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Cinemark Holdings, Inc. Reports Record Revenues of $707.2 Million and Adjusted EBITDA of $168.4 Million for Q4 2015

PLANO, Texas--(BUSINESS WIRE)--Feb. 24, 2016-- Cinemark Holdings, Inc. (NYSE: CNK), one of the largest motion picture exhibitors in the world, today reported results for the three months and year ended December 31, 2015.

Cinemark Holdings, Inc.’s revenues for the three months ended December 31, 2015 increased 7.2% to $707.2 million compared to $659.9 million for the three months ended December 31, 2014. For the three months ended December 31, 2015, admissions revenues increased 6.2% to $429.7 million and concession revenues increased 8.4% to $232.8 million. Average ticket price was $6.42 and concession revenues per patron was $3.48 for the three months ended December 31, 2015.

Adjusted EBITDA for the three months ended December 31, 2015 increased 7.3% to $168.4 million from $156.9 million for the three months ended December 31, 2014. 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 December 31, 2015 increased 22.2% to $57.8 million from $47.3 million for the three months ended December 31, 2014. Diluted earnings per share for the three months ended December 31, 2015 was $0.50 compared to $0.41 for the three months ended December 31, 2014.

“It was a record-breaking year for the North American industry box office, as well as for each of the countries in which we operate throughout South and Central America,” stated Mark Zoradi, Cinemark’s Chief Executive Officer. “Cinemark is extremely pleased with our worldwide fourth quarter and full-year 2015 results that created new records in each key performance metric, including attendance, admissions and concession revenues, average ticket price, concession per patron, Adjusted EBITDA, and net income.”

Cinemark Holdings, Inc.’s revenues for the year ended December 31, 2015 increased 8.6% to $2,852.6 million from $2,627.0 million for the year ended December 31, 2014. For the year ended December 31, 2015, admissions revenues increased 7.4% to $1,765.5 million and concession revenues increased 10.8% to $937.0 million. Average ticket price increased 1.1% to $6.30 and concession revenues per patron increased 4.7% to $3.35 for the year ended December 31, 2015.

Adjusted EBITDA for the year ended December 31, 2015 increased 11.3% to $663.8 million from $596.5 million for the year ended December 31, 2014. 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 year ended December 31, 2015 increased 12.6% to $216.9 million from $192.6 million for the year ended December 31, 2014. Diluted earnings per share for the year ended December 31, 2015 was $1.87 compared to $1.66 for the year ended December 31, 2014.

As of December 31, 2015, the Company’s aggregate screen count was 5,796 and the Company had commitments to open 13 new theatres and 115 screens during 2016 and seven new theatres and 76 screens subsequent to 2016.

Conference Call/Webcast – Today at 8:30 AM ET

Telephone: via 888-755-8910 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 513 theatres with 5,796 screens in 41 U.S. states, Brazil, Argentina and 12 other Latin American countries as of December 31, 2015. 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, except per share amounts)
 
    Three Months Ended     Year Ended
December 31, December 31,
  2015         2014     2015         2014  
Statement of Income Data:
Revenues
Admissions $ 429,758 $ 404,697 $ 1,765,519 $ 1,644,169
Concession 232,780 214,805 936,970 845,376
Other   44,685         40,442     150,120         137,445  
Total revenues   707,223         659,944     2,852,609         2,626,990  
 
Cost of operations
Film rentals and advertising 239,213 217,632 976,590 883,052
Concession supplies 34,825 33,123 144,270 131,985
Salaries and wages 78,838 71,684 301,099 273,880
Facility lease expense 77,149 77,525 319,761 317,096
Utilities and other 79,770 74,466 324,851 308,445
General and administrative expenses 40,435 36,552 156,736 151,444
Depreciation and amortization 49,762 44,548 189,206 175,656
Impairment of long-lived assets 3,846 1,353 8,801 6,647
Loss on sale of assets and other   4,291         6,996     8,143         15,715  
Total cost of operations   608,129         563,879     2,429,457         2,263,920  
Operating income 99,094 96,065 423,152 363,070
Interest expense (1) (27,811 ) (28,597 ) (112,741 ) (113,698 )
Loss on amendment to debt agreement (925 )
Distributions from NCM 5,040 4,383 18,140 18,541
Foreign currency exchange gain (loss) 1,909 (5,834 ) (16,793 ) (6,192 )
Other income   9,679         7,207     36,834         28,342  
Income before income taxes 87,911 73,224 347,667 290,063
Income taxes   29,676         25,587     128,939         96,064  
Net income $ 58,235 $ 47,637 $ 218,728 $ 193,999
Less: Net income attributable to noncontrolling interests   484         330     1,859         1,389  
Net income attributable to Cinemark Holdings, Inc. $ 57,751       $ 47,307   $ 216,869       $ 192,610  
 
Earnings per share attributable to Cinemark Holdings, Inc.’s common stockholders:
Basic $ 0.50       $ 0.41   $ 1.87       $ 1.66  
Diluted $ 0.50       $ 0.41   $ 1.87       $ 1.66  
 
Weighted average diluted shares outstanding   115,463         115,062     115,399         114,966  
Other Financial Data:
Adjusted EBITDA (2) $ 168,404       $ 156,876   $ 663,755       $ 596,525  
(1)   Includes amortization of debt issuance 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
December 31,
2015     2014
Balance Sheet Data (unaudited, in thousands):
Cash and cash equivalents $ 588,539 $ 638,869
Theatre properties and equipment, net $ 1,505,069 $ 1,450,812
Total assets $ 4,126,497 $ 4,120,561
Long-term debt, including current portion $ 1,781,335 $ 1,791,578
Equity $ 1,110,813 $ 1,123,129
 
 
Segment Information

(unaudited, in thousands)

 
    Three Months Ended     Year Ended
December 31,     December 31,
  2015         2014     2015         2014  
Revenues
U.S. $ 561,626 $ 501,731 $ 2,137,733 $ 1,934,990
International 148,400 161,122 728,735 704,623
Eliminations   (2,803 )       (2,909 )       (13,859 )       (12,623 )
Total revenues $ 707,223       $ 659,944       $ 2,852,609       $ 2,626,990  
Adjusted EBITDA
U.S. $ 137,939 $ 122,933 $ 497,339 $ 436,863
International   30,465         33,943         166,416         159,662  
Total Adjusted EBITDA $ 168,404       $ 156,876       $ 663,755       $ 596,525  
Capital expenditures
U.S. $ 56,131 $ 51,412 $ 223,213 $ 148,532
International   43,244         37,125         108,513         96,173  
Total capital expenditures $ 99,375       $ 88,537       $ 331,726       $ 244,705  
 
 

Additional Segment Information (1)

(unaudited)
 
        International Operating    
U.S. Operating Segment Segment Consolidated
Three Months Ended Three Months Ended Three Months Ended
December 31, December 31, December 31,
        %         %         %
2015 2014 Change 2015 2014 Change 2015 2014 Change
Admissions revenues $ 348.0 $ 312.9 11.2 % $ 81.7 $ 91.8 (11.0 %) $ 429.7 $ 404.7 6.2 %
Concession revenues $ 186.6 $ 164.2 13.6 % $ 46.2 $ 50.6 (8.7 %) $ 232.8 $ 214.8 8.4 %
Other revenues(2) $ 24.2 $ 21.7 11.5 % $ 20.5 $ 18.7 9.6 % $ 44.7 $ 40.4 10.6 %
Total revenues(2) $ 558.8 $ 498.8 12.0 % $ 148.4 $ 161.1 (7.9 %) $ 707.2 $ 659.9 7.2 %
Attendance 45.3 44.0 3.0 % 21.6 21.7 (0.5 %) 66.9 65.7 1.8 %
Average ticket price $ 7.68 $ 7.11 8.0 % $ 3.78 $ 4.23 (10.6 %) $ 6.42 $ 6.16 4.2 %
Concession revenues per patron $ 4.12 $ 3.73 10.5 % $ 2.14 $ 2.33 (8.2 %) $ 3.48 $ 3.27 6.4 %
Average screen count 4,506 4,481 0.6 % 1,263 1,163 8.6 % 5,769 5,644 2.2 %
 
    U.S. Operating     International    
Segment Operating Segment Consolidated
Three Months Ended Three Months Ended Three Months Ended
December 31, December 31, December 31,
2015     2014 2015     2014 2015     2014
Film rentals and advertising $ 200.7 $ 175.6 $ 38.5 $ 42.1 $ 239.2 $ 217.7
Concession supplies $ 25.1 $ 22.0 $ 9.8 $ 11.1 $ 34.9 $ 33.1
Salaries and wages $ 61.5 $ 53.0 $ 17.3 $ 18.7 $ 78.8 $ 71.7
Facility lease expense $ 60.3 $ 59.0 $ 16.8 $ 18.5 $ 77.1 $ 77.5
Utilities and other $ 57.4 $ 52.5 $ 22.4 $ 21.9 $ 79.8 $ 74.4
                           
International
U.S. Operating Segment Operating Segment Consolidated
Year Ended Year Ended Year Ended
December 31, December 31, December 31,
%         % %
2015 2014 Change 2015 2014 Change 2015 2014 Change
Admissions revenues $ 1,338.0 $ 1,220.8 9.6 % $ 427.5 $ 423.4 1.0 % $ 1,765.5 $ 1,644.2 7.4 %
Concession revenues $ 709.7 $ 635.6 11.7 % $ 227.3 $ 209.8 8.3 % $ 937.0 $ 845.4 10.8 %
Other revenues(2) $ 76.2 $ 66.0 15.5 % $ 73.9 $ 71.4 3.5 % $ 150.1 $ 137.4 9.2 %
Total revenues(2) $ 2,123.9 $ 1,922.4 10.5 % $ 728.7 $ 704.6 3.4 % $ 2,852.6 $ 2,627.0 8.6 %
Attendance 179.6 173.9 3.3 % 100.5 90.0 11.7 % 280.1 263.9 6.1 %
Average ticket price $ 7.45 $ 7.02 6.1 % $ 4.25 $ 4.70 (9.6 %) $ 6.30 $ 6.23 1.1 %
Concession revenues per patron $ 3.95 $ 3.65 8.2 % $ 2.26 $ 2.33 (3.0 %) $ 3.35 $ 3.20 4.7 %
Average screen count 4,499 4,467 0.7 % 1,226 1,146 7.0 % 5,725 5,613 2.0 %
           
International
U.S. Operating Segment Operating Segment Consolidated
Year Ended Year Ended Year Ended
December 31, December 31, December 31,
2015     2014 2015     2014 2015     2014
Film rentals and advertising $ 768.2 $ 681.1 $ 208.4 $ 202.0 $ 976.6 $ 883.1
Concession supplies $ 95.4 $ 86.4 $ 48.9 $ 45.6 $ 144.3 $ 132.0
Salaries and wages $ 226.9 $ 202.8 $ 74.2 $ 71.1 $ 301.1 $ 273.9
Facility lease expense $ 239.4 $ 235.2 $ 80.3 $ 81.9 $ 319.7 $ 317.1
Utilities and other $ 228.0 $ 217.2 $ 96.9 $ 91.2 $ 324.9 $ 308.4
(1)   Revenues, attendance and theatre operating costs are in millions. Average ticket price and concession revenues per patron are in dollars.
(2) U.S. operating segment revenues include eliminations of intercompany transactions with the international operating segment.
 
 
Reconciliation of Adjusted EBITDA
(unaudited, in thousands)
               
Three months ended Year ended
December 31,     December 31,
  2015     2014     2015     2014  
Net income $ 58,235 $ 47,637 $ 218,728 $ 193,999
Income taxes 29,676 25,587 128,939 96,064
Interest expense 27,811 28,597 112,741 113,698
Loss on amendment to debt agreement 925
Foreign currency exchange (gain) loss (1,909 ) 5,834 16,793 6,192
Other income (9,679 ) (7,207 ) (36,834 ) (28,342 )
Depreciation and amortization 49,762 44,548 189,206 175,656
Impairment of long-lived assets 3,846 1,353 8,801 6,647
Loss on sale of assets and other 4,291 6,996 8,143 15,715
Deferred lease expenses – theatres (2) 234 754 (874 ) 2,197
Deferred lease expenses – DCIP (3) (231 ) (234 ) (932 ) 339
Amortization of long-term prepaid rents (2) 460 (243 ) 2,361 1,542
Share based awards compensation expense (4)   5,908         3,254         15,758         12,818  
Adjusted EBITDA (1) $ 168,404       $ 156,876       $ 663,755       $ 596,525  
(1)   Adjusted EBITDA as calculated in the chart above represents net income before income taxes, interest expense, loss on amendment to debt agreement, foreign currency exchange (gain) loss, other income, 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 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.

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