Cinemark Holdings, Inc. Reports Q2 2010 Adjusted EBITDA of $125.1 Million on Revenues of $539.4 Million
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, 2010.
Cinemark Holdings, Inc.'s revenues for the three months ended June 30, 2010 increased 4.2% to $539.4 million from $517.5 million for the three months ended June 30, 2009. For the three months ended June 30, 2010, admissions revenues increased 4.1% to $353.1 million and concession revenues increased 4.0% to $165.2 million. The increases were primarily related to a 5.8% increase in average ticket price and a 5.4% increase in concession revenues per patron, partially offset by a 1.5% decline in attendance.
Adjusted EBITDA for the three months ended June 30, 2010 increased 3.6% to $125.1 million from $120.8 million for the three months ended June 30, 2009. 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, 2010 increased 112.3% to $39.7 million compared to $18.7 million for the three months ended June 30, 2009. Net income for the three months ended June 30, 2009 included a loss on early retirement of debt of approximately $26.8 million, before income taxes.
"We again achieved strong, industry-leading results. This is the seventh straight quarter that our domestic box office performance has exceeded industry performance. In addition, our international circuit continued to be an important factor in driving our worldwide revenue and Adjusted EBITDA growth," stated Cinemark Chief Executive Officer Alan Stock. "The Company's digital cinema rollout is well underway with Barco projectors and RealD 3D systems being installed to expand our 3D footprint. In response to increasing customer demand and an expanding 3D slate, we now expect to install 3D systems in approximately 40-50% of our worldwide screens. Once this installation process is completed we will begin converting all of our remaining screens to digital. We are excited by the performance of Cinemark's XD Extreme Digital Cinema auditoriums, and are actively expanding that footprint both domestically and internationally."
Cinemark Holdings, Inc.'s revenues for the six months ended June 30, 2010 increased 11.9% to $1,056.0 million from $943.3 million for the six months ended June 30, 2009. During the six months ended June 30, 2010, admissions revenues increased 12.5% to $696.1 million and concession revenues increased 10.2% to $318.3 million. The increases were primarily related to a 3.0% increase in attendance, a 9.1% increase in average ticket price and a 6.8% increase in concession revenues per patron.
Adjusted EBITDA for the six months ended June 30, 2010 increased 12.8% to $246.9 million from $218.8 million for the six months ended June 30, 2009. 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, 2010 increased 106.6% to $74.8 million compared to $36.2 million for the six months ended June 30, 2009. Net income for the six months ended June 30, 2009 included a loss on early retirement of debt of approximately $26.8 million, before income taxes.
On June 30, 2010, the Company's aggregate screen count was 4,907. As of June 30, 2010, the Company had signed commitments to open 10 new theatres with 97 screens by the end of 2010 and open 12 new theatres with 126 screens subsequent to 2010.
Conference Call/Webcast - Today at 8:30 AM ET Telephone: via 800/374-1346 or 706/679-3149 (for international callers).
Live Webcast/Replay: available live at www.cinemark.com in the Investor Relations section and archived for a limited time immediately following the call.
Call Replay: until August 8, 2010 via 800/642-1687 or 706/645-9291, passcode: 91767430.
About Cinemark Holdings, Inc.
Cinemark is a leading domestic and international motion picture exhibitor, operating 425 theatres with 4,907 screens in 39 U.S. states, one Canadian province, Brazil, Mexico and 11 other Latin American countries as of June 30, 2010. For more information go to www.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 March 10, 2010 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 June 30, Six months ended June 30,
2010 2009 2010 2009
Statement of income
data:
Revenues
Admissions $ 353,085 $ 339,088 $ 696,075 $ 618,971
Concession 165,230 158,926 318,334 288,957
Other 21,054 19,494 41,591 35,380
Total revenues 539,369 517,508 1,056,000 943,308
Cost of operations
Film rentals and 193,550 190,826 382,369 337,952
advertising
Concession supplies 24,494 24,027 46,900 43,744
Facility lease expense 61,990 59,195 124,705 114,933
Other theatre 113,898 106,238 221,661 199,316
operating expenses
General and
administrative 24,946 23,675 50,476 45,463
expenses
Depreciation and 34,915 37,881 69,006 74,337
amortization
Impairment of 4,688 3,930 5,035 4,969
long-lived assets
Loss on sale of assets 1,191 1,186 4,358 1,458
and other
Total cost of 459,672 446,958 904,510 822,172
operations
Operating income 79,697 70,550 151,490 121,136
Interest expense (1) (28,605) (25,649) (54,615) (51,113)
Distributions from NCM 1,332 5,027 11,278 11,606
Loss on early - (26,795) - (26,795)
retirement of debt
Other income (expense) (1,454) 994 (642) 2,287
Income before income 50,970 24,127 107,511 57,121
taxes
Income taxes 10,211 4,320 30,041 18,963
Net income $ 40,759 $ 19,807 $ 77,470 $ 38,158
Less: Net income
attributable to 1,077 1,137 2,695 1,923
noncontrolling
interests
Net income attributable
to Cinemark Holdings, $ 39,682 $ 18,670 $ 74,775 $ 36,235
Inc.
Earnings per share
attributable to
Cinemark Holdings,
Inc.'s common
stockholders:
Basic $ 0.35 $ 0.17 $ 0.67 $ 0.33
Diluted $ 0.35 $ 0.17 $ 0.67 $ 0.33
Weighted average
diluted shares 111,552 110,266 111,299 109,922
outstanding
Other financial data:
Adjusted EBITDA (2) $ 125,116 $ 120,792 $ 246,897 $ 218,780
(1) Includes amortization of debt issue costs and excludes capitalized
interest.
(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,
2010 2009
Balance sheet data:
Cash and cash $ 435,770 $ 437,936
equivalents
Theatre properties and 1,184,254 1,219,588
equipment, net
Total assets 3,305,151 3,276,448
Long-term debt,
including current 1,537,917 1,543,705
portion
Equity 959,934 914,628
Three months ended Six months ended
June 30, June 30,
2010 2009 2010 2009
Other operating data:
Attendance (patrons):
Domestic 41,658 43,922 81,231 81,190
International 18,526 17,198 37,460 34,053
Worldwide 60,184 61,120 118,691 115,243
Average ticket price (in dollars):
Domestic $ 6.47 $ 6.29 $ 6.51 $ 6.18
International $ 4.51 $ 3.66 $ 4.47 $ 3.45
Worldwide $ 5.87 $ 5.55 $ 5.86 $ 5.37
Concession revenues per patron (in
dollars):
Domestic $ 3.12 $ 2.99 $ 3.06 $ 2.92
International $ 1.91 $ 1.61 $ 1.87 $ 1.52
Worldwide $ 2.74 $ 2.60 $ 2.68 $ 2.51
Average screen count (month end
average):
Domestic 3,827 3,825 3,827 3,789
International 1,070 1,037 1,068 1,037
Worldwide 4,897 4,862 4,895 4,826
Segment Information
(unaudited, in thousands)
Three months ended Six months ended
June 30, June 30,
2010 2009 2010 2009
Revenues
U.S. $ 410,964 $ 419,575 $ 799,579 $ 761,019
International 129,641 98,962 258,912 184,158
Eliminations (1,236) (1,029) (2,491) (1,869)
Total revenues $ 539,369 $ 517,508 $ 1,056,000 $ 943,308
Adjusted EBITDA (1)
U.S. $ 96,548 $ 100,576 $ 185,953 $ 182,295
International 28,568 20,216 60,944 36,485
Total adjusted EBITDA $ 125,116 $ 120,792 $ 246,897 $ 218,780
Capital expenditures
U.S. $ 23,508 $ 27,171 $ 36,008 $ 43,422
International 13,935 10,875 20,952 17,496
Total capital expenditures $ 37,443 $ 38,046 $ 56,960 $ 60,918
Reconciliation of Adjusted EBITDA
(unaudited, in thousands)
Three months ended Six months ended
June 30, June 30,
2010 2009 2010 2009
Net income $ 40,759 $ 19,807 $ 77,470 $ 38,158
Income taxes 10,211 4,320 30,041 18,963
Interest expense 28,605 25,649 54,615 51,113
Loss on early retirement of debt 26,795 26,795
Other (income) expense 1,454 (994) 642 (2,287)
Depreciation and amortization 34,915 37,881 69,006 74,337
Impairment of long-lived assets 4,688 3,930 5,035 4,969
Loss on sale of assets and other 1,191 1,186 4,358 1,458
Deferred lease expenses - theatres 801 1,034 1,551 2,121
(2)
Deferred lease expenses - DCIP 113 146
equipment (3)
Amortization of long-term prepaid 438 360 779 750
rents (2)
Share based awards compensation 1,941 824 3,254 2,403
expense (4)
Adjusted EBITDA (1) $ 125,116 $ 120,792 $ 246,897 $ 218,780
Adjusted EBITDA as calculated in the chart above represents net income
before income taxes, interest expense, loss on early retirement of debt,
other (income) expense, 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
(1) 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.
Source: Cinemark Holdings, Inc.
Released August 5, 2010