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, 2019.
Cinemark Holdings, Inc.’s total revenues for the three months
ended September 30, 2019 increased 9.0% to a record $821.8 million
from $754.2 million for the three months ended September 30, 2018.
For the three months ended September 30, 2019, admissions revenues
increased 6.3% to $454.5 million and concession revenues increased
9.6% to $289.5 million. For the three months ended September 30,
2019, attendance increased 5.0% to 73.3 million patrons, average
ticket price increased 1.1% to $6.20 and concession revenues per
patron increased 4.5% to $3.95.
Net income attributable to Cinemark Holdings, Inc. for the three
months ended September 30, 2019 was $31.4 million compared to $50.2
million for the three months ended September 30, 2018. Diluted
earnings per share for the three months ended September 30, 2019
was $0.27 compared to $0.43 for the three months ended September
30, 2018.
Adjusted EBITDA for the three months ended September 30, 2019
increased to $169.8 million from $168.4 million for the three
months ended September 30, 2018. Reconciliations of non-GAAP
financial measures are provided in the financial schedules
accompanying this press release and at investors.cinemark.com.
“Our third quarter’s record worldwide revenues were fueled by
strength in both our domestic and international operations,” stated
Mark Zoradi, Cinemark’s Chief Executive Officer. “In addition to
the film content that resonated extremely well with our global
audiences, we benefited from the continued focus and execution of
our guest-oriented strategic priorities. We continue to believe the
investments we are making to differentiate and enrich the overall
entertainment experience we provide our guests will further
position Cinemark for long-term success.”
Cinemark Holdings, Inc.’s total revenues for the nine months
ended September 30, 2019 increased 2.9% to $2,494.3 million from
$2,423.2 million for the nine months ended September 30, 2018. For
the nine months ended September 30, 2019, admissions revenues were
$1,371.1 million and concession revenues increased 6.6% to $886.1
million. For the nine months ended September 30, 2019, attendance
was 215.8 million patrons, average ticket price was $6.35 and
concession revenues per patron increased 6.2% to $4.11.
Net income attributable to Cinemark Holdings, Inc. for the nine
months ended September 30, 2019 was $165.1 million compared to
$194.4 million for the nine months ended September 30, 2018.
Diluted earnings per share for the nine months ended September 30,
2019 was $1.41 compared to $1.66 for the nine months ended
September 30, 2018.
Adjusted EBITDA for the nine months ended September 30, 2019 was
$566.8 million compared to $583.4 million for the nine months ended
September 30, 2018. Reconciliations of non-GAAP financial measures
are provided in the financial schedules accompanying this press
release and at investors.cinemark.com.
As of September 30, 2019, the Company’s aggregate screen count
was 6,082 and the Company had commitments to open seven new
theatres and 63 screens during the remainder of 2019 and 22 new
theatres and 214 screens subsequent to 2019.
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 investors.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, operates 548 theatres with 6,082
screens in 41 states domestically and 15 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://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
28, 2019. 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,
except per share amounts)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2019
2018
2019
2018
Statement of income data:
Revenues
Admissions
$
454,429
$
427,616
$
1,371,041
$
1,389,110
Concession
289,477
264,165
886,083
831,243
Other
77,911
62,454
237,172
202,906
Total revenues
821,817
754,235
2,494,296
2,423,259
Cost of operations
Film rentals and advertising
254,911
230,121
759,693
758,242
Concession supplies
51,573
42,720
157,361
134,577
Salaries and wages
103,270
92,495
308,316
285,997
Facility lease expense
87,436
80,592
262,529
243,873
Utilities and other
123,877
112,832
357,210
337,866
General and administrative expenses
44,702
38,299
127,002
123,714
Depreciation and amortization
67,760
64,971
196,795
193,656
Impairment of long-lived assets
27,304
1,641
45,382
5,020
Loss on disposal of assets and other
2,453
7,826
8,057
28,666
Total cost of operations
763,286
671,497
2,222,345
2,111,611
Operating income
58,531
82,738
271,951
311,648
Interest expense
(24,967
)
(27,144
)
(75,037
)
(82,725
)
Loss on debt amendments and
refinancing
—
—
—
(1,484
)
Interest income
3,903
2,761
10,062
7,861
Foreign currency exchange loss
(4,406
)
(3,126
)
(4,785
)
(6,947
)
Distributions from NCM
2,474
2,386
9,168
12,168
Interest expense - NCM
(4,666
)
(4,983
)
(14,180
)
(14,875
)
Equity in income of affiliates
15,139
14,158
33,982
29,208
Income before income taxes
46,008
66,790
231,161
254,854
Income taxes
14,053
16,169
64,152
59,592
Net income
$
31,955
$
50,621
$
167,009
$
195,262
Less: Net income attributable to
noncontrolling interests
602
393
1,957
878
Net income attributable to Cinemark
Holdings, Inc.
$
31,353
$
50,228
$
165,052
$
194,384
Earnings per share attributable to
Cinemark Holdings, Inc.'s common stockholders
Basic
$
0.27
$
0.43
$
1.41
$
1.66
Diluted
$
0.27
$
0.43
$
1.41
$
1.66
Weighted average shares outstanding -
Diluted
116,600
116,322
116,577
116,288
Other Operating Data
(unaudited, in thousands)
As of
As of
September 30,
December 31,
2019
2018
Balance sheet data:
Cash and cash equivalents
$
482,772
$
426,222
Theatre properties and equipment, net
$
1,682,401
$
1,833,133
Total assets
$
5,751,603
$
4,481,838
Long-term debt, including current portion,
net of unamortized debt issue costs
$
1,779,647
$
1,780,611
Equity
$
1,496,451
$
1,456,117
Segment Information
(unaudited, in millions, except
per patron data)
U.S. Operating Segment
International Operating
Segment
Consolidated
Three Months Ended September
30,
Three Months Ended September
30,
Constant
Currency (1)
Three Months Ended September
30,
Revenues
2019
2018
% Change
2019
2018
% Change
2019
% Change
2019
2018
% Change
Admissions revenues
$
351.1
$
333.3
5.3
%
$
103.4
$
94.3
9.7
%
$
114.7
21.6
%
$
454.5
$
427.6
6.3
%
Concession revenues
$
230.4
$
207.9
10.8
%
$
59.1
$
56.2
5.2
%
$
65.4
16.4
%
$
289.5
$
264.1
9.6
%
Other revenues
$
51.5
$
41.1
25.3
%
$
26.3
$
21.4
22.9
%
$
29.9
39.7
%
$
77.8
$
62.5
24.5
%
Total revenues
$
633.0
$
582.3
8.7
%
$
188.8
$
171.9
9.8
%
$
210.0
22.2
%
$
821.8
$
754.2
9.0
%
Attendance
44.1
43.7
0.9
%
29.2
26.1
11.9
%
73.3
69.8
5.0
%
Average ticket price
$
7.96
$
7.63
4.3
%
$
3.54
$
3.61
(1.9
)%
$
3.93
8.9
%
$
6.20
$
6.13
1.1
%
Concession revenues per patron
$
5.22
$
4.76
9.7
%
$
2.02
$
2.15
(6.0
)%
$
2.24
4.2
%
$
3.95
$
3.78
4.5
%
U.S. Operating Segment
International Operating
Segment
Consolidated
Three Months Ended
Three Months Ended
Three Months Ended
September 30,
September 30,
September 30,
Cost of Operations
2019
2018
2019
2018
Constant
Currency (1)
2019
2019
2018
Film rentals and advertising
$
203.5
$
185.1
$
51.4
$
45.0
$
57.1
$
254.9
$
230.1
Concession supplies
$
38.6
$
31.2
$
12.9
$
11.5
$
14.4
$
51.5
$
42.7
Salaries and wages
$
83.2
$
73.2
$
20.1
$
19.3
$
22.6
$
103.3
$
92.5
Facility lease expense
$
64.5
$
61.1
$
22.9
$
19.5
$
24.8
$
87.4
$
80.6
Utilities and other
$
91.7
$
83.0
$
32.2
$
29.9
$
36.0
$
123.9
$
112.9
U.S. Operating Segment
International Operating
Segment
Consolidated
Nine Months Ended September
30,
Nine Months Ended September
30,
Constant
Currency (1)
Nine Months Ended September
30,
Revenues
2019
2018
% Change
2019
2018
% Change
2019
% Change
2019
2018
% Change
Admissions revenues
$
1,066.9
$
1,091.5
(2.3
)%
$
304.2
$
297.6
2.2
%
$
357.3
20.1
%
$
1,371.1
$
1,389.1
(1.3
)%
Concession revenues
$
704.7
$
661.3
6.6
%
$
181.4
$
169.9
6.8
%
$
210.6
24.0
%
$
886.1
$
831.2
6.6
%
Other revenues
$
159.2
$
134.9
18.0
%
$
77.9
$
68.0
14.6
%
$
94.2
38.5
%
$
237.1
$
202.9
16.9
%
Total revenues
$
1,930.8
$
1,887.7
2.3
%
$
563.5
$
535.5
5.2
%
$
662.1
23.6
%
$
2,494.3
$
2,423.2
2.9
%
Attendance
132.9
138.9
(4.3
)%
82.9
75.8
9.4
%
215.8
214.7
0.5
%
Average ticket price
$
8.03
$
7.86
2.2
%
$
3.67
$
3.93
(6.6
)%
$
4.31
9.7
%
$
6.35
$
6.47
(1.9
)%
Concession revenues per patron
$
5.30
$
4.76
11.3
%
$
2.19
$
2.24
(2.2
)%
$
2.54
13.4
%
$
4.11
$
3.87
6.2
%
U.S. Operating Segment
International Operating
Segment
Consolidated
Nine Months Ended
Nine Months Ended
Nine Months Ended
September 30,
September 30,
September 30,
Cost of Operations
2019
2018
2019
2018
Constant
Currency (1)
2019
2019
2018
Film rentals and advertising
$
610.3
$
616.7
$
149.4
$
141.5
$
175.6
$
759.7
$
758.2
Concession supplies
$
117.6
$
98.1
$
39.7
$
36.5
$
46.2
$
157.3
$
134.6
Salaries and wages
$
247.4
$
224.3
$
60.9
$
61.7
$
72.5
$
308.3
$
286.0
Facility lease expense
$
194.1
$
183.1
$
68.4
$
60.8
$
77.8
$
262.5
$
243.9
Utilities and other
$
260.8
$
245.7
$
96.4
$
92.2
$
113.8
$
357.2
$
337.9
(1)
Constant currency amounts, which are
non-GAAP measurements, were calculated using the average exchange
rate for the corresponding month for 2018. 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 thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2019
2018
2019
2018
Adjusted EBITDA (1)
U.S.
$
132,347
$
132,652
$
453,404
$
476,907
International
37,411
35,740
113,346
106,518
Total Adjusted EBITDA (1)
$
169,758
$
168,392
$
566,750
$
583,425
Capital expenditures
U.S.
$
50,679
$
65,458
$
148,609
$
195,104
International
20,664
17,915
37,903
50,858
Total capital expenditures
$
71,343
$
83,373
$
186,512
$
245,962
(1)
Adjusted EBITDA represents net income 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.
Reconciliation of Adjusted
EBITDA
(unaudited, in thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2019
2018
2019
2018
Net income
$
31,955
$
50,621
$
167,009
$
195,262
Add (deduct):
Income taxes
14,053
16,169
64,152
59,592
Interest expense (a)
24,967
27,144
75,037
82,725
Other income, net (b)
(9,970
)
(8,810
)
(25,079
)
(15,247
)
Loss on debt amendments and
refinancing
—
—
—
1,484
Distributions from DCIP (c)
2,694
—
7,912
5,201
Other cash distributions from equity
investees (d)
5,804
4,786
20,251
15,840
Depreciation and amortization (a)
67,760
64,971
196,795
193,656
Impairment of long-lived assets
27,304
1,641
45,382
5,020
Loss on disposal of assets and other
2,453
7,826
8,057
28,666
Non-cash rent (e)
(1,102
)
—
(3,252
)
—
Deferred lease expenses - theatres
(a)(f)
—
216
—
(488
)
Deferred lease expenses - projectors
(a)(g)
—
(236
)
—
(464
)
Amortization of long-term prepaid rents
(a)(f)
—
578
—
1,814
Share based awards compensation expense
(h)
3,840
3,486
10,486
10,364
Adjusted EBITDA
$
169,758
$
168,392
$
566,750
$
583,425
(a)
Amounts for the three and nine months ended September 30, 2019
were impacted by the adoption of ASC Topic 842 and the resulting
change in the classification of certain of the Company’s
leases.
(b)
Includes loss on debt amendments and refinancing, interest
income, foreign currency exchange loss, interest expense – NCM and
equity in income of affiliates.
(c)
Cash distributions from DCIP, which were
recorded as a reduction of the Company’s investment in DCIP.
(d)
Cash distributions received from equity
investees, other than those from DCIP noted above, that were
recorded as a reduction of the respective investment balances.
(e)
The adoption of ASC Topic 842 impacted how
the Company amortizes lease related assets and liabilities such as
deferred lease expenses, favorable and unfavorable lease intangible
assets, long-term prepaid rents and deferred lease
incentives. Beginning January 1, 2019, these items are
amortized to facility lease expense for theatre operating leases
and utilities and other for equipment operating leases.
(f)
Non-cash expense included in facility
lease expense.
(g)
Non-cash expense included in utilities and
other.
(h)
Non-cash expense included in general and
administrative expenses.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20191105005397/en/
Financial and Media Contact
: Chanda Brashears – 972-665-1671 or
cbrashears@cinemark.com
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