SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
QUARTERLY REPORT
Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
FOR THE QUARTER ENDED MARCH 31, 2000
Commission File Number - 0-1607
MID-STATE RACEWAY, INC.
(Exact Name of Registrant as Specified in Charter)
New York 15-0555258
(State of Incorporation) (I.R.S. Employer
Identification No.)
Vernon, New York 13476
(Address of Principal (Zip Code)
Executive Offices)
(315) 829-2201
(Registrant's Telephone Number)
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 and (2) has been subject to the filing
requirements for at least the past 90 days. Yes X No .
----- -----
Indicate the number of shares outstanding of each of the issuers' classes of
common stock, as of the close of the period covered by this report.
Class Outstanding at March 31, 2000
----- -----------------------------
Common Stock, $0.10 par value 442,766
<PAGE>
A. Summary of Financial Information
MID-STATE RACEWAY, INC.
PROFIT AND LOSS INFORMATION
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended Year Ended
March 31, 2000 March 31, 1999 December 31, 1999
0 Racing Days 2 Racing Days 114 Racing Days
-------------- -------------- ------------------
<S> <C> <C> <C>
Operating Revenues $ 1,001,582 $ 944,064 $ 5,994,965
Operating Expenses 900,746 878,276 7,073,820
Income (loss) from operations 100,836 65,788 (1,078,855)
----------- --------- ------------
Other income (loss):
Commissions for Capital Improvements -- -- --
Aid from state and local governments -- -- 233,751
Investment income 20,479 967 6,598
Interest expense (42,281) (33,958) (146,708)
Settlement of lawsuits 991,961 -- (380,000)
----------- --------- ------------
Total other income (loss) 970,159 (32,991) (286,359)
----------- --------- ------------
Income (loss) before provision for
taxes 1,070,995 32,797 (1,365,214)
Provision for taxes -- -- 404
----------- --------- ------------
Net income (loss) $ 1,070,995 $ 32,797 ($ 1,365,214)
=========== ========= ============
Income (loss) per common share * $2.43 $0.13 ($4.89)
=========== ========= ============
Cash dividend per share* $0.00 $0.00 $0.00
=========== ========= ============
*-Based on weighted average shares outstanding.
</TABLE>
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<PAGE>
A. (Continued)
MID-STATE RACEWAY, INC.
STATEMENTS OF CASH FLOW
<TABLE>
<CAPTION>
For the Three For the
Months Ended Year Ended
March 31, December 31,
2000 1999
-------------- ------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net income (loss) $1,070,995 ($1,368,967)
Adjustments to reconcile net income (loss) to net
cash provided by (used) in operating activities:
Depreciation 43,215 191,984
Settlement of lawsuits (991,961) 380,000
Allowance for ( recoveries) of doubtful accounts (87,000) 90,000
Changes in:
Restricted cash 54,068 (70,431)
Accounts and grants receivable 320,756 (167,011)
Prepaid expenses 19,858 91,613
Other assets 22,129 48,341
Real estate taxes payable 106,000 (72,000)
Accounts payable (212,363) 481,302
Uncashed winning tickets (54,538) 4,134
Retention for capital improvements 630 63,484
---------- -----------
Net cash provided by (used) in operating activities 291,789 (327,551)
---------- -----------
Cash Flows from Investing Activities:
Purchase of available-for-sale investment securities (129,250) (196,119)
Purchase of properties and equipment (260,352) (505,042)
---------- -----------
Net cash used in investing activities (389,602) (701,161)
---------- -----------
Cash Flows from Financing Activities:
Proceeds from mortgage loan -- 250,000
Net proceeds from sale of stock -- 1,455,000
---------- -----------
Net cash provided by financing activities -- 1,705,000
---------- -----------
Net increase (decrease) in cash (97,813) 676,288
Cash, beginning of period 1,113,529 437,241
---------- -----------
Cash, end of period $1,015,716 $1,113,529
========== ===========
</TABLE>
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<PAGE>
A. (Continued)
Management Analyses of Profit and Loss Information
-------------------------------------------------------------------------------
The Company generated net income from operations of $100,836 for the quarter
ended March 31, 2000 which amounted to an increase of $35,048 (53%) over the
$65,788 in net income generated from operations for the same period in 1999. A
significant factor in this improvement was the decrease in operating expense in
the pari-mutuel operations of approximately $87,000. This was offset by a
$58,500 net loss from operations incurred for the quarter ended March 31, 2000
by Mid-State Development Corporation ("MSD"), a wholly-owned subsidiary of
Mid-State Raceway, Inc. ("MSR"), which was an inactive company for the same
period in 1999. MSD has taken over the operation of concessions at the harness
racing track owned by MSR. Significant start up costs were incurred by MSD
during the quarter ended March 31, 2000.
The increase in net income of $1,038,158 for the quarter ended March 31, 2000
versus the same period last year was largely the result of the settlement of a
lawsuit against MSR. In March 1998, a lawsuit was brought against MSR alleging
Breach of Contract and Fiduciary Duty with the Company's decision to eliminate
its Supplemental Retirement Benefit Plan. In February 2000, the lawsuit was
settled for the issuance of 4,380 shares of the Company's stock to the remaining
beneficiaries under the Plan. The settlement of the lawsuit resulted in income
to the Company in the first quarter of 2000 in the amount of $991,961 due to the
elimination of a deferred liability in the amount of $1,013,861 in connection
with the Supplemental Retirement Benefit Plan, which was terminated.
Total wagering on thoroughbred and harness simulcasts during the quarter ended
March 31, 2000 increased by $71,469 (2.4%) over the same period last year. No
live racing days during the quarter ended March 31, 2000 versus 2 days of live
racing for the same period last year did not have a significant impact on the
net income generated from operations.
Liquidity and Capital Resources
In the first three quarters of 2000, the funding of business operations and
capital requirements for the Company will be substantially sourced from existing
cash. The Company anticipates that it will borrow up to $4,000,000 in the fourth
quarter of 2000 to fund ongoing capital improvements, provide working capital
necessary to institute planned programs and events, and to replace the existing
mortgages on the property that currently total $1,250,000.
The Company's current ratio at March 31, 2000 was approximately 2.1:1.
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<PAGE>
B. Capitalization and Shareholders' Equity
MID-STATE RACEWAY, INC.
BALANCE SHEETS
March 31, 2000 and December 31, 1999
<TABLE>
<CAPTION>
March 31, December 31,
ASSETS 2000 1999
----------- ------------
<S> <C> <C>
Current Assets
Cash and cash equivalents $ 1,015,716 $ 1,113,529
Cash restricted for purses, capital improvements and
uncashed winning tickets 103,841 157,909
Grant receivable -- 233,751
Accounts receivable, net of allowance for doubtful
accounts of $25,000 in 2000 and $112,000 in 1999 339,859 339,864
Investments 308,123 200,125
Other current assets 141,406 161,264
----------- -----------
Total current assets 1,908,945 2,206,442
Property, Plant and Equipment
Land, racing plant and equipment 13,483,999 13,223,647
Other Properties 121,671 121,671
----------- -----------
13,605,670 13,345,318
Less accumulated depreciation 11,237,513 11,194,298
----------- -----------
2,368,157 2,151,020
Other Assets 7,136 29,265
$ 4,284,238 $ 4,386,727
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued expenses $ 751,707 $ 964,070
Current portion of real estate taxes payable 54,000 72,000
Uncashed winning tickets 8,854 63,392
Retention for capital improvements 84,902 84,272
----------- -----------
Total current liabilities 899,463 1,183,734
Real estate taxes payable, less current portion 154,000 30,000
Mortgages payable 1,250,000 1,250,000
Deferred retirement benefits -- 1,013,861
Shareholders' equity
Common stock, par value $.10 per share;authorized 10,000,000 shares;
issued and outstanding 442,766 in 2000, 438,386 in 1999 44,277 43,839
Additional paid-in-capital 2,063,009 2,041,547
Accumulated deficit (109,265) (1,180,260)
Accumulated other comprehensive income (17,246) 4,006
----------- -----------
Total shareholders' equity 1,980,775 909,132
----------- -----------
$ 4,284,238 $ 4,386,727
=========== ===========
</TABLE>
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<PAGE>
Part II - Other Information
Item 1 through 5 - Not applicable
Item 6 - Exhibits and Reports on Form 8-K
Reports on Form 8-K - There were no reports on Form 8-K filed for the three
months ended March 31, 2000.
Item 7 - Submission of Matters to a Vote of Securities Holders
There were no matters that were required to be submitted to a vote of securities
holders for the three months ended March 31, 2000.
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MID-STATE RACEWAY, INC.
Date: 08/11/00 /s/ JOHN J. SIGNORELLI
----------- ------------------------------------------
John J. Signorelli, President &
Chief Executive Officer
Date: 08/11/00 /s/ JAMES R. WISE
----------- ------------------------------------------
James R. Wise, Treasurer and
Principal Financial and Accounting Officer
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