NASCAR’s downfall leads to huge SMI loss

Speedway Motorsports Inc. reported its first quarterly loss in three years Wednesday, but executives said neither that nor a pending race track purchase would necessarily prevent Bruton Smith from building a new speedway in the Charlotte area.

Smith, chairman and CEO of Speedway Motorsports, has threatened to close Lowe's Motor Speedway in Concord — where he and local leaders have sparred over a proposed drag strip — and build a $350 million track elsewhere in the region. He also announced last week that his company will buy the New Hampshire International Speedway for $340 million in cash.

Amid those planned and potential expenses, Speedway Motorsports showed a loss of about $13.6 million for the third quarter — down from a profit of $4.7 million in the same period last year. The company's 2007 net income through Sept. 30 dipped to $58.6 million, down 29 percent from $82.4 million in 2006.

Shares in Concord-based Speedway Motorsports closed Wednesday at $35.39, down almost 8 percent.

Executives blamed the third-quarter decline mostly on losses at Motorsports Authentics, a joint merchandising venture with rival International Speedway Corp., saying Speedway Motorsports otherwise would have had a $4.4 million profit. [If NASCAR was still as popular as it once was, merchandise sales would not be off so much]

In addition, the third quarter usually is the company's least profitable. Only two major NASCAR races are held at its venues — the company has six large speedways — between July 1 and Sept. 30, while other quarters have five or six races.

Still, the fact that Speedway Motorsports reported its first loss since the fall of 2004 as Smith considers nearly $700 million between two projects raises the question of whether he could pull both of them off. More at Charlotte Observer