedway Corporation CONTACT: Charles N.
Talbert, Director, Investor and Corporate Communications,
+1-386-947-6465 Web Site: http://www.iscmotorsports.com/
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