INVESTOR RELATIONS

News Release


« Back

Cinemark Holdings, Inc. Reports Record Revenues, Net Income, Adjusted EBITDA and EPS for the Second Quarter of 2018


PLANO, Texas--(BUSINESS WIRE)--Aug. 8, 2018-- 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, 2018.

Cinemark Holdings, Inc.’s total revenues for the three months ended June 30, 2018 increased 18.3% to $889.0 million compared to $751.2 million for the three months ended June 30, 2017. For the three months ended June 30, 2018, admissions revenues increased 13.1% to $508.9 million and concession revenues increased 16.4% to $305.3 million. For the three months ended June 30, 2018, attendance increased 10.1% to 76.4 million patrons, average ticket price increased 2.8% to $6.66 and concession revenues per patron increased 5.8% to $4.00.

Net income attributable to Cinemark Holdings, Inc. for the three months ended June 30, 2018 was $82.1 million compared to $51.2 million for the three months ended June 30, 2017. Diluted earnings per share for the three months ended June 30, 2018 was $0.70 compared to $0.44 for the three months ended June 30, 2017.

Adjusted EBITDA for the three months ended June 30, 2018 increased 29.8% to $221.6 million compared to $170.7 million for the three months ended June 30, 2017. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release and at investors.cinemark.com.

Mark Zoradi, Cinemark’s Chief Executive Officer, stated, “We are thrilled to have delivered multiple records across all revenue categories, net income, and Adjusted EBITDA. I commend our Cinemark team for capitalizing on second quarter film content strength and continuing to advance our strategic initiatives to achieve these results. Given the all-time high box office that the North American industry celebrated in the second quarter and first half of the year, we remain bullish on full-year 2018 box office potential, while our enthusiasm for the 2019 film slate continues to grow.”

Cinemark Holdings, Inc.’s total revenues for the six months ended June 30, 2018 increased 9% to $1,669.0 million compared to $1,530.8 million for the six months ended June 30, 2017. For the six months ended June 30, 2018, admissions revenues increased 3.8% to $961.5 million and concession revenues increased 6.9% to $567.1 million. For the six months ended June 30, 2018, attendance increased 0.8% to 144.9 million patrons, average ticket price increased 2.9% to $6.64 and concession revenues per patron increased 6.0% to $3.91.

Net income attributable to Cinemark Holdings, Inc. for the six months ended June 30, 2018 was $144.2 million compared to $131.0 million for the six months ended June 30, 2017. Diluted earnings per share for the six months ended June 30, 2018 was $1.23 compared to $1.12 for the six months ended June 30, 2017.

Adjusted EBITDA for the six months ended June 30, 2018 increased 8.5% to $415.0 million compared to $382.6 million for the six months ended June 30, 2017. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release and at investors.cinemark.com.

As of June 30, 2018, the Company’s aggregate screen count was 5,998 and the Company had commitments to open 8 new theatres and 59 screens during the remainder of 2018 and 16 new theatres and 146 screens subsequent to 2018.

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.

Cinemark is a leading domestic and international motion picture exhibitor, operating 539 theatres with 5,998 screens in 41 U.S. states, Brazil, Argentina and 13 other Latin American countries as of June 30, 2018. 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 23, 2018. 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       Six Months Ended
      June 30,       June 30,
      2018     2017       2018     2017
Statement of income data:                          
Revenues                          
Admissions     $ 508,870       $ 449,880         $ 961,494       $ 926,349  
Concession       305,306         262,322           567,078         530,546  
Other       74,877         38,993           140,452         73,910  
Total revenues       889,053         751,195           1,669,024         1,530,805  
Cost of operations                          
Film rentals and advertising       287,206         246,556           528,121         499,374  
Concession supplies       51,033         41,839           91,857         83,939  
Salaries and wages       100,344         89,812           193,502         174,013  
Facility lease expense       81,190         82,388           163,281         166,650  
Utilities and other       115,602         91,053           225,034         179,410  
General and administrative expenses       43,031         37,834           85,415         76,050  
Depreciation and amortization       64,290         59,137           128,685         116,493  
Impairment of long-lived assets       2,788         4,301           3,379         4,574  
Loss on disposal of assets and other       16,901         54           20,840         888  
Total cost of operations       762,385         652,974           1,440,114         1,301,391  
Operating income       126,668         98,221           228,910         229,414  
Interest expense       (28,466 )       (26,522 )         (55,581 )       (52,891 )
Loss on debt amendments       -         (246 )         (1,484 )       (246 )
Interest income       2,862         1,380           5,100         2,713  
Foreign currency exchange gain (loss)       (5,199 )       (155 )         (3,821 )       1,434  
Distributions from NCM       3,424         2,772           9,782         9,560  
Interest expense - NCM       (4,913 )       -           (9,892 )       -  
Equity in income of affiliates       6,414         5,805           15,050         15,865  
Income before income taxes       100,790         81,255           188,064         205,849  
Income taxes       18,326         29,445           43,423         73,845  
Net income     $ 82,464       $ 51,810         $ 144,641       $ 132,004  
Less: Net income attributable to noncontrolling interests       329         571           485         1,037  
Net income attributable to Cinemark Holdings, Inc.     $ 82,135       $ 51,239         $ 144,156       $ 130,967  
Earnings per share attributable to Cinemark Holdings, Inc.'s common stockholders                          
Basic     $ 0.70       $ 0.44         $ 1.23       $ 1.12  
Diluted     $ 0.70       $ 0.44         $ 1.23       $ 1.12  
Weighted average shares outstanding - Diluted       116,268         116,072           116,238         116,020  
                                           
             
Other Operating Data
(unaudited, in thousands)
             
      As of     As of
      June 30,     December 31,
      2018     2017
Balance sheet data:            
Cash and cash equivalents     $ 504,712     $ 522,547
Theatre properties and equipment, net     $ 1,817,737     $ 1,828,054
Total assets     $ 4,455,238     $ 4,470,893
Long-term debt, including current portion, net of unamortized debt issue costs     $ 1,782,766     $ 1,787,480
Equity     $ 1,463,810     $ 1,405,688
                 
                       
Segment Information

(unaudited, in millions, except per patron data)

                       
      U.S. Operating Segment       International Operating Segment       Consolidated
      Three Months Ended June 30,           Three Months Ended June 30,         Constant

Currency (1)

      Three Months Ended June 30,    
Revenues     2018   2017   % Change       2018   2017   % Change     2018   % Change       2018   2017   % Change
Admissions revenues     $ 408.9   $ 335.0   22.1 %       $ 100.0   $ 114.9   (13.0 )%     $ 111.7   (2.8 )%       $ 508.9   $ 449.9   13.1 %
Concession revenues     $ 249.6   $ 197.3   26.5 %       $ 55.7   $ 65.0   (14.3 )%     $ 61.5   (5.4 )%       $ 305.3   $ 262.3   16.4 %
Other revenues     $ 50.5   $ 18.9   167.2 %       $ 24.3   $ 20.1   20.9 %     $ 27.7   37.8 %       $ 74.8   $ 39.0   91.8 %
Total revenues     $ 709.0   $ 551.2   28.6 %       $ 180.0   $ 200.0   (10.0 )%     $ 200.9   0.4 %       $ 889.0   $ 751.2   18.3 %
Attendance       50.6     43.0   17.7 %         25.8     26.4   (2.3 )%                     76.4     69.4   10.1 %
Average ticket price     $ 8.08   $ 7.79   3.7 %       $ 3.88   $ 4.35   (10.8 )%     $ 4.33   (0.5 )%       $ 6.66   $ 6.48   2.8 %
Concession revenues per patron     $ 4.93   $ 4.59   7.4 %       $ 2.16   $ 2.46   (12.2 )%     $ 2.38   (3.3 )%       $ 4.00   $ 3.78   5.8 %
                                                                       
                 
    U.S. Operating Segment     International Operating Segment     Consolidated
    Three Months Ended     Three Months Ended     Three Months Ended
    June 30,     March 31,     June 30,
Cost of Operations   2018     2017     2018     2017     Constant

Currency (1)

2018

    2018     2017
Film rentals and advertising   $ 238.7     $ 190.4     $ 48.4     $ 56.2     $ 54.3     $ 287.1     $ 246.6
Concession supplies   $ 38.4     $ 27.8     $ 12.7     $ 14.0     $ 14.0     $ 51.1     $ 41.8
Salaries and wages   $ 79.4     $ 66.7     $ 21.0     $ 23.1     $ 24.0     $ 100.4     $ 89.8
Facility lease expense   $ 61.0     $ 59.9     $ 20.2     $ 22.4     $ 22.1     $ 81.2     $ 82.3
Utilities and other   $ 83.7     $ 61.1     $ 31.9     $ 29.9     $ 36.0     $ 115.6     $ 91.0
                                                       
                     
    U.S. Operating Segment       International Operating Segment       Consolidated
    Six Months Ended June 30,           Six Months Ended June 30,        

Constant

Currency (1)

      Six Months Ended June 30,    
Revenues   2018   2017   % Change       2018     2017   % Change     2018   % Change       2018   2017   % Change
Admissions revenues   $ 758.2   $ 691.2   9.7 %       $ 203.3     $ 235.2   (13.6 )%     $ 219.4   (6.7 )%       $ 961.5   $ 926.4   3.8 %
Concession revenues   $ 453.4   $ 400.7   13.2 %       $ 113.7     $ 129.8   (12.4 )%     $ 121.6   (6.3 )%       $ 567.1   $ 530.5   6.9 %
Other revenues   $ 93.8   $ 36.9   154.2 %       $ 46.6     $ 37.0   25.9 %     $ 51.5   39.2 %       $ 140.4   $ 73.9   90.0 %
Total revenues   $ 1,305.4   $ 1,128.8   15.6 %       $ 363.6     $ 402.0   (9.6 )%     $ 392.5   (2.4 )%       $ 1,669.0   $ 1,530.8   9.0 %
Attendance     95.2     89.5   6.4 %         49.7       54.2   (8.3 )%                     144.9     143.7   0.8 %
Average ticket price   $ 7.96   $ 7.72   3.1 %       $ 4.09     $ 4.34   (5.8 )%     $ 4.41   1.6 %       $ 6.64   $ 6.45   2.9 %
Concession revenues per patron   $ 4.76   $ 4.48   6.2 %       $ 2.29     $ 2.39   (4.2 )%     $ 2.45   2.5 %       $ 3.91   $ 3.69   6.0 %
                                                                               
                       
      U.S. Operating Segment       International Operating Segment       Consolidated
      Six Months Ended       Six Months Ended       Six Months Ended
      June 30,       June 30,       June 30,
Cost of Operations     2018     2017       2018     2017     Constant

Currency (1)

2018

      2018     2017
Film rentals and advertising     $ 431.6     $ 386.8       $ 96.5     $ 112.6     $ 104.5       $ 528.1     $ 499.4
Concession supplies     $ 66.9     $ 55.9       $ 25.0     $ 28.0     $ 26.8       $ 91.9     $ 83.9
Salaries and wages     $ 151.1     $ 129.9       $ 42.4     $ 44.1     $ 46.7       $ 193.5     $ 174.0
Facility lease expense     $ 122.0     $ 121.3       $ 41.3     $ 45.3     $ 43.8       $ 163.3     $ 166.6
Utilities and other     $ 162.7     $ 121.1       $ 62.3     $ 58.3     $ 68.1       $ 225.0     $ 179.4
                                                             
(1)   Constant currency amounts, which are non-GAAP measurements, were calculated using the average exchange rate for the corresponding month for 2017. 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 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.
     
               
Segment Information, Continued

(unaudited, in thousands)

               
      Three Months Ended       Six Months Ended
      June 30,       June 30,
      2018     2017       2018     2017
Revenues                                  
U.S.     $ 712,483       $ 554,929         $ 1,312,128       $ 1,136,138  
International       179,979         199,926           363,607         401,994  
Eliminations       (3,409 )       (3,660 )         (6,711 )       (7,327 )
Total revenues     $ 889,053       $ 751,195         $ 1,669,024       $ 1,530,805  
Adjusted EBITDA (1)                                  
U.S.     $ 188,411       $ 129,394        

$

344,255      

$

294,048  
International       33,192         41,285           70,778         88,511  
Total Adjusted EBITDA (1)     $ 221,603       $ 170,679         $ 415,033       $ 382,559  
Capital expenditures                                  
U.S.     $ 59,675       $ 77,175        

$

129,646      

$

155,992  
International       22,751         14,438           32,943         26,808  
Total capital expenditures     $ 82,426       $ 91,613         $ 162,589       $ 182,800  
                                           
(1)   Adjusted EBITDA represents net income before income taxes, interest expense, other (income) expense, loss on debt amendments, other cash distributions from equity investees, depreciation and amortization, impairment of long-lived assets, loss on disposal of assets and other, changes in deferred lease expense, amortization of long-term prepaid rents and share based awards compensation expense, 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       Six Months Ended
      June 30,       June 30,
      2018     2017       2018     2017
Net income     $ 82,464       $ 51,810         $ 144,641       $ 132,004  
Add (deduct):                                  
Income taxes       18,326         29,445           43,423         73,845  
Interest expense       28,466         26,522           55,581         52,891  
Other (income) expense       836         (7,030 )         (6,437 )       (20,012 )
Loss on debt amendments               246           1,484         246  
Other cash distributions from equity investees (2)       3,932         2,870           16,255         14,919  
Depreciation and amortization       64,290         59,137           128,685         116,493  
Impairment of long-lived assets       2,788         4,301           3,379         4,574  
Loss on disposal of assets and other       16,901         54           20,840         888  
Deferred lease expenses - theatres (3)       (217 )       (120 )         (468 )       (234 )
Deferred lease expenses - projectors (4)       (232 )       (255 )         (464 )       (488 )
Amortization of long-term prepaid rents (3)       597         496           1,236         989  
Share based awards compensation expense (5)       3,452         3,203           6,878         6,444  
Adjusted EBITDA     $ 221,603       $ 170,679         $ 415,033       $ 382,559  
                                           
(2)   Represents cash distributions received from equity investees that were recorded as a reduction of the respective investment balances.
(3)   Non-cash expense included in facility lease expense.
(4)   Non-cash expense included in utilities and other.
(5)   Non-cash expense included in general and administrative expenses.
     

 

Source: Cinemark Holdings, Inc.

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