<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A NO. 1
(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
June 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
----------- -----------
<TABLE>
<S> <C>
Commission File Number 1-9319 Commission File Number 1-9320
CALIFORNIA JOCKEY CLUB BAY MEADOWS OPERATING COMPANY
- --------------------------------------------------------- -----------------------------------------------------------
(Exact name of registrant as specified in its charter) (Exact name of registrant as specified in its charter)
Delaware 94-0358820 Delaware 94-2878485
- --------------------------------------------------------- -----------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer (State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.) incorporation or organization) Identification No.)
94-0358820 94-2878485
- --------------------------------------------------------- -----------------------------------------------------------
(I.R.S. Employer Identification No.) (I.R.S. Employer Identification No.)
2600 S. Delaware Street, San Mateo, California 94403 2600 S. Delaware Street, San Mateo, California 94402
- --------------------------------------------------------- -----------------------------------------------------------
(Address of principal executive offices) (Zip Code) (Address of principal executive offices) (Zip Code)
(415) 573-4514 (415) 574-7223
- --------------------------------------------------------- -----------------------------------------------------------
(Registrant's telephone number, including area code) (Registrant's telephone number, including area code)
Not Applicable Not Applicable
- --------------------------------------------------------- -----------------------------------------------------------
(Former name, former address and former fiscal year, if (Former name, former address and former fiscal year, if
changed since last report) changed since last report)
</TABLE>
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 December 12, 1996, was
as follows:
<TABLE>
<CAPTION>
Registrant Number of Shares
---------- ----------------
<S> <C>
California Jockey Club 5,763,257
Bay Meadows Operating Company 5,763,257
</TABLE>
- 1 -
<PAGE> 2
ITEM 2. MANAGEMENTS' DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
General
Bay Meadows Operating Company ("Bay Meadows") has been allocated 115 racing days
for the year ending December 31, 1996 versus 108 racing days for calendar year
1995. Of these days, Bay Meadows conducted 63 days of racing in the six months
ended June 30, 1996 versus 30 days in the same period in 1995. Historically, Bay
Meadows and California Jockey Club have derived a major portion of their
revenues from the racing meet.
California Jockey Club
Results of Operations: Quarter Ended June 30, 1996
Compared with Quarter Ended June 30, 1995
Total revenues for California Jockey Club ("Cal Jockey") decreased $207,000
(28%) for the three months ended June 30, 1996, compared to the same period in
the prior year. The decrease is due to a decrease in the rental of the racing
facility. During the quarter ended June 30, 1996, Bay Meadows did not host any
live race days as compared to 10 live race days in the same period prior year.
Rental of the racing facility is based on racing revenues.
Expenses for the three months ended June 30, 1996 increased $133,000 (38%),
primarily as a result of an increase in salary expenses and legal fees.
Results of Operations: Six Months Ended June 30, 1996
Compared with Six Months Ended June 30, 1995
Total revenues for California Jockey Club ("Cal Jockey") increased $1,228,000
(75%) for the six months ended June 30, 1996, compared to the same period in the
prior year. Rental income derived from the leasing of its racing facility is
based on Bay Meadows' racing revenues and increased $1,228,000 as a result of 33
more racing days in the first six months of 1996 than in the same period in
1995.
Expenses for the six months ended June 30, 1996, increased $216,000 (32%),
primarily as a result of professional fees incurred in 1996.
Liquidity and Capital Resources
The liquid assets (cash and marketable securities) of Cal Jockey decreased to
$9,072,000 at June 30, 1996, from $9,253,000 at December 31, 1995. This decrease
is primarily the result of a $349,000 decrease in receivables from Bay Meadows
due to the timing of the rent payments from Bay Meadows, partially offset by
the increase in the fair market value of the securities available for sale. Bay
Meadows has received a signed commitment to extend its $6,000,000 bank line of
credit through June 1, 1998. The terms of the extension are substantially the
same as the terms of the previous bank line of credit and the extension is
subject to a number of conditions, including Cal Jockey's continuing guarantee
of the $6,000,000 line of credit. As of June 30, 1996 there
-2-
<PAGE> 3
were $2,000,000 of borrowings outstanding under this bank line of credit.
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 Subsidiary
Results of Operations: Quarter Ended June 30, 1996
Compared with Quarter Ended June 30, 1995
Total revenues decreased $4,602,000 (64%) for the three months ended June 30,
1996 compared with the same period in 1995. Bay Meadows did not host any live
race days during the quarter ended June 30, 1996 as compared to 10 race days
during the same period in 1995.
Expenses for the three months ended June 30, 1996 decreased $3,519,00 (47%)
compared with the same period in 1995. The decrease is also due to the
decrease in racing days.
Results of Operations: Six Months Ended June 30, 1996
Compared with Six Months Ended June 30, 1995
Total revenues increased $12,503,000 (74%) for the six months ended June 30,
1996 compared with the same period in 1995. This was due to an increase in
pari-mutuel revenues of $11,620,000. Pari-mutuel revenues increased due
primarily to an additional 33 more racing days in the first six months of 1996
compared to the same period in 1995.
Other revenues were positively impacted by the same factors which affected
pari-mutuel revenues. Admissions, program, parking and other racing income
increased $458,000, and concession sales increased $270,000.
Total costs and expenses increased $10,577,000 (62%) for the six months ended
June 30, 1996, compared with the same period in the prior year. This was due to
increases in expenses associated with higher operating revenues, including (i)
purses and incentive awards ($5,065,000), (ii) commissions paid to guest
locations ($824,000), (iii) direct operating costs ($2,995,000) and (iv) racing
facility rental ($1,213,000).
Liquidity and Capital Resources
The liquid assets (cash and cash equivalents) of Bay Meadows decreased to
$1,581,000 at June 30, 1996, from $6,318,000 at December 31, 1995. This decrease
is mostly due to the conclusion of the 1995/1996 racing meet and the settlement
of liabilities related to the meet. Amounts held on deposit for Thoroughbred
horse owners and related due to Thoroughbred horse owners decreased $2,920,000
due to the settlement of amounts related to the 1995/1996 racing meet.
Accounts receivable decreased $2,260,000 from December 31, 1995 due to the
completion to the 1995/1996 racing meet and settlement of amounts due to Bay
Meadows.
Accounts payable and accrued liabilities decreased $4,407,000 due to settlement
of liabilities related to the 1995/1996 racing meet. Accrued purses and
uncashed pari-mutuel tickets and vouchers decreased $687,000 and $4,321,000,
respectively, also due to the completion of the 1995/1996 racing meet.
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
received a signed commitment to extend its $6,000,000 bank line of credit
through June 1, 1998. The terms of the extension are substantially the same as
the terms of the previous bank line of credit and the extension is subject to
a number of conditions, including Cal Jockey's continuing guarantee of the
$6,000,000 line of credit. As of June 30, 1996 there were $2,000,000 of
borrowings outstanding under this bank 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 June 30, 1996, Bay Meadows' current liabilities exceeded its current
assets by $2,390,000. The current ratio (current assets to current liabilities)
was .53 to 1 at June 30, 1996, compared to .81 to 1 at December 31, 1995.
ITEM 5. OTHER INFORMATION
Status of the Master Lease
The Master Lease Agreement pursuant to which Bay Meadows leases the Racecourse
Properties from Cal Jockey expired on March 31, 1996. Prior to the expiration of
the lease, Cal Jockey and Bay Meadows had discussions regarding the extension of
the Master Lease Agreement. The companies now have conflicting views concerning
the status of the Master Lease Agreement's extension. Cal Jockey believes, based
on the absence of an executed lease and applicable laws, among other things,
that no lease exists and that Bay Meadows is a tenant at will. Bay Meadows
believes, based partly on its understanding of certain corporate action taken by
Cal Jockey and statements of Cal Jockey's President and Chairman, that the
Master Lease Agreement has been extended for an additional three years with an
increase in rent but otherwise substantially on the same terms as the previous
lease.
-3-
<PAGE> 4
PART I: FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CALIFORNIA JOCKEY CLUB AND
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
SEPARATE AND COMBINED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1996
(In thousands, except share and per share amounts) (Unaudited)
<TABLE>
<CAPTION>
Bay Meadows
California Operating
Jockey Company and
Club Subsidiary Eliminations Combined
<S> <C> <C> <C> <C>
REVENUES:
Pari-mutuel revenue $ 23,534 $ 23,534
Producer fees 398 398
Admissions, programs, parking and
other racing income 2,731 2,731
Concession sales 1,218 1,218
Rental of racing facility $ 2,610 430 $(2,610) 430
Interest and dividend income 250 93 (4) 339
Other income 5 924 929
---------- ---------- ------- ----------
Total 2,865 29,328 (2,614) 29,579
---------- ---------- ------- ----------
COSTS AND EXPENSES:
Purses and incentive awards 9,639 9,639
Commissions paid to guest tracks 1,599 1,599
Direct operating costs 10,574 10,574
Cost of concession sales 368 368
Depreciation and amortization 459 333 792
Racing facility rental 2,622 (2,610) 12
Marketing 736 736
General and administrative expense 432 1,632 (4) 2,060
---------- ---------- ------- ----------
Total 891 27,503 (2,614) 25,780
---------- ---------- ------- ----------
INCOME BEFORE INCOME TAX PROVISION 1,974 1,825 3,799
INCOME TAX PROVISION 730 730
---------- ---------- ------- ----------
NET INCOME $ 1,974 $ 1,095 $ - $ 3,069
========== ========== ======= ==========
PER SHARE AMOUNTS:
NET INCOME $ 0.34 $0.19 $0.53
========== ========== ======= ==========
DIVIDEND $ 0.40 $0.40
========== ========== ======= ==========
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 5,763,257 5,763,257 5,763,257
========== ========== ======= ==========
</TABLE>
See Notes to Financial Statements.
-4-
<PAGE> 5
CALIFORNIA JOCKEY CLUB AND
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
SEPARATE AND COMBINED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1995
(In thousands, except share and per share amounts) (Unaudited)
<TABLE>
<CAPTION>
Bay Meadows
California Operating
Jockey Company and
Club Subsidiary Eliminations Combined
<S> <C> <C> <C> <C>
REVENUES:
Pari-mutuel revenue $ 11,914 $ 11,914
Producer fees 209 209
Admissions, programs, parking and other racing income 2,273 2,273
Concession sales 948 948
Rental of racing facility $ 1,404 625 $(1,404) 625
Interest and dividend income 229 82 311
Other income 4 774 (4) 774
---------- ---------- ------- ----------
Total 1,637 16,825 (1,408) 17,054
---------- ---------- ------- ----------
COSTS AND EXPENSES:
Purses and incentive awards 4,574 4,574
Commissions paid to guest tracks 775 775
Direct operating costs 7,579 7,579
Cost of concession sales 306 306
Depreciation and amortization 481 318 799
Racing facility rental 1,409 (1,404) 5
Marketing 452 452
General and administrative expense 194 1,349 (4) 1,539
Card club costs 164 164
---------- ---------- ------- ----------
Total 675 16,926 (1,408) 16,193
---------- ---------- ------- ----------
INCOME (LOSS) BEFORE TAXES 962 (101) 861
INCOME TAX BENEFIT 46 46
---------- ---------- ------- ----------
NET INCOME (LOSS) $ 962 $ (55) $ - $ 907
========== ========== ======= ==========
PER SHARE AMOUNTS:
NET INCOME (LOSS) $ 0.17 $ (0.01) $ 0.16
========== ========== ======= ==========
DIVIDEND $ 0.25 $ 0.25
========== ========== ======= ==========
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 5,756,019 5,756,019 5,756,019
========== ========== ======= ==========
</TABLE>
See Notes to Financial Statements.
-5-
<PAGE> 6
CALIFORNIA JOCKEY CLUB AND
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
SEPARATE AND COMBINED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 1996
(In thousands, except share and per share amounts) (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Bay Meadows
California Operating
Jockey Company and
Club Subsidiary Eliminations Combined
<S> <C> <C> <C> <C>
REVENUES:
Pari-mutuel revenue $ 701 $ 701
Admissions, programs, parking and other racing income 796 796
Concession sales 363 363
Rental of racing facility $ 398 290 (398) 290
Interest and dividend income 127 7 134
Other income 2 479 481
--------- ----------- ------- ----------
Total 527 2,636 (398) 2,765
--------- ----------- ------- ----------
COSTS AND EXPENSES:
Purses and incentive awards 5 5
Direct operating costs 2,503 2,503
Cost of concession sales 135 135
Depreciation and amortization 229 167 396
Racing facility rental 404 (398) 6
Marketing 125 125
General and administrative expense 255 607 862
--------- ----------- ------- ----------
Total 484 3,946 (398) 4,032
--------- ----------- ------- ----------
INCOME (LOSS) BEFORE TAXES 43 (1,310) (1,267)
INCOME TAX BENEFIT 528 528
--------- ----------- ------- ----------
NET INCOME (LOSS) $ 43 $ (782) $ -- $ (739)
========= =========== ======= ==========
PER SHARE AMOUNTS:
NET INCOME (LOSS) $ .01 $ (.14) $ (.13)
========= =========== ==========
DIVIDEND $ .40 $ .40
========= ==========
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 5,763,257 5,763,257 5,763,257
========= ========= =========
</TABLE>
See Notes to Financial Statements.
- 6 -
<PAGE> 7
CALIFORNIA JOCKEY CLUB AND
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
SEPARATE AND COMBINED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 1995
(In thousands, except share and per share amounts) (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Bay Meadows
California Operating
Jockey Company and
Club Subsidiary Eliminations Combined
<S> <C> <C> <C> <C>
REVENUES:
Pari-mutuel revenue $ 4,644 $ 4,644
Producer fees 64 64
Admissions, programs, parking and other racing income 1,089 1,089
Concession sales 491 491
Rental of racing facility $ 604 461 $ (604) 461
Interest and dividend income 128 21 149
Other income 2 468 (1) 469
----------- ----------- ----------- -----------
Total 734 7,238 (605) 7,367
----------- ----------- ----------- -----------
COSTS AND EXPENSES:
Purses and incentive awards 1,685 1,685
Commissions paid to guest tracks 286 286
Direct operating costs 3,429 3,429
Cost of concession sales 148 148
Depreciation and amortization 240 159 399
Racing facility rental 608 (604) 4
Marketing 142 142
General and administrative expense 111 873 (1) 983
Card Club costs 135 135
----------- ----------- ----------- -----------
Total 351 7,465 (605) 7,211
----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE TAXES 383 (227) 156
INCOME TAX BENEFIT 104 104
----------- ----------- ----------- -----------
NET INCOME (LOSS) $ 383 $ (123) $ -- $ 260
=========== =========== =========== ===========
PER SHARE AMOUNTS:
NET INCOME (LOSS) $ .07 $ (.02) $ .05
=========== =========== ===========
DIVIDEND $ .25 $ .25
=========== ===========
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 5,758,752 5,758,752 5,758,752
========= ========= =========
</TABLE>
See Notes to Financial Statements.
- 7 -
<PAGE> 8
CALIFORNIA JOCKEY CLUB AND
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
COMBINED BALANCE SHEETS
(In thousands, except per share amounts) (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 2,506 $ 7,307
Securities available for sale (at fair value) 1,263 1,187
Securities held to maturity (at cost) 6,884 7,077
Amounts held on deposit for Thoroughbred horse owners 136 3,056
Accounts receivable (net of allowance for doubtful accounts of
$77 in 1996 and $82 in 1995) 184 2,442
Prepaid expenses 799 377
-------- --------
Total current assets 11,772 21,446
-------- --------
PROPERTY, PLANT AND EQUIPMENT:
Land 691 691
Land held for sale 2,621 1,954
Racing plant 23,986 23,906
Tennis facility 308 308
Equipment and leasehold improvements 10,971 10,088
-------- --------
Total 38,577 36,947
Accumulated depreciation and amortization (21,474) (20,759)
-------- --------
Property, plant and equipment - net 17,103 16,188
-------- --------
OTHER ASSETS (net of accumulated amortization of
$1,260 in 1996 and $1,221 in 1995) 139 223
-------- --------
DEFERRED INCOME TAXES 78 78
-------- --------
TOTAL ASSETS $ 29,092 $ 37,935
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,259 $ 4,676
Accrued liabilities 555 1,530
Accrued purses 327 1,014
Due to Thoroughbred horse owners 136 3,056
Income taxes payable 712 75
Note Payable 2,000
Uncashed pari-mutuel tickets and vouchers 156 4,477
-------- --------
Total current liabilities 5,145 14,828
-------- --------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common Stock, $.01 par value, authorized 10,000,000 shares;
issued and outstanding 5,763,257 shares 116 116
Additional paid in capital 18,385 18,385
Retained earnings 5,581 4,817
Unrealized loss on securities available for sale (135) (211)
-------- --------
Total stockholders' equity 23,947 23,107
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 29,092 $ 37,935
======== ========
</TABLE>
See Notes to Financial Statements.
- 8 -
<PAGE> 9
CALIFORNIA JOCKEY CLUB AND
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
<TABLE>
<CAPTION>
COMBINED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(IN THOUSANDS) (UNAUDITED)
- ------------------------------------------------------------------------------------------
1996 1995
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 3,069 $ 907
Adjustments to reconcile net income to net cash
used in operating activities:
Depreciation and amortization 792 799
Changes in operating assets and liabilities:
Accounts receivable 2,258 246
Amounts held on deposit for Thoroughbred horse owners 2,920 3,001
Income taxes receivable and payable 637 (372)
Prepaid expenses and other current assets (414) (645)
Accounts payable (3,417) (1,908)
Accrued liabilities (975) (1,415)
Accrued purses (687) (1,850)
Due to Thoroughbred horse owners (2,920) (3,001)
Uncashed pari-mutuel tickets and vouchers (4,321) (2,014)
------- -------
Net cash used in operating activities (3,058) (6,252)
------- -------
INVESTING ACTIVITIES:
Purchase of securities held to maturity (8,382) 1,255
Maturities of securities held to maturity 8,575
Purchase of property, plant and equipment (1,631) (1,187)
------- -------
Net cash provided by (used in) investing activities (1,438) 68
------- -------
FINANCING ACTIVITIES:
Proceeds from note payable - bank 2,000
Dividends (2,305) (1,441)
Stock options exercised 123
------- -------
Net cash used in financing activities (305) (1,318)
------- -------
DECREASE IN CASH AND CASH EQUIVALENTS (4,801) (7,502)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 7,307 9,356
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 2,506 $ 1,854
======= =======
</TABLE>
See Notes to Financial Statements.
-9-
<PAGE> 10
CALIFORNIA JOCKEY CLUB AND
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
<TABLE>
<CAPTION>
SEPARATE AND COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 1996
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) (UNAUDITED)
- ---------------------------------------------------------------------------------------
BAY MEADOWS
CALIFORNIA OPERATING
JOCKEY COMPANY AND
CLUB SUBSIDIARY ELIMINATIONS COMBINED
<S> <C> <C> <C> <C>
Balance at January 1, 1996 $21,878 $ 1,229 $23,107
Net income 1,974 1,095 3,069
Dividends ($.40/share) (2,305) (2,305)
Unrealized gain on securities
available for sale 76 76
------- ------- -------
Balance at June 30, 1996 $21,623 $ 2,324 $23,947
======= ======= =======
</TABLE>
See Notes to Financial Statements.
- 10 -
<PAGE> 11
CALIFORNIA JOCKEY CLUB AND
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
<TABLE>
<CAPTION>
SEPARATE AND COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 1995
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) (UNAUDITED)
- ------------------------------------------------------------------------------------------
BAY MEADOWS
CALIFORNIA OPERATING
JOCKEY COMPANY AND
CLUB SUBSIDIARY ELIMINATIONS COMBINED
<S> <C> <C> <C> <C>
Balance at January 1, 1995 $21,970 $ 748 $22,718
Net income (loss) 962 (55) 907
Dividends ($.25/share) (1,441) (1,441)
Stock options exercised 119 4 123
Unrealized gain on securities
available for sale 75 75
------- ------- -------
Balance at June 30, 1995 $21,685 $ 697 $22,382
======= ======= =======
</TABLE>
See Notes to Financial Statements.
- 11 -
<PAGE> 12
CALIFORNIA JOCKEY CLUB
<TABLE>
<CAPTION>
BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AMOUNTS) (UNAUDITED)
- ----------------------------------------------------------------------------------------------
JUNE 30, DECEMBER 31,
1996 1995
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 925 $ 989
Securities available for sale (at fair value) 1,263 1,187
Securities held to maturity (at cost) 6,884 7,077
Accounts receivable 9 7
Receivable from Bay Meadows Operating Company 220 569
-------- --------
Total current assets 9,301 9,829
-------- --------
PROPERTY, PLANT AND EQUIPMENT:
Land 691 691
Land held for sale 2,621 1,954
Racing plant 23,986 23,906
Tennis facility 308 308
Equipment 456 456
-------- --------
Total 28,062 27,315
Accumulated depreciation (15,456) (14,997)
-------- --------
Property, plant and equipment - net 12,606 12,318
-------- --------
TOTAL ASSETS $ 21,907 $ 22,147
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 67 $ 129
Accrued liabilities 217 140
-------- --------
Total current liabilities 284 269
-------- --------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common Stock, $.01 par value, authorized 10,000,000 shares;
issued and outstanding 5,763,257 shares 58 58
Additional paid in capital 17,597 17,597
Retained earnings 4,103 4,434
Unrealized loss on securities available for sale (135) (211)
-------- --------
Total stockholders' equity 21,623 21,878
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 21,907 $ 22,147
======== ========
</TABLE>
See Notes to Financial Statements.
- 12 -
<PAGE> 13
CALIFORNIA JOCKEY CLUB
STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(IN THOUSANDS) (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1996 1995
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 1,974 $ 962
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation 459 481
Changes in operating assets and liabilities:
Accounts receivable (2) (74)
Receivable from Bay Meadows Operating Company 349 345
Prepaid expenses and other assets 26
Accounts payable (62) (69)
Accrued liabilities 77 30
------- -------
Net cash provided by operating activities 2,795 1,701
------- -------
INVESTING ACTIVITIES:
Purchase of securities held to maturity (8,382) 1,255
Maturities of securities held to maturity 8,575
Purchase of property, plant and equipment (747) (319)
------- -------
Net cash provided by (used in) investing activities (554) 936
------- -------
FINANCING ACTIVITIES:
Dividends (2,305) (1,441)
Stock options exercised 119
------- -------
Net cash used in financing activities (2,305) (1,322)
------- -------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (64) 1,315
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 989 412
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 925 $ 1,727
======= =======
</TABLE>
See Notes to Financial Statements.
-13-
<PAGE> 14
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1996 1995
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 1,581 $ 6,318
Amounts held on deposit for Thoroughbred horse owners 136 3,056
Accounts receivable (net of allowance for doubtful accounts of $77 in 1996 and $82 in 1995) 175 2,435
Prepaid expenses and other current assets 799 377
-------- --------
Total current assets 2,691 12,186
-------- --------
PROPERTY, PLANT AND EQUIPMENT:
Equipment and leasehold improvements 10,515 9,631
Accumulated depreciation and amortization (6,018) (5,761)
-------- --------
Property, plant and equipment - net 4,497 3,870
-------- --------
OTHER ASSETS (net of accumulated amortization of $1,260 in 1996 and $1,221 in 1995) 139 223
-------- --------
DEFERRED INCOME TAXES 78 78
-------- --------
TOTAL ASSETS $ 7,405 $ 16,357
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,192 $ 4,547
Accrued liabilities 338 1,390
Accrued purses 327 1,014
Due to Thoroughbred horse owners 136 3,056
Payable to California Jockey Club 220 569
Income taxes payable 712 75
Note payable 2,000
Uncashed pari-mutuel tickets and vouchers 156 4,477
-------- --------
Total current liabilities 5,081 15,128
-------- --------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common Stock .01 par value authorized 10,000,000 shares; issued and outstanding:
5,763,257 shares 58 58
Additional paid in capital 788 788
Retained earnings 1,478 383
-------- --------
Total stockholders' equity 2,324 1,229
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 7,405 $ 16,357
======== ========
</TABLE>
See Notes to Financial Statements.
-14-
<PAGE> 15
BAY MEADOWS OPERATING COMPANY AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(IN THOUSANDS) (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1996 1995
<S> <C> <C>
OPERATING ACTIVITIES:
Net income (loss) $ 1,095 $ (55)
Adjustments to reconcile net income to net cash
used in operating activities:
Depreciation and amortization 333 318
Changes in operating assets and liabilities:
Accounts receivable 2,260 320
Amounts held on deposit for Thoroughbred horse owners 2,920 3,001
Income taxes receivable and payable 637 (372)
Prepaid expenses and other assets (414) (671)
Accounts payable (3,355) (1,839)
Accrued liabilities (1,052) (1,445)
Accrued purses (687) (1,850)
Due to Thoroughbred horse owners (2,920) (3,001)
Payable to California Jockey Club (349) (345)
Uncashed pari-mutuel tickets and vouchers (4,321) (2,014)
------- -------
Net cash used in operating activities (5,853) (7,953)
------- -------
NET CASH USED IN INVESTING ACTIVITIES - Purchase of
property, plant and equipment (884) (868)
------- -------
FINANCING ACTIVITIES:
Proceeds from note payable - bank 2,000
Stock option exercised 4
------- -------
Net cash provided by financing activities 2,000 4
------- -------
DECREASE IN CASH AND CASH EQUIVALENTS (4,737) (8,817)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 6,318 8,944
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 1,581 $ 127
======= =======
</TABLE>
See Notes to Financial Statements.
-15-
<PAGE> 16
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' 1995 Annual Report. Net income per share is
computed as net income divided by weighted average shares outstanding.
Certain prior year amounts have been reclassified to conform to the 1996
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 six months ended June 30, 1996, are not indicative of
the results that may be expected for the year ending December 31, 1996,
because of the seasonal nature of the operations.
2. PROPERTY, PLANT AND EQUIPMENT
At June 30, 1996, land held for sale included $2,129,000 in costs incurred
to develop the land including zoning and engineering costs. No assurance
can be gained that such activities will ultimately result in the
development or sale of such land.
-16-
<PAGE> 17
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: December 13, 1996
CALIFORNIA JOCKEY CLUB
/s/ James M. Harris
------------------------------------------------
James M. Harris
President and Treasurer
(Principal Executive and Financial Officer)
BAY MEADOWS OPERATING COMPANY
/s/ Frank Trigeiro
------------------------------------------------
Frank Trigeiro
Vice President-Finance and Chief Financial
Officer
(Principal Financial Officer)
-17-
