Cinemark Holdings, Inc. Reports a 9.8% Increase in Revenues and a 42% Increase in Net Income for the Third Quarter of 2016

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 nine months ended September 30, 2016.

Cinemark Holdings, Inc.’s total revenues for the three months ended September 30, 2016 increased 9.8% to $768.6 million from $700.1 million for the three months ended September 30, 2015. For the three months ended September 30, 2016, admissions revenues increased 9.4% to $472.9 million and concession revenues increased 13.6% to $261.4 million. Attendance increased 7.3% to 76.2 million patrons, concession revenues per patron increased 5.9% to $3.43 and average ticket price increased 2.0% to $6.21 for the three months ended September 30, 2016.

Net income attributable to Cinemark Holdings, Inc. for the three months ended September 30, 2016 increased 42% to approximately $65.7 million from $46.3 million for the three months ended September 30, 2015. Diluted earnings per share for the three months ended September 30, 2016 increased 40% to $0.56 from $0.40 for the three months ended September 30, 2015.

Adjusted EBITDA for the three months ended September 30, 2016 increased 16% to $184.9 million from $159.1 million for the three months ended September 30, 2015. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.

“The robust film environment, coupled with our focus and execution on our strategic initiatives, enabled us to deliver a 9.8% increase in total revenues, 16% growth in Adjusted EBITDA and a 42% increase in net income,” stated Mark Zoradi, Cinemark’s CEO. “We are pleased to see how our strategic investments and emphasis on enriching the guest experience favorably impacted our third quarter results. We remain opportunistic regarding these endeavors with an eye toward driving long-term shareholder value.”

Cinemark Holdings, Inc.’s total revenues for the nine months ended September 30, 2016 increased 3.4% to $2,217.9 million from $2,145.4 million for the nine months ended September 30, 2015. For the nine months ended September 30, 2016, admissions revenues increased 2.2% to $1,364.8 million and concession revenues increased 6.9% to $752.8 million. Attendance increased 4.0% to 221.7 million patrons, concession revenues per patron increased 3.0% to $3.40 and average ticket price was $6.16 for the nine months ended September 30, 2016.

Net income attributable to Cinemark Holdings, Inc. for the nine months ended September 30, 2016 increased 12% to $178.1 million from $159.1 million for the nine months ended September 30, 2015. Net income for the nine months ended September 30, 2016 was impacted by a loss on debt amendments and refinancing of $13.3 million, which was primarily due to the refinancing of the Company’s 7.375% senior subordinated notes with an add-on to the Company’s 4.875% senior notes. Diluted earnings per share for the nine months ended September 30, 2016 increased 12% to $1.53 from $1.37 for the nine months ended September 30, 2015, even with the aforementioned loss on debt amendments and refinancing.

Adjusted EBITDA for the nine months ended September 30, 2016 increased approximately 6% to $537.9 million from $508.0 million for the nine months ended September 30, 2015. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.

On September 30, 2016, the Company’s aggregate screen count was 5,865. As of September 30, 2016, the Company had signed commitments to open 7 new theatres and 60 screens by the end of 2016 and open 16 new theatres with 147 screens subsequent to 2016.

Conference Call/Webcast – Today at 8:30AM ET
Telephone: via 800-374-1346 or 706-679-3149 (for international callers).

Live Webcast/Replay: Available live at investors.cinemark.com. A replay will be available following the call and archived for a limited time.

About Cinemark Holdings, Inc.

Cinemark is a leading domestic and international motion picture exhibitor, operating 522 theatres with 5,865 screens in 41 U.S. states, Brazil, Argentina and 13 other Latin American countries as of September 30, 2016. 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 24, 2016 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 September 30,						Nine months ended September 30,
		2016			2015			2016			2015
Statement of income data:
Revenues
	Admissions	$	472,842		$	432,136		$	1,364,737		$	1,335,761
	Concession		261,391			230,233			752,798			704,190
	Other		34,341			37,687			100,312			105,435
Total revenues			768,574			700,056			2,217,847			2,145,386
Cost of operations
	Film rentals and advertising		249,766			227,571			733,101			713,306
	Concession supplies		41,888			36,039			116,999			109,445
	Facility lease expense		82,848			80,604			241,904			242,612
	Other theatre operating expenses		179,459			169,940			509,339			491,413
	General and administrative expenses		35,290			39,099			109,143			116,301
	Depreciation and amortization		54,187			47,543			155,874			139,444
	Impairment of long-lived assets		406			633			2,323			4,955
	(Gain) loss on sale of assets and other		6,940			(500	)		10,985			3,852
Total cost of operations			650,784			600,929			1,879,668			1,821,328
Operating income			117,790			99,127			338,179			324,058
	Interest expense ⁽¹⁾		(26,659	)		(28,419	)		(81,980	)		(84,930	)
	Loss on debt amendments and refinancing		-			-			(13,284	)		(925	)
	Distributions from NCM		1,381			4,601			10,117			13,100
	Foreign currency exchange gain (loss)		485			(11,935	)		2,883			(18,702	)
	Other income		14,055			13,436			29,627			27,155
Income before income taxes			107,052			76,810			285,542			259,756
Income taxes			40,926			30,109			106,002			99,263
Net income			66,126			46,701			179,540			160,493
Less: Net income attributable to noncontrolling interests			471			362			1,454			1,375
Net income attributable to Cinemark Holdings, Inc.		$	65,655		$	46,339		$	178,086		$	159,118
Earnings per share attributable to Cinemark Holdings, Inc.’s common stockholders:
	Basic		115,601			115,164			115,475			115,051
	Diluted		115,793			115,356			115,706			115,279

	Weighted average diluted shares outstanding	$	0.56		$	0.40		$	1.53		$	1.37

Other financial data:
Adjusted EBITDA ⁽²⁾		$	184,891		$	159,147		$	537,933		$	508,030
________________________________
⁽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
	September 30,		December 31,
	2016		2015
Balance sheet data:
Cash and cash equivalents	$	527,111	$	588,539
Theatre properties and equipment, net	$	1,613,109	$	1,505,069
Total assets	$	4,176,619	$	4,126,497
Long-term debt, including current portion	$	1,790,793	$	1,781,335
Equity	$	1,233,616	$	1,110,813


		Three months ended September 30,		Nine months ended September 30,
		2016	2015	2016	2015
Other operating data:
	Attendance (patrons, in millions):
	Domestic	48.0	43.8	138.0	134.3
	International	28.2	27.2	83.7	78.9
	Worldwide	76.2	71.0	221.7	213.2

	Average ticket price (in dollars):
	Domestic	$ 7.39	$ 7.27	$ 7.52	$ 7.37
	International	$ 4.18	$ 4.18	$ 3.91	$ 4.38
	Worldwide	$ 6.21	$ 6.09	$ 6.16	$ 6.27

	Concession revenues per patron (in dollars):
	Domestic	$ 4.11	$ 3.85	$ 4.17	$ 3.90
	International	$ 2.27	$ 2.27	$ 2.12	$ 2.30
	Worldwide	$ 3.43	$ 3.24	$ 3.40	$ 3.30

	Average screen count (month end average):
	Domestic	4,563	4,493	4,547	4,496
	International	1,317	1,250	1,299	1,214
	Worldwide	5,880	5,743	5,846	5,710


Segment Information (unaudited, in thousands)

		Three months ended September 30,						Nine months ended September 30,
		2016			2015			2016			2015
Revenues
	U.S.	$	572,916		$	509,330		$	1,677,365		$	1,576,107
	International		199,476			194,497			551,212			580,335
	Eliminations		(3,818	)		(3,771	)		(10,730	)		(11,056	)
	Total revenues	$	768,574		$	700,056		$	2,217,847		$	2,145,386
Adjusted EBITDA
	U.S.	$	137,540		$	113,059		$	409,018		$	372,079
	International		47,351			46,088			128,915			135,951
	Total Adjusted EBITDA	$	184,891		$	159,147		$	537,933		$	508,030
Capital expenditures
U.S.		$	75,839		$	48,868		$	175,218		$	167,082
International			22,984			27,771			55,128			65,269
Total capital expenditures		$	98,823		$	76,639		$	230,346		$	232,351


	Reconciliation of Adjusted EBITDA
	(unaudited, in thousands)

		Three months ended						Nine months ended
		September 30,						September 30,
		2016			2015			2016			2015
Net income		$	66,126		$	46,701		$	179,540		$	160,493
	Income taxes		40,926			30,109			106,002			99,263
	Interest expense		26,659			28,419			81,980			84,930
	Other income		(14,540	)		(1,501	)		(32,510	)		(8,453	)
	Loss on debt amendments and refinancing		-			-			13,284			925
	Other cash distributions from equity investees ⁽²⁾		1,391			4,370			9,660			12,679
	Depreciation and amortization		54,187			47,543			155,874			139,444
	Impairment of long-lived assets		406			633			2,323			4,955
	(Gain) loss on sale of assets and other		6,940			(500	)		10,985			3,852
	Deferred lease expenses - theatres ⁽³⁾		70			(289	)		(111	)		(1,108	)
	Deferred lease expenses – DCIP equipment ⁽⁴⁾		(232	)		(232	)		(698	)		(701	)
	Amortization of long-term prepaid rents ⁽³⁾		371			519			1,357			1,901
	Share based awards compensation expense ⁽⁵⁾		2,587			3,375			10,247			9,850
Adjusted EBITDA ⁽¹⁾		$	184,891		$	159,147		$	537,933		$	508,030


⁽¹⁾			^{Adjusted EBITDA as calculated in the chart above represents net income before income taxes, interest expense, other income, loss on debt amendments and refinancing, other cash distributions from equity investees, depreciation and amortization, impairment of long-lived assets, (gain) 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. Adjusted EBITDA margin represents Adjusted EBITDA divided by total revenues.}
⁽²⁾			^{Represents cash distributions received from equity investees that were recorded as a reduction of the respective investment balances. Adjusted EBITDA for the three and nine months ended September 30, 2015 has been adjusted to reflect a comparable presentation.}
⁽³⁾			^{Non-cash expense included in facility lease expense.}
⁽⁴⁾			^{Non-cash expense included in other theatre operating expenses.}
⁽⁵⁾			^{Non-cash expense included in general and administrative expenses.}

View source version on businesswire.com: http://www.businesswire.com/news/home/20161108005344/en/

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

Source: Cinemark Holdings, Inc.

Released November 8, 2016

Cinemark Holdings, Inc. Reports a 9.8% Increase in Revenues and a 42% Increase in Net Income for the Third Quarter of 2016

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