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International Speedway Reports Results For The Third Quarter Of Fiscal 2004

10/07/04

~Results at High End of Expectations; Company Reiterates Fourth Quarter Guidance~ ~Announces Renewal of Multi-Year, Multi-Track Agreement with Pepsi~ ~Receives Proposal for Public/Private Partnership to Develop Motorsports Facility in Pacific Northwest~

DAYTONA BEACH, Fla., Oct. 7 /PRNewswire-FirstCall/ -- International Speedway Corporation (Nasdaq: ISCA)(OTC Bulletin Board: ISCB) ("ISC") today reported results for the third quarter and nine months ended August 31, 2004.

Third Quarter Comparison

Total revenues for the third quarter were $156.5 million compared to revenues of $160.5 million in the prior-year period. Prior period financial statements have been restated to reflect discontinued operations, net of tax, related to the previously announced sale of North Carolina Speedway. Operating income was $50.8 million during the period compared to $59.9 million in the third quarter of fiscal 2003. Net income for the third quarter of fiscal 2004 was $68.1 million, or $1.28 per diluted share, compared to net income of $36.0 million, or $0.68 per diluted share, in the prior-year period.

The timing of the Company's Labor Day NASCAR NEXTEL Cup and Busch series weekend significantly impacted results for this year's third quarter. Results for the 2003 third quarter include the Labor Day Cup/Busch weekend at Darlington, while the 2004 Labor Day weekend events at California will be included in 2004 fourth quarter results. Third quarter fiscal 2004 results also include, net of tax, a $36.3 million, or $0.68 per diluted share, gain on the sale of North Carolina's assets and a $0.7 million pre-tax non-cash charge for the net book value of assets removed related to the Daytona infield renovation project.

Year to Date Comparison

For the nine months ended August 31, 2004, total revenues increased to $419.9 million from $400.0 million in 2003. Prior period financial statements have been restated to reflect discontinued operations, net of tax, related to the sale of North Carolina. Operating income for the nine-month period was $121.3 million compared to $133.1 million in the prior year.

Year to date net income was $101.9 million, or $1.92 per diluted share, in 2004, which includes:

* Income, net of tax, from the discontinued operations of North Carolina of $3.1 million, or $0.06 per diluted share;

* the after-tax gain of $36.3 million, or $0.68 per diluted share, on the sale of North Carolina;

* the third quarter $0.7 million pre-tax non-cash charge for the net book value of assets removed related to the Daytona infield renovation project;

* a second quarter non-cash pre-tax charge of $13.2 million, or $0.16 per diluted share, for the impairment of Nazareth's long-lived assets; and

* a second quarter combined pre-tax charge of $6.6 million, or $0.08 per diluted share, associated with refinancing the Company's Senior Notes.

As stated above, results for the nine months ended August 31, 2003 include the Labor Day Cup event held at Darlington, while the 2004 Labor Day weekend event at California will be recorded in the fourth quarter.

In the first nine months of 2003, net income was $73.8 million, or $1.39 per diluted share, which includes:

* Income, net of tax, from the discontinued operations of North Carolina of $1.7 million, or $0.03 per diluted share;

* a non-cash pre-tax charge of $2.8 million, or $0.03 per diluted share, for the net book value of assets removed at Homestead-Miami Speedway; and

* a revenue contribution to ISC's Food, Beverage and Merchandise Income of $1.6 million, or $0.02 per diluted share, related to the Company's ongoing activities to audit third party vendors' sales reports for prior years.

GAAP to Non-GAAP Reconciliation

The following financial information is presented below using other than generally accepted accounting principles ("non-GAAP"), and is reconciled to comparable information presented using GAAP. Non-GAAP net income and diluted earnings per share below are derived by adjusting amounts determined in accordance with GAAP for certain items presented in the accompanying selected operating statement data, net of taxes. The adjustments relate to: (1) the presentation of North Carolina Speedway's operations and sale as discontinued; (2) the impairment of long-lived assets at Nazareth Speedway; (3) the write- off of the net book value of certain undepreciated assets removed in connection with a major track reconfiguration project at Homestead-Miami Speedway; and (4) charges associated with refinancing the majority of the Company's long-term debt. We believe such non-GAAP information is useful and meaningful to investors, and is used by investors and us to assess our core operations.

This non-GAAP financial information may not be comparable to similarly titled measures used by other entities and should not be considered as alternatives to operating income, net income or diluted earnings per share, which are determined in accordance with GAAP.

                                    (In Thousands, Except Per Share Amounts)
                                                   (Unaudited)

                                    Three Months Ended      Nine Months Ended
                                     Aug. 31   Aug. 31      Aug. 31   Aug. 31
                                       2003      2004         2003      2004

    Net income                       $35,953   $68,090      $73,809  $101,942

    Net loss (income), net of
     tax, from:
     Discontinued operations
      of North Carolina                 547        (50)      (1,742)   (3,074)
     Gain on sale of North
      Carolina                           --    (36,337)               (36,337)

    Income from continuing
     operations                      36,500     31,703       72,067    62,531

    Adjustments, net of tax:
     Impairment of long-lived
      assets at Nazareth                 --         --           --     8,591
     Homestead-Miami track
      reconfiguration                    --         --        1,726        --
     Interim interest on debt
      redeemed                           --         --           --       995
     Loss on early redemption
      of debt                            --         --           --     3,028

    Non-GAAP net income             $36,500    $31,703      $73,793   $75,145


    Diluted earnings per share        $0.68      $1.28        $1.39     $1.92

    Net loss (income), net of
     tax, from:
    Discontinued operations
     of North Carolina                 0.01         --        (0.03)    (0.06)
    Gain on sale of North
     Carolina                            --      (0.68)          --     (0.68)

    Income from continuing
     operations                        0.69       0.60         1.36      1.18

    Adjustments, net of tax:
     Impairment of long-lived
      assets at Nazareth                 --         --           --      0.16
     Homestead-Miami track
      reconfiguration                    --         --         0.03        --
     Interim interest on debt
      redeemed                           --         --           --      0.02
     Loss on early redemption
      of debt                            --         --           --      0.06

    Non-GAAP diluted earnings
     per share                        $0.69      $0.60        $1.39     $1.42

    Highlights of the third quarter of 2004 include:
    * Capacity crowds for Michigan's two NASCAR NEXTEL Cup races;

* sold-out attendance for Chicagoland's NEXTEL Cup and Busch weekend and Kansas' IRL IndyCar and NASCAR Craftsman Truck weekend;

* increased attendance for Watkins Glen's NEXTEL Cup event, Michigan's Busch and Craftsman Truck races and the IndyCar events at Richmond, Michigan and Nazareth; and

* despite a two-hour delay to the start of the NEXTEL Cup Pepsi 400 due to inclement weather, Daytona's race weekend posted record revenue, even after excluding the increase from NASCAR's broadcast rights revenue.

"ISC posted an excellent quarter with revenues up over ten percent on a comparable event basis," commented Lesa France Kennedy, President of ISC. "Revenue growth was driven by increased broadcast rights fees and higher sales primarily attributable to Americrown's expanded merchandising operations as of the beginning of this year. Also contributing to overall top line results were higher sponsorship, camping, hospitality, advertising and other motorsports related revenues for comparable events held in the quarter."

The 2004 third quarter benefited from ISC's renewal of its multi-year, multi-track official status agreement with Pepsi. Other than the collective ten-year deals Nextel has with the Company's facilities, Pepsi's agreement marks the single largest marketing partnership announced by ISC to date. Pepsi continues its status as the official soft drink of ISC and its facilities. In addition, Pepsi remains title sponsor of the July NEXTEL Cup race in Daytona.

Ms. Kennedy continued, "We are very excited to announce that we have extended our longstanding relationship with Pepsi. Our key market penetration and strengthening nationwide presence raises our value to major corporate partners. In addition, our focus on relationship management helps ISC's sponsors maximize their return on investment. We remain committed to securing similar multi-year, multi-track agreements, further enhancing revenue visibility and stability for the Company."

Recent Events

To date in the fourth quarter, ISC has hosted several successful major events, including:

* The inaugural Pop Secret 500 weekend at California Speedway, the result of realignment of the NEXTEL Cup schedule. The event, which finished "under the lights," posted a more than 50 percent attendance increase over the same Labor Day weekend race held at Darlington in 2003.

* Richmond posted record weekend attendance and a sold-out NEXTEL Cup Chevy Rock and Roll 400. The final race before the Chase for the NEXTEL Cup featured thrilling door-to-door racing as drivers competed for an opportunity to become the first NEXTEL Cup Champion. Television viewership grew 15% over the prior year, resulting in the largest television audience for an event at the facility.

* Chicagoland recorded sold-out attendance for its IRL IndyCar and ARCA racing weekend.

* California hosted an exciting Craftsman Truck/IRL IndyCar weekend highlighted by Tony Kanaan's clinching of the 2004 IndyCar Championship with his second place finish in the Toyota Indy 400.

* Talladega posted increased attendance for its successful ARCA/NEXTEL Cup weekend. Dale Earnhardt Jr. recorded his fifth win of the season and fifth career victory at Talladega, placing him second only to his father, Dale Earnhardt, for most career victories at the facility. Viewership for the event was strong as overnight results posted a six percent increase over the prior year.

For the remainder of the fourth quarter, the Company will host a sold-out NASCAR NEXTEL Cup/Busch series weekend at Kansas, and a Craftsman Truck/NEXTEL Cup weekend at newly acquired Martinsville Speedway. In addition, ISC will host three consecutive NASCAR triple-header weekends at Phoenix, Darlington and the season finale Ford Championship Weekend at Homestead-Miami Speedway in November. Advanced ticket sales for these events are trending ahead of the prior year.

Regarding the Company's ongoing expansion efforts in the New York metropolitan area, due diligence continues on the collection of land parcels identified on Staten Island. The land purchase will depend on the outcome of that process. However, even if the property is purchased, the ultimate decision to develop a motorsports facility will be based on the overall results of a detailed feasibility study, including estimated construction cost, availability of public financing, permitting considerations, traffic and transportation analyses, and other necessary project reviews. The Company remains optimistic for its prospects to bring NASCAR racing to New York City.

In the Pacific Northwest, the Company has identified a preferred site for the development of a motorsports facility in Snohomish County, approximately 30 miles north of Seattle, Washington, the country's 12th largest media market. On October 6, City of Marysville and Snohomish County officials presented a proposal for a public/private partnership to Washington's Legislative Committee on Economic Development and International Relations. While it is too early to know if any public participation will materialize, as it will require approval by the Washington Legislature, ISC is excited to take this important next step toward building a major motorsports venue in this underserved region of the country.

Outlook

The Company reiterates its previously issued fourth quarter guidance for revenues of $220 to $225 million and earnings of $0.98 to $1.00 per diluted share.

"As evidenced by the strength of our advanced ticket sales, we are on track for another record fourth quarter," Ms. France Kennedy continued. "We are especially excited about hosting our first NEXTEL Cup and Craftsman Truck events since purchasing Martinsville in July. Advanced sales for the Subway 500 race weekend are trending solidly ahead of 2003 -- a testament to the excellent show put on there year after year. The facility and its outstanding management team have made a wonderful addition to the ISC family, and we look forward to contributing to their future success."

Ms. France Kennedy concluded, "Supported by our strong business fundamentals, we expect to post solid results during fiscal 2005. Contributing to next year's growth will be increased capacity at our facilities, including 1,600 grandstand seats at Kansas, and 900 club seats and six incremental luxury suites at Michigan. On the external developmental front, our efforts in New York and the Pacific Northwest are proceeding well, and we look forward to working diligently to bring those projects to fruition. Finally, industry initiatives including Nextel's sponsorship, Realignment and the Chase for the NEXTEL Cup are yielding important long-term results and we expect the sport's positive momentum will continue to build in 2005."

Conference Call Details

The management of ISC will host a conference call today with investors at 9:00 a.m. Eastern time. To participate, dial (973) 582-2710 five to ten minutes prior to the scheduled start time and request to be connected to the ISC earnings call. A live webcast will also be available at that time on the Company's Web site, www.iscmotorsports.com, under the "Investor Relations" section. This section has been expanded to include a full range of company, financial, corporate governance and other data that is useful to the financial community.

A replay will be available one hour after the end of the call through midnight Thursday, October 14, 2004. To access, dial (973) 341-3080 and enter the code 5162788, or visit the "Investor Relations" section of the Company's Web site.

International Speedway Corporation is a leading promoter of motorsports activities in the United States, currently promoting more than 100 events annually. The Company owns and/or operates 11 of the nation's major motorsports facilities, including Daytona International Speedway in Florida (home of the Daytona 500); Talladega Superspeedway in Alabama; Michigan International Speedway located outside Detroit; Richmond International Raceway in Virginia; California Speedway near Los Angeles; Kansas Speedway in Kansas City, Kansas; Phoenix International Raceway in Arizona; Homestead-Miami Speedway in Florida; Martinsville Speedway in Virginia; Darlington Raceway in South Carolina; and Watkins Glen International in New York. Other track ownership includes Nazareth Speedway in Pennsylvania and an indirect 37.5% interest in Raceway Associates, LLC, which owns and operates Chicagoland Speedway and Route 66 Raceway near Chicago, Illinois.

The Company also owns and operates MRN Radio, the nation's largest independent sports radio network; DAYTONA USA, the "Ultimate Motorsports Attraction" in Daytona Beach, Florida, the official attraction of NASCAR; and subsidiaries which provide catering services, food and beverage concessions, and produce and market motorsports-related merchandise under the trade name "Americrown." For more information, visit the Company's Web site at 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.

                      Consolidated Statements of Operations
                     (In Thousands, Except Per Share Amounts)
                                   (Unaudited)

                                  Three Months Ended       Nine Months Ended
                                       August 31,              August 31,
                                    2003        2004        2003        2004
    REVENUES:
      Admissions, net             $62,673     $56,735    $150,975    $147,358
      Motorsports related
       income                      74,806      75,753     191,944     211,709
      Food, beverage and
       merchandise income          21,612      22,083      52,766      55,769
      Other income                  1,449       1,912       4,320       5,030
                                  160,540     156,483     400,005     419,866

    EXPENSES:
      Direct expenses:
        Prize and point fund
         monies and NASCAR
         sanction fees             26,329      23,278      68,786      69,919
        Motorsports related
         expenses                  31,610      33,041      74,960      79,957
        Food, beverage and
         merchandise expenses      12,053      14,997      29,547      35,748
      General and
       administrative expenses     20,169      23,243      59,765      66,503
      Depreciation and
       amortization                10,470      11,159      30,980      33,179
      Impairment of long-
       lived assets                    --          --          --      13,217
      Homestead-Miami Speedway
       track reconfiguration           --          --       2,829          --
                                  100,631     105,718     266,867     298,523

    Operating income               59,909      50,765     133,138     121,343
    Interest income                   554       1,065       1,245       2,824
    Interest expense               (5,834)     (4,833)    (17,617)    (17,301)
    Loss on early redemption
     of debt                           --          --          --      (4,988)
    Equity in net income from
     equity investments             5,176       5,253       2,154       2,318

    Income from continuing
     operations before income
     taxes                         59,805      52,250     118,920     104,196
    Income taxes                   23,305      20,547      46,853      41,665

    Income from continuing
     operations                    36,500      31,703      72,067      62,531
    (Loss) income from
     discontinued operations,
     net of income taxes             (547)         50       1,742       3,074
    Gain on sale of
     discontinued operations,
     net of income taxes               --      36,337          --      36,337
    Net income                    $35,953     $68,090     $73,809    $101,942

    Basic earnings per share:
      Income from continuing
       operations                   $0.69       $0.60       $1.36       $1.18
      (Loss) income from
       discontinued operations      (0.01)         --        0.03        0.06
      Gain on sale of
       discontinued
       operations                      --        0.68          --        0.68
      Net income                    $0.68       $1.28       $1.39       $1.92

    Diluted earnings per share
      Income from continuing
       operations                   $0.69       $0.60       $1.36       $1.18
      (Loss) income from
       discontinued operations      (0.01)         --        0.03        0.06
      Gain on sale of
       discontinued
       operations                      --        0.68          --        0.68
      Net income                    $0.68       $1.28       $1.39       $1.92

    Dividends per share             $0.00       $0.00       $0.06       $0.06

    Basic weighted average
     shares outstanding        53,064,693  53,092,962  53,054,252  53,079,888

    Diluted weighted average
     shares outstanding        53,135,632  53,194,807  53,127,718  53,175,098



                           Consolidated Balance Sheets
                                 (In Thousands)

                                         November 30, 2003   August 31, 2004
                                                                (Unaudited)

    ASSETS
    Current Assets:
         Cash and cash equivalents                $223,973          $286,133
         Short-term investments                        201               200
         Receivables, less allowance of
          $1,500 in 2003 and 2004                   37,996            46,104
         Inventories                                 5,496             9,600
         Prepaid expenses and other
          current assets                             4,078            17,950
    Total Current Assets                           271,744           359,987

    Property and Equipment, net of
     accumulated depreciation of $235,672
     and $254,247, respectively                    884,623           926,662
    Other Assets:
         Equity investments                         33,706            36,023
         Intangible assets, net                      1,033           149,000
         Goodwill                                   92,542            98,688
         Other                                      20,144            21,828
                                                   147,425           305,539
    Total Assets                                $1,303,792        $1,592,188

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current Liabilities:
         Current portion of long-term
          debt                                    $232,963            $7,390
         Accounts payable                           15,739            32,710
         Deferred income                           106,998           159,847
         Income taxes payable                        6,877             3,667
         Other current liabilities                  13,928            18,432
    Total Current Liabilities                      376,505           222,046

    Long-Term Debt                                  75,168           369,893
    Deferred Income Taxes                          113,414           161,483
    Long-Term Deferred Income                       11,894            11,772
    Other Long-Term Liabilities                        346               198
    Commitments and Contingencies                       --                --
    Shareholders' Equity:
         Class A Common Stock, $.01 par
          value, 80,000,000 shares
          authorized; 28,359,173 and
          28,692,895 issued and outstanding
          at November 30, 2003 and
          August 31, 2004, respectively                283               287
         Class B Common Stock, $.01 par
          value, 40,000,000 shares
          authorized; 24,858,610 and
          24,575,152 issued and outstanding
          at November 30, 2003 and
          August 31, 2004, respectively                249               246
         Additional paid-in capital                694,719           696,846
         Retained earnings                          34,602           133,314
         Accumulated other comprehensive
          loss                                        (333)              (89)
                                                   729,520           830,604
         Less: unearned compensation-
          restricted stock                          (3,055)           (3,808)
    Total Shareholders' Equity                     726,465           826,796
    Total Liabilities and Shareholders'
     Equity                                     $1,303,792        $1,592,188



                      Consolidated Statements of Cash Flows

                                                  Nine Months Ended August 31,
                                                     2003              2004
                                                          (Unaudited)
                                                        (In Thousands)
    OPERATING ACTIVITIES
    Net income                                     $73,809          $101,942
         Adjustments to reconcile net
          income to net cash provided by
          operating activities:
          Gain on sale of discontinued
           operations                                   --           (63,926)
          Depreciation and amortization             32,500            34,022
          Amortization of unearned
           compensation                              1,280             1,270
          Amortization of financing
           costs                                       240                91
          Deferred income taxes                     25,958            48,069
          Undistributed loss from
           equity investments                       (2,154)           (2,318)
          Impairment of long-lived
           assets                                       --            13,217
          Homestead-Miami Speedway
           track reconfiguration                     2,829                --
          Loss on early redemption of
           debt                                         --             4,988
          Other, net                                   (49)              608
          Changes in operating assets
           and liabilities:
            Receivables, net                       (11,735)           (4,267)
            Inventories, prepaid
             expenses and other assets             (11,723)          (17,861)
            Accounts payable and
             other liabilities                       4,185             6,117
            Deferred income                         32,359            48,785
            Income taxes payable                     8,987            (3,152)
    Net cash provided by operating
     activities                                    156,486           167,585

    INVESTING ACTIVITIES
         Capital expenditures                      (42,116)          (71,524)
         Proceeds from asset disposals                 178                85
         Acquisition of business                        --          (193,745)
         Proceeds from sale of
          discontinued operations                       --           100,391
         Proceeds from affiliate                     4,075                --
         Proceeds from short-term
          investments                                  200               200
         Purchases of short-term
          investments                                 (200)             (200)
         Other, net                                 (1,034)             (477)
    Net cash used in investing activities          (38,897)         (165,270)

    FINANCING ACTIVITIES
         Proceeds from long-term debt                   --           299,570
         Payment of long-term debt                  (5,500)         (231,500)
         Payment of long-term debt
          redemption premium                            --            (5,340)
         Proceeds from interest rate
          swaps                                         --             2,771
         Cash dividends paid                        (3,193)           (3,196)
         Deferred financing costs                       --            (2,473)
         Reacquisition of previously
          issued common stock                         (336)             (386)
         Exercise of Class A common stock
          options                                       --               399
    Net cash (used in) provided by
     financing activities                           (9,029)           59,845

    Net increase in cash and cash
     equivalents                                   108,560            62,160
    Cash and cash equivalents at
     beginning of period                           109,263           223,973
    Cash and cash equivalents at end of
     period                                       $217,823          $286,133


SOURCE International Speedway Corporation