ISCA
#Good morning, everyone, and I want to thank you for joining us today on our fourth-quarter call.
First of all, 2015 was an exceptional year for ISC, with our financial results exceeding expectations in growth in all areas of our core business.
In the second year of the new Chase format, the 2015 season continues to provide thrilling competition, culminating at the Homestead-Miami Speedway in front of a sold-out crowd.
We bid an emotional farewell to Jeff Gordon in his final season and cheered Kyle Busch to Victory Lane for his first NASCAR Sprint Cup championship.
2016 will mark a significant milestone for ISC and the Daytona International Speedway with the opening of DAYTONA Rising.
After 31 months of construction, the new facility will be fully operational beginning with this weekend's event, elevating the experience for all guests with improved amenities throughout the stadium.
Our fan response has been overwhelmingly positive.
We have nearly sold out of all the grandstand seats for the Daytona 500 and we've seen unprecedented participation in corporate sales and partner activation.
We expect to see continued growth in 2016 from attendance-related and corporate revenues as a result of our capacity management and guest experience initiatives.
Our non-motorsports activities will complement growth from our core business, including recently announced music festivals at Daytona and Talladega as well as continued growth from our investment in the Hollywood Casino at Kansas Speedway.
Finally, we continue to progress with ONE DAYTONA, our mixed-use real estate development across from the Daytona International Speedway.
The conceptual design of the project has been refined to include three components: retail dining and entertainment, hotels, and residential.
We are going to target the spring of 2016 for commencement for our vertical construction.
We expect our investment in Phase I of the project to meet or exceed our cost of capital.
So with that, I will now turn the call over to <UNK> <UNK> and he's going to tell you little bit more about our 2016 outlook.
Thanks.
Thanks, <UNK>, and good morning, everyone.
As <UNK> mentioned, quarterly results again exceeded our expectations for 2015 and we have great momentum heading into 2016.
2015 marked the second year of the new Chase format, which proved to be just as thrilling as the first, emphasizing the importance of winning races, from Joey Logano's sweep of the contender round, to Jeff Gordon's win at Martinsville that put him in contention for the championship, and culminating with Kyle Busch overcoming adversity early in the 2015 season to stand in Victory Lane at Homestead-Miami Speedway and secure his first NASCAR Sprint Cup championship.
During the quarter, we hosted eight Sprint Cup weekends, which included the return of the Bojangles' Southern 500 at Darlington to its traditional Labor Day date from the second quarter in recent years.
The event took spectators and the industry stakeholders back to its roots in a 1970s throwback themed event that featured retro paint schemes and uniforms across the track.
The success of the event was recognized throughout the industry and received the esteemed Myers Brothers award in Las Vegas.
We continue to see positive results in our core business, with increased attendance and admissions at every event where weather was not factor.
After adjusting for Darlington, which moved into the fourth quarter in 2015 from the second quarter in 2014, admissions increased 1.3% versus comparable events in the fourth quarter of 2014.
For the year, total admissions increased approximately 1.5% versus 2014, excluding the Coke Zero 400 at Daytona, which due to construction was limited to approximately 50,000 grandstand seats.
Average ticket price of grandstands for Sprint Cup events for the quarter was approximately $80.36 compared to $78.17 in 2014, an increase of approximately 2.8%.
For the year, average ticket price of grandstand seats for Sprint Cup events was $86.10 compared to $85.82 in 2014, an increase of just less than 1%.
For the year, we had sold out our reserve grandstand seats at four events: Auto Club Speedway, Homestead-Miami, Phoenix, and Watkins Glen.
Additionally, grandstand utilization in 2015 was approximately 89% compared to 87% in 2014.
We believe these increases are sustainable and a result of our capacity management and variable pricing initiatives.
Revenue from corporate partnerships was a bright spot for the quarter as well for full year, exceeding expectations and prior-year results.
Contributing significantly to this increase was the resurgence from MRN Advertising following the restructure of our agency agreement in 2014.
Also contributing to the increase was approximately $2.1 million of sponsor revenue, net of operating expenses, associated with DAYTONA Rising that was recognized in 2015.
This was also the first year of the industry's new 10-year broadcast agreements with Fox and NBC.
Regarding TV ratings, as I pointed out on previous calls, the year-over-year comparisons were complicated in 2015 due to changes in broadcaster lineup and network-versus-cable distribution week to week, and further challenged by impacts of inclement weather in the current and prior years.
During 2015, Sprint Cup averaged 5.1 million viewers per event.
Viewership on Fox increased 9% year over year.
On Fox Sports 1, five of the top 15 most viewed telecasts in 20 network history were 2015 Sprint Cup series events.
Sprint Cup races on NBC reached a total audience of 31 million people, up 42% versus comparable races in 2014.
On NBC Sports Network, five of the top 10 most watched telecasts in the network's history are 2015 NASCAR Sprint Cup races.
Finally, the Sprint Cup championship race from Homestead was the most-watched NASCAR season finale in a decade.
The Hollywood Casino at Kansas Speedway, our joint venture partnership with Penn Gaming, was a significant contributor towards the success of 2015.
Equity earnings for the year increased over 57% to $14.1 million, and cash contributions for the year totaled $32.1 million compared to $22 million in 2014.
Approximately $4.5 million of the increase is nonrecurring as a result of transitioning from quarterly to monthly distributions in 2015, the balance resulting from improved operating results.
For 2016, we expect cash distributions from the casino to be approximately $27 million to $28 million.
2016 is shaping up to be another great year.
I'm pleased to announce that after 31 months of construction, DAYTONA Rising has been completed on time and on budget, a significant accomplishment for a project of this size.
We recently received the CO and certificate of substantial completion.
The final seat was installed by our Chairman, Jim <UNK>, rendering the new stadium ready for full operation at this weekend's Rolex 24.
The project will contribute $20 million in revenue and $15 million in EBITDA towards ISC's growth.
The majority of this growth will come from corporate partnerships, including our four founding partners: Toyota, Chevrolet, Florida Hospital, and Sunoco, with these partnerships extending over 10 years.
Advanced ticket sales for Speedweeks are trending up, with expectations for a sellout of the Daytona 500.
Heading into the second quarter and the West Coast swing, advanced ticket sales for early Q2 events at Phoenix and California are trending up approximately 2%.
From a partnership perspective, for fiscal 2016, we have agreements in place for approximately 75% of our gross marketing partnership revenue target, which is projected to increase 11% from 2015.
We currently only have one Sprint Cup entitlement for 2016, which is in our fourth quarter.
Last year at this time, we had 74% of our gross marketing partnership revenue targets sold and one open Sprint Cup entitlement.
In 2016, we will look for additional growth from our non-motorsports events.
Last year, we announced music festivals at Daytona and Talladega.
Through a partnership with AEG Live, we will host the Country 500 at Daytona on May 27 through May 29, and Dega Jam at Talladega on July 1 through July 3.
These events will feature top talent, including Jason Aldean, Luke Bryan, Blake Shelton, and Toby Keith, among many other premier artists over the three-day event.
We have seen great success with music festivals at our other venues, including Faster Horses at Michigan, promoted by Live Nation.
Our facilities are well suited to host these events, with the expansive camping areas and programs that feature multiple performers on a number of stages across the property.
While we don't act as the promoter of these events, we will earn revenues and profits from providing concessions and other services to the event promoter and guests.
As <UNK> mentioned, we have completed the conceptual design for Phase I of ONE DAYTONA to include retail, dining, and entertainment, with previously announced anchor tenants Bass Pro and Cobb Theaters.
We estimate the total costs for developing Phase I to be approximately $120 million to $150 million.
Sources of funds will include in addition to borrowings on our credit facility public incentives and land to be contributed to the project.
Complementing the RD&E will be hotel and residential development.
We have executed agreements with Shaner Hotels and Prime Hospitality to construct both a Marriott Autograph Collection Hotel and a limited service hotel.
Additionally, Prime Group has been selected for a 300-unit rental apartment community.
As part of these agreements, our contribution of equity will be limited to our land and we will share in the profits of the joint ventures.
Vertical construction is expected to commence in the spring of 2016.
We expect our investment in Phase I of ONE DAYTONA to meet or exceed our cost of capital.
Any future phases will be subject to prudent business considerations.
We're excited about the growth opportunities for ISC in 2016 and the future.
We look forward to seeing you at Daytona for Speedweeks.
And now I will turn to call over to <UNK> to give you the financial review and guidance for 2016.
<UNK>.
Thanks, <UNK>, and good morning, everyone.
We are extremely pleased with our fourth-quarter and fiscal 2015 results, exceeding our earnings guidance for revenue and non-GAAP operating margin and EPS, driven by growth in the core business, non-motorsports-related events, and our joint venture in the Hollywood Casino at Kansas Speedway.
Items impacting year-over-year fourth-quarter comparability include: the Sprint Cup event held at Darlington Raceway in the fourth quarter 2015 was held in the second quarter 2014; certain costs associated with the 2016 opening of DAYTONA Rising, which are not capitalized, including marketing and consulting, accelerated depreciation, demolition and relocation of assets, partially offset by capitalized interest; income for a settlement of legal judgment related to certain ancillary operations in the fourth quarter 2014 with no comparable amount in 2015; the consolidation of Motorsports Authentics, including asset impairment in the fourth quarter of 2014 with no comparable transaction in 2015; certain elements of DAYTONA Rising project placed in service during 2015, which increased depreciation; a settlement of interest income related to a long-term receivable in the fourth quarter of 2014 with no comparable amount in 2015; and the Company and industry strategic change in the business model for merchandising officially licensed apparel and souvenirs.
All of these are outlined in the earnings news release and are included in the GAAP to non-GAAP reconciliation where appropriate.
Concerning merchandise operations, as we discussed on previous calls, beginning in 2015, NASCAR and NASCAR Team Properties entered a 10-year agreement with Fanatics to operate NASCAR's entire at-track merchandise business.
In addition, Fanatics also contracted with ISC for 10-year exclusive retail merchandise rights at our track for our track trademarks and certain other intellectual property at all ISC tracks.
Consequently, ISC's wholly owned subsidiaries, Americrown and MA, no longer provide at-track merchandise to fans at motorsports events and therefore no longer earn and recognize the related revenue or incur the related expenses.
Instead, we receive a percentage of sales from Fanatics recorded as part of food, beverage, and merchandise revenue.
For the fourth quarter of fiscal 2016, ISC recognized approximately $1.9 million in commissions related to merchandise sales.
This compares to the fourth quarter of fiscal 2014, where we recognized revenue and expense related to merchandise operations of approximately $11.6 million and $10 million, respectively.
For the full year of fiscal 2015, ISC recognized revenue and expense related to merchandise operations of approximately $16.5 million and $12.3 million, respectively, including $5.1 million of commissions related to merchandise sales predominantly from Fanatics and approximately $10.4 million and $12.3 million in revenue and expense, respectively, related to nonrecurring merchandise sales and cost to transition the business.
This compares to fiscal 2014, where we recognized merchandise revenue and expense of approximately $44.1 million and $35.5 million, respectively.
Looking to the income statement, admissions revenue for the fourth quarter was $42.3 million, an increase of approximately $4.6 million compared to the same period in 2014.
The increase is primarily related to the date change for the Darlington NASCAR weekend as well as increased admissions for Sprint Cup Chase events held during the quarter, slightly offset by lower admissions at Richmond, which was impacted by rain.
The increase in motorsports-related revenues to $162.7 million was primarily due to the Darlington date change and increased TV broadcast rights.
Also contributing to the increase were corporate sales, primarily MRN advertising.
ISC's domestic television broadcast and ancillary revenues were $115.8 million for the quarter and $314.5 million for the year.
The decrease in food, beverage, and merchandise revenue to $10.5 million is primarily a result of the previously discussed change in merchandise operations, partially offset by the Darlington date change and to a lesser extent an increase in concessions and catering at Sprint Cup events during the quarter.
NASCAR event management fees increased to $63.8 million.
The increase is due to the Darlington date change, variable costs driven by higher television broadcast rights fees for the NASCAR Sprint cup, XFINITY, and Camping World Truck Series events, and to a lesser extent increases in non-TV NASCAR event management fees.
Motorsports-related expense increased to $39 million.
The increase is primarily related to the Darlington date change and to a lesser extent personnel-related expenses and incremental costs for certain events, largely driven by inclement weather.
Food, beverage, and merchandise expense decreased to $7.8 million, primarily a result of the previously discussed change in merchandise operations, partially offset by the Darlington date change.
General and administrative expense increased to $30.6 million.
The increase is primarily due to certain personnel-related expenses, including merit pay increases and healthcare and to a lesser extent maintenance and utility costs at certain properties.
Depreciation and amortization expense decreased to $21.7 million for the quarter, largely due to higher accelerated depreciation in 2014 associated with the removal of assets for DAYTONA Rising.
Excluding this charge, depreciation increased approximately $2 million compared to the fourth quarter of fiscal 2014, primarily related to new DAYTONA Rising assets placed in service during 2015.
Specific to DAYTONA Rising, accounting conventions during the construction period and also when DAYTONA comes online impact financial reporting.
For DAYTONA Rising, we recognize accelerated depreciation, certain removal costs, and losses on retirements of assets totaling approximately $45.4 million since inception of the project.
In addition, we have significant capitalized interest through the project, which I will discuss shortly.
Losses on asset retirements increased to $4.4 million, primarily due to the removal of certain assets not fully depreciated in connection with DAYTONA Rising.
Interest income decreased approximately $1.9 million to $72,000, largely due to a non-routine settlement of interest related to a long-term receivable in the fourth quarter of fiscal 2014.
Excluding this income, interest for the period was comparable to the same period of the prior year.
Interest expense increased to $2.8 million due to lower capitalized interest on DAYTONA Rising.
Equity and net income from equity investments of approximately $2.8 million represents our 50% interest in the Hollywood Casino at Kansas Speedway.
For the full-year fiscal 2015, equity and net income was $14.1 million compared to $8.9 million in fiscal 2014.
During fiscal 2015, cash distributions from the casino to ISC totaled $32.1 million compared to $22 million in fiscal 2014.
Approximately $4.5 million of the increase was related to a change from quarterly to monthly distributions.
We received a $600,000 distribution in December 2015.
Net income for the three months ended November 30, 2015, was $32.3 million or $0.69 per diluted share on approximately 46.6 million shares outstanding.
However, when you exclude certain costs incurred in accelerated depreciation in connection with the DAYTONA Rising project, capitalized interest related to DAYTONA Rising, and a de minimus net gain on a sale of asset, we posted earnings of $0.74 per diluted share for the 2015 fiscal fourth quarter compared to non-GAAP net income for the 2014 fourth quarter of $0.56 per diluted share.
As for the balance sheet and future liquidity, at November 30, our combined cash and cash equivalents totaled $160.5 million and shareholders' equity was $1.4 billion.
Our deferred income was approximately $38.2 million, with the increase compared to the previous year primarily related to advanced ticket sales and partnership billings associated with 2016 events at Daytona.
At the end of the quarter, total debt was approximately $268.4 million, which includes approximately $165 million in senior notes, $54.6 million in TIF bonds associated with Kansas Speedway, and $48.7 million for our term loan on our headquarters office building.
Despite not incurring additional long-term debt to fund DAYTONA Rising, accounting rules require that we capitalize a portion of the interest on our outstanding debt during the construction period.
Through November 30, 2015, we recorded approximately $14 million of capitalized interest associated with DAYTONA Rising since inception.
With regards to capital allocations, we have established a long-term plan to ensure the Company generates sufficient cash flow from operations and available borrowings to fund our working capital needs, capital expenditures at existing facilities, and return of capital through payments of an annual cash dividend and repurchase of our shares under our stock purchase plan.
In addition to the sources of working capital and available borrowings, our ability to execute our capital allocation plans are supported by the federal tax legislation passed in December 2015 that provides for an extension of the seven-year depreciation for tax purposes on certain assets placed in service during fiscal 2015 through 2016 and bonus depreciation on capital expenditures in service 2015 through 2019.
While the tax legislation does not impact our overall tax liability, it does impact the timing of annual payment of cash taxes.
Cash taxes for federal and state in fiscal 2014 and 2015 were approximately $51.3 million and $45 million, respectively.
As a result of this legislation, which was passed subsequent to our fiscal 2015 year end but retroactive for all assets placed in service during 2015, we currently estimate a net tax cash refund for fiscal 2016 between approximately $10 million to $15 million, primarily attributable to depreciation for assets placed in service related to DAYTONA Rising.
We currently expect cash tax payments for fiscal 2017 between approximately $55 million to $60 million.
Also on the horizon is the final payment on our Staten Island note of approximately $66.4 million plus interest due early in Q2.
As it relates to capital expenditures, for fiscal year 2015, we spent approximately $155 million on capital expenditures for projects at our existing facilities, which include spending for the DAYTONA Rising project.
We continue to manage capital expenditures to the $600 million five-year capital plan discussed on previous calls, covering the period 2013 through 2017.
The five-year plan encompasses CapEx for all of our 13 facilities, including DAYTONA Rising.
The total cost of construction for DAYTONA Rising, excluding capitalized interest and internal labor, will be approximately $400 million.
Since inception, we've spent approximately $332.8 million.
Remaining capital expenditures under the $600 million capital expenditure plan will total approximately $170 million for fiscal 2016 through 2017, of which approximately $67 million is related to the timing of the remaining construction payments associated with the completion of DAYTONA Rising.
This capital expenditure plan will be evaluated during 2016 and refined to include years subsequent to 2017 based on evolving business requirements.
Concerning ONE DAYTONA, as <UNK> mentioned, Phase I of the project should proceed with cost approximately $120 million to $150 million in fiscal 2016 through 2017 and will be in addition to the previously discussed $600 million capital expenditure plan.
Sources of funds will include in addition to borrowings on our credit facility public incentives from the city of Daytona Beach and Volusia County and land to be contributed to the project.
Additional guidance will be provided as the project moves toward groundbreaking.
Return of capital to shareholders is an important component of our overall capital allocation strategy.
At this time, we are targeting a total payout of approximately $50 million in fiscal 2016 through a combination of dividends and share repurchases.
This compares to approximately $12.1 million in 2015.
To facilitate our 2016 plan, during the upcoming open trading window, we will request a special committee of our Board of Directors to revise parameters under our Rule 10b-5 open market share repurchase program.
The objective of the revised parameters is to buy back shares on an opportunistic but consistent basis in 2016.
The open market program currently has $61.7 million remaining under the total $330 million authorization.
We will review our return of capital programs and make adjustments if necessary on a quarterly basis.
In terms of 2016 outlook, our guidance considers the following business changes: completion and grand opening of the DAYTONA Rising project; the strategic change in the business model for merchandising officially licensed apparel and souvenirs launched in 2015; and that the NASCAR XFINITY Series event at Chicagoland held in the third quarter of 2015 will not return in 2016.
After considering these business changes, for fiscal 2016, we anticipate total revenues to range between $660 million and $670 million.
We expect revenue related to admissions, food, beverage, and merchandise to increase approximately 3% to 4%, and corporate sales to increase approximately 15% to 16%.
Contributing significantly to these increases are the contribution from DAYTONA Rising.
With regards to expenses, we expect an approximate 3.5% increase in NASCAR's event management fees resulting from an approximate 3.1% increase in broadcast revenue and an approximate 4% increase in non-TV event management fees included in recently contracted five-year sanctioned agreements, partially offset by the previously discussed discontinued XFINITY event at Chicagoland.
Also contributing to the increase in operating expenses is an approximately 2.3% net increase in motorsports and general and administrative expenses, primarily personnel-related costs, strategic expense supporting consumer marketing initiatives, and the incremental ongoing operating expenses associated with opening DAYTONA Rising.
We continue to invest in strategies that target the younger demographics and social media as well as improving the guest experience at live events, including enhanced data connectivity and multimedia content distribution on mobile devices and high-definition video screens.
As a result, we currently expect our fiscal 2016 non-GAAP EBITDA to be between $215 million and $225 million and EBITDA margin to range between 32.5% and 33.5% of total revenues.
This compares to fiscal 2015 EBITDA and margin of approximately $197.8 million and 30.6%, respectively.
Depreciation and amortization expense is expected to be approximately $100 million to $105 million on a non-GAAP basis, which includes an incremental approximately $15 million to $16 million related to assets placed in service for DAYTONA Rising.
We currently expect our 2016 operating margin to range between 16.5% and 18% of total revenues on a non-GAAP basis.
Our non-GAAP effective tax rate in 2015 will be approximately 38.5% to 39%.
We expect our fiscal 2016 cash distributions from the casino venture will be approximately $27 million to $28 million.
Equity income from the casino is expected to be approximately $14.5 million to $15.5 million.
Based on all of the above assumptions, we expect fiscal 2016 non-GAAP earnings to be between $1.45 and $1.60 per diluted share.
From an earnings perspective, the fourth quarter will be our most significant, followed by the first, second, and third quarters, respectively.
DAYTONA Rising will have a significant impact on the first quarter and to a lesser extent the third-quarter revenues and EBITDA.
We believe the Chase format will continue to produce growth in the fourth quarter, with results more flat year over year for Q2.
Our fiscal 2016 non-GAAP earnings per share guidance excludes certain remaining income statement impacts attributable to the DAYTONA Rising project, including preopening marketing and consulting, non-capitalized costs associated with accelerated depreciation or removal of assets not fully depreciated, and capitalized interest.
Also excluded for non-GAAP earnings are any costs related to legal settlements; potential non-capitalized costs or charges that could be recognized related to the ONE DAYTONA development; start-up and/or financing costs should our Hollywood Casino at Kansas Speedway joint venture pursue hotel construction; gain or loss on the sales of fixed assets; accelerated depreciation; and loss on asset retirements or relocations that could be recorded as part of capital improvements other than DAYTONA Rising.
Before signing off, we contacted most of you regarding our upcoming investor day on February 17, which is the Wednesday before the Daytona 500.
The event will take place here at the International Motorsport Center across from DAYTONA Rising and will feature management's discussion on multiple topics, including the project, ONE DAYTONA, media rights metrics, and our overall capital allocation and 2016 outlook.
The day will be capped off with the DAYTONA Rising open house attended by, in addition to our group, many corporate partners and industry participants.
There's still time to make your reservations by contacting our investor relations.
I hope to see you in sunny Daytona Beach in February.
In closing, ISC maintains a solid financial position developed over many years that affords us the ability to follow our disciplined capital allocation strategy and maintain our leadership position in the motorsports industry.
We have delivered DAYTONA Rising on time, on budget, and on track to meet incremental revenue and EBITDA commitments.
For the future, we are well positioned to balance the strategic capital needs of our business with returning capital to our shareholders.
We look forward to speaking with you on our next earnings conference call in April.
With that, I'll turn it back over to the operator, who will lead us through the Q&A portion of the call.
It's really, <UNK>, what we're looking at is a long-term sustainable return of capital program.
So it's not so much based upon what cash is available just in 2016, but what is available and sustainable over the long term.
So we're looking at obviously at open market share repurchase, but we also are examining this year different dividend strategies.
And we're very focused on something that's sustainable over the long term.
I would say ---+ it's hard to say in a market ---+ the way the market has been going.
But I would say that ---+ I would kind of think more over a six-month period, maybe.
First half.
I think it's up a little bit.
Our equity income there grew dramatically this year.
And we're growing there based on not so much that market growing, but on being able to capture additional market share.
So there comes a point where you start to ---+ that curve is going to start to slow down on you because it isn't an overall broad market increase.
It's you are capturing more from other facilities there.
But I think we continue to see good healthy growth there.
But I think we're pretty comfortable with what the guidance we gave there and that's why.
It's primarily capturing additional market share from other facilities.
Yes, they definitely should.
I think that the line up should be pretty consistent week to week as far as what is on the cable channels versus the networks.
If we get into the year and we see anything changing, we will give you guys the heads up.
But it should be a little bit easier to make sense out of this coming year.
Yes.
I mean, again, that's my guess based upon some modeling I've done over where share price has been and kind of where I'm targeting my 10b-5 grid.
That's why I think we will be through it in six months.
You know, if the market goes down, it may be quicker.
If the market goes up, it may take a little longer.
And <UNK>, if I heard your question correctly regarding advanced sales, we're currently trending up about 2% for the ---+ as I said, we expect the Daytona 500 to sell out.
And as we look into Q2 and heading to the West Coast swing, we are trending up about 2% on advanced sales.
That's units.
But I have to emphasize that we deploy across all of our events variable pricing, where we will not only take stair step increases through the sales process as we get closer to the events, but also we will monitor certain grandstands where demands are higher than other parts of the facility and take pricing as we see those demands increase.
And many of our venues, we are still somewhat reliant on weather forecasts and many of our events actually take week-of or day-of increased pricing.
So we expect the trends to increase on the average ticket price, but again, weather is the factor that can influence that.
A good percentage of it continues to be mix.
I think that ---+ I would say that overall when we look at the year, we have some momentum from DAYTONA Rising.
But DAYTONA Rising is largely coming from the corporate dollars in the early years.
So the increase that we're seeing in admissions I think is pretty broad over the business in the low-single-digits range.
And like I said, I think a lot of that will have it driven in by the DAYTONA Rising piece.
As <UNK> said, things are looking pretty good where we have visibility into Phoenix and Auto Club coming up in Q2.
We continue to think that the Chase is going to keep driving stronger results there.
It may be less when you are looking at some of the later Q2 events and over the ---+ we've got some challenged ---+ we have our challenges in Michigan and also in Richmond.
Those are probably going to be the laggers as far as the overall portfolio.
Well, I think, <UNK>, that depends upon the opportunity.
Because I think from our viewpoint, if we have the opportunity for an acquisition that builds shareholder value, that meets the return metrics, then we wouldn't hesitate to go forward.
But I don't see us levering for deals that really don't make financial sense.
So again, I think that we're looking out a very long term over ---+ and particularly, like I said, as we begin to think about a dividend strategy, you want something that you know you can continue to meet that commitment year after year.
So we're doing a very judicious process here.
One of the other things is we talked about this ---+ the timing of the cash from these taxes.
But the other side of it is ultimately, you got to pay your tax liability.
It's always great to have the cash early in the cycle, but you know what's going to happen is later on, particularly if there's tax reform, we've got the potential to have some years of cash tax payments.
So we got to be prudent on those points as well.
<UNK>ing of payments on DAYTONA Rising.
Yes.
That's what it is.
So we've got ---+ under the plan ---+ there's $170 million left ---+ almost $70 million of it is DAYTONA Rising.
So you know that's going to go ---+ that's going to be 2016 money.
And then again, so now you are left with $100 million kind of between 2016 and 2017.
Again, that's going to depend on the timing of outflows and some of that ---+ things like that really don't get decided until we get to our April Board meeting.
That's when we go and we are kind of mapping out what the timing is, where those would specifically fall.
But you can figure for sure $70 million of it.
You've probably got $100 million to $120 million this year and then $50 million, $60 million next year would be a relatively good estimate at this point until we give more clarity.
No, we don't there.
We still have some thresholds that we seek to meet to say we're going forward.
I think it's a good probability that the project is going to be moving forward.
We'll probably have a little bit more to talk about that when we get to the ---+ when we do the investor meeting down here in February.
The thing about DAYTONA Rising ---+ I mean, ONE DAYTONA is we always envision that being a project that supported itself with its own financing.
So the original plan was we had a joint venture partner; we go out and get third-party financing that was just on the project itself.
We've since taken that in-house, but I think we still think a long-term plan for that would be use the revolver like a construction loan and then when the project is up and running, put some permanent financing on it.
So like we said, as things take more shape, we will be giving more information on it.
Every indication we have is that it is not going to be a problem.
The buyers have performed on all interest payments and on all non-financial requirements under the note.
They've put a tremendous amount of equity into the project, so they have a lot sunk into this.
So they are not going to let this project get away from them.
But again, my conservative nature is always that I'll count that money when I get it in hand.
Well, what I'd say, <UNK>, is that even with ---+ if you stripped out DAYTONA Rising, we still see growth in all areas of the business next year.
The positive thing for us now is a few years ago, we were in that high degree of churn in our corporate deals and we are back more in that kind of three-, five-year sweet spot and most all the deals have some accelerators in them.
So you get some natural growth right there.
That's feeling good and our teams are in a good position to keep mining for 2016.
We only have one Cup entitlement and that's in the fourth quarter left to sell.
So that makes it a lot easier to be working all angles and all opportunities out there.
So we feel pretty good and pretty bullish on corporate sales outside of DAYTONA Rising.
What I would say in addition to that, <UNK>, is that they exceeded their targets for 2016.
And for 2015, in a year when they were selling all of this stuff for DAYTONA Rising as well.
So I'm looking for these guys to come out with guns blazing in 2016.
This is <UNK>, <UNK>.
Certainly the macro environment, particularly lower gas prices, is a plus.
We've seen when they were high at facilities like Talladega, where it really had an impact.
And with unemployment down, our demographic is back to work.
But we've also been very focused on elevating the live guest experience.
Really looking at unique experiences on property well beyond what we traditionally had done prior to the downturn, where we can really focus in on maximizing the yield, if you will, per attendee by adding more experiences.
And as I think <UNK> touched on in his comments: connectivity, apps, mobile websites, in venue high definition video experiences.
So it's a combination of the macro; it's a combination of some targeted consumer strategies that we have kept focused on in terms of execution.
And the racing has been getting better.
<UNK> touched on the Chase earlier last week.
Just last week, NASCAR announced that the Chase format is now expanding to the XFINITY Series and the Truck Series.
And we've seen the Chase format really create some excitement in our biggest quarter, for the fourth quarter.
And now with these championship formats culminating down at Homestead-Miami Speedway, along with the Cup format, we have expectations that things are going to get even more exciting for the live experience.
Yes, first of all, the good news is that Sprint continues to perform.
And as you know, they exit at the end of 2016.
We get regular updates from NASCAR ---+ they are high-level updates.
They are in discussions with multiple opportunities.
They've talked about global brands and what they refer to as challenger brands, people who are perhaps second in market share and want to try to use the platform to grow to number one.
But we don't have any specific detail as to who they are talking to or any timing on announcements, but we are confident that there will be a replacement to Sprint.
This is <UNK>.
I just want to thank everybody for joining us on our fourth-quarter and 2016 guidance call.
Hope you can make it to the investor relations function here in Daytona coming up shortly.
If not, we look forward to talking to you on our first-quarter 2016 call.
So again, thank you for joining us today.
