Cineplex Reports Post-Pandemic Record
Quarterly EBITDAaL for Q2 2023
TORONTO,
Aug. 10,
2023 /CNW/ - (TSX: CGX) - Cineplex Inc.
("Cineplex" or the "Company") today released its financial results
for the three and six months ended June 30,
2023. Unless otherwise specified, all amounts are in
Canadian dollars.
Second Quarter Summary
- Total revenues increased 20.9% to $423.1
million compared to the second quarter of 2022.
- Net income increased to $176.5
million compared to net income of $1.3 million in the second quarter of 2022.
- Recognized approximately $158.4
million of deferred income tax assets as a result of the
reasonable expectation of utilization to offset future periods of
taxable income.
- Adjusted EBITDAaL increased to $60.3
million compared to $35.8
million in the second quarter of 2022.
- All time quarterly record revenues and adjusted EBITDAaL of
$55.2 million and $13.1 million, respectively, for Player One
Amusement Group ("P1AG").
- Second quarter record revenues of $29.1
million for Location-Based Entertainment ("LBE").
- Second quarter record BPP of $12.84; 4.5% higher than prior year.
- Second quarter record CPP of $9.21; 4.2% higher than prior year.
"We are extremely pleased with our second quarter
performance, which stemmed from the return of strong film product
resulting in total revenues of $423.1
million and adjusted EBITDAaL of $60.3 million," said Ellis Jacob, President & CEO, Cineplex.
"This EBITDAaL level enabled repayment of approximately
$26.0 million in bank debt during the
quarter as part of our focus to de-lever the balance sheet and
strengthen the capital base."
"In addition to a notable second quarter, the
third quarter is also off to a sensational start with Barbie
and Oppenheimer leading the charge. These remarkable
results, as well as the performance of other major titles including
Mission: Impossible – Dead Reckoning Part One, led to
Cineplex's July box office revenues not only exceeding 2019 levels
but resulted in our highest July box office results ever and our
second highest monthly box office results behind December, 2015.
Consumers continue to demonstrate their desire for a shared,
immersive cinematic experience, and our studio partners have seen
time and again that the best way to elevate and promote films and
maximize financial value is with an exclusive theatrical
release."
"Looking ahead, our positive outlook for the
exhibition industry and all the other businesses in which we
operate continues to hold true. We are excited about our strong
year-to-date results which reflect the positive momentum from the
industry's rebound, combined with our strategic actions to maximize
attendance and box office, drive growth from diversified
businesses, improve productivity, our liquidity position, and our
balance," Mr. Jacob concluded.
The following table compares 2023 monthly box
office revenues to 2019 monthly box office revenues:
Month
|
2019 Box office
(i)
|
2023 Box office
(i)
|
2023 as a
percentage of 2019
|
April
|
$63,759
|
$61,278
|
96 %
|
May
|
$68,698
|
$47,514
|
69 %
|
June
|
$56,914
|
$55,699
|
98 %
|
Q2
Total
|
$189,371
|
$164,491
|
79 %
|
July
|
$76,935
|
$86,388
|
112 %
|
(i) Amounts are in
thousands of dollars.
|
Second Quarter and Year to Date
Financial Results
Financial
highlights
|
Second
Quarter
|
Year to
Date
|
(in thousands of
dollars, except theatre attendance in thousands of
patrons and per share and per patron amounts)
|
2023
|
2022
|
Change
(i)
|
2023
|
2022
|
Change
(i)
|
Total
revenues
|
$423,118
|
$349,878
|
20.9 %
|
$764,075
|
$578,601
|
32.1 %
|
Theatre
attendance
|
12,806
|
11,092
|
15.5 %
|
22,573
|
17,753
|
27.2 %
|
Net income (loss)
(ii)
|
$176,545
|
$1,313
|
NM
|
$146,372
|
$(40,912)
|
NM
|
Net income (loss) as a
percentage of sales (ii)
|
41.7 %
|
0.4 %
|
41.3 %
|
19.2 %
|
(7.1) %
|
26.2 %
|
Cash provided by
operating activities
|
$93,219
|
$47,152
|
97.7 %
|
$96,354
|
$41,715
|
131.0 %
|
Box office revenues per
patron ("BPP") (iii)
|
$12.84
|
$12.29
|
4.5 %
|
$12.75
|
$12.19
|
4.6 %
|
Concession revenues per
patron ("CPP") (iii)
|
$9.21
|
$8.84
|
4.2 %
|
$9.06
|
$8.83
|
2.6 %
|
Adjusted EBITDA
(iii)
|
$102,192
|
$77,939
|
31.1 %
|
$164,957
|
$114,414
|
44.2 %
|
Adjusted EBITDAaL
(iii)
|
$60,258
|
$35,764
|
68.5 %
|
$80,501
|
$30,045
|
167.9 %
|
Adjusted EBITDAaL
margin (iii)
|
14.2 %
|
10.2 %
|
4.0 %
|
10.5 %
|
5.2 %
|
5.3 %
|
Adjusted free cash flow
(iii)
|
$39,584
|
$21,844
|
81.2 %
|
$41,210
|
$99
|
NM
|
Adjusted free cash flow
per share (iii)
|
$0.63
|
$0.345
|
81.2 %
|
$0.650
|
$0.002
|
NM
|
Earnings (net loss) per
share - basic (ii)
|
$2.79
|
$0.02
|
NM
|
$2.31
|
$(0.65)
|
NM
|
Earnings (net loss) per
share - diluted (ii)
|
$1.99
|
$0.02
|
NM
|
$1.74
|
$(0.65)
|
NM
|
i.
|
Period over period
change calculated based on thousands of dollars except percentage
and per share values. Changes in percentage amounts are calculated
as 2023 value less 2022 value.
|
ii.
|
2023 includes recovery
of approximately $158.4 million related to the recognition of
deferred income tax assets recognized during the second quarter and
expenses related to the Cineworld transaction and associated
litigation and claims recovery in the amount of $0.2 million (2022
- $1.2 million) for the second quarter and $1.1 million (2022 -
$1.5 million) for the year to date.
|
iii.
|
Adjusted EBITDA,
adjusted EBITDAaL, adjusted EBITDAaL margin, adjusted free cash
flow per common share of Cineplex, BPP and CPP are measures that do
not have a standardized meaning under generally accepted accounting
principles ("GAAP"). These measures as well as other Non-GAAP other
financial measures reported by Cineplex are defined in the
'Non-GAAP and Other Financial Measures' section at the end of this
news release.
|
KEY DEVELOPMENTS IN THE
SECOND QUARTER OF 2023
The following describes certain key business
initiatives undertaken and results achieved during 2023 in each of
Cineplex's core business areas:
FILM ENTERTAINMENT AND
CONTENT
Theatre Exhibition
- Reported second quarter box office revenues of $164.5 million, an increase of $28.1 million or 20.6% from $136.4 million due to a 15.5% increase in theatre
attendance as a result of a strong film slate during the quarter,
including The Super Mario Bros. Movie, which set a
record for the biggest opening for an animated film ever.
- Reported a second quarter record BPP of $12.84, $0.55 or
4.5% higher than the $12.29 reported
during the prior year due to a higher percentage of premium ticket
sales in the current period as compared to the prior year.
- Opened Cineplex's second Junxion location at
Cineplex Junxion Erin Mills in Mississauga, Ontario on May 17, 2023. Cineplex Junxion is
an innovative entertainment destination that brings movies,
amusement gaming, dining and live performances together for the
ultimate guest experience.
- Enhanced the theatre circuit with a retrofit of all recliner
seating at three auditoriums at SilverCity St.Vital Cinemas
in Winnipeg, Manitoba.
Theatre Food Service
- Reported second quarter theatre food service revenues of
$118.0 million, an increase of
$19.9 million or 20.3% compared to
the prior year primarily due to a 15.5% increase in theatre
attendance.
- Reported a second quarter record CPP of $9.21, an increase of $0.37 or 4.2% compared to the prior year,
primarily due to an increase in average spend.
Alternative Programming and
Distribution
- As part of the theatrical distribution partnership with
Lionsgate, during the second quarter, Cineplex's distribution
business (Cineplex Pictures) distributed Are You There God? It's
Me, Margaret, Sisu, About My Father and The
Blackening. Additionally, Cineplex Pictures also distributed
the feature film The Wrath of Becky during the quarter.
- Cineplex represented over 80% of the total North American box
office market share for successful international films, including
Annhi Dea Mazaak Ae (Punjabi), Godday Godday Chaa
(Punjabi) and Jodi (Punjabi).
- Event Cinema presented an assortment of big-screen programs,
including the 20th anniversary of Lord of the Rings:
Return of the King, continued presentations from the
Metropolitan Opera with Don
Giovanni and Falstaff, as well as a variety of
music events featuring Machine Gun Kelly, one of the members of BTS
(Suga), Metallica and Coldplay.
Digital Commerce
- Total registered users for Cineplex Store increased 4.0%
compared to the prior year, reaching approximately 2.3 million
registered users.
- Curated Cineplex Store collections for Asian History Month,
National Indigenous Peoples Day and Pride Month to elevate Asian
stories, Indigenous people and LGBTQ2IA+ voices.
MEDIA
- Reported second quarter media revenues of $26.1 million, a decrease of $0.3 million or 1.2% as compared to the prior
year.
Cinema Media
- Reported second quarter cinema media revenues of $17.8 million, a decrease of $0.9 million or 4.6% over the prior year.
Digital Place-Based Media
- Reported second quarter revenues of $8.3
million, an increase of $0.6
million or 7.3% over the prior year.
AMUSEMENT SOLUTIONS (P1AG) AND
LBE
- Reported all-time quarterly record revenues of $76.9 million, an increase of $11.2 million or 17.0% compared to the prior
year.
Player One Amusement Group
- Reported all-time quarterly record revenues of $55.2 million, an increase of $10.1 million or 22.4% compared to the prior
year. Adjusted EBITDAaL during the second quarter also was an
all-time quarterly record of $13.1
million, an increase of $4.9
million or 60.9% compared to the prior year. The increase in
revenues and adjusted EBITDAaL were primarily due to increases in
P1AG amusement revenues from US and Canada route locations at FEC's and theatres,
along with an increase in distribution sales.
Location-based Entertainment
- Reported second quarter record revenues of $29.1 million, an increase of $1.0 million or 3.5% compared to the prior
year.
- Reported adjusted store level EBITDAaL of $6.3 million, a decrease of $2.0 million or 24.0% compared to the prior
year.
LOYALTY
- Membership in the Scene+ loyalty program increased to over 13
million members as at June 30,
2023.
CORPORATE
- On May 18, 2023, the Competition
Bureau commenced legal action against Cineplex, alleging that
Cineplex's online booking fee is misleading and constitutes "drip
pricing". Cineplex strongly denies the Competition Bureau's
allegations and believes that the online booking fee fully complies
with the letter and spirit of the law. Cineplex believes that the
Competition Bureau's allegations have no merit Cineplex will seek
an early determination of this matter. Cineplex filed its response
to the Competition Bureau's allegations on June 30, 2023.
- The CineClub subscription program ("CineClub") reached over
115,000 members, providing members with benefits accessible across
Cineplex's businesses nationwide including Cineplex theatres LBE
venues and the Cineplex Store.
- Recognized income taxes recovery of approximately $158.4 million on the basis of continued strong
return to profitability providing a reasonable expectation that
previously derecognized net deferred income tax assets will be
utilized to offset future periods of taxable income.
NON-GAAP AND OTHER FINANCIAL
MEASURES
National Instrument 52-112, Non-GAAP and Other
Financial Measures Disclosure ("NI 52-112") imposes
obligations regarding disclosure of non-GAAP financial measures,
non-GAAP ratios, and other financial measures. Cineplex reports on
certain non-GAAP measures, non-GAAP ratios, supplementary financial
measures and total segment measures that are used by management to
evaluate Cineplex's performance. The following measures included in
this news release do not have a standardized meaning under GAAP and
may not be comparable to similar measures provided by other
issuers. Cineplex includes these measures because management
believes that they assist investors in assessing financial
performance. These non-GAAP and other financial measures are used
throughout this news release and are defined below.
NON-GAAP FINANCIAL
MEASURES
Non-GAAP financial measures are defined in 52-112
as a financial measure disclosed that (a) depicts the historical or
expected future financial performance, financial position or cash
flow of an entity, (b) with respect to its composition, excludes an
amount that is included in, or includes an amount that is excluded
from, the composition of the most directly comparable financial
measure disclosed in the primary financial statements of the
entity, (c) is not disclosed in the financial statements of the
entity, and (d) is not a ratio, fraction, percentage or similar
representation.
NON-GAAP RATIO
A non-GAAP ratio is defined by 52-112 as a
financial measure disclosed that (a) is in the form of a ratio,
fraction, percentage or similar representation, (b) has a non-GAAP
financial measure as one or more of its components, and (c) is not
disclosed in the financial statements.
Below are non-GAAP financial measures or non-GAAP
ratios that are reported by Cineplex.
EBITDA, ADJUSTED EBITDA AND
ADJUSTED EBITDAaL
Management defines EBITDA as earnings before
interest income and expense, income taxes and depreciation and
amortization expense. Adjusted EBITDA excludes the change in fair
value of financial instrument, loss (gain) on disposal of assets,
foreign exchange, the equity income of CDCP, and impairment,
depreciation, amortization, interest and taxes of Cineplex's other
joint ventures and associates. Adjusted EBITDAaL modifies adjusted
EBITDA to deduct current period cash rent paid or payable related
to lease obligations.
Subsequent to the adoption of IFRS 16,
Leases, by Cineplex effective January
1, 2019, the calculation of EBITDA no longer includes a
charge for amounts paid or payable with respect to leased property
and equipment. Given the majority of Cineplex's businesses are
carried on in leased premises, Cineplex introduced the measure of
adjusted EBITDAaL which includes a deduction for cash rent
paid/payable related to lease obligations. Cineplex's management
believes that adjusted EBITDAaL is an important supplemental
measure of Cineplex's profitability at an operational level and
provides analysts and investors with comparability in evaluating
and valuing Cineplex's performance period over period. EBITDA,
adjusted for various unusual items, is also used to define certain
financial covenants in Cineplex's Credit Facilities. Management
calculates adjusted EBITDAaL margin by dividing adjusted EBITDAaL
by total revenues.
EBITDA, adjusted EBITDA and adjusted EBITDAaL are
non-GAAP measures generally used as an indicator of financial
performance and they should not be seen as a measure of liquidity
or a substitute for comparable metrics prepared in accordance with
GAAP. Cineplex's EBITDA, adjusted EBITDA and adjusted EBITDAaL may
differ from similar calculations as reported by other entities and
accordingly may not be comparable to EBITDA, adjusted EBITDA or
adjusted EBITDAaL as reported by other entities.
Reconciliation of reported net
income (loss) to adjusted EBITDAaL
|
|
Three months ended
June 30,
|
|
|
Six months ended
June 30,
|
|
|
2023
|
|
2022
|
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
(iv)
|
$
|
176,545
|
$
|
1,313
|
|
$
|
146,372
|
$
|
(40,912)
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization - other
|
|
24,889
|
|
26,651
|
|
|
50,895
|
|
53,543
|
Depreciation -
right-of-use assets
|
|
22,650
|
|
24,486
|
|
|
44,849
|
|
48,749
|
Interest expense -
lease obligations
|
|
16,488
|
|
14,739
|
|
|
32,821
|
|
29,443
|
Interest expense -
other
|
|
18,230
|
|
13,812
|
|
|
41,736
|
|
23,895
|
Interest
income
|
|
(282)
|
|
(38)
|
|
|
(493)
|
|
(68)
|
Current income tax
expense (recovery)
|
|
269
|
|
—
|
|
|
1,884
|
|
(724)
|
Deferred income tax
expense
|
|
(158,440)
|
|
—
|
|
|
(156,133)
|
|
—
|
EBITDA
|
$
|
100,349
|
$
|
80,963
|
|
$
|
161,931
|
$
|
113,926
|
|
|
|
|
|
|
|
|
|
|
Loss (gain) on disposal
of assets
|
|
226
|
|
(4,650)
|
|
|
970
|
|
(4,493)
|
Loss on financial
instruments recorded at fair value
|
|
1,020
|
|
1,770
|
|
|
1,290
|
|
5,600
|
CDCP equity income
(i)
|
|
—
|
|
332
|
|
|
—
|
|
(522)
|
Foreign exchange loss
(gain)
|
|
409
|
|
(623)
|
|
|
423
|
|
(389)
|
Depreciation and
amortization - joint ventures and associates (ii)
|
|
187
|
|
133
|
|
|
329
|
|
264
|
Taxes and interest of
joint ventures and associates (ii)
|
|
1
|
|
14
|
|
|
14
|
|
28
|
Adjusted
EBITDA
|
$
|
102,192
|
$
|
77,939
|
|
$
|
164,957
|
$
|
114,414
|
|
|
|
|
|
|
|
|
|
|
Cash rent paid/payable
related to lease obligations
|
|
(41,536)
|
|
(41,791)
|
|
|
(85,259)
|
|
(85,144)
|
Cash rent paid not
pertaining to current period
|
|
(398)
|
|
(384)
|
|
|
803
|
|
775
|
Adjusted EBITDAaL
(iii)
|
$
|
60,258
|
$
|
35,764
|
|
$
|
80,501
|
$
|
30,045
|
(i)
|
CDCP equity income is
not included in adjusted EBITDA as CDCP is a limited-life financing
vehicle that is funded by virtual print fees collected from
distributors. On December 16, 2022, Cineplex divested its
investment in CDCP.
|
(ii)
|
Includes the joint
ventures with the exception of CDCP (see (i) above).
|
(iii)
|
See Non-GAAP and other
financial measures section of this news release.
|
(iv)
|
2023 includes recovery
of approximately $158.4 million related to the recognition of
deferred income tax assets recognized during the second quarter and
expenses related to the Cineworld transaction and associated
litigation and claims recovery in the amount of $0.2 million (2022
- $1.2 million) for the second quarter and $1.1 million (2022 -
$1.5 million) for the year to date.
|
Adjusted Free Cash Flow
Free cash flow is a non-GAAP measure generally
used by Canadian corporations as an indicator of financial
performance and it should not be viewed as a measure of liquidity
or a substitute for comparable metrics prepared in accordance with
GAAP. Standardized free cash flow adjusts the amount of cash from
operating activities to deduct capital expenditures net of proceeds
on sale of assets in ordinary business operations. Standardized
free cash flow is a non-GAAP measure recommended by the CICA in its
2008 interpretive release, Improved Communication with Non-GAAP
Financial Measures: General Principles and Guidance for Reporting
EBITDA and Free Cash Flow, and is designed to enhance
comparability. Adjusted free cash flow is also a non-GAAP measure
used by Cineplex to modify standardized free cash flow to exclude
certain cash flow activities and to measure the amount available
for activities such as repayment of debt, dividends to owners and
investments in future growth through acquisitions. Adjusted free
cash flow includes repayments of lease obligations that represented
the principal portion of rent expenses that were included in net
income calculation prior to the adoption of accounting standard
IFRS 16, Leases, by Cineplex. Given that the materiality of
the principal portion of the rent expenses and comparability of
adjusted free cash flow disclosure for comparative periods,
adjusted free cash flow also adjusts standard free cash flow to
deduct principal amount of repayment of lease obligation.
Cineplex presents standardized free cash flow and
adjusted free cash flow per share because they are key measures
used by investors to value and assess Cineplex. Cineplex's
management defines adjusted free cash flow as standardized free
cash flow adjusted for certain items, and considers adjusted free
cash flow the amount available for distribution to shareholders.
Standardized free cash flow is defined by the CICA as cash from
operating activities as reported in the GAAP financial statements,
less total capital expenditures minus proceeds from the disposition
of capital assets other than those of discontinued operations, as
reported in the GAAP financial statements; and dividends, when
stipulated, unless deducted in arriving at cash flows from
operating activities. The standardized free cash flow calculation
excludes common dividends and others that are declared at the
Board's discretion.
Reconciliation of reported cash
provided by operating activities to adjusted free cash flow per
share
|
|
Three months ended
June 30,
|
|
|
Six months ended
June 30,
|
|
|
2023
|
|
2022
|
|
|
2023
|
|
2022
|
Cash provided by
operating activities
|
$
|
93,219
|
$
|
47,152
|
|
$
|
96,354
|
$
|
41,715
|
Less: Total capital
expenditures net of proceeds on sale of assets
|
|
(16,569)
|
|
(10,885)
|
|
|
(33,054)
|
|
(20,470)
|
|
|
|
|
|
|
|
|
|
|
Standardized free
cash flow
|
|
76,650
|
|
36,267
|
|
|
63,300
|
|
21,245
|
|
|
|
|
|
|
|
|
|
|
Add/(Less):
|
|
|
|
|
|
|
|
|
|
Changes in operating
assets and liabilities (i)
|
|
(20,052)
|
|
1,120
|
|
|
8,946
|
|
16,197
|
Changes in operating
assets and liabilities of joint ventures and associates
(i)
|
|
(415)
|
|
775
|
|
|
339
|
|
68
|
Repayments of lease
obligations - principal
|
|
(25,904)
|
|
(27,428)
|
|
|
(53,436)
|
|
(56,695)
|
Principal portion of
cash rent paid not pertaining to current period
|
|
(398)
|
|
(381)
|
|
|
803
|
|
762
|
Growth capital
expenditures and other (ii)
|
|
10,085
|
|
6,078
|
|
|
22,904
|
|
13,132
|
Share of income of
joint ventures and associates, net of non-cash
depreciation
|
|
(382)
|
|
95
|
|
|
(1,646)
|
|
72
|
Net cash received
from CDCP (iii)
|
|
—
|
|
5,318
|
|
|
—
|
|
5,318
|
Adjusted free cash
flow
|
$
|
39,584
|
$
|
21,844
|
|
$
|
41,210
|
$
|
99
|
Average number of
shares outstanding
|
|
63,376,043
|
|
63,360,746
|
|
|
63,375,758
|
|
63,353,634
|
Adjusted free cash
flow per share
|
$
|
0.625
|
$
|
0.345
|
|
$
|
0.650
|
$
|
0.002
|
(i)
|
Changes in operating
assets and liabilities are not considered a source or use of
adjusted free cash flow. Refer to Note 25 of Cineplex's 2022 Annual
Consolidated Financial Statements for further details.
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(ii)
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Growth capital
expenditures and other represent expenditures on Board approved
projects, exclude maintenance capital expenditures and are net
of proceeds on asset sales. The Revolving Facility is available
to Cineplex to fund Board approved projects.
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SUPPLEMENTARY FINANCIAL
MEASURES
Supplementary financial measures are financial
measures that are not (a) presented in the financial statements and
(b) is, or is intended to be, disclosed periodically to depict the
historical or expected future financial performance, financial
position or cash flow, that is not a non-GAAP financial measure or
a non-GAAP ratio as defined in the instrument. Below are
supplementary financial measures that Cineplex uses to depict its
financial performance, financial position or cash flows.
Earnings (loss) per Share
Metrics
Cineplex has presented basic and diluted earnings
(loss) per share net of this item to provide a more comparable loss
per share metric between the current periods and prior year
periods. In the non-GAAP and other financial measure, earnings is
defined as net income or net loss attributable to Cineplex
excluding the change in fair value of financial instruments.
Per Patron Revenue
Metrics
Cineplex reviews per patron metrics as they
relate to box office revenue and theatre food service revenue such
as BPP, CPP, BPP excluding premium priced product, and concession
margin per patron, as these are key measures used by investors to
value and assess Cineplex's performance, and are widely used in the
theatre exhibition industry. Management of Cineplex defines these
metrics as follows:
Theatre Attendance: Theatre attendance is
calculated as the total number of paying patrons that frequent
Cineplex's theatres during the period.
BPP: Calculated as total box office
revenues divided by total paid theatre attendance for the
period.
BPP excluding premium priced product:
Calculated as total box office revenues for the period, less box
office revenues from 3D, 4DX, UltraAVX, VIP ScreenX and IMAX
product; divided by total paid theatre attendance for the period,
less paid theatre attendance for 3D, 4DX, UltraAVX, VIP, ScreenX
and IMAX product.
CPP: Calculated as total theatre food
service revenues divided by total paid total theatre attendance for
the period.
Premium priced product: Defined as
3D, 4DX, UltraAVX, IMAX, ScreenX and VIP film product.
Theatre concession margin per patron:
Calculated as total theatre food service revenues less total
theatre food service cost, divided by theatre attendance for the
period.
Same Theatre Analysis
Cineplex reviews and reports same theatre metrics
relating to box office revenues, theatre food service revenues,
theatre rent expense and theatre payroll expense, as these measures
are widely used in the theatre exhibition industry as well as other
retail industries.
Same theatre metrics are calculated by removing
the results for all theatres that have been opened, acquired,
closed or otherwise disposed of subsequent to the start of the
prior year comparative period. For the three months ended
June 30, 2023 the impact of the
impact of two locations that has been opened or acquired and three
locations that have been closed or otherwise disposed of have been
excluded, resulting in 153 theatres being included in the same
theatre metrics. For the six months ended June 30, 2023 the impact of two locations that
has been opened or acquired and four locations that have been
closed or otherwise disposed of have been excluded, resulting in
152 theatres being included in the same theatre metrics.
Cost of sales
percentages
Cineplex reviews and reports cost of sales
percentages for its two largest revenue sources, box office
revenues and food service revenues as these measures are widely
used in the theatre exhibition industry. These measures are
reported as film cost percentage and concession cost percentage,
respectively, and are calculated as follows:
Film cost percentage: Calculated as total
film cost expense divided by total box office revenues for the
period.
Theatre concession cost percentage:
Calculated as total theatre food service costs divided by total
theatre food service revenues for the period.
LBE food cost percentage: Calculated as
total LBE food costs divided by total LBE food service revenues for
the period.
Certain information included in
this news release contains forward-looking statements within the
meaning of applicable securities laws. These forward-looking
statements include, among others, statements with respect to
Cineplex's objectives and goals, and the strategies to achieve
those objectives and goals, as well as statements with respect to
Cineplex's beliefs, plans, objectives, expectations, anticipations,
estimates and intentions. The words "may", "will", "could",
"should", "would", "suspect", "outlook", "believe", "plan",
"anticipate", "estimate", "expect", "intend", "forecast",
"objective" and "continue" (or the negative thereof), and words and
expressions of similar import, are intended to identify
forward-looking statements.
By their very nature, forward-looking
statements involve inherent risks and uncertainties, including
those described in Cineplex's Annual Information Form ("AIF"), and
the management's discussion and analysis for the year ended
December 31, 2022 ("Annual MD&A")
and in this news release, which is incorporated herein by reference
and available on the System for Electronic Document Analysis and
Retrieval Plus ("SEDAR+") (www.sedarplus.ca). These risks and
uncertainties, both general and specific, give rise to the
possibility that predictions, forecasts, projections and other
forward-looking statements will not be achieved. Certain material
factors or assumptions are applied in making forward-looking
statements and actual results may differ materially from those
expressed or implied in such statements. Cineplex cautions readers
not to place undue reliance on these statements, as a number of
important factors, many of which are beyond Cineplex's control,
could cause actual results to differ materially from the beliefs,
plans, objectives, expectations, anticipations, estimates and
intentions expressed in such forward-looking statements, including:
Cineplex's expectations with respect to liquidity and capital
expenditures; its ability to meet its ongoing capital, operating
and other obligations, and anticipated needs for, and sources of,
funds; Cineplex's ability to execute cost-cutting and
revenue enhancement initiatives; risks generally encountered
in the relevant industry, competition, customer, legal, taxation
and accounting matters.
The foregoing list of factors that may affect
future results is not exhaustive. When reviewing Cineplex's
forward-looking statements, readers should carefully consider the
foregoing factors and other uncertainties and potential events.
Additional information about factors that may cause actual results
to differ materially from expectations and about material factors
or assumptions applied in making forward-looking statements may be
found in the "Risks and Uncertainties" section of Cineplex's Annual
MD&A.
Cineplex does not undertake to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
applicable Canadian securities law. Additionally, Cineplex
undertakes no obligation to comment on analyses, expectations or
statements made by third parties in respect of Cineplex, its
financial or operating results or its securities. All
forward-looking statements in this news release are made as of the
date hereof and are qualified by these cautionary statements.
Additional information, including Cineplex's AIF, can be found on
SEDAR+ at www.sedarplus.ca.
You are cordially invited to participate in a
conference call with the management of Cineplex (TSX: CGX) to
review our second quarter. Ellis
Jacob, President and Chief Executive Officer and Gord
Nelson, Chief Financial Officer, will host the call scheduled
for:
Cineplex Inc. Q2 2023 Earnings Webcast:
Date:
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Thursday, August 10,
2023
|
Time:
|
10:00 a.m. Eastern
Daylight Time
|
Audio Webcast:
|
Audience URL
https://events.q4inc.com/attendee/578656441
|
|
Pre-registration
available.
|
|
An archive of the
webcast will be available at https://corp.cineplex.com/investors
after the webcast for a limited time.
|
Please note, analysts who cover the Company,
should use the dial-in option to participate in the live question
period:
1-226-828-7575 (Local) or 1-833-950-0062 (Canada Toll-free), access
code 362335.
All attendees should join the event 5-10 minutes
prior to the scheduled start time. Media are welcome to join the
call in listen-only mode.
About Cineplex
Cineplex (TSX:CGX) is a top-tier Canadian brand
that operates in the Film Entertainment and Content, Amusement and
Leisure, and Media sectors. Cineplex offers a unique escape from
the everyday to millions of guests through its circuit of over 170
movie theatres and location-based entertainment venues. In addition
to being Canada's largest and most
innovative film exhibitor, the company operates Canada's favourite destination for 'Eats &
Entertainment' (The Rec Room), complexes specially designed for
teens and families (Playdium), and a newly launched entertainment
concept that brings movies, amusement gaming, dining, and live
performances together under one roof (Cineplex Junxion). It also
operates successful businesses in digital commerce
(CineplexStore.com), alternative programming (Cineplex Events),
motion picture distribution (Cineplex Pictures), cinema media
(Cineplex Media), digital place-based media (Cineplex Digital
Media) and amusement solutions (Player One Amusement Group).
Providing even more value for its guests, Cineplex is a partner in
Scene+, Canada's largest
entertainment and lifestyle loyalty program.
Proudly recognized as having one of the country's
Most Admired Corporate Cultures, Cineplex employs over 10,000
people in its offices and venues across Canada and the
United States. To learn more, visit Cineplex.com.
SOURCE Cineplex