Cineplex Inc. Reports First Quarter Results and Announces Dividend Increase
(firmenpresse) - TORONTO, ONTARIO -- (Marketwired) -- 05/09/13 -- Cineplex Inc. (TSX: CGX) ("Cineplex") today released its financial results for the first quarter of 2013.
First Quarter Results
"A lack of blockbuster hits resulted in box office revenues decreasing 2.8% this quarter versus the same period in 2012," said Ellis Jacob, President and CEO, Cineplex Entertainment. "However, Cineplex's media revenues increased 28.6% versus the first quarter of 2012 and realized gains in all major media categories. A new first quarter record was established for BPP of $8.97, an increase of 2.9% and a new all-time quarterly record was established for CPP of $4.69, up 4.2% versus 2012's first quarter."
"In other areas of the business, our SCENE loyalty program exceeded 4.5 million members during the quarter, an increase of more than 200,000 new members. The Cineplex Mobile app has now been downloaded more than 5.8 million times. We acquired two theatres in Vancouver, BC and added five more UltraAVX auditoriums to our circuit. Our premium entertainment experiences accounted for 35.5% of box office revenues during the first quarter which reflects an 8.4% increase versus the same period last year and is a new all-time high. Cineplex's strong balance sheet, continued investment in the enhancement of the exhibition experience and the diversification of our business model positions us well for the future and we are also pleased to announce a 6.7% dividend increase to $1.44 per share on an annual basis from the current $1.35 per share. This increase will be effective with the May 2013 dividend which will be paid in June 2013. This increase represents our third dividend increase since converting to a corporation on January 1, 2011."
EBITDA and adjusted free cash flow are not measures recognized by generally accepted accounting principles ("GAAP") and do not have standardized meanings in accordance with such principles. Therefore, EBITDA and adjusted free cash flow may not be comparable to similar measures presented by other issuers. EBITDA is calculated by adding back to net income, income tax expense, amortization and interest expense net of interest income. Adjusted EBITDA is calculated by adjusting EBITDA for gains and losses on disposal of assets and the share of income of the Canadian Digital Cinema Partnership ("CDCP"). Adjusted free cash flow is a non-GAAP measure generally used by Canadian corporations, as an indicator of financial performance and it should not be seen as a measure of liquidity or a substitute for comparable metrics prepared in accordance with GAAP. Management uses adjusted EBITDA and adjusted free cash flow to evaluate performance primarily because of the significant effect certain unusual or non-recurring charges and other items have on EBITDA from period to period. For a detailed reconciliation of net income to EBITDA and adjusted EBITDA and from cash used in or provided by operating activities to adjusted free cash flow, please refer to Cineplex's management's discussion and analysis filed on .
KEY DEVELOPMENTS IN THE FIRST QUARTER OF 2013
The following describes certain key business initiatives and results undertaken and achieved during the first quarter of 2013 in each of Cineplex's core business areas:
THEATRE EXHIBITION
MERCHANDISING
MEDIA
ALTERNATIVE PROGRAMMING
INTERACTIVE
LOYALTY
OPERATING RESULTS FOR THE FIRST QUARTER OF 2013
Total revenues
Total revenues for the three months ended March 31, 2013 decreased $0.9 million (0.4%) to $248.1 million as compared to the prior year period. A discussion of the factors affecting the changes in box office, concession and other revenues for the period is provided on the following pages.
Box office revenues
The following table highlights the movement in box office revenues, attendance and BPP for the quarter (in thousands of Canadian dollars, except attendance reported in thousands of patrons, and per patron amounts, unless otherwise noted):
First Quarter
Box office revenues decreased $4.2 million, or 2.8%, to $145.2 million during the first quarter of 2013, compared to $149.4 million recorded in the same period in 2012. The decrease was primarily due to a 5.5% decrease in attendance as a result of the current period lacking a blockbuster release similar to the prior period's highly-anticipated release of the first film in The Hunger Games trilogy, which recorded the highest-ever box office revenues for a first quarter release and the third-largest opening weekend of all-time. The current period attendance decline was also impacted by less compelling product for children, as only one of the top five films during the quarter, Jack the Giant Slayer, catered to young children in the period that included the March break school holiday.
BPP increased 2.9% from $8.72 in the first quarter of 2012 to $8.97 in the current year period. The performance of premium priced product contributed to this BPP increase, which accounted for 35.5% of box office revenues in the current period, up from 27.1% in the prior year period. The top two films released during the quarter were screened in 3D, compared to only one last year. Since March 31, 2012, Cineplex has added 139 RealD 3D screens, 19 UltraAVX screens, 10 VIP auditoriums and three IMAX screens, contributing to the increase in revenues from premium priced product. The four theatres acquired from AMC in the third quarter of 2012, which are located in major metropolitan areas and have higher ticket prices than those in smaller markets, also contributed to the higher BPP in the period.
Cineplex continues to invest in premium priced formats including 3D, UltraAVX, IMAX and VIP thereby positioning itself to benefit from the premiums charged for these offerings.
Concession revenues
The following table highlights the movement in concession revenues, attendance and CPP for the quarter (in thousands of Canadian dollars, except attendance and same store attendance reported in thousands of patrons, and per patron amounts):
First Quarter
Concession revenues decreased 1.5% as compared to the prior year quarter primarily due to the 5.5% decrease in attendance. CPP increased from $4.50 in the first quarter of 2012 to $4.69 in the same period in 2013, a 4.2% increase and quarterly record for Cineplex. Cineplex believes a focus on revised concession offerings, its RBO program and improved product promotion through the expansion of a digital menu board program have all contributed to the higher CPP in the current period compared to the prior year period.
Other revenues
The following table highlights the movement in media, games and other revenues for the quarter (in thousands of Canadian dollars):
First Quarter
Other revenues increased 20.0% to $27.0 million in the first quarter of 2013 compared to the prior year period. This increase was primarily due to higher media revenues, which were $16.3 million, up $3.6 million, or 28.6%, when compared to the prior year period. This increase was primarily due to showtime revenues increasing $2.8 million and CDM revenues increasing $0.5 million compared to the prior year period. A focus on regional advertising campaigns in addition to national campaigns contributed to the higher media revenues in the current year period.
The games revenue increase is primarily due to the addition of six new XSCAPE entertainment centres since the first quarter of 2012. The current period includes a life-to-date one-time increase to games revenue of $0.5 million due to a change in accounting policy regarding the recognition of revenue on the sale of XSCAPE gaming cards, which was offset by the games revenues for the first quarter of 2012 including the results of New Way Sales ("NWS") for January 2012 ($0.4 million).
On January 31, 2012, Cineplex deconsolidated NWS and merged its operations with the amusement game and vending assets of Starburst Coin Machines Inc. ("SCM"), to create Cineplex Starburst Inc. ("CSI"). Cineplex and SCM both have a 50% interest in CSI. Cineplex's share of revenues from CSI for the periods subsequent to January 31, 2012 are included in the 'Share of income of joint ventures' line in the statements of operations.
Other revenues increased primarily due to increased revenues from enhanced guest service initiatives and auditorium rentals.
Film cost
The following table highlights the movement in film cost and the film cost percentage for the quarter (in thousands of Canadian dollars, except film cost percentage):
First Quarter
Film cost varies primarily with box office revenue, and can vary from quarter to quarter based on the relative strength of the titles exhibited during the period. The decrease in the first quarter of 2013 compared to the prior year period was due to the decrease in box office revenue and the impact of the 0.7% decrease in film cost percentage. The decrease in film cost percentage is primarily due to the settlement rate on the top films during the first quarter of 2013 being lower than the average film settlement rate on certain strong performing titles in the 2012 period.
Cost of concessions
The following table highlights the movement in concession cost and concession cost as a percentage of concession revenues ("concession cost percentage") for the quarter (in thousands of Canadian dollars, except concession cost percentage and concession margin per patron):
First Quarter
Cost of concessions varies primarily with theatre attendance as well as the quantity and mix of concession offerings sold. The increase in concession cost as compared to the prior year period was due to the 0.9% increase in the concession cost percentage during the period. This increase was partially offset by the 1.5% decrease in concession revenues. The concession margin per patron increased from $3.58 in the first quarter of 2012 to $3.68 in the same period in 2013, reflecting the impact of the higher CPP during the period.
Despite the 10% discount offered to SCENE members and SCENE points offered on select combo offerings, which contributes to a higher concession cost percentage, Cineplex believes the SCENE program drives incremental attendance and purchase incidence which increases concession revenues and CPP.
Depreciation and amortization
The following table highlights the movement in depreciation and amortization expenses during the quarter (in thousands of Canadian dollars):
The quarterly decrease in amortization of property, equipment and leaseholds of $0.8 million is due in part to certain assets becoming fully amortized in the third quarter of 2012.
The increase in amortization of intangible assets and other in the first quarter of 2013 compared to the prior year period is due to the amortization of certain trade name assets that are being phased out by Cineplex. These assets were previously classified as indefinite life assets however during the fourth quarter of 2012 their classification was changed to definite life with amortization being recorded over the anticipated rebranding schedule of the associated theatres.
Loss (gain) on disposal of assets
The following table shows the movement in the loss (gain) on disposal of assets during the quarter (in thousands of Canadian dollars):
First Quarter
During the first quarter of 2013, Cineplex recorded a loss of $1.1 million on the disposal of assets that were sold or otherwise disposed of. The first quarter of 2012 resulted in a gain of $0.1 million on the disposal of assets.
Other costs
Other costs include three main sub-categories of expenses, including theatre occupancy expenses, which capture the rent and associated occupancy costs for Cineplex's various operations; other operating expenses, which include the costs related to running Cineplex's theatres and ancillary businesses; and general and administrative expenses, which includes costs related to managing Cineplex's operations, including the head office expenses. Please see the discussions below for more details on these categories. The following table highlights the movement in other costs for the quarter (in thousands of Canadian dollars):
Theatre occupancy expenses
The following table highlights the movement in theatre occupancy expenses for the quarter (in thousands of Canadian dollars):
First Quarter
Theatre occupancy expenses increased $4.9 million during the first quarter of 2013 compared to the prior year period. This increase was primarily due to the four theatres acquired from AMC in the third quarter of 2012 ($4.9 million).
Other operating expenses
The following table highlights the movement in other operating expenses during the quarter (in thousands of Canadian dollars):
First Quarter
Other operating expenses during the first quarter of 2013 increased $5.9 million or 10.1% compared to the prior year period. The impact of new and acquired net of disposed theatres was a $2.9 million increase to the category primarily due to the four theatres acquired from AMC which accounted for $2.1 million of the $2.9 million increase. Media expenses increased $1.3 million due to the higher volume of media activity in the quarter. As a result of lower business volumes at the theatres during the current year period, same-store payroll costs decreased $0.3 million. The impact of NWS ($0.3 million) represents January 2012 activity prior to the deconsolidation of NWS and the formation of CSI.
The major movement in the Other category include the following:
Total theatre payroll costs accounted for 43.5% of total operating expenses during the first quarter of 2013 as compared to 45.7% for the same period one year earlier.
General and administrative expenses
The following table highlights the movement in general and administrative ("G&A") expenses during the quarter, including Share based compensation costs, and G&A net of these costs (in thousands of Canadian dollars):
First Quarter
G&A expenses increased $0.8 million during the first quarter of 2013 compared to the prior year period, due to a $0.8 million increase in LTIP expense. The $0.2 million increase in G&A excluding LTIP and option plan expense was offset by the $0.2 million decrease in the option plan expense.
Share of income of joint ventures
Cineplex's joint ventures in the 2013 period include its 50% share of one theatre in Quebec and one IMAX screen in Ontario, its 78.2% interest in CDCP and its 50% interest in CSI. For the 2012 period, Cineplex's joint ventures included one theatre in Quebec, one IMAX screen in Ontario, its 78.2% interest in CDCP and its 50% interest in CSI for February and March as CSI was formed January 31, 2012. The following table highlights the components of share of income of joint ventures during the quarter (in thousands of Canadian dollars):
First Quarter
The increase from income of $0.3 million in the first quarter of 2012 to income of $0.5 million in the current period is primarily due to CDCP. The CDCP increase is due in part to the full roll-out of Cineplex's digital projectors being completed in the third quarter of 2012.
Under IFRS 11, Cineplex's 50% interest in SCENE LP is classified as a joint operation and not a joint venture, resulting in Cineplex recognizing its share of the assets, liabilities, revenues and expenses of SCENE in its consolidated financial statements on a line-by-line basis.
EARNINGS BEFORE INTEREST, INCOME TAXES, DEPRECIATION AND AMORTIZATION ("EBITDA")
The following table presents EBITDA and adjusted EBITDA for the three months ended March 31, 2013 as compared to the three months ended March 31, 2012 (expressed in thousands of Canadian dollars, except adjusted EBITDA margin):
Adjusted EBITDA for the first quarter of 2013 decreased $9.4 million, or 23.0%, as compared to the prior year period. The decrease as compared to the prior year period was primarily due to the lower attendance in the period resulting in lower exhibition and concession revenues in the period. The four theatres acquired from AMC in the third quarter of 2012 reduced adjusted EBITDA in the period by $0.3 million.
Cineplex believes its operating and programming expertise, combined with its merchandising, media, marketing, interactive and SCENE loyalty programs will positively and significantly improve the operations of the four theatres acquired from AMC. Cineplex has added UltraAVX auditoriums to these locations and will continue to invest in each of the locations by potentially adding VIP auditoriums or XSCAPE entertainment centres to one or more of the locations.
Adjusted Free Cash Flow
For the first quarter of 2013, adjusted free cash flow per common share of Cineplex was $0.3838 as compared to $0.4803 in the prior year period. The declared dividends per common share of Cineplex were $0.3375 in the first quarter of 2013 and $0.3225 in the prior year period. During the twelve months ended March 31, 2013, Cineplex generated adjusted free cash flow per Share of $1.9784, compared to $2.0527 in the prior year period. Cineplex declared dividends per Share of $1.3450 and $1.2875, respectively, in each period. The payout ratios for these periods were approximately 68.0% and 62.7%, respectively.
This news release contains "forward-looking statements" within the meaning of applicable securities laws, such as statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. These statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those described in our Annual Information Form and in this news release. Those risks and uncertainties include adverse factors generally encountered in the film exhibition industry such as poor film product and unauthorized copying; the risks associated with national and world events, including war, terrorism, international conflicts, natural disasters, extreme weather conditions, infectious diseases, changes in income tax legislation; and general economic conditions. Many of these risks and uncertainties can affect our actual results and could cause our actual results to differ materially from those expressed or implied in any forward-looking statement made by us or on our behalf. All forward-looking statements in this news release are qualified by these cautionary statements. These statements are made as of the date of this news release and, except as required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Additionally, we undertake no obligation to comment on analyses, expectations or statements made by third parties in respect of Cineplex Inc. or Cineplex Entertainment Limited Partnership, their financial or operating results or their securities.
About Cineplex Inc.
Cineplex is one of Canada's leading entertainment companies and operates one of the most modern and fully digitized motion picture circuits in the world. A top-tier Canadian brand, Cineplex operates numerous businesses including theatrical exhibition, food services, gaming, alternative programming (Front Row Centre Events), Cineplex Media, Cineplex Digital Solutions and the online sale of home entertainment content through CineplexStore.com and on apps embedded in various electronic devices. Cineplex is also a joint venture partner in SCENE - Canada's largest entertainment loyalty program.
Cineplex is headquartered in Toronto, Canada, and operates 136 theatres with 1,455 screens from British Columbia to Quebec, serving approximately 71 million guests annually through the following theatre brands: Cineplex Odeon, SilverCity, Galaxy Cinemas, Colossus, Coliseum, Scotiabank Theatres, Cineplex Cinemas, Cineplex VIP Cinemas, Famous Players and Cinema City. Cineplex also owns and operates the UltraAVX, Poptopia, and Outtakes brands. Cineplex trades on the Toronto Stock Exchange under the symbol CGX. More information is available at cineplex.com.
Further information can be found in the disclosure documents filed by Cineplex with the securities regulatory authorities, available at .
You are cordially invited to participate in a teleconference call with the management of Cineplex (TSX: CGX) to review our quarterly results. Ellis Jacob, President and Chief Executive Officer and Gord Nelson, Chief Financial Officer, will host the call. The teleconference call is scheduled for:
In order to participate in the conference call, please dial 416-644-3417 or outside of Toronto dial 1-877-974-0446 at least five to ten minutes prior to 10:00 a.m. Eastern Time. Please quote the conference ID 4612961 to access the call.
Components of Other Costs
Contacts:
Cineplex Inc.
Gord Nelson
Chief Financial Officer
(416) 323-6602
Cineplex Inc.
Pat Marshall
Vice President Communications and Investor Relations
(416) 323-6648
Themen in dieser Pressemitteilung:
Unternehmensinformation / Kurzprofil:
Datum: 09.05.2013 - 04:15 Uhr
Sprache: Deutsch
News-ID 1225359
Anzahl Zeichen: 0
contact information:
Contact person:
Town:
TORONTO, ONTARIO
Phone:
Kategorie:
Arts & Culture
Anmerkungen:
Diese Pressemitteilung wurde bisher 407 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"Cineplex Inc. Reports First Quarter Results and Announces Dividend Increase
"
steht unter der journalistisch-redaktionellen Verantwortung von
Cineplex Inc. (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
