Championship Auto Racing Teams Inc., the troubled company behind the Grand Prix of St. Petersburg, said Tuesday that it posted a $34.5-million net loss for the second quarter as corporate sponsorships continued to lag behind projections.
In addition, CART, which revealed three weeks ago that it needs to raise additional capital to finish the 2004 racing season, said in a statement that it "has not identified any source for this capital and there is not any assurance it could be raised."
The Indianapolis company also reaffirmed that it doesn't expect to report earnings or positive cash flow before 2006.
Even though CART said in the statement that the "viability of the self- or co-promoted races that CART ran this year is being re-evaluated," CART chief financial officer Thomas Carter maintained that he doesn't expect the Grand Prix of St. Petersburg to be affected. "I think we had a very good inaugural event at St. Pete," Carter said. "It's a venue we can build on and continue to grow."
The 2004 Grand Prix of St. Petersburg is scheduled to be held Feb. 20-22 and is to be broadcast nationwide by CBS.
CART said it posted a net loss of $34.5-million, or $2.34 a share, in the quarter ended June 30, widening from a net loss of $3.7-million, or 25 cents a share, a year earlier. Revenue slid to $14.4-million, down from $19.3-million during the same period last year, as a surge in promotion revenue failed to make up for drops in sanction fees and television revenue.
CART said in June that it had retained Bear Stearns & Co. to help identify potential "strategic alternatives," including such possibilities as selling the company or taking it private. ESPN.com said Tuesday that CART team owners Gerry Forsythe, Paul Gentilozzi, Paul Newman and Kevin Kalkhoven are "expected to buy CART's remaining public shares and take it private within the next few days."
CART's thinly traded stock closed Tuesday at $1.82, down 35 cents or 16 percent.
- Louis Hau can be reached at hau@sptimes.com or 813 226-3404.
