Reported $120 million of Net Income and $232
million of Adjusted EBITDA, the Company's second highest quarterly
result of all time, with a 24.6% Adjusted EBITDA margin
Further strengthened the balance sheet by
generating $215 million of Free Cash Flow, paying down $100 million
of debt in the quarter, and extending term loan maturity to
2030
Cinemark Holdings, Inc. (NYSE: CNK), one of the largest and most
influential theatrical exhibition companies in the world, today
reported results for the three and six months ended June 30,
2023.
“The strength of the second quarter’s film lineup, supplemented
with the ongoing benefits we are achieving from our strategic
initiatives, translated into exceptional second quarter results
across our entire global footprint,” stated Sean Gamble, Cinemark
President and CEO. “We believe box office performance witnessed
year-to-date, and over the past two years, provides conclusive
evidence that consumer enthusiasm to view compelling films in a
shared, larger-than-life, cinematic environment is as strong as
ever. We remain confident in the long-term fundamentals of
theatrical exhibition, and Cinemark is well-positioned to capture
an outsized portion of our industry’s ongoing recovery.”
Earnings Highlights
- Entertained more than 64 million moviegoers and delivered box
office recovery that once again outpaced industry results.
- Continued to be the only major U.S. exhibitor to have achieved
and maintained a meaningful increase in market share since
reopening, which remains up more than 100 basis points compared to
our pre-pandemic average.
- Reported $120 million in net income.
- Delivered $232 million of Adjusted EBITDA, the second highest
quarterly Adjusted EBITDA in Cinemark's history; achieved a 24.6%
Adjusted EBITDA margin that was amongst the Company's highest of
all time.
- Further strengthened the balance sheet by generating $215
million of Free Cash Flow and increasing cash by $108 million to
end the quarter with a $758 million cash balance.
- Maintained proactive history of managing debt by redeeming $100
million of 8.75% senior secured notes in May 2023 and successfully
refinancing credit facility that secured $650 million new term loan
maturing in 2030, while upsizing revolver to $125 million maturing
in 2028.
Financial Results
Cinemark Holdings, Inc.’s total revenue for the three months
ended June 30, 2023 increased 26.6% to $942.3 million compared with
$744.1 million for the three months ended June 30, 2022. For the
three months ended June 30, 2023, admissions revenue increased
25.3% to $478.4 million and concession revenue increased 30.6% to
$373.4 million, driven by a 23.8% increase in attendance to 64.4
million patrons. Worldwide average ticket price was $7.43 and
concession revenue per patron was $5.80.
Net income attributable to Cinemark Holdings, Inc. for the three
months ended June 30, 2023 was $119.1 million compared with a loss
of $(73.4) million for the three months ended June 30, 2022.
Diluted earnings per share for the three months ended June 30, 2023
was $0.80 compared with a diluted loss per share of $(0.61) for the
three months ended June 30, 2022.
Adjusted EBITDA for the three months ended June 30, 2023 was
$231.5 million compared with $138.3 million for the three months
ended June 30, 2022. Reconciliations of non-GAAP financial measures
are provided in the financial schedules accompanying this press
release and at https://ir.cinemark.com.
Cinemark Holdings, Inc.’s total revenue for the six months ended
June 30, 2023 increased 28.9% to $1,553.0 million compared with
$1,204.6 million for the six months ended June 30, 2022. For the
six months ended June 30, 2023, admissions revenue increased 27.8%
to $789.4 million and concession revenue increased 32.7% to $609.2
million, driven by a 26.1% increase in attendance to 107.3 million
patrons. Worldwide average ticket price was $7.36 and concession
revenue per patron was $5.68.
Net income attributable to Cinemark Holdings, Inc. for the six
months ended June 30, 2023 was $116.0 million compared with a loss
of $(147.4) million for the six months ended June 30, 2022. Diluted
earnings per share for the six months ended June 30, 2023 was $0.82
compared with a diluted loss per share of $(1.23) for the six
months ended June 30, 2022.
Adjusted EBITDA for the six months ended June 30, 2023 was
$317.7 million compared with $163.5 million for the six months
ended June 30, 2022. Reconciliations of non-GAAP financial measures
are provided in the financial schedules accompanying this press
release and at https://ir.cinemark.com.
As of June 30, 2023, the Company’s aggregate screen count was
5,812, and the Company had commitments to open 5 new theatres and
46 screens over the next two years.
Webcast – Today at 8:30 AM
ET
Live Webcast/Replay: Available at
https://ir.cinemark.com. A replay will be available following the
call and archived for a limited time.
About Cinemark Holdings, Inc.
Headquartered in Plano, TX, Cinemark (NYSE: CNK) is one of the
largest and most influential movie theatre companies in the world.
Cinemark’s circuit, comprised of various brands that also include
Century, Tinseltown and Rave, as of June 30, 2023 operated 514
theatres with 5,812 screens in 42 states domestically and 14
countries throughout South and Central America. Cinemark
consistently provides an extraordinary guest experience from the
initial ticket purchase to the closing credits, including Movie
Club, the first U.S. exhibitor-launched subscription program; the
highest Luxury Lounger recliner seat penetration among the major
players; XD - the No. 1 exhibitor-brand premium large format; and
expansive food and beverage options to further enhance the
moviegoing experience. For more information go to
https://ir.cinemark.com.
Forward-looking Statements
This press release includes “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements are based on information
currently available as well as management’s assumptions and beliefs
today. These statements are subject to numerous risks and
uncertainties that could cause actual results to differ materially
from the results expressed or implied by the statements, and
investors should not place undue reliance on them. Risks and
uncertainties that could cause actual results to differ materially
from such statements include:
- future revenues, expenses and profitability;
- currency exchange rate and inflationary impacts;
- the future development and expected growth of our
business;
- projected capital expenditures;
- access to capital resources;
- attendance at movies generally or in any of the markets in
which we operate;
- the number and diversity of popular movies released, the length
of exclusive theatrical release windows, and our ability to
successfully license and exhibit popular films;
- national and international growth in our industry;
- competition from other exhibitors, alternative forms of
entertainment and content delivery via streaming and other
formats;
- determinations in lawsuits in which we are a party; and
- the impact of the COVID-19 pandemic on us and the motion
picture exhibition industry.
You can identify forward-looking statements by the use of words
such as “may,” “should,” “could,” “estimates,” “predicts,”
“potential,” “continue,” “anticipates,” “believes,” “plans,”
“expects,” “future” and “intends” and similar expressions which are
intended to identify forward-looking statements. These statements
are not guarantees of future performance and are subject to risks,
uncertainties and other factors, some of which are beyond our
control and difficult to predict. Such risks and uncertainties
could cause actual results to differ materially from those
expressed or forecasted in the forward-looking statements. In
evaluating forward-looking statements, you should carefully
consider the risks and uncertainties described in the “Risk
Factors” section or other sections in the Company's Annual Report
on Form 10-K filed February 24, 2023. All forward-looking
statements attributable to us or persons acting on our behalf are
expressly qualified in their entirety by these cautionary
statements and risk factors. Forward-looking statements contained
in this press release reflect our view only as of the date of this
press release. We undertake no obligation, other than as required
by law, to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
Cinemark Holdings,
Inc.
Financial and Operating
Summary
(unaudited, in millions, except
per share amounts)
Three Months Ended
Six Months Ended
June 30,
June 30,
2023
2022
2023
2022
Statement of income (loss)
data:
Revenue
Admissions
$
478.4
$
381.9
$
789.4
$
617.7
Concession
373.4
286.0
609.2
459.0
Other
90.5
76.2
154.4
127.9
Total revenue
$
942.3
$
744.1
$
1,553.0
$
1,204.6
Cost of operations
Film rentals and advertising
278.0
222.6
444.7
350.2
Concession supplies
67.4
52.5
111.0
82.5
Salaries and wages
112.1
100.2
198.3
180.0
Facility lease expense
87.0
80.3
166.5
154.0
Utilities and other
120.2
106.5
224.0
193.4
General and administrative expenses
50.0
48.2
96.5
88.9
Depreciation and amortization
52.8
61.0
107.7
122.7
Impairment of long-lived and other
assets
9.4
92.3
10.1
92.3
Restructuring costs
—
(0.2
)
—
(0.2
)
Gain on disposal of assets and other
(3.0
)
(0.7
)
(2.7
)
(7.6
)
Total cost of operations
773.9
762.7
1,356.1
1,256.2
Operating income (loss)
168.4
(18.6
)
196.9
(51.6
)
Other income (expense)
Interest expense
(37.1
)
(38.1
)
(73.9
)
(76.2
)
Interest income
13.0
3.1
24.9
4.7
Loss on debt extinguishment and
refinancing
(10.7
)
—
(10.7
)
—
Foreign currency and other related gain
(loss)
(6.2
)
(3.1
)
(8.4
)
0.1
Interest expense - NCM
(5.7
)
(5.9
)
(11.4
)
(11.7
)
Equity in income (loss) of affiliates
1.8
(5.5
)
(0.3
)
(7.7
)
Unrealized gain on investment in NCMI
9.2
—
9.2
—
Income (loss) before income taxes
132.7
(68.1
)
126.3
(142.4
)
Income tax expense
12.3
4.7
8.4
2.9
Net income (loss)
$
120.4
$
(72.8
)
$
117.9
$
(145.3
)
Less: Net income attributable to
noncontrolling interests
1.3
0.6
1.9
2.1
Net income (loss) attributable to Cinemark
Holdings, Inc.
$
119.1
$
(73.4
)
$
116.0
$
(147.4
)
Net income (loss) per share attributable
to Cinemark Holdings, Inc.'s common stockholders
Basic
$
0.98
$
(0.61
)
$
0.96
$
(1.23
)
Diluted
$
0.80
$
(0.61
)
$
0.82
$
(1.23
)
Weighted average shares outstanding
Basic
119.1
118.2
118.9
118.0
Diluted
151.7
118.2
151.5
118.0
Other Operating Data
(unaudited, in millions)
As of
June 30, 2023
December 31, 2022
Balance sheet data:
Cash and cash equivalents
$
758.0
$
674.5
Theatre properties and equipment, net
$
1,187.9
$
1,232.1
Total assets
$
4,846.8
$
4,817.7
Total long-term debt, net of unamortized
debt issuance costs and original issue discount
$
2,398.4
$
2,484.7
Total equity
$
254.8
$
119.5
Six Months Ended June
30,
2023
2022
Cash flows provided by (used
for):
Operating activities (1)
$
251.1
$
46.1
Investing activities
$
(54.6
)
$
(28.8
)
Financing activities
$
(110.8
)
$
(19.2
)
(1)
We define free cash flow as cash flow
provided by operating activities less capital expenditures. A
reconciliation of cash flow provided by operating activities to
free cash flow is provided below:
Six Months Ended June
30,
2023
2022
Reconciliation of free cash
flow:
Cash flows provided by operating
activities
$
251.1
$
46.1
Less: Capital expenditures
54.6
40.6
Free cash flow
$
196.5
$
5.5
Segment Information
(unaudited, in millions, except
per patron data)
U.S. Operating Segment
International Operating
Segment
Consolidated
Three Months Ended June
30,
Three Months Ended June
30,
Three Months Ended June
30,
Revenue and Attendance
2023
2022
2023
2022
Constant Currency (1)
2023
2023
2022
Admissions revenue
$
373.4
$
309.7
$
105.0
$
72.2
$
126.1
$
478.4
$
381.9
Concession revenue
296.3
234.6
77.1
51.4
92.8
373.4
286.0
Other revenue
65.2
56.5
25.3
19.7
30.8
90.5
76.2
Total revenue
$
734.9
$
600.8
$
207.4
$
143.3
$
249.7
$
942.3
$
744.1
Attendance
38.8
34.0
25.6
18.0
64.4
52.0
Average ticket price
$
9.62
$
9.11
$
4.10
$
4.01
$
4.93
$
7.43
$
7.34
Concession revenue per patron
$
7.64
$
6.90
$
3.01
$
2.86
$
3.63
$
5.80
$
5.50
Cost of Operations
Film rentals and advertising
$
224.0
$
185.7
$
54.0
$
36.9
$
65.6
$
278.0
$
222.6
Concession supplies
$
50.4
$
41.2
$
17.0
$
11.3
$
20.7
$
67.4
$
52.5
Salaries and wages
$
92.5
$
84.4
$
19.6
$
15.8
$
24.5
$
112.1
$
100.2
Facility lease expense
$
61.9
$
63.2
$
25.1
$
17.1
$
29.1
$
87.0
$
80.3
Utilities and other
$
90.3
$
81.3
$
29.9
$
25.2
$
36.4
$
120.2
$
106.5
U.S. Operating Segment
International Operating
Segment
Consolidated
Six Months Ended June
30,
Six Months Ended June
30,
Six Months Ended June
30,
Revenue and Attendance
2023
2022
2023
2022
Constant Currency (1)
2023
2023
2022
Admissions revenue
$
618.1
$
501.5
$
171.3
$
116.2
$
204.7
$
789.4
$
617.7
Concession revenue
483.1
375.7
126.1
83.3
151.5
609.2
459.0
Other revenue
112.8
95.6
41.6
32.3
50.5
154.4
127.9
Total revenue
$
1,214.0
$
972.8
$
339.0
$
231.8
$
406.7
$
1,553.0
$
1,204.6
Attendance
64.0
54.7
43.3
30.4
107.3
85.1
Average ticket price
$
9.66
$
9.17
$
3.96
$
3.82
$
4.73
$
7.36
$
7.26
Concession revenue per patron
$
7.55
$
6.87
$
2.91
$
2.74
$
3.50
$
5.68
$
5.39
Cost of Operations
Film rentals and advertising
$
357.5
$
291.9
$
87.2
$
58.3
$
105.4
$
444.7
$
350.2
Concession supplies
$
83.3
$
64.1
$
27.7
$
18.4
$
33.6
$
111.0
$
82.5
Salaries and wages
$
164.0
$
151.5
$
34.3
$
28.5
$
42.1
$
198.3
$
180.0
Facility lease expense
$
123.9
$
125.7
$
42.6
$
28.3
$
48.9
$
166.5
$
154.0
Utilities and other
$
170.8
$
149.4
$
53.2
$
44.0
$
64.1
$
224.0
$
193.4
(1)
Constant currency amounts, which are
non-GAAP measurements, were calculated using the average exchange
rate for the corresponding month for 2022. We translate the results
of our international operating segment from local currencies into
U.S. dollars using currency rates in effect at different points in
time in accordance with U.S. GAAP. Significant changes in foreign
currency exchange rates from one period to the next can result in
meaningful variations in reported results. We are providing
constant currency amounts for our international operating segment
to present a period-to-period comparison of business performance
that excludes the impact of foreign currency fluctuations.
Other Segment
Information
(unaudited, in millions)
Three Months Ended
Six Months Ended
June 30,
June 30,
2023
2022
2023
2022
Adjusted EBITDA (1)
U.S.
$
180.8
$
111.1
$
244.2
$
125.5
International
50.7
27.2
73.5
38.0
Total Adjusted EBITDA (1)
$
231.5
$
138.3
$
317.7
$
163.5
Capital expenditures
U.S.
$
21.1
$
16.5
$
43.8
$
30.5
International
7.2
5.4
10.8
10.1
Total Capital expenditures
$
28.3
$
21.9
$
54.6
$
40.6
(1)
Adjusted EBITDA represents net income
(loss) before income taxes, depreciation and amortization expense
and other items, as calculated below. Adjusted EBITDA is a non-GAAP
financial measure commonly used in our industry and should not be
construed as an alternative to net income as an indicator of
operating performance or as an alternative to cash flow provided by
operating activities as a measure of liquidity (as determined in
accordance with GAAP). Adjusted EBITDA may not be comparable to
similarly titled measures reported by other companies. We have
included Adjusted EBITDA because we believe it provides management
and investors with additional information to measure our
performance and liquidity, estimate our value and evaluate our
ability to service debt. In addition, we use Adjusted EBITDA for
incentive compensation purposes. A reconciliation of net income
(loss) to Adjusted EBITDA is provided below.
Reconciliation of Adjusted
EBITDA
(unaudited, in millions)
Three Months Ended
Six Months Ended
June 30,
June 30,
2023
2022
2023
2022
Net income (loss)
$
120.4
$
(72.8
)
$
117.9
$
(145.3
)
Add (deduct):
Income tax expense
12.3
4.7
8.4
2.9
Interest expense (1)
37.1
38.1
73.9
76.2
Other (income) expense, net (2)
(12.1
)
11.4
(14.0
)
14.6
Cash distributions from equity investees
(3)
1.6
0.9
1.6
1.5
Depreciation and amortization
52.8
61.0
107.7
122.7
Impairment of long-lived and other
assets
9.4
92.3
10.1
92.3
Restructuring costs
—
(0.2
)
—
(0.2
)
Gain on disposal of assets and other
(3.0
)
(0.7
)
(2.7
)
(7.6
)
Loss on debt extinguishment and
refinancing
10.7
—
10.7
—
Non-cash rent expense
(4.5
)
(2.4
)
(8.4
)
(4.7
)
Share-based awards compensation expense
(4)
6.8
6.0
12.5
11.1
Adjusted EBITDA
$
231.5
$
138.3
$
317.7
$
163.5
(1)
Includes amortization of debt issuance
costs, amortization of original issue discount and amortization of
accumulated gains (losses) for amended swap agreements.
(2)
Includes interest income, foreign currency
exchange and other related (gains) losses, interest expense - NCM,
equity in income (loss) of affiliates and unrealized gain on
investment in NCMI.
(3)
Includes cash distributions received from
equity investees that were recorded as a reduction of the
respective investment balances. These distributions are reported
entirely within the U.S. operating segment.
(4)
Non-cash expense included in general and
administrative expenses.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230804809256/en/
Investor Relations Contact:
Chanda Brashears – 972-665-1671 or cbrashears@cinemark.com
Media Contact: Julia McCartha –
972-665-1322 or pr@cinemark.com
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