Cinemark Holdings, Inc. Reports Record Revenues of $799.9 Million for the Second Quarter of 2015

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PLANO, Texas--(BUSINESS WIRE)-- Cinemark Holdings, Inc. (NYSE: CNK), one of the largest motion picture exhibitors in the world, today reported results for the three and six months ended June 30, 2015.

Cinemark Holdings, Inc.’s total revenues for the three months ended June 30, 2015 were $799.9 million, an 11.4% increase from total revenues for the three months ended June 30, 2014 of $717.9 million. Admissions revenues increased 10.4%, concession revenues increased 14.6% and attendance was up 8.8% for the three months ended June 30, 2015 compared to the same prior year period.

Adjusted EBITDA for the three months ended June 30, 2015 was $193.5 million compared to $169.4 million for the three months ended June 30, 2014. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.

Net income attributable to Cinemark Holdings, Inc. for the three months ended June 30, 2015 was approximately $70.3 million compared to $71.7 million for the three months ended June 30, 2014. Diluted earnings per share for the three months ended June 30, 2015 was $0.61 compared to $0.62 for the three months ended June 30, 2014. Net income for the three months ended June 30, 2015 reflected an effective income tax rate of approximately 38% compared to the effective income tax rate for the three months ended June 30, 2014 of approximately 25%. The rate for the three months ended June 30, 2014 included certain discreet income tax benefits related to the sale of our Mexican subsidiary.

“It was an incredible second quarter for the North American industry with 9.3% year-over-year growth,” stated Tim Warner, Cinemark CEO. “With our global footprint, as well as our focus on technology and innovation, our worldwide operations outperformed the industry by 740 basis points on a currency adjusted basis. Furthermore, we have now achieved 24 out of 26 quarters of North American industry outperformance and congratulate our entire worldwide team for yet another quarter of outstanding results.”

Cinemark Holdings, Inc.’s revenues for the six months ended June 30, 2015 increased 9.5% to $1,445.3 million from $1,320.2 million for the six months ended June 30, 2014. During the six months ended June 30, 2015, admissions revenues increased 8.0% to $903.6 million, concession revenues increased 13.0% to $474.0 million and attendance increased 7.7% to 142.2 million patrons. Average ticket price increased 0.2% to $6.35 and concession revenues per patron increased 4.7% to $3.33 during the six months ended June 30, 2015.

Adjusted EBITDA for the six months ended June 30, 2015 was $340.6 million compared to $297.9 million for the six months ended June 30, 2014. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.

Net income attributable to Cinemark Holdings, Inc. for the six months ended June 30, 2015 was $112.8 million compared to $107.2 million for the six months ended June 30, 2014. Diluted earnings per share for the six months ended June 30, 2015 was $0.97 compared to $0.93 for the six months ended June 30, 2014.

On June 30, 2015, the Company’s aggregate screen count was 5,720. As of June 30, 2015, the Company had signed commitments to open 11 new theatres and 111 screens by the end of 2015 and open 12 new theatres with 123 screens subsequent to 2015.

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Telephone: via 888-755-8910 or 706-679-3149 (for international callers).

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About Cinemark Holdings, Inc.

Cinemark is a leading domestic and international motion picture exhibitor, operating 503 theatres with 5,720 screens in 41 U.S. states, Brazil, Argentina and 12 other Latin American countries as of June 30, 2015. For more information go to investors.cinemark.com.

Forward-looking Statements

This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The “forward-looking statements” include our current expectations, assumptions, estimates and projections about our business and our industry. They include statements relating to future revenues, expenses and profitability, the future development and expected growth of our business, projected capital expenditures, attendance at movies generally or in any of the markets in which we operate, the number or diversity of popular movies released and our ability to successfully license and exhibit popular films, national and international growth in our industry, competition from other exhibitors and alternative forms of entertainment and determinations in lawsuits in which we are defendants. 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 and 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 27, 2015 and quarterly reports on Form 10-Q. 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 thousands)
       
Three months ended Six months ended
June 30, June 30,
2015 2014 2015 2014
Statement of income data:
Revenues
Admissions $ 502,963 $ 455,726 $ 903,625 $ 836,640
Concession 259,530 226,417 473,957 419,440
Other   37,439       35,720     67,748       64,063  
Total revenues 799,932 717,863 1,445,330 1,320,143
Cost of operations
Film rentals and advertising 285,303 249,198 500,962 449,855
Concession supplies 40,903 35,336 73,406 65,389
Facility lease expense 82,391 80,647 162,008 159,004
Other theatre operating expenses 161,666 148,512 306,246 288,795
General and administrative expenses 39,277 39,717 77,202 79,089
Depreciation and amortization 46,569 43,881 91,901 86,377
Impairment of long-lived assets 3,528 430 4,322 784
Loss on sale of assets and other   5,802       3,276     4,352       6,129  
Total cost of operations   665,439       600,997     1,220,399       1,135,422  
Operating income 134,493 116,866 224,931 184,721
Interest expense (1) (28,304 ) (28,286 ) (56,511 ) (56,766 )
Distributions from NCM — 1,180 8,499 10,677
Loss on amendment to debt agreement (925 ) — (925 ) —
Other income   8,400       6,455     6,952       14,141  
Income before income taxes 113,664 96,215 182,946 152,773
Income taxes   42,774       24,081     69,154       44,943  
Net income $ 70,890 $ 72,134 $ 113,792 $ 107,830
Less: Net income attributable to noncontrolling interests   632       403     1,013       656  
Net income attributable to Cinemark Holdings, Inc. $ 70,258     $ 71,731   $ 112,779     $ 107,174  
Earnings per share attributable to Cinemark Holdings, Inc.’s common stockholders:
Basic $ 0.61     $ 0.62   $ 0.97     $ 0.93  
Diluted $ 0.61     $ 0.62   $ 0.97     $ 0.93  
 
Weighted average diluted shares outstanding   115,328       114,961     115,215       114,814  
 
Other financial data:
Adjusted EBITDA (2) $ 193,453     $ 169,355   $ 340,574     $ 297,910  
(1) Includes amortization of debt issue costs.
(2) Adjusted EBITDA is a non-GAAP financial measure. A reconciliation of Adjusted EBITDA to net income is provided in the financial schedules accompanying this press release.
     
 
As of As of
June 30, December 31,
2015 2014
Balance sheet data:
Cash and cash equivalents $ 576,289 $ 638,869
Theatre properties and equipment, net $ 1,484,389 $ 1,450,812
Total assets $ 4,164,070 $ 4,151,980
Long-term debt, including current portion $ 1,819,479 $ 1,822,997
Equity $ 1,135,537 $ 1,123,129
       
 
Three months ended Six months ended
June 30, June 30,
2015   2014 2015   2014
Other operating data:
Attendance (patrons, in millions):
Domestic 49.0 46.5 90.5 87.1
International   27.7     24.0   51.7     44.9
Worldwide   76.7     70.5   142.2     132.0
 
Average ticket price (in dollars):
Domestic $ 7.67 $ 7.20 $ 7.42 $ 7.09
International $ 4.60 $ 5.04 $ 4.49 $ 4.88
Worldwide $ 6.56 $ 6.46 $ 6.35 $ 6.34
 
Concession revenues per patron (in dollars):
Domestic $ 3.98 $ 3.67 $ 3.92 $ 3.63
International $ 2.33 $ 2.33 $ 2.31 $ 2.30
Worldwide $ 3.38 $ 3.21 $ 3.33 $ 3.18
 
Average screen count (month end average):
Domestic 4,498 4,452 4,497 4,457
International   1,209     1,145   1,196     1,133
Worldwide   5,707     5,597   5,693     5,590
       
 
Segment Information

(unaudited, in thousands)

 
Three months ended Six months ended
June 30, June 30,
2015   2014 2015   2014
Revenues
U.S. $ 592,482 $ 524,485 $ 1,066,777 $ 969,405
International 211,505 196,881 385,838 357,073
Eliminations   (4,055 )     (3,503 )   (7,285 )     (6,335 )
Total revenues $ 799,932     $ 717,863   $ 1,445,330     $ 1,320,143  
Adjusted EBITDA (1)
U.S. $ 143,604 $ 120,871 $ 250,711 $ 214,411
International   49,849       48,484     89,863       83,499  
Total Adjusted EBITDA $ 193,453     $ 169,355   $ 340,574     $ 297,910  
Capital expenditures
U.S. $ 43,947 $ 30,483 $ 118,214 $ 60,795
International   26,018       19,274     37,498       41,768  
Total capital expenditures $ 69,965     $ 49,757   $ 155,712     $ 102,563  
 
 
Reconciliation of Adjusted EBITDA
(unaudited, in thousands)
   
Three months ended     Six months ended
June 30, June 30,
2015   2014 2015   2014
Net income $ 70,890 $ 72,134 $ 113,792 $ 107,830
Income taxes 42,774 24,081 69,154 44,943
Interest expense 28,304 28,286 56,511 56,766
Loss on amendment to debt agreement 925 — 925 —
Other income (8,400 ) (6,455 ) (6,952 ) (14,141 )
Depreciation and amortization 46,569 43,881 91,901 86,377
Impairment of long-lived assets 3,528 430 4,322 784
Loss on sale of assets and other 5,802 3,276 4,352 6,129
Deferred lease expenses - theatres (2) (351 ) 485 (819 ) 1,040
Deferred lease expenses – DCIP equipment (3) (234 ) (236 ) (469 ) 808
Amortization of long-term prepaid rents (2) 669 407 1,382 785
Share based awards compensation expense (4)   2,977       3,066     6,475       6,589  
Adjusted EBITDA (1) $ 193,453     $ 169,355   $ 340,574     $ 297,910  
 

(1)

Adjusted EBITDA as calculated in the chart above represents net income before income taxes, interest expense, other income, depreciation and amortization, impairment of long-lived assets, loss on sale of assets and other, changes in deferred lease expense, amortization of long-term prepaid rents and share based awards compensation expense. 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.

(2)

Non-cash expense included in facility lease expense.

(3)

Non-cash expense included in other theatre operating expenses.

(4)

Non-cash expense included in general and administrative expenses.

Cinemark Holdings, Inc.
Financial Contact:
Chanda Brashears, 972-665-1671
cbrashears@cinemark.com
or
Media Contact:
James Meredith, 972-665-1060
jmeredith@cinemark.com

Source: Cinemark Holdings, Inc.

Released August 6, 2015