International Speedway's CEO Discusses Q1 2011 Results - Earnings Call Transcript

Apr. 5.11 | About: International Speedway (ISCA)

International Speedway (NASDAQ:ISCA)

Q1 2011 Earnings Call

April 05, 2011 9:00 am ET

Executives

Daniel Houser - Chief Financial Officer, Principal Accounting Officer, Senior Vice President and Treasurer

John Saunders - President

Charles Talbert - Director of Investor & Corporate Communications

Lesa Kennedy - Vice Chairman and Chief Executive Officer

Analysts

Stephen Altebrando - Sidoti & Company, LLC

Michael Walsh

Edward Williams - BMO Capital Markets U.S.

Brandon Taylor - Raymond James

Alvin Concepcion - Citigroup

Barry Lucas - Gabelli & Company, Inc.

Operator

Good morning, and welcome to the International Speedway Corporation's 2011 First Quarter Results Conference Call. [Operator Instructions] I would now like to turn the conference over to Charles Talbert, Director of Investor and Corporate Communications for International Speedway. Mr. Talbert, please go ahead.

Charles Talbert

Thank you, operator. Good morning, everyone, and welcome to the International Speedway's conference call. We are here to discuss the company's results for the first quarter ended February 28, 2011.

With us on this morning's call are Lesa France Kennedy, Chief Executive Officer; John Saunders, President; and Dan Houser, Senior Vice President and Chief Financial Officer. After our formal remarks, a question-and-answer period will follow. The operator will instruct you on procedures at that time.

Before we start, I would like to address forward-looking statements that may be addressed on the call. Forward-looking statements involve risks, uncertainties and assumptions. Actual future performance, outcomes and results may differ materially from those expressed in these forward-looking statements. Please refer to the documents filed by International Speedway Corporation with the SEC, specifically the most recent reports on Form 10-K and 10-Q, which identify important risk factors, which could cause actual results to differ from those contained in these forward-looking statements.

So with these formalities out of the way, I'll turn the call over to Lesa Kennedy. Lesa?

Lesa Kennedy

Good morning, and thank you for participating in today's call. While we couldn't have asked for a better start to the motorsport season in 2011, in addition to the excitement normally surrounding the start of any season with the anticipation of racing on a freshly paved surface at Daytona, this facility looked fantastic, and the racing has never been better. It was just absolutely fantastic. Our fans loved it.

The capital that we spent on the paving project gave us additional national prominence, as well as providing our fans with a brand new experience. The success of this project confirms our belief that we need to continue our focus on strategic capital opportunities that will enhance the guest experience which, of course, ultimately drive positive results for the company.

The storyline of Trevor Bayne pulling off one of the sport's bigger success to become the youngest driver ever to win the 500 [Daytona 500] provided additional momentum to the start of our season. Trevor is an up and coming driver. He's been a great ambassador to our sport, and he's been featured on national programs such as Good Morning America and Ellen DeGeneres Show. He's only 20 years old, and we expect that he would generate a strong following amongst his age group, which will surely benefit us and NASCAR.

We successfully navigated through an extended downturn in the economy, and remained in excellent financial position. While still early in the year, we remain hopeful that the growth in the economy will continue and lead to job creation. Through prudent cost containment, we expect to see meaningful improvement in our operating margin this year. And as growth returns to the economy and to our sport, these sustained cost savings will provide further margin improvement.

So with that, I'd now like to turn it over to John Saunders. Thank you.

John Saunders

Thank you, Lesa, and good morning, everyone. We are very pleased with the momentum generated from the start of the motorsports season, beginning with Speedweeks at Daytona and then on Phoenix. We had solid attendance, incredible racing and strong television ratings, which contributed to a positive quarter for ISC. Dan will provide a detailed review of our financial performance later in the call.

We're keeping a very close eye on the consumer and corporate spending trends. The economy is improving, but concerns remain, particularly in employment levels, consumer confidence and more recent world events. As a result of being disciplined with our capital structure and having focused attention on the cost side of the business, we are reiterating our full year guidance of total revenues of between $635 million and $650 million and non-GAAP earnings to range between $1.60 and $1.80 per diluted share. This guidance contemplates a strong increase in EPS and operating margins compared to our 2010 results.

Our attendance-related revenues continued to be our most significant short-term business risk. Advanced ticket sales for our Sprint Cup events remain in the range of approximately 11% and 12% off from last year in units and revenue, respectively. While part of this decline is associated with the timing of our renewals and related programs, fans continue to make their purchase decisions closer to race day. This is demonstrated by the strong increase in sales we have seen during the weeks preceding our event. For the Daytona 500, we sold almost 30,000 tickets during the final three weeks before the event. That equates to approximately 20% of the available grandstand capacity at the Speedway.

We understand the challenges that face ISC and are aggressively addressing them. Regaining a more normalized advanced ticket sales trend is a priority. In this operating environment, we are providing our customers with attractive pricing, particularly entry points for new fans. And as always, we maintain price integrity throughout an event sales cycle.

In 2010, permanent capacity was reduced by approximately 5%, most of which was a result of upgrading and widening seats, which enhances the fans' experience. The goal is to drive a healthy tension between supply and demand, leading to greater pricing control and more robust advance ticket sales.

While the at-track experience is paramount, a critical area of fan focus is the competition on the track. I commend NASCAR for the enhancements that have been made to the sport over the past few years. These improvements are being favorably received by the fans. And as long as the event experience is what the fans expect, we know it will support ticket sales and retention rates.

We are actively pursuing new customers through various segmented marketing programs. One demographic, the youth, is the next-generation race fan. Traditional means of advertising may not be adequate to reach this demographic. Other mediums, primarily social media channels, more effectively reach and resonate with the Youth segment. All constituents, promoters, sanctioning bodies and drivers are actively involved in creating this interactive dialogue and interest with current and potential fans. As Lesa mentioned, we are excited for Trevor Bayne winning the Daytona 500. As the youngest driver ever to win the iconic race, he has the ability to reach the younger audience.

Television ratings for the Daytona 500 were up considerably, but the biggest increase came in the teen male, 20 to 17-year-old viewership, which grew 91% over 2010. To date, for the Sprint Cup Series household viewership is up double digits. And the male 18 to 30-year-old group has spiked upwards as well. Also, the upcoming movies, Cars 2 and Transformers 3, nicely aim at these next-generation fans. These initiatives and others underway are aimed at generating interest in the sport. As we are able to attract more fans to the live event, the better able we will be to generate revenue for our corporate partners.

We remain encouraged by the level of corporate marketing activity. ISC currently has agreements in place for 87% of our gross marketing partnership revenue target for fiscal 2011. During the fiscal quarter, we announced a 10-year agreement with Hollywood Casino at Kansas Speedway to sponsor Kansas Speedway's fall NASCAR Sprint Cup Series race.

Subsequent to quarter end, we announced a multi-year agreement with Royal Purple Synthetic Oil to serve as the title sponsor for Auto Club's NASCAR Nationwide Series race. For the remainder of the season, we have five Sprint Cup and three nationwide entitlements either open or not yet announced. Based on current activity, we expect to secure all of our 2011 NASCAR Sprint Cup and Nationwide Series event entitlements.

As it relates to our Staten Island property, the Department of Environmental Conservation that we have a been working with on remediation and permitting matters, last week published for public comment a series of documents including an Engineering Work Plan, which ultimately allows for the property to be filled.

Following the public comment period, we are hopeful the DEC will approve the Engineering Work Plan, as well as a Modified Order on Consent and other related documents. This step will allow the property to be filled and remaining environmental remediation to be completed, both of which are necessary precursors for commercial development of the property. We believe this is an important step in the development of the property and its potential to bring jobs and economic development to Staten Island. Currently, the company does not anticipate filling activities to commence until after we have sold our interest in 380 Development, which owns the land.

Our Hollywood Casino at Kansas Speedway is on track for opening in 2012 and, importantly, on budget. This is the first venture underway to monetize our vast real estate holdings and is expected to be very successful for our shareholders. Our share of the expected cash flow from the 50-50 joint venture would be nearly equivalent to ISC opening another Kansas Speedway-type motorsports facility with a fresh NASCAR Sprint Cup Series date included. Since there are no new dates being awarded by NASCAR, this is another way we are increasing the company's bottom line result.

Now with that, I will now turn the call over to Dan to discuss the financial performance for the quarter.

Daniel Houser

Thanks, John, and good morning, everyone. We're very pleased to be reporting improved first quarter results. The performance of our first quarter events, coupled with the cost-reduction commitments we outlined last year, have generated financial results that exceeded our expectation.

Our first quarter results were impacted by the ongoing economic trends, which continued to be a headwind for attendance related, as well as corporate partner revenues. Also, comparability was affected by the realignment of events impacting the California and Phoenix race calendars. Other factors impacting comparability for our first quarter 2011 results include non-cash impairments of track assets, interest rate swap expense and state tax settlements. All these are outlined in the earnings news release and are included in our GAAP to non-GAAP reconciliation. Let's take a look at the income statement.

Admissions revenue for the first quarter decreased to $36.1 million, anticipated as a result of the previously mentioned realignment of events impacting the California and Phoenix race times. Also, contributing to the decrease was a lower-weighted average ticket price per comparable event. Partially offsetting these decreases were increased attendance at certain events held during Speedweeks at Daytona. For the quarter, while attendance for certain of our Sprint Cup events increased, the weighted-average ticket price for all Sprint Cup events decreased approximately 3%.

The slight decrease in motorsports-related revenue to $98 million was primarily driven by the previously mentioned event realignment. Partially offsetting the decrease were increases in television and broadcast ancillary rights, sponsorship, hospitality revenues for Speedweeks.

For the quarter, ISC's domestic television broadcast and ancillary rights were $64.9 million, with $63.3 million associated with domestic broadcast contracts, and $1.6 million of ancillary rights. The slight decrease in food, beverage and merchandise revenue to $12.1 million was primarily attributable to chilly weather at Phoenix, which impacted concession beverage sales and, to a lesser extent, certain non-event-related merchandise sales.

The decrease in Prize & Point Fund Monies in NASCAR sanction fees to $31.9 million was largely attributable to the previously mentioned event realignments. To a lesser extent, reductions in certain Prize & Point Fund Monies paid for the events held during Speedweeks also contributed to the decrease. Partially offsetting these decreases were increase in television broadcast rights fees for NASCAR Speedweeks events, a portion of which were paid to competitors as part of Prize & Point Fund Monies.

Motorsports-related expense decreased to $24.5 million. The decrease was primarily attributable to our cost-containment initiatives, focused to enhance operating margin without negatively impacting our guest experience, as well as the previously mentioned event realignments. Food, beverage and merchandise expense increased to $8.8 million for the quarter, primarily due to certain costs associated with catering and concessions during Speedweeks and intended to enhance the guest experience for both the consumer and the corporate customer.

General and administrative expense decreased to $22.2 million for the quarter. The reduction in personnel related and various other costs driven by our cost-containment initiatives contributed significantly to the decrease.

The increase in depreciation and amortization expense to $19.1 million for the quarter was attributable to capital expenditures for ongoing facility enhancements and related initiatives. The $2.9 million non-cash impairment of long-lived assets is attributable to the removal of certain assets in connection with the repaving of the track and grandstand enhancements at Phoenix, as well as grandstand enhancements at Kansas. Interest income was comparable to the same period of the prior year.

Interest expense for the quarter decreased to approximately $3.8 million. The decrease is due to the partial tender of senior notes due 2014 in the fourth quarter of fiscal 2010, and increased capitalized interest during the current period. Partially offsetting these decreases was interest on the private placement issued in January 2011 and higher interest rates and fees on our new credit facility as compared to the same period in the prior year.

Equity and net loss from equity investments represent certain start-up costs for our 50% equity interest in Hollywood Casino at Kansas Speedway. Our effective tax rate for the quarter was approximately 39.3%.

Income from continuing operations for the three months ended February 28, 2011, was $21.4 million or $0.45 per diluted share on approximately 48 million shares outstanding. However, when you exclude non-cash asset impairments and the equity and net loss from equity investments, we posted earnings of $0.49 per diluted share for the 2011 fiscal first quarter. As described in the release, this is comparable to non-GAAP net income for the 2010 first quarter of $0.45 per diluted share.

Now we'll take a look at the balance sheet and future liquidity. At February 28, our combined cash and cash equivalents totaled $102 million. Current deferred income was approximately $87.4 million, and shareholders' equity was $1.2 billion. At the end of the quarter, total debt was approximately $319 million, including $152 million in senior notes, $64 million in TIF bonds associated with Kansas, $2 million in revenue bonds, $51 million for a loan to construct our headquarters’ office building, and $50 million in borrowings on our line of credit.

As John mentioned, our Hollywood Casino at Kansas Speedway joint venture is progressing as planned. As of the end of the first quarter, we have funded approximately $39.3 million of the approximately $155 million we estimate to be our share of the capitalized development cost for the project, which is included on our balance sheet as equity investments. In addition, we will continue to incur certain other start-up and related costs through the casino opening, a number of which will be expensed through equity and net loss from equity investments.

In February, our Board of Directors approved a request to make open market share repurchase consistently over the year up to the remaining $29 million balance approved. During the first quarter, we purchased 81,988 shares of our Class A stock for approximately $2.4 million, bringing the total number of shares purchased from December 2006 through February 2011 to approximately 5.3 million shares. At the end of the quarter, we had approximately $27 million in remaining capacity on our $250 million authorization.

Returning capital through shares and an annual dividend payment, which this year, I estimate will be approximately $9 million, is an important component of our long-term capital allocation strategy. As it relates to capital spending, for the three months ended February 28, 2011, we spent $11.7 million on capital expenditures, which includes $9.6 million for projects at our existing facilities. The remaining balance is mainly associated with amounts capitalized to the Staten Island property.

At quarter end, we have approximately $52.9 million in capital projects currently approved for our existing facilities. These projects include completion of track repaving at Phoenix, grandstand seating enhancements and infield improvements at Michigan and Martinsville, grandstand seating enhancements at Watkins Glen, improvements at various facilities for expansion of parking, camping capacity and other uses and a variety of other improvements and renovations to our facilities that enable us to effectively compete with other sports venues for consumer and corporate spending.

As a result of these currently approved projects and anticipated additional approvals in fiscal 2011, we expect our total 2011 capital expenditures at our existing facilities will be approximately $65 million to $75 million, depending on the timing of certain projects. We review the capital expenditure program periodically and modify it as required to meet current business needs.

In closing, these results are a testament to focused and dedicated attention to managing our company for the long term. The cost-containment initiatives we put in place are expected to generate a significant increase in operating margin this year. As the economy strengthens and consumer and corporate spending improves, we fully expect to see further gains in our margins.

This is an important achievement as we reverse declining trends and show improvement year-over-year not only in margins, but in ISC's earnings per share. Our sound financial policies ensure we maintain a strong financial position that provides us a significant competitive advantage within our industry. We have a tremendous opportunity to see our company grow stronger as we successfully execute our strategic initiatives.

We look forward to speaking with you on our next earnings call in July. And with that, I'll turn it back over to the operator for Q&A.

Question-and-Answer Session

Operator

[Operator Instructions] Your first question comes from the line of Michael Walsh with Wells Fargo.

Michael Walsh

Just on the cost-containment initiatives, I think you had said maybe $25 million in savings in '11. I don't know if that's correct and how much did you realize in Q1, if any? It sounds like there is some realization of the savings there. And if there's any color on timing the rest of the year that you could give us?

John Saunders

Yes, Michael. We expect to see at least $20 million over the course of the year. And it'll kind of be -- it's going to be ratably over the course of the year. A lot of the changes that we made were really made in the fourth quarter last year. And henceforth, they're going to appear throughout the year. So most of this stuff is initiated, is executed and we've just got to discipline ourselves to stay within our budgets and spending guidelines, and it should show good results.

Michael Walsh

Just one more question, I'll jump back in the queue. It didn't look like there is any contribution in the quarter to the Kansas JV. Would you expect most of that over the next couple of quarters, the remaining portion?

Daniel Houser

Yes, it's going to be -- you'll see through the rest of the year, we made some contributions before year end, have made some since quarter end. And that'll ramp up through the rest of this year, as John said in his remarks and I alluded to, we're on course there. So that we expect that facility to open in the first half of 2012. So we will see some inflow cash.

Michael Walsh

And no changes there for your EBITDA estimates, 2013, I think $50 million EBITDA, is that right?

John Saunders

Yes.

Daniel Houser

Yes.

Operator

Your next question comes from the line of Greg Badishkanian with Citi.

Alvin Concepcion - Citigroup

This is Alvin Concepcion in for Greg. I apologize if I missed this, but can you talk about your current advanced ticket sales trends?

Daniel Houser

Yes, Alvin. What I mentioned earlier on in my remarks is the year-to-date. Our advanced ticket sales units are down about 11% in units and 12% in revenue. And what you have to keep in mind though is, what we're getting and we're seeing this at every event so far this year, a tremendous ramp-up, a spike anywhere from three to six weeks out with enormous volume of ticket sales going on. And so, it's a little bit misleading in terms of where the event ultimately ends up. But year-over-year, it is down by the numbers that I mentioned.

Alvin Concepcion - Citigroup

Have you seen any impact to your attendance or ticket sales related to rising gas prices or any of the other recent global events?

John Saunders

We're very concerned about -- gas prices are roughly up somewhere between $0.85 and $1 dollar a gallon on average across all of our markets from where we were a year ago. The interesting thing is that we're not seeing it in any kind of significant feedback from fans yet. Now we had this situation, I believe, it was back in '08, where we were pushing over $4 a gallon, and we were seeing some impact. As you know, our fans travel in excess of 200 miles one way to attend events. And so, this could be an issue. But we're not seeing it in any kind of math just yet.

Daniel Houser

And that's the kind of thing, Greg, where some events may be impacted more than others. For example, Talladega draws from a much wider radius, probably a 50% larger radius, than some of our other events do. And then we also camp a tremendous amount of people, around 50,000 people camp for the Talladega event. So that means they're driving more fuel-hungry vehicles and things like that. So it can be isolated sometimes on the -- which events will have more impact.

Alvin Concepcion - Citigroup

Great. And just a longer-term question, you talked about your focus on younger fans. Can you discuss any other major initiatives to bring in some new fans or expand to other demographics? And along that note, what are you seeing, as a percentage of your attendance, from first-time attendees and how does that compare to last year?

John Saunders

Well, on the first part of your question, certainly, the youth demographic is something that not just we are focused on, but NASCAR as well. But also, we're certainly not leaving our core avid fans, and we are doing a number of things to reinforce the relationship. A number of these folks, obviously, have been impacted by the economy. Our demographic was more significantly hit by the downturn. And when you look at things like manufacturing and construction jobs. But we have, as I mentioned, adjusted pricing. We still have a very strong discipline of giving our best price to our best customers. And so, we certainly aren't abandoning any of the initiatives there for the base that we have. I would also say that the industry is getting much more aligned and aggressive, if you will, in overall PR communications with the fan base, much that we've never seen before. And then, there are a number of value-add programs that we're promoting across all of our targeted demographics, whether it's an all-you-can-eat section, promoting more family sections in our grandstands, things of that nature. So what was the second part of your question?

Alvin Concepcion - Citigroup

Well, just what are you seeing in terms of your attendance maybe as a percentage of your attendance of some first-time attendees and how does that compare historically?

John Saunders

I don't have that with me. What we can do is circle back with you on that, on that particular piece.

Operator

Your next question comes from the line of Steve Altebrando with Sidoti & Company.

Stephen Altebrando - Sidoti & Company, LLC

You had mentioned corporate marketing is about close to 90% of your goal for the year. I'm wondering if you could put that in perspective on a year-over-year basis, where you were at this point last year and if your goals are higher?

Daniel Houser

Yes. The overall goal, pretty flat. Last year, we were at about 85% of our goal at this time, this year at 87%. So while we've got some more entitlements that are in process versus what was signed and announced at that time last year, the overall target where actually we're doing very well with, and we're pretty excited and optimistic about discussions going on, activity, and we like to see these deals get -- it's best when they're announced by the tracks first. So, we are hopeful that we'll have some good news over the next weeks and months.

Stephen Altebrando - Sidoti & Company, LLC

Okay. And you might have mentioned this, but can you give an idea of what same event admissions revenue was in the quarter?

Daniel Houser

Well, yes. It's pretty comparable. Most of the decline in admissions revenue is really impacted by what we anticipated from the realignment of events. So, you've got a little bit lower weighted-average ticket price at Phoenix. And we also had anticipated with moving that event on the calendar, that much farther forward and the proximity to the event in November is going to take some time to get the attention and move the fan that way. Actually, it did very -- we were very pleased with how well that move did do, but we anticipated some decline. We also had, compared to last year, changed some of the kind of curtail cut back on some of the activity at our Daytona 500 experience here in Daytona, and that had some impact on year-over-year admission dollars. So, pretty happy with what we saw for Speedweeks.

Stephen Altebrando - Sidoti & Company, LLC

Okay. And then just lastly, looks like a pretty meaningful decline in receivables and deferred income year-over-year?

Daniel Houser

Yes. I'm glad you asked that because that's a very good question. What we had is, I think, it's a $30-some million decline in deferred revenue. About $8 million of that is related to the timing of TV payments for the Martinsville event. Then we have about a $9 million decrease in ticket advance sales, as John was speaking to. We're still seeing a very solid ramp-up late in the cycle. So while we're happy with the attendance numbers overall, we'd certainly like to move what we can back to a more robust advance sales. The balance of that is related to the changes in the events schedule, not only for Phoenix and the California, Kansas moves, but also with IRL and what we had to do with some existing contracts because of those event changes was go out and get contract amendments. And we hadn't re-billed that stuff. So it wasn't that the dollars were going down, it's just that the allocations need to be amended. Some of the benefits and what the companies are getting in those contracts reassigned and those didn't get re-billed until after quarter end. So that has corrected itself at this point.

Operator

Your next question comes from the line of Edward Williams with BMO Capital Markets.

Edward Williams - BMO Capital Markets U.S.

Just to follow up a little bit, John, on some of the demographic questions. Can you give us a little bit color as to what the demographic is like currently of people who are attending some of the International Speedway races to the extent that, that differs from NASCAR as a whole, if it does, and how that has trended over time? And then also, if you can give us a little bit of color as to the number of races per year people seem to be attending. I'm not quite sure how to look at it, but if you're going to look at your most avid fans, is that number changing at all over recent years?

John Saunders

Edward, with regards to the second part of your question, several years ago, certainly, before the downturn, perhaps in the mid part of the decade, the survey, the data suggested to us that fans were frequenting up to somewhere around five cup events on an annual basis. And that, obviously, has declined the somewhere in the neighborhood of two to three. And I don't have any recent data since that, which I think was at the tail end of 2009, the beginning of 2010. So we have seen -- and a lot of that, obviously, was driven by the downturn, the macroeconomic environment. As to the demographics, we've talked about this. Our demographics largely mirror that of the U.S. population, and we have not seen any real meaningful movement in those demographics. Although, as I mentioned, we're highly focused on youth and first timers, first timers to our event. When you think of youth, you think of young people whether who are working with school systems and educational programs. But also, first timers to our event is a critical focus area for our marketing sales and consumer marketing sales folks in that you really -- these events are somewhat challenging. They're large events. When you think about the size of Superspeedway compared to a baseball or a football stadium, it's a little bit intimidating if you haven't been introduced to the sport by somebody that has been coming for years. And so, some of the research that we're looking at is suggesting that we all have to do a better job of whether it's way finding, whether it’s ingress/egress, whether it's a sort of a NASCAR 101 to help people really understand and to consume our events. But clearly, a big area of focus are our first timers and the youth.

Edward Williams - BMO Capital Markets U.S.

What's the percentage of your fans that kind of attended in any given season that are first timers?

John Saunders

Edward, I don't have that. We can circle back. I'm not sure that we have that readily available. But we'll circle back. We'll take a look. But I don't have any kind of current information on that.

Edward Williams - BMO Capital Markets U.S.

Okay. I mean, it certainly would be interesting, I think, to see some sort of trend along those lines with recent years.

John Saunders

Sure.

Edward Williams - BMO Capital Markets U.S.

And then the other thing, I think, would be interesting would be to kind of get a gauge of whether or not your attendance is getting younger. I'm not sure if you have any surveys on who's actually coming, but to see if there's any change in the average age of who's actually attending the races?

John Saunders

Right now, it's rather flat. But that said, our intent is to build that audience.

Operator

Your next question comes from the line of Barry Lucas with Gabelli & Company.

Barry Lucas - Gabelli & Company, Inc.

John, I just want to make sure I've got this right in front of the optimism, if you will. On the corporate side, you've contracted a higher percentage of your goal with fewer entitlements actually sold versus a year ago so there's more interest from the corporate side? I hope I've got that right. And if so, where is it coming from? Are there new -- are you seeing new interest or is it renewed interest from people or companies that went away and came back?

John Saunders

Really, it's kind of a mix of all of that. We've got some great new entrants. We had GEICO, important new partner for us this year. We always are working very hard to keep our existing partners in the sport. And we've got some exciting things we hope we announce here soon about some familiar names coming back to participate with us. So keep in mind that with the entitlements and things like that, is that, that's about, I think, today, 30% of our overall target there. We have done extremely well in the official status category. We think that's a model that works very well for partners. And we have great success in recurring renewal success there. Entitlements are kind of -- a lot of times, they're market specific and season specific. And so, we're careful there. Our teams are careful to get the right partner for the right event and the right market. Again, because we want success. We want them back. So a lot of the things that we're working on and some of the things we've announced are, we're getting some partners in and getting them in for multiple years.

Barry Lucas - Gabelli & Company, Inc.

On Staten Island, again, I just want to understand, how long is the public comment period supposed to last for this hearing or whatever it is?

Daniel Houser

The public comment period is 21 days.

John Saunders

It runs through April 20.

Daniel Houser

April 20, if that should expire, Barry.

Barry Lucas - Gabelli & Company, Inc.

And when that expires, what does that mean?

Daniel Houser

That means that the -- that's a comment period for stakeholders to give comments back to the DEC. Then the DEC can evaluate whether or not they're going to react to any of those comments. So, there's some process after that. It's a huge threshold for us that the DEC publishes because that means they have made their decision. And they're the decision-making body. So, how quickly they move once the comment period is done is, unfortunately, where, again, they control our destiny on that. But it should -- we're hopeful that it should move right along. We think there's a lot of interest besides ISC and any interested parties that would like to see this process culminated and be to where a transaction could get done.

John Saunders

And Barry, this is John. I would add to that, that Dan said, that was going to the public comment period was a major, major threshold to the project. And the DEC was extremely, as we've talked about in prior calls, was extremely thorough and diligent in trying to capture everything they possibly could before publishing this Engineering Work Plan. And they are not obligated. They're not obligated to react to comments that they get back. And they have done what we viewed to be a very, very thorough job of communicating in advance with all of the stakeholders that may have issues with this process. But we are hopeful that if there are any, that they can be quickly adjusted in the documents. But then, we are able, at that point, to proceed to some sort of transaction.

Barry Lucas - Gabelli & Company, Inc.

Last question on this subject, John. Have you had definitive indications of interest from potential buyers, and that can't be a lot for 700 acres on Staten Island, but from groups or individuals that have been waiting for this to happen? Has this really been a deterrent to potential purchases?

John Saunders

Well, it's a deterrent in the sense that when one, in this day and age, when one wants to acquire a property and develop it or have some kind of use for it, they want to be assured that they can get the entitlements to do that. And that's what this process allows us to do. And to your other question is, yes, we've had definitive conversations with a couple of buyers. The one that we've talked publicly about is KB Marine Holdings. We've been under contract with them for some time with, I think, one or two amendments, and then eventually terminated that contract. That was our decision to do that. But they remain very interested as well as -- you're right, there's not a lot of the people. But now that this process is coming to what we hope a closure, there are others that are expressing interest. So we're feeling pretty good about it.

Operator

[Operator Instructions] Your next question comes from the line of Brandon Taylor with Raymond James.

Brandon Taylor - Raymond James

Just had one quick question about occupancy in the quarter. Could you give me that, as well as what it was a year ago?

Daniel Houser

Yes. I think our capacity utilization for -- with available for total capacity was -- it's about 78% versus about 75%, 76% last year. So, up a little.

Operator

And there are no further questions.

John Saunders

Okay. Well, thank you. I'd like to thank everybody for joining us on the first quarter call, and we look forward to seeing you on the next quarter. We've got momentum. We're optimistic that this will continue. A little concerned about the economy still, but we're off to a great start. So, once again, thanks for joining us.

Operator

Thank you for participating in today's conference call. You may now disconnect.

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