Quarter Highlighted by New 11-Year NCAA Marketing Agreement;
Investment Sales Produce $2.8 Million Gain, Debt Reduced by Over
$10 Million Since Year End
ATLANTA, Nov. 14 /PRNewswire/ -- Bull Run Corporation (Nasdaq: BULL) today
announced that total revenue from continuing operations for the first quarter
ended September 30, 2001 was $23,104,000 compared to $23,983,000 for the same
period last year. Primarily all the revenue is attributable to the operations
of Host Communications, Inc., Bull Run's wholly owned subsidiary. The Company
generates the majority of its revenues during the Company's second and third
fiscal quarters, since its largest business segment provides marketing and
production services in connection with college athletics primarily during the
college football and college basketball seasons.
During the quarter ended September 30, 2001, Bull Run recognized a gain of
approximately $2.8 million on the sale of its investment in Gray
Communications Systems, Inc. preferred stock, generating approximately
$6.8 million in proceeds that were used to reduce long-term debt. The Company
continues to hold all of its investments in Gray common stock and warrants for
common stock. Long-term debt has been reduced by approximately $10.4 million
since July 1, 2001. The Company has stated that reduction of its long-term
debt, primarily through liquidation of non-strategic assets, is one of its
primary objectives this year.
Bull Run reported several non-cash items that impact its net results. The
Company adopted a new accounting standard effective July 1, 2001 that
eliminates the requirement to amortize goodwill and certain other intangible
assets. Therefore amortization of acquisition intangibles, including
goodwill, decreased to $256,000 for the three months ended September 30, 2001
from $1,138,000 for the same period in 2000. Equity in earnings (losses) of
affiliated companies, which is Bull Run's proportionate share of net results
reported by Gray, Rawlings Sporting Goods Company and iHigh, Inc., negatively
impacted Bull Run's pretax loss by $942,000 and $983,000 for the three months
ended September 30, 2001 and 2000, respectively. Debt issue cost amortization
negatively impacted the pretax results by $847,000 and $813,000 for the three
months ended September 30, 2001 and 2000, respectively.
The Company reported a charge of $1,120,000 in the prior year from the
cumulative effect of adopting a new accounting standard for accounting for
derivative instruments and hedging activities. The non-cash net depreciation
in the aggregate value of derivative instruments was $2,145,000 and $122,000
for the three months ended September 30, 2001 and 2000, respectively.
Primarily as a result of the non-cash items discussed above representing
approximately $4.2 million in pretax loss for the quarter ended
September 30, 2001, the $2.8 million gain on the sale of investments, non-cash
items discussed above representing $3.1 million in pretax loss for the quarter
ended September 30, 2000 and the non-cash cumulative effect of the accounting
change in the prior year, the Company reported a net loss of $3,665,000 for
the quarter ended September 30, 2001, compared to a net loss of $6,830,000 for
the quarter ended September 30, 2000.
Robert S. Prather, Jr., Bull Run's President and CEO, commented, "We
continue to weather a very difficult economic period. We have responded by
taking further actions to reduce operating expenses and improving our
operating efficiency. We believe that college sports and grassroots events,
while not invulnerable to economic recession, provide a targeted audience for
corporate advertisers, and therefore may be a prudent marketing strategy for
those companies that wish to focus their sponsorship and ad spending."
Mr. Prather continued, "The highlight of our quarter was that Host
Communications was successful in negotiating a new 11-year agreement with CBS
Sports that will commence in September 2002. This agreement continues Host's
26-year relationship with the NCAA and its position as the foremost company in
college sports marketing. We hope to build off this new relationship to
arrange for long-term agreements with new NCAA corporate sponsors during this
final year of our current contract, as well as new expanded arrangements with
our current NCAA Corporate Partners."
Bull Run, through Host Communications, provides affinity, multimedia,
promotional and event management services to universities, athletic
conferences, associations and corporations. Bull Run also has significant
investments in Gray Communications Systems, Inc., an owner and operator of
13 television stations and four newspapers; Rawlings Sporting Goods Company,
Inc., a leading supplier of team sports equipment in North America; iHigh
Inc., a marketing company focused on high school students; and Sarkes Tarzian,
Inc., an owner and operator of two television stations and four radio
stations.
Forward-Looking Statements
Certain statements contained herein are forward-looking statements that
are made pursuant to the safe harbor provisions of the Private Litigation
Reform Act of 1995. Wherever used, the words "expect," "plan," "anticipate,"
"believe," "may" and similar expressions are intended to identify forward-
looking statements. Forward-looking statements involve known and unknown
risks and uncertainties, which may cause the Company's actual results in
future periods or plans for future periods to differ materially from what is
currently anticipated. Those risks include, among other things, those risks
set forth in the Company's Annual Report on Form 10-K and other reports and
documents filed with the Securities and Exchange Commission. The Company has
no obligation to publicly update or revise any forward-looking statements made
herein or elsewhere, whether as a result of new information, future events or
otherwise.
Contacts: Robert S. Prather, Jr., Bull Run's President & Chief Executive
Officer, at (404) 266-8333, or W. James Host, Chief Executive
Officer of Host Communications, Inc., at (859) 226-4202
Summarized financial results for the quarters ended September 30, 2001 and
2000 follow:
BULL RUN CORPORATION
Comparative Results of Operations (Unaudited)
(in thousands, except per share amounts)
Three Months Ended
September 30,
2001 2000
Revenue from services rendered $23,104 $23,983
Operating costs and expenses:
Direct operating costs for
services rendered 16,341 18,211
Selling, general and
administrative 8,640 8,581
Amortization of acquisition
intangibles 256 1,138
25,237 27,930
Loss from operations (2,133) (3,947)
Equity in earnings (losses) of
affiliated companies (942) (983)
Net change in value of certain
derivative instruments (2,145) (122)
Gain on sale of investments 2,814
Debt issue cost amortization (847) (813)
Interest and other, net (2,422) (2,515)
Loss from continuing
operations before income
taxes and cumulative
effect adjustment (5,675) (8,380)
Income tax benefit 2,010 2,670
Loss before cumulative
effect adjustment (3,665) (5,710)
Cumulative effect of
accounting change, net of tax (1,120)
Net loss (3,665) (6,830)
Preferred dividends (68)
Net loss available to
common stockholders $(3,733) $(6,830)
Loss per share available to
common stockholders,
basic and diluted:
Loss before cumulative
effect adjustment $(0.10) $(0.16)
Cumulative effect of
accounting change (0.03)
Net loss $(0.10) $(0.19)
Weighted average shares
outstanding,
basic and diluted 36,002 35,085
SOURCE Bull Run Corporation
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Company News On-Call:
http://www.prnewswire.com/gh/cnoc/comp/232438.html
CONTACT:
Robert S. Prather, Jr., President & Chief
Executive Officer of Bull Run Corporation, +1-404-266-8333, or W.
James Host, Chief Executive Officer of Host Communications, Inc.,
+1-859-226-4202
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