Thursday, April 14, 2005

Long Beach Grand Prix Could Net Dover Over 9 Million

LBGP by the number$

Information gleaned from the 10k, the annual report that is required by the SEC to be filed by all corporations, filed by Dover Motor sports clearly shows that Dover Motor sports had revenues from the 2004 Long Beach Grand Prix of $8,986,000 dollars. If there is a modest increase in the revenues from this year’s event they could be looking at over $9,000,000. Dover’s share of ticket revenues is approximately 39% of top line revenues ($93,817,000 for 2004) according to their 10k. 39% of the 2004 revenues for the LBGP works out to $3,504,000. The remainder of the revenue comes from TV rights and fees, sponsorship fees, suite rentals, hospitality and catering, concessions, souvenir sales, vendor commissions and grandstand rentals.

Total ticket revenues become more of a guess though clearly 3.5M cannot be the total. If we assume that 50,000 three day passes were sold for an average of 110 dollars ($5,500,000) and the balance of the estimated 170,000 in attendance only purchased a $35.00 ticket for Friday or Saturday ($5,950,000) then the total from ticket sales alone exceeds $10,000.000. This would suggest that it is likely that CCWS and the city are sharing in the ticket sales also.

Champ car’s share would be strictly a guess but I wouldn’t be surprised if they collected at least 2.5M in ticket sales. Add that to the 2.4M sanctioning fee that we keep hearing about in the media and CCWS has a nice 5M revenue stream from the LBGP alone.

So what happens to the rest of the ticket revenues…only those who counted the money really know! Perhaps CCWS gets more or the city gets some, it could be a part of the $40,000,000 that is estimated to be what the city reaps from the event. We aren’t likely to ever know for sure.

This certainly looks to be a profitable event for all parties. 9 million is almost 10% of Dover’s top line for the year and given they are promoting 16 events this one certainly contributes more than its share to their business. I can’t imagine why Dover would be the slightest bit interested in giving up the event. Of course most everything is for sale and perhaps they think that this event does not have a future given the state of open U.S. open wheel racing. It will be very interesting to see if any of the rumors hold water. From a financial standpoint I say Dover retains the rights to the GP.


Blogger Thinice_9 said...

Article on states that Mr. Kalkhoven is in talks to buy LBGP from Dover and...."IRL owner Tony George had previously not ruled out a GPALB takeover, but the League’s vice-president of business affairs, Ken Ungar, stated to the Telegram that the IRL would “not be a bidder” for the association, being only interested in sanctioning the race for Dover from '06 on."
BUT how about Pensky or some 88 corp type affiliation.

10:52 AM  

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