ISC Puts Focus on Prospecting & Deeper Partner ROI
International Speedway Corporation, in quarterly results released yesterday, says the "macroeconomic downturn continues to impact business," despite adjustments to ticket pricing and cost-cutting measures. Total revenues for the third quarter decreased to $172.9 million, compared to revenues of $213.2 million in the prior-year period, causing the stock to drop 2% in trading today. Net income for the third quarter was $4.4 million, compared to net income of $38.8 million a year ago.
While the company has implemented reduced ticket pricing initiatives to spur renewal and loyalty for the remainder of this year and into next, "from a marketing partnership perspective, the Company has agreements in place for substantially its entire revised gross marketing partnership revenue target for fiscal 2009" including all 2009 NASCAR Sprint Cup and Nationwide series event entitlements.
ISC says they have stepped up sponsorship prospecting and put more attention on providing deeper ROI insights to current sponsors.
“We are pleased with this performance given the state of the economy,” stated ISC Chief Executive Officer Lesa France Kennedy. “We are confident that sponsorship in NASCAR provides our partners with a strong return on investment. However, looking ahead into next year, we expect to continue to face a difficult climate regarding the sales and renewals of corporate sponsorships. Our team is doing a great job of managing this process by active prospecting and working with existing partners to ensure their ROI and keep them involved in the sport."
In the company's results, ISC talked about one potentially troubling development for motorsports teams. Motorsports Authentics, a maker of diecast cars and apparel and a 50/50 joint venture with Speedway Motorsports, has stopped paying some certain guaranteed royalties to teams under licensing agreements where estimated owed royalties based on projected sales were less than stipulated guaranteed minimum royalties payable. Some licensors have alleged default if it does not pay unearned royalties within stipulated periods. If Motorsports Authentics is unable to renegotiate agreements, it could face bankruptcy.