-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QCe9vBJEJ+EITk0husw+UhFbatg+h33XbtYAs6gSl9KzEJZQ7XI7ChDCuLm8jO8e /GrV+AqT0oVcJPY9wnh6iw== 0000950149-95-000804.txt : 19951119 0000950149-95-000804.hdr.sgml : 19951119 ACCESSION NUMBER: 0000950149-95-000804 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951114 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: BAY MEADOWS OPERATING CO CENTRAL INDEX KEY: 0000715273 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-RACING, INCLUDING TRACK OPERATION [7948] IRS NUMBER: 942878485 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09320 FILM NUMBER: 95592192 BUSINESS ADDRESS: STREET 1: 2600 S DELEWARE ST STREET 2: P O BOX 5050 CITY: SAN MATEO STATE: CA ZIP: 94402 BUSINESS PHONE: 4155747223 MAIL ADDRESS: STREET 1: 2600 S DELAWARE ST CITY: SAN MATEO STATE: CA ZIP: 94402 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CALIFORNIA JOCKEY CLUB CENTRAL INDEX KEY: 0000016343 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-RACING, INCLUDING TRACK OPERATION [7948] IRS NUMBER: 940358820 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09319 FILM NUMBER: 95592193 BUSINESS ADDRESS: STREET 1: 2600 S DELAWARE ST STREET 2: P O BOX 1117 CITY: SAN MATEO STATE: CA ZIP: 94402 BUSINESS PHONE: 4155734514 MAIL ADDRESS: STREET 1: 2600 S DELAWARE ST CITY: SAN MATEO STATE: CA ZIP: 94402 10-Q 1 FORM 10-Q 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) / X / JOINT QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1995 OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________________ to __________________ Commission file number 1-9319 CALIFORNIA JOCKEY CLUB (Exact name of registrant as specified in its charter) Delaware 94-0358820 (State or other jurisdiction (I.R.S. Employer of incoporation or organization) Identification No.) 2600 S. Delaware Street, San Mateo, California 94402 (Address of principal executive offices) (Zip Code) (415) 573-4514 (Registrant's telephone number, including area code) Not Applicable (Former name, former address and former fiscal year, if changed since last report) Commission file number 1-9320 BAY MEADOWS OPERATING COMPANY (Exact name of registrant as specified in its charter) Delaware 94-2878485 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) 2600 S. Delaware Street, San Mateo, California 94402 (Address of principal executive offices) (Zip Code) (415) 574-7223 (Registrant's telephone number, including area code) Not Applicable (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X . No____. The number of shares outstanding of each registrant's classes of common stock, par value $.01 per share, as of the close of business on November 1, 1995, was as follows:
Registrant Number of Shares ---------- ---------------- California Jockey Club 5,763,257 Bay Meadows Operating Company 5,763,257
2 PART I: FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY SEPARATE AND COMBINED STATEMENTS OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 1995 (In thousands, except per share amounts)
- ----------------------------------------------------------------------------------------------- BAY MEADOWS CALIFORNIA OPERATING ADJUSTMENTS JOCKEY COMPANY AND AND CLUB SUBSIDIARY ELIMINATIONS COMBINED REVENUES: Pari-mutuel revenue $ 21,753 $ 21,753 Producer fees 424 424 Admissions, programs, parking and other racing income 3,530 3,530 Concession sales 1,749 1,749 Rental of racing facility $ 2,757 1,233 $ (2,757) 1,233 Interest and dividend income 355 129 (36) 448 Other income 7 1,065 (11) 1,061 ----------- ----------- ----------- ----------- 3,119 29,883 (2,804) 30,198 ----------- ----------- ----------- ----------- COSTS AND EXPENSES: Purses and incentive awards 8,453 8,453 Commissions paid to guest tracks 1,385 1,385 Producer fees 161 161 Direct operating costs 12,586 12,586 Cost of concession sales 580 580 Depreciation and amortization 710 485 1,195 Racing facility rental 2,768 (2,757) 11 Marketing expense 874 874 General and administrative expense 299 1,990 (11) 2,278 Project development 97 615 712 Interest expense 51 (36) 15 ----------- ----------- ----------- ----------- 1,106 29,948 (2,804) 28,250 ----------- ----------- ----------- ----------- INCOME (LOSS) BEFORE TAXES 2,013 (65) 1,948 INCOME TAX BENEFIT 30 30 ----------- ----------- ----------- ----------- NET INCOME (LOSS) $ 2,013 $ (35) $ 0 $ 1,978 =========== =========== =========== =========== PER SHARE AMOUNTS: NET INCOME (LOSS) $ .35 $ (.01) $ .34 =========== =========== =========== DIVIDEND $ .25 $ .25 =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 5,758,458 5,758,458 5,758,458
See Notes to Financial Statements. -1- 3 CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY SEPARATE AND COMBINED STATEMENTS OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 1994 (In thousands, except per share amounts)
- ---------------------------------------------------------------------------------------------- BAY MEADOWS CALIFORNIA OPERATING ADJUSTMENTS JOCKEY COMPANY AND AND CLUB SUBSIDIARY ELIMINATIONS COMBINED REVENUES: Pari-mutuel revenue $ 16,866 $ 16,866 Producer fees 406 406 Admissions, programs, parking and other racing income 3,271 3,271 Concession sales 1,636 1,636 Rental of racing facility $ 2,531 1,207 $ (2,531) 1,207 Interest and dividend income 279 27 306 Other income 17 703 (11) 709 ----------- ----------- ----------- ----------- 2,827 24,116 (2,542) 24,401 ----------- ----------- ----------- ----------- COSTS AND EXPENSES: Purses and incentive awards 6,714 6,714 Commissions paid to guest tracks 1,100 1,100 Producer fees 152 152 Direct operating costs 10,285 10,285 Cost of concession sales 468 468 Depreciation and amortization 704 534 1,238 Racing facility rental 2,555 (2,531) 24 General and administrative expense 311 2,224 2,535 Marketing expense 829 829 Interest expense 83 (11) 72 ----------- ----------- ----------- ----------- 1,015 24,944 (2,542) 23,417 ----------- ----------- ----------- ----------- INCOME (LOSS) BEFORE TAXES 1,812 (828) 984 INCOME TAX BENEFIT 348 348 ----------- ----------- ----------- ----------- NET INCOME (LOSS) AFTER TAXES $ 1,812 $ (480) $ 0 $ 1,332 =========== =========== =========== =========== PER SHARE AMOUNTS: NET INCOME (LOSS) $ .32 $ (.08) $ .24 =========== =========== =========== DIVIDEND $ .15 $ .15 =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 5,753,257 5,753,257 5,753,257
See Notes to Financial Statements. -2- 4 CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY SEPARATE AND COMBINED STATEMENTS OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 1995 (In thousands, except per share amounts)
- ---------------------------------------------------------------------------------------------- BAY MEADOWS CALIFORNIA OPERATING ADJUSTMENTS JOCKEY COMPANY AND AND CLUB SUBSIDIARY ELIMINATIONS COMBINED REVENUES: Pari-mutuel revenues $ 9,839 $ 9,839 Producer fees 215 215 Admissions, programs, parking and other racing income 1,257 1,257 Concession sales 801 801 Rental of racing facility $ 1,353 608 $ (1,353) 608 Interest and dividend income 126 47 (36) 137 Other income 3 291 (7) 287 ----------- ----------- ----------- ----------- 1,482 13,058 (1,396) 13,144 ----------- ----------- ----------- ----------- COSTS AND EXPENSES: Purses and incentive awards 3,879 3,879 Commissions paid to guest tracks 610 610 Producer fees 161 161 Direct operating costs 5,007 5,007 Cost of concession sales 274 274 Depreciation and amortization 229 167 396 Racing facility rental 1,359 (1,353) 6 Marketing expense 422 422 General and administrative expense 116 651 (7) 760 Project development 86 451 537 Interest expense 41 (36) 5 ----------- ----------- ----------- ----------- 431 13,022 (1,396) 12,057 ----------- ----------- ----------- ----------- INCOME (LOSS) BEFORE TAXES 1,051 36 1,087 PROVISION FOR INCOME TAX 16 16 ----------- ----------- ----------- ----------- NET INCOME (LOSS) $ 1,051 $ 20 $ 0 $ 1,071 =========== =========== =========== =========== NET INCOME PER SHARE $ .18 $ .01 $ .19 =========== =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 5,763,257 5,763,257 5,763,257
See Notes to Financial Statements. -3- 5 CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY SEPARATE AND COMBINED STATEMENTS OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 1994 (In thousands, except per share amounts)
- ---------------------------------------------------------------------------------------------- BAY MEADOWS CALIFORNIA OPERATING ADJUSTMENTS JOCKEY COMPANY AND AND CLUB SUBSIDIARY ELIMINATIONS COMBINED REVENUES: Pari-mutuel revenues $ 8,560 $ 8,560 Rights and producer fees 250 250 Admissions, programs, parking and other racing income 1,196 1,196 Concession sales 732 732 Rental of racing facility $ 1,191 691 $ (1,191) 691 Interest and dividend income 106 9 115 Other income 3 278 (2) 279 ----------- ----------- ----------- ----------- 1,300 11,716 (1,193) 11,823 ----------- ----------- ----------- ----------- COSTS AND EXPENSES: Purses and incentive awards 3,580 3,580 Commissions paid to guest tracks 562 562 Producer fees 142 142 Direct operating costs 4,259 4,259 Cost of concession sales 218 218 Depreciation and amortization 234 176 410 Racing facility rental 1,191 (1,191) General and administrative expense 91 1,046 1,137 Marketing expense 398 398 Interest expense 49 (2) 47 ----------- ----------- ----------- ----------- 325 11,621 (1,193) 10,753 ----------- ----------- ----------- ----------- INCOME BEFORE TAXES 975 95 1,070 PROVISION FOR INCOME TAX BENEFIT 348 348 ----------- ----------- ----------- ----------- NET INCOME AFTER TAXES $ 975 $ 443 $ 0 $ 1,418 =========== =========== =========== =========== NET INCOME PER SHARE $ .17 $ .08 $ .25 =========== =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 5,753,257 5,753,257 5,753,257
See Notes to Financial Statements. -4- 6 CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY COMBINED BALANCE SHEETS (In thousands, except share amounts)
- ---------------------------------------------------------------------------------------------------- SEPTEMBER 30, DECEMBER 31, 1995 1994 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 10,365 $ 9,356 Securities available for sale (at fair value) 1,350 1,375 Securities held to maturity (at cost) 3,809 6,570 Amounts held on deposit for Thoroughbred horse owners 2,474 3,003 Accounts receivable (net of allowance for doubtful accounts of $82 in 1995 and $97 in 1994) 999 1,351 Prepaid expenses and other current assets 921 188 -------- -------- Total current assets 19,918 21,843 -------- -------- PROPERTY, PLANT AND EQUIPMENT: Land 1,182 1,182 Racing plant 24,494 23,812 Tennis facilities 308 308 Equipment and leasehold improvements 9,914 8,454 -------- -------- Total 35,898 33,756 Accumulated depreciation and amortization (20,291) (19,211) -------- -------- Property, plant and equipment - net 15,607 14,545 -------- -------- INVESTMENTS AND OTHER ASSETS (net of accumulated amortization of $1,183 in 1995 and $1,083 in 1994) 261 398 -------- -------- TOTAL $ 35,786 $ 36,786 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 2,244 $ 3,163 Accrued liabilities 3,615 3,216 Accrued purses 1,129 1,850 Due to Thoroughbred horse owners 2,474 3,003 Income taxes payable 32 372 Uncashed pari-mutuel tickets and vouchers 2,896 2,421 -------- -------- Total current liabilities 12,390 14,025 -------- -------- DEFERRED INCOME TAXES 43 43 -------- -------- COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY: Common Stock (paired shares), $.01 par value - authorized 10,000,000 shares each; issued and outstanding: 5,763,257 and 5,753,257 shares 116 116 Additional paid-in capital 18,385 18,262 Retained earnings 4,900 4,363 Unrealized gain (loss) on securities available for sale (48) (23) -------- -------- Total stockholders' equity 23,353 22,718 -------- -------- TOTAL $ 35,786 $ 36,786 ======== ========
See Notes to Financial Statements. -5- 7 CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY COMBINED STATEMENTS OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (In thousands)
- ----------------------------------------------------------------------------------------- 1995 1994 OPERATING ACTIVITIES: Net income (loss) $ 1,978 $ 1,332 Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 1,195 1,238 Changes in operating assets and liabilities: Accounts receivable 352 (982) Amounts held on deposit for Thoroughbred horse owners 529 609 Income taxes receivable and payable (340) 22 Inventories 25 Prepaid expenses and other assets (711) (736) Accounts payable (919) 412 Accrued liabilities 399 1,588 Accrued purses (721) 552 Due to Thoroughbred horse owners (529) (609) Uncashed pari-mutuel tickets and vouchers 475 756 -------- -------- Net cash provided by (used in) operating activities 1,708 4,207 -------- -------- INVESTING ACTIVITIES: Maturity (purchase) sale of securities held to maturity, net 2,761 (1,245) Purchase of property, plant and equipment (2,142) (1,612) -------- -------- Net cash provided by (used in) investing activities 619 (2,857) -------- -------- FINANCING ACTIVITIES: Proceeds from note payable - bank 3,383 Repayment of note payable - bank (3,358) Dividends (1,441) (863) Stock options exercised 123 -------- -------- Net cash provided by (used in) financing activities (1,318) (838) -------- -------- DECREASE IN CASH AND CASH EQUIVALENTS 1,009 512 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 9,356 4,909 -------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 10,365 $ 5,421 ======== ========
See Notes to Financial Statements. -6- 8 CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY SEPARATE AND COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY NINE MONTHS ENDED SEPTEMBER 30, 1995 (In thousands, except per share amounts)
- ----------------------------------------------------------------------------------------------- CALIFORNIA BAY MEADOWS ADJUSTMENTS JOCKEY OPERATING AND CLUB COMPANY ELIMINATIONS COMBINED Balance at January 1, 1995 $ 21,970 $ 748 $ 22,718 Net income (loss) 2,013 (35) 1,978 Dividends ($.25/share) (1,441) (1,441) Stock options exercised 119 4 123 Unrealized gain (loss) on securities available for sale (25) (25) -------- -------- -------- Balance at September 30, 1995 $ 22,636 $ 717 $ 23,353 ======== ======== ========
See Notes to Financial Statements. -7- 9 CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY SEPARATE AND COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY NINE MONTHS ENDED SEPTEMBER 30, 1994 (In thousands, except per share amounts)
- ------------------------------------------------------------------------------------------------------ CALIFORNIA BAY MEADOWS ADJUSTMENTS JOCKEY OPERATING AND CLUB COMPANY ELIMINATIONS COMBINED Balance at January 1, 1994 $ 21,825 $ 156 $ 21,981 Net income (loss) 1,812 (480) 1,332 Dividends ($.15/share) (863) (863) Balance at September 30, 1994 $ 22,774 $ (324) $ 22,450 ======== ======== ========
See Notes to Financial Statements. -8- 10 CALIFORNIA JOCKEY CLUB BALANCE SHEETS (In thousands, except share amounts)
- ---------------------------------------------------------------------------------------------- SEPTEMBER 30, DECEMBER 31, 1995 1994 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 1,023 $ 412 Securities available for sale (at fair value) 1,350 1,375 Securities held to maturity (at cost) 3,809 6,570 Accounts receivable 5 53 Receivable from Bay Meadows Operating Company 5,032 1,991 Prepaid expenses and other current assets 6 32 -------- -------- Total current assets 11,225 10,433 -------- -------- PROPERTY, PLANT AND EQUIPMENT: Land 1,182 1,182 Racing plant 24,494 23,812 Tennis facility 308 308 Equipment 456 456 -------- -------- Total 26,440 25,758 Accumulated depreciation (14,772) (14,062) -------- -------- Property, plant and equipment - net 11,668 11,696 -------- -------- TOTAL ASSETS $ 22,893 $ 22,129 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 151 $ 95 Accrued liabilities 106 64 -------- -------- Total current liabilities 257 159 -------- -------- COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY: Common Stock, $.01 par value - authorized 10,000,000 shares; issued and outstanding 5,763,257 and 5,753,257 shares 58 58 Additional paid-in capital 17,597 17,478 Retained earnings 5,029 4,457 Unrealized gain (loss) on securities available for sale (48) (23) -------- -------- Total stockholders' equity 22,636 21,970 -------- -------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 22,893 $ 22,129 ======== ========
See Notes to Financial Statements. -9- 11 CALIFORNIA JOCKEY CLUB STATEMENTS OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (In thousands)
- --------------------------------------------------------------------------------------- 1995 1994 OPERATING ACTIVITIES: Net income $ 2,013 $ 1,812 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 710 704 Changes in operating assets and liabilities: Accounts receivable 48 2 Receivable from Bay Meadows Operating Company (3,041) (1,034) Prepaid expenses and other assets 26 (37) Accounts payable 56 72 Accrued liabilities 42 98 ------- ------- Net cash provided by (used in) operating activities (146) 1,617 ------- ------- INVESTING ACTIVITIES: Maturity (purchase) of securities held to maturity, net 2,761 (1,245) Purchase of property, plant and equipment (682) (855) ------- ------- Net cash provided by (used in) investing activities 2,079 (2,100) ------- ------- FINANCING ACTIVITIES: Stock options exercised 119 Dividends (1,441) (863) ------- ------- Net cash used in financing activities (1,322) (863) ------- ------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 611 (1,346) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 412 1,779 ------- ------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 1,023 $ 433 ======= =======
See Notes to Financial Statements. -10- 12 BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS (In thousands, except share amounts)
- -------------------------------------------------------------------------------------------------- SEPTEMBER 30, DECEMBER 31, 1995 1994 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 9,342 $ 8,944 Amounts held on deposit for Thoroughbred horse owners 2,474 3,003 Accounts receivable (net of allowance for doubtful accounts of $82 in 1995 and $97 in 1994) 994 1,298 Prepaid expenses and other current assets 916 156 -------- -------- Total current assets 13,726 13,401 -------- -------- PROPERTY, PLANT AND EQUIPMENT: Equipment and leasehold improvements 9,458 7,998 Accumulated depreciation and amortization (5,520) (5,149) -------- -------- Property, plant and equipment, net 3,938 2,849 -------- -------- INVESTMENTS AND OTHER ASSETS (net of accumulated amortization of $1,183 in 1995 and $1,083 in 1994) 261 398 -------- -------- TOTAL ASSETS $ 17,925 $ 16,648 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 2,093 $ 3,068 Accrued liabilities 3,509 3,152 Accrued purses 1,129 1,850 Due to Thoroughbred horse owners 2,474 3,003 Payable to California Jockey Club 5,032 1,991 Income taxes payable 32 372 Uncashed pari-mutuel tickets and vouchers 2,896 2,421 -------- -------- Total current liabilities 17,165 15,857 -------- -------- DEFERRED INCOME TAXES 43 43 -------- -------- COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY: Common Stock $.01 par value-authorized 10,000,000 shares; issued and outstanding 5,763,257 and 5,753,257 shares 58 58 Additional paid-in capital 788 784 Accumulated deficit (129) (94) -------- -------- Total stockholders' equity 717 748 -------- -------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 17,925 $ 16,648 ======== ========
See Notes to Financial Statements. -11- 13 BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (In thousands)
- ------------------------------------------------------------------------------------- 1995 1994 OPERATING ACTIVITIES: Net loss $ (35) $ (480) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 485 534 Changes in operating assets and liabilities: Accounts receivable 304 (984) Amounts held on deposit for Thoroughbred horse owners 529 609 Income taxes receivable and payable (340) 22 Inventories 25 Prepaid expenses and other assets (737) (698) Accounts payable (975) 300 Accrued liabilities 357 1,529 Accrued purses (721) 552 Due to Thoroughbred horse owners (529) (609) Payable to California Jockey Club 3,041 1,034 Uncashed pari-mutuel tickets and vouchers 475 756 ------- ------- Net cash provided by (used in) operating activities 1,854 2,590 ------- ------- INVESTING ACTIVITIES - Purchase of property, plant and equipment (1,460) (757) ------- ------- FINANCING ACTIVITIES: Proceeds from note payable - bank 3,383 Repayment of note payable - bank (3,358) Stock options exercised 4 ------- ------- Net cash provided by financing activities 4 25 ------- ------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 398 1,858 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 8,944 3,130 ------- ------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 9,342 $ 4,988 ======= =======
See Notes to Financial Statements. -12- 14 CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY NOTES TO FINANCIAL STATEMENTS 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited financial statements include condensed unaudited financial statements of California Jockey Club ("Cal Jockey") and Bay Meadows Operating Company ("Bay Meadows") on a combined basis and for each company individually. All significant affiliate and intercompany balances and transactions have been eliminated on the combined financial statements. The accompanying condensed unaudited financial statements should be read in conjunction with the companies' 1994 Annual Report. Net income (loss) per share is computed as net income (loss) divided by weighted average shares outstanding. Certain prior year amounts have been reclassified to conform to the 1995 presentation. In the opinion of management, all adjustments (consisting of only recurring adjustments) considered necessary for a fair presentation of the financial condition and results of operations for Cal Jockey and Bay Meadows individually, have been included in the financial statements. The results of operations for the nine months ended September 30, 1995, are not indicative of the results that may be expected for the year ending December 31, 1995, because of the seasonal nature of the operations. -13- 15 ITEM 2. MANAGEMENTS' DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS California Jockey Club Results of Operations: Nine Months Ended September 30, 1995 Compared with Nine Months Ended September 30, 1994 Total revenues for California Jockey Club ("Cal Jockey") increased $292,000 (10.3%) for the nine months ended September 30, 1995, compared to the same period in the prior year. Rental income derived from the leasing of its racing facility increased $226,000, in addition to an increase in interest and other income of $66,000. The rental income increase was primarily the result of Bay Meadows racing eleven more days in 1995. Expenses for the nine months ended September 30, 1995, increased $91,000 (9.0%) due to costs incurred related to the development of Cal Jockey property. Results of Operations: Quarter Ended September 30, 1995 Compared with Quarter Ended September 30, 1994 Total revenues for Cal Jockey increased $182,000 (14.0%) for the quarter ended September 30, 1995, compared to the same quarter of the prior year. Rental income derived from the leasing of its racing facility increased $162,000 (13.6%). The rental income increase was primarily the result of 26 days of racing in the current quarter compared with 24 racing days in the third quarter of 1994. Expenses for the quarter ended September 30, 1995, increased $106,000 (32.6%) compared to the same quarter of the prior year due to costs incurred related to the development of Cal Jockey property. Liquidity and Capital Resources The liquid assets (cash and marketable securities) of Cal Jockey decreased to $6,182,000 at September 30, 1995, from $8,357,000 at December 31, 1994. The decrease was principally the result of the timing of the payments from Bay Meadows Operating Company. Cal Jockey has guaranteed a $6,000,000 line of credit that Bay Meadows has with a bank, which expires on May 31, 1996. As of September 30, 1995, there were no borrowings outstanding on this line of credit. The City of San Mateo (the "City"), along with the State of California, have mandated that water runoff from Bay Meadows' barn area be disconnected from the municipal sewer collection system. Cal Jockey is cooperating with the City and State Regional Water Quality Control Board to resolve this situation and has prepared preliminary reports describing the proposed compliance measures. The estimated costs of $1,500,000 are expected to be capitalized in Property, Plant and Equipment. Therefore, such costs have not been accrued in the accompanying financial statements. Final determinations and approvals have not been received nor has a schedule for implementation been established. Cal Jockey anticipates that funds generated internally and its cash reserves will be sufficient to meet its liquidity requirements for the foreseeable future. Bay Meadows Operating Company and Subsidiaries Results of Operations: Nine Months Ended September 30, 1995 Compared with Nine Months Ended September 30, 1994 Total revenues increased $5,767,000 (23.9%) for the nine months ended September 30, 1995 compared with the same period in 1994. This was due to an increase in pari-mutuel revenues of $4,887,000. Pari-mutuel revenues increased due in part to there being 11 more racing days in the first nine months of 1995 than in the same period in 1994. These increases in pari-mutuel revenues were helped by an increase in handle on imported races from Southern California as a result of regulatory changes in the summer of 1994 which permit "Full-card" intrastate simulcasting. -14- 16 Other revenues were positively impacted by the same factors which affected pari-mutuel revenues. Admissions, program, parking and other racing income increased $259,000, and concession sales increased $113,000. In addition, interest income increased due to higher investment balances. A settlement with a satellite location regarding producer fees resulted in higher fees for 1995 and a settlement from prior year producer fees that had been previously reserved for, of approximately $92,000 is included in other income. Total costs and expenses increased $5,004,000 (20.0%) for the nine months ended September 30, 1995, compared with the same period in the prior year. This was primarily due to increases in expenses associated with higher operating revenues, including (i) purses and incentive awards ($1,739,000), (ii) commissions paid to guest locations ($285,000), (iii) direct operating costs ($2,301,000) and (iv) racing facility rental ($213,000). During the current year the Company incurred $615,000 of costs in attempting to establish a card club, which are shown under Project Development Costs. On November 7, 1995, voters of the City of San Mateo rejected a measure which would have permitted the establishment of a card club. No such costs were incurred during the prior year. As a result of the Spring Meet in 1995, there will be an offsetting reduction of racing days during the fourth quarter of 1995 as compared to 1994. Accordingly, the improvement in revenues and operating results during the first nine months of 1995 might be offset by a reduction in revenues and operating results during the last three months of 1995. Bay Meadows recorded an income tax benefit of $30,000 (46% of net loss before taxes) for the nine months ended September 30, 1995. The tax benefit in the prior year resulted from the anticipated benefit from losses sustained in the first nine months of the year. Results of Operations: Quarter Ended September 30, 1995 Compared with Quarter Ended September 30, 1994 Total revenues for increased $1,342,000 (11.5%) for the three months ended September 30, 1995, compared to the same period in 1994. Total costs and expenses increased $1,401,000 (12.1%) for the three months ended September 30, 1995, compared with the same period in the prior year. This was primarily due to increases in expenses associated with higher operating revenues, including (i) purses and incentive awards ($299,000), (ii) commissions paid to guest locations ($48,000), (iii) direct operating expenses ($748,000) and (iv) racing facility rental ($168,000). During the current quarter the Company incurred $451,000 of costs in attempting to establish a card club. No such costs were not incurred during the prior year. Bay Meadows recorded a provision for income tax expense of $16,000 (46% of net loss before taxes) for the quarter ended September 30, 1995. The tax benefit in the prior year resulted from the anticipated benefit from losses sustained in the first nine months of the year. Liquidity and Capital Resources The liquid assets (cash and cash equivalents) of Bay Meadows increased to $9,342,000 at September 30, 1995, from $8,944,000 at December 31, 1994. Bay Meadows is dependent on Cal Jockey's assistance in securing a bank line of credit for its working capital needs throughout the year. Bay Meadows has a $6,000,000 bank line of credit that expires on May 31, 1996, for which Cal Jockey has guaranteed all borrowings. As of September 30, 1995, there were no borrowings outstanding on this line of credit. Management believes that Bay Meadows can meet its funding needs for the foreseeable future through internally generated funds and the utilization of the line of credit. As of September 30, 1995, Bay Meadows' current liabilities exceeded its current assets by $3,469,000. The current ratio (current assets to current liabilities) was .80 to 1 at September 30, 1995, compared to .85 to 1 at December 31, 1994. -15- 17 PART II: OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS Bay Meadows and Cal Jockey are, in the ordinary course of business, involved in litigation and other legal matters. The employment- related lawsuit with James Burkes v Bay Meadows Racing Association, Bay Meadows Catering and Bill Caldwell was settled on September 29, 1995. ITEM 2. CHANGES IN SECURITIES None ITEM 3. DEFAULTS UPON SENIOR SECURITIES None ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS (a) On June 1, 1995, Bay Meadows Operating Company ("Bay Meadows") and California Jockey Club ("Cal Jockey") each held their 1995 Annual Stockholders Meetings. The results of the annual meetings were as follows: Cal Jockey Election of Directors: Cal Jockey's stockholders elected the following individuals to serve as directors for an additional term as follows: James P. Conn 2,893,152 Votes James M. Harris 3,628,090 Votes Kjell H. Qvale 3,685,946 Votes Marylin Kyne Gunderson 3,601,103 Votes Richard E. Perazzo 3,486,873 Votes Brian M. Herrera 3,608,160 Votes Appointment of Auditors: Cal Jockey's stockholders ratified the appointment of Deloitte & Touche, L.L.P. as Cal Jockey's independent auditors for the 1995 fiscal year as follows: FOR 3,729,992 Votes AGAINST 17,115 Votes ABSTAIN 33,679 Votes Bay Meadows Mandatory Retirement Age Stockholder Proposal: Bay Meadows' stockholders approved a stockholder proposal to establish a mandatory age of 72 for members of the board of directors as follows: FOR 2,197,832 Votes AGAINST 1,249,052 Votes ABSTAIN 381,961 Votes -16- 18 Election of Directors: Bay Meadows' stockholders elected the following individuals to serve as directors for an additional term as follows: Eugene F. Barsotti, Jr. 3,585,909 Votes John C. Harris 3,586,094 Votes F. Jack Liebau 3,582,115 Votes Lee R. Tucker 3,320,914 Votes Anthony J. Zidich 3,511,852 Votes Appointment of Auditors: Bay Meadows' stockholders ratified the appointment of Deloitte & Touche, L.L.P. as Bay Meadows' independent auditors for the 1995 fiscal year as follows: FOR 3,755,803 Votes AGAINST 11,841 Votes ABSTAIN 35,455 Votes (b) On August 22, 1995, Bay Meadows held a Special Stockholders Meeting to vote again on a proposal to establish a mandatory retirement age of 72 for members of the board of directors. Bay Meadows' stockholders approved the proposal as follows: FOR 3,132,313 Votes AGAINST 1,687,007 Votes ABSTAIN 40,024 Votes ITEM 5. OTHER INFORMATION None ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits None (b) Reports on Form 8-K None -17- 19 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrants have duly caused this report to be signed on their behalf by the undersigned, thereunto duly authorized. DATED: November 14, 1995 CALIFORNIA JOCKEY CLUB /s/ James M. Harris ----------------------------- James M. Harris President, Treasurer and Controller (Principal Executive and Financial Officer) BAY MEADOWS OPERATING COMPANY /s/ F. Jack Liebau ----------------------------- F. Jack Liebau President and Chief Executive Officer (Principal Executive Officer) -18- 20 EXHIBIT INDEX Exhibit No. Description 27-A California Jockey Club and Bay Meadows Operating Company Financial Data Schedule. 27-B California Jockey Club Financial Data Schedule. 27-C Bay Meadows Operating Company Financial Data Schedule. EX-27.1 2 FINANCIAL DATA SCHEDULE WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
5 0000016343 CALIFORNIA JOCKEY CLUB AND BAY MEADOWS OPERATING COMPANY 1000 9-MOS DEC-31-1995 JAN-01-1995 SEP-30-1995 10,365 5,159 999 82 0 19,918 35,898 20,291 35,786 12,390 0 116 0 0 23,353 35,786 1,749 30,198 580 28,235 0 0 15 1,948 30 1,978 0 0 0 1,978 .34 .34
EX-27.2 3 FINANCIAL DATA SCHEDULE
5 0000016343 CALIFORNIA JOCKEY CLUB 1000 9-MOS DEC-31-1995 JAN-01-1995 SEP-30-1995 1,023 5,159 5,037 0 0 11,225 26,440 14,772 32,893 257 0 58 0 0 22,578 22,893 0 3,119 0 1,106 0 0 0 2,013 0 0 0 0 0 2,013 .35 .35
EX-27.3 4 FINANCIAL DATA SCHEDULE
5 0000715273 BAY MEADOWS OPERATING COMPANY 1000 9-MOS DEC-31-1995 JAN-01-1995 SEP-30-1995 9,342 0 994 82 0 13,726 9,458 5,520 17,925 17,165 0 58 0 0 659 17,925 1,749 29,883 580 39,897 0 0 51 (65) 30 (35) 0 0 0 (35) (.01) (.01)
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