TORONTO, ONTARIO--(Marketwired - Nov. 8, 2016) - Cineplex Inc. ("Cineplex") (TSX:CGX) today released its
financial results for the three and nine months ended September 30, 2016. Unless otherwise specified, all amounts are in
Canadian dollars.
Third Quarter Results
| |
2016 |
|
2015 |
|
Period
over Period
Change (i) |
|
| Total revenues |
$ |
376.0 million |
|
$ |
328.2 million |
|
14.5 |
% |
| Attendance |
|
19.2 million |
|
|
19.4 million |
|
-1.0 |
% |
| Net income |
$ |
26.0 million |
|
$ |
21.4 million |
|
21.3 |
% |
| Box office revenues per patron ("BPP") (ii) |
$ |
9.37 |
|
$ |
8.89 |
|
5.4 |
% |
| Concession revenues per patron ("CPP") (ii) |
$ |
5.69 |
|
$ |
5.43 |
|
4.8 |
% |
| Adjusted EBITDA (ii) |
$ |
67.3 million |
|
$ |
59.1 million |
|
13.8 |
% |
| Adjusted EBITDA margin (ii) |
|
17.9 |
% |
|
18.0 |
% |
-0.1 |
% |
| Adjusted free cash flow (ii) |
$ |
46.9 million |
|
$ |
35.9 million |
|
30.8 |
% |
| Adjusted free cash flow per common share of Cineplex ("Share") (ii) |
$ |
0.739 |
|
$ |
0.568 |
|
30.1 |
% |
| Earnings per Share attributable to owners of Cineplex ("EPS") - basic |
$ |
0.42 |
|
$ |
0.34 |
|
23.5 |
% |
| EPS - diluted |
$ |
0.41 |
|
$ |
0.34 |
|
20.6 |
% |
Year to Date Results
| |
2016 |
|
2015 |
|
Period
over Period
Change (i) |
|
| Total revenues |
$ |
1,092.9 million |
|
$ |
963.6 million |
|
13.4 |
% |
| Attendance |
|
56.7 million |
|
|
56.6 million |
|
- |
% |
| Net income |
$ |
54.7 million |
|
$ |
57.4 million |
|
-4.8 |
% |
| BPP (ii) |
$ |
9.44 |
|
$ |
9.09 |
|
3.9 |
% |
| CPP (ii) |
$ |
5.61 |
|
$ |
5.38 |
|
4.3 |
% |
| Adjusted EBITDA (ii) |
$ |
167.2 million |
|
$ |
164.6 million |
|
1.5 |
% |
| Adjusted EBITDA margin (ii) |
|
15.3 |
% |
|
17.1 |
% |
-1.8 |
% |
| Adjusted free cash flow (ii) |
$ |
116.4 million |
|
$ |
104.3 million |
|
11.6 |
% |
| Adjusted free cash flow per Share (ii) |
$ |
1.835 |
|
$ |
1.655 |
|
10.9 |
% |
| EPS - basic |
$ |
0.88 |
|
$ |
0.91 |
|
-3.3 |
% |
| EPS - diluted |
$ |
0.88 |
|
$ |
0.90 |
|
-2.2 |
% |
| |
|
| (i) |
Period over period change calculated based on thousands of dollars except percentage and per share values.
Changes in percentage amounts are calculated as 2016 value less 2015 value. |
| (ii) |
Adjusted EBITDA, adjusted EBITDA margin, adjusted free cash flow per common share of Cineplex, BPP and CPP
are measures that do not have a standardized meaning under generally accepted accounting principles ("GAAP"). These
measures as well as other non-GAAP financial measures reported by Cineplex are defined in the 'Non-GAAP Financial Measures'
section at the end of this news release. |
"Cineplex delivered a record third quarter with total revenue up 14.5% to $376.0 million and adjusted EBITDA up 13.8% to $67.3
million - both third quarter records," said Ellis Jacob, President and CEO, Cineplex Entertainment.
"Key accomplishments during the quarter included the opening of the first location of The Rec Room in South Edmonton
in addition to opening two theatres, one in each of Barrie and Kitchener, Ontario. The Rec Room brings together
incredible dining experiences with exciting live entertainment and amusement gaming, all under one roof. We are very pleased
with the results to date."
"Subsequent to quarter end, we announced the acquisition of Tricorp Amusements Inc., a leading provider of interactive video,
redemption and amusement gaming services in the United States. This acquisition continues our goal of expanding CSI further
throughout the USA."
"Overall, it was a successful quarter. Looking ahead, I am excited about the strategic opportunities that will help us achieve
meaningful growth in the future."
"We would also like to extend our thanks and best wishes to Phyllis Yaffe, who in light of her new role as Consul General in
New York has stepped down from the Cineplex board. In addition, we extend a warm welcome to Donna Hayes, the retired
Publisher and CEO of Harlequin, who has joined our board of directors."
KEY DEVELOPMENTS IN THE THIRD QUARTER OF 2016
The following describes certain key business initiatives undertaken and results achieved during the third quarter in each of
Cineplex's core business areas:
FILM ENTERTAINMENT AND CONTENT
Theatre Exhibition
- Reported record third quarter box office revenues of $180.1 million, an increase of $7.6 million (4.4%) from the $172.6
million reported in the prior year period. The increase is due to higher BPP resulting from a higher proportion of box
office revenues from premium priced product in the current period compared to the prior year period.
- BPP of $9.37 was 5.4% higher than the $8.89 reported in the prior year period, and represents a third quarter record for
Cineplex.
- Opened Cineplex Cinemas North Barrie in Barrie, Ontario, an eight screen theatre featuring an UltraAVX
auditorium.
- Opened Cineplex Cinemas Kitchener and VIP at Fairview Park Commons in Kitchener, Ontario, an 11 screen theatre
featuring four VIP auditoriums and one UltraAVX auditorium. The six regular and one UltraAVX auditoriums all feature
luxurious, extra-wide lounger seats.
- Announced further expansion of Cineplex's agreement with D-BOX to install D-BOX in 10 Cineplex auditoriums across Canada by
the end of 2016.
Theatre Food Service
- Reported record third quarter food services revenues of $109.6 million, an increase of 3.9% from the $105.5 million
reported in the prior year period. Included in this amount is $0.3 million of food service revenues from The Rec
Room, which opened in mid-September.
- CPP in the third quarter of 2016 was $5.69, a third quarter record for Cineplex, $0.26 (4.8%) higher than the $5.43
reported during the prior year period.
Alternative Programming
- Alternative programming in the third quarter of 2016 included strong performances from international film programming and
concert presentations.
- Partnered with the Canadian Broadcasting Corporation to offer screenings of The Tragically Hip: A National
Celebration to raise funds for the Canadian Cancer Society.
Digital Commerce
- Launched a fully transactional Cineplex Store Android app, allowing guests to rent, buy and watch movies directly from
their Android tablet or mobile phone.
- Updated the Cineplex Store app to support all LG 2016 WebOS Smart TVs.
MEDIA
- Reported record third quarter total media revenues of $44.8 million, which increased $10.5 million, or 30.7% compared to
the prior year period.
Cineplex Media
- Reported record third quarter Cineplex Media revenues of $29.1 million, compared to $25.0 million in the prior year period,
an increase of 16.2% due to increases in showtime and pre-show advertising as well as growth in new media offerings.
Cineplex Digital Media
- Cineplex Digital Media reported record third quarter revenues of $15.7 million, an increase of $6.5 million (69.8%)
compared to the prior year. An expanded client base contributed to increased project installation revenues and advertising
revenue growth in the period.
AMUSEMENT GAMING AND LEISURE
Cineplex Starburst Inc.
- CSI reported third quarter revenues of $26.8 million ($2.7 million due to Cineplex theatre gaming and $24.0 million from
all other sources of revenues). In the prior year period, Cineplex equity accounted for its 50% interest in CSI acquiring
the remaining 50% of issued and outstanding equity that it did not already own in the fourth quarter of 2015.
- Announced the acquisition of Tricorp Amusements Inc. ("Tricorp"), a leading provider of interactive video, redemption and
amusement gaming services in the United States. Tricorp has a diversified client portfolio focusing on the theatrical
exhibition vertical as well as community-based family entertainment destinations. The transaction was completed on October
1, 2016.
The Rec Room
- Opened the first location at South Edmonton Commons in Edmonton, Alberta in mid-September. The 60,000 square foot
multi-level entertainment facility offers guests 'Eats & Entertainment', bringing together dining, amusement gaming, technology
and live entertainment experiences all under one roof.
eSports
- WGN hosted its first multi-player Canadian championship, featuring the game Uncharted 4, which included online
qualifiers followed by regional and national final events hosted at Cineplex theatres.
- Collegiate StarLeague Inc. ("CSL"), a subsidiary of WGN, announced a partnership with Riot Games to present the 2017 season
of CSL's League of Legends collegiate league, called 'uLoL Campus Series', which will see over 500 schools in North
America competing to qualify for the regional and national championships.
LOYALTY
- Membership in the SCENE loyalty program increased by 0.2 million members in the period, reaching 7.9 million at September
30, 2016.
CORPORATE
- Named one of Canadian Business magazine's "25 Best Brands in Canada" for 2017. The rankings are based on consumer
opinions of a company's reputation based on the quality of its products and/or services; its customer service; its commitment
to innovation; community involvement; and overall view of the brand.
- Named one of Strategy magazine's 2016 Brands of the Year. The selections were made focusing on companies' with unique
position in a category and distinct brand image in the consumer's mind.
OPERATING RESULTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2016
Total revenues
Total revenues for the three months ended September 30, 2016 increased $47.7 million (14.5%) to $376.0 million as compared to
the prior year period. Total revenues for the nine months ended September 30, 2016 increased $129.3 million (13.4%) as
compared to the prior year period to $1.1 billion. A discussion of the factors affecting the changes in box office, food
service, media and other revenues for the period is provided below.
Non-GAAP measures discussed throughout this MD&A, including adjusted EBITDA, adjusted free cash flow, attendance, BPP,
premium priced product, same theatre metrics, CPP, film cost percentage, theatre concession cost percentage and theatre
concession margin per patron are defined and discussed in the non-GAAP measures section of this news release.
Box office revenues
The following table highlights the movement in box office revenues, attendance and BPP for the quarter and the year to date
(in thousands of dollars, except attendance reported in thousands of patrons, and per patron amounts, unless otherwise
noted):
| Box office revenues |
Third Quarter |
|
Year to Date |
|
| |
2016 |
|
2015 |
|
Change |
|
2016 |
|
2015 |
|
Change |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Box office revenues |
$ |
180,146 |
|
$ |
172,571 |
|
4.4 |
% |
$ |
534,930 |
|
$ |
514,814 |
|
3.9 |
% |
| Attendance (i) |
|
19,219 |
|
|
19,407 |
|
-1.0 |
% |
|
56,660 |
|
|
56,640 |
|
- |
% |
| Box office revenue per patron (i) |
$ |
9.37 |
|
$ |
8.89 |
|
5.4 |
% |
$ |
9.44 |
|
$ |
9.09 |
|
3.9 |
% |
| BPP excluding premium priced product (i) |
$ |
8.20 |
|
$ |
8.10 |
|
1.2 |
% |
$ |
8.26 |
|
$ |
8.25 |
|
0.1 |
% |
| Canadian industry revenues (ii) |
|
|
|
|
|
|
5.1 |
% |
|
|
|
|
|
|
3.2 |
% |
| Same theatre box office revenues (i) |
$ |
178,403 |
|
$ |
172,333 |
|
3.5 |
% |
$ |
520,912 |
|
$ |
507,067 |
|
2.7 |
% |
| Same theatre attendance (i) |
|
19,052 |
|
|
19,375 |
|
-1.7 |
% |
|
55,337 |
|
|
55,838 |
|
-0.9 |
% |
| % Total box from premium priced product (i) |
|
46.5 |
% |
|
34.5 |
% |
12.0 |
% |
|
45.5 |
% |
|
36.0 |
% |
9.5 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (i) |
See Non-GAAP measures section of this news release. |
| (ii) |
The Movie Theatre Association of Canada ("MTAC") reported that the Canadian exhibition industry reported a
box office revenue increase of 6.8% for the period from July 1, 2016 to September 29, 2016 as compared to the period from
July 3, 2015 to October 1, 2015. On a basis consistent with Cineplex's calendar reporting period (July 1 to September 30),
the Canadian industry box office revenue change is estimated to be an increase of 5.1%. For the period from January 1, 2016
to September 29, 2016 as compared to the period from January 2, 2015 to October 1, 2015, MTAC reported a box office revenue
increase of 3.4%. On a basis consistent with Cineplex's calendar reporting period (January 1 to September 30), the Canadian
industry box office revenues are estimated to be an increase of 3.2%. |
| |
|
|
|
|
| Box office continuity |
Third Quarter |
|
Year to Date |
|
| |
Box
Office |
|
Attendance |
|
Box
Office |
|
Attendance |
|
| 2015 as reported |
$ |
172,571 |
|
19,407 |
|
$ |
514,814 |
|
56,640 |
|
| Same theatre attendance change |
|
(2,867 |
) |
(322 |
) |
|
(4,543 |
) |
(501 |
) |
| Impact of same theatre BPP change |
|
8,938 |
|
- |
|
|
18,396 |
|
- |
|
| New and acquired theatres (i) |
|
1,742 |
|
167 |
|
|
7,418 |
|
664 |
|
| Disposed and closed theatres (i) |
|
(238 |
) |
(33 |
) |
|
(1,155 |
) |
(143 |
) |
| 2016 as reported |
$ |
180,146 |
|
19,219 |
|
$ |
534,930 |
|
56,660 |
|
| (i) |
See non-GAAP measures section of this news release. Represents theatres opened, acquired, disposed or
closed subsequent to the start of the prior year comparative period. |
Third Quarter
| Third Quarter 2016 Top Cineplex Films |
3D |
%
Box |
|
|
Third Quarter 2015 Top Cineplex Films |
3D |
%
Box |
|
| 1 |
Suicide Squad |
x |
12.0 |
% |
|
1 |
Minions |
x |
13.7 |
% |
| 2 |
The Secret Life of Pets |
x |
11.2 |
% |
|
2 |
Mission: Impossible - Rogue Nation |
|
9.3 |
% |
| 3 |
Star Trek Beyond |
x |
6.9 |
% |
|
3 |
Ant-Man |
x |
6.9 |
% |
| 4 |
Jason Bourne |
|
6.6 |
% |
|
4 |
Jurassic World |
x |
6.0 |
% |
| 5 |
Finding Dory |
x |
5.8 |
% |
|
5 |
Inside Out |
x |
5.4 |
% |
Box office revenues increased $7.6 million, or 4.4%, to a third quarter record of $180.1 million during the period, compared
to $172.6 million reported in the third quarter of 2015. The increase was due to the record third quarter BPP more than
offsetting the impact of the 1.0% decrease in attendance.
BPP for the three months ended September 30, 2016 was $9.37, a $0.48 increase from the prior year period and a third quarter
record for Cineplex. The increase in BPP was due to the higher percentage of box office revenues from premium product, which
accounted for 46.5% of box office revenues in the current period, up from 34.5% in the prior year period. This increase was
due to a higher proportion of strong performing 3D product versus 2D product in the current period, as compared to the prior year
period.
Year to Date
| Year to Date 2016 Top Cineplex Films |
3D |
%
Box |
|
|
Year to Date 2015 Top Cineplex Films |
3D |
%
Box |
|
| 1 |
Deadpool |
|
5.3 |
% |
|
1 |
Jurassic World |
x |
7.7 |
% |
| 2 |
Finding Dory |
x |
4.7 |
% |
|
2 |
The Avengers: Age of Ultron |
x |
5.8 |
% |
| 3 |
Star Wars: The Force Awakens |
x |
4.7 |
% |
|
3 |
Minions |
x |
4.6 |
% |
| 4 |
Captain America: Civil War |
x |
4.6 |
% |
|
4 |
Furious 7 |
|
4.3 |
% |
| 5 |
The Jungle Book |
x |
4.5 |
% |
|
5 |
Inside Out |
x |
3.7 |
% |
Box office revenues for the nine months ended September 30, 2016 were $534.9 million, an increase of $20.1 million or 3.9%
over the prior year due to the higher BPP in the current year period compared to the 2015 period, with attendance flat period
over period.
Cineplex's BPP for the period increased $0.35, or 3.9%, from $9.09 in the prior year period to $9.44 in the current
period. This increase was primarily due to the increase in revenues from 3D product in the current period compared to the
prior year period. Premium priced offerings accounted for 45.5% of Cineplex's box office revenues in the nine months ended
September 30, 2016, compared to 36.0% in the prior year period.
Food service revenues
The following table highlights the movement in food service revenues, attendance and CPP for the quarter and the year to date
(in thousands of dollars, except attendance and same theatre attendance reported in thousands of patrons, and per patron
amounts):
| Food service revenues |
Third Quarter |
|
Year to Date |
|
| |
2016 |
2015 |
Change |
|
2016 |
2015 |
Change |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Food service - theatres |
$ |
109,278 |
$ |
105,464 |
3.6 |
% |
$ |
318,098 |
$ |
304,646 |
4.4 |
% |
| Food service - The Rec Room |
|
287 |
|
- |
NM |
|
$ |
287 |
|
- |
NM |
|
| Total food service revenues |
$ |
109,565 |
$ |
105,464 |
3.9 |
% |
$ |
318,385 |
$ |
304,646 |
4.5 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Attendance (i) |
|
19,219 |
|
19,407 |
-1.0 |
% |
|
56,660 |
|
56,640 |
- |
% |
| CPP (i) |
$ |
5.69 |
$ |
5.43 |
4.8 |
% |
$ |
5.61 |
$ |
5.38 |
4.3 |
% |
| Same theatre food service revenues (i) |
$ |
108,163 |
$ |
105,329 |
2.7 |
% |
$ |
309,870 |
$ |
299,964 |
3.3 |
% |
| Same theatre attendance (i) |
|
19,052 |
|
19,375 |
-1.7 |
% |
|
55,337 |
|
55,838 |
-0.9 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| (i) |
See non-GAAP measures section of this news release. |
| Theatre food service revenue continuity |
Third Quarter |
|
Year to Date |
|
| |
Theatre
Food
Service |
|
Attendance |
|
Theatre
Food
Service |
|
Attendance |
|
| 2015 as reported |
$ |
105,464 |
|
19,407 |
|
$ |
304,646 |
|
56,640 |
|
| Same theatre attendance change |
|
(1,751 |
) |
(322 |
) |
|
(2,691 |
) |
(501 |
) |
| Impact of same theatre CPP change |
|
4,587 |
|
- |
|
|
12,599 |
|
- |
|
| New and acquired theatres (i) |
|
1,113 |
|
167 |
|
|
4,044 |
|
664 |
|
| Disposed and closed theatres (i) |
|
(135 |
) |
(33 |
) |
|
(500 |
) |
(143 |
) |
| 2016 as reported |
$ |
109,278 |
|
19,219 |
|
$ |
318,098 |
|
56,660 |
|
| (i) |
See non-GAAP measures section of this news release. Represents theatres opened, acquired, disposed or
closed subsequent to the start of the prior year comparative period. |
Third Quarter
Food service revenues are comprised primarily of concession revenues, which includes food sales at theatre
locations. Food service revenues also include food sales at The Rec Room. Food service revenues increased $4.1
million, or 3.9% as compared to the prior year period due to the increase in CPP partially offset by the impact of the 1.0%
decrease in attendance. The operations of The Rec Room in Edmonton, which opened mid-September, contributed $0.3
million to the increase, and are excluded from the CPP calculation.
CPP increased 4.8% to $5.69, a third quarter record for Cineplex. Expanded offerings outside of core food service
products, including offerings at Cineplex's VIP Cinemas and Outtakes locations, have contributed to increased visitation and
higher average transaction values, resulting in the higher CPP in the period.
Year to Date
Food service revenues increased $13.7 million, or 4.5% as compared to the prior year, due to the 4.3% increase in
CPP. The CPP of $5.61 in the current period is the highest CPP Cineplex has reported through the first nine months of a
year.
While the 10% SCENE discount and SCENE points issued on food service purchases reduce individual transaction values which
impacts CPP, Cineplex believes that this loyalty program drives incremental visits and food service purchases, resulting in
higher overall food service revenues.
Media revenues
The following table highlights the movement in media revenues for the quarter and the year to date (in thousands of
dollars):
| Media revenues |
Third Quarter |
|
Year to Date |
|
| |
2016 |
2015 |
Change |
|
2016 |
2015 |
Change |
|
| Cineplex Media |
$ |
29,093 |
$ |
25,029 |
16.2 |
% |
$ |
76,432 |
$ |
70,363 |
8.6 |
% |
| Cineplex Digital Media |
|
15,735 |
|
9,267 |
69.8 |
% |
|
41,640 |
|
28,025 |
48.6 |
% |
| Total media revenues |
$ |
44,828 |
$ |
34,296 |
30.7 |
% |
$ |
118,072 |
$ |
98,388 |
20.0 |
% |
Third Quarter
Total media revenues increased $10.5 million (30.7%) to $44.8 million in the third quarter of 2016 compared to the prior year
period, representing a third quarter media revenue record for Cineplex. This increase was primarily due to higher Cineplex
Digital Media revenues, which increased $6.5 million as expansion of the client base resulted in increased project installation
revenues including clients Dairy Queen and A&W Canada as well as advertising and other media revenue growth. Cineplex
Media revenues increased $4.1 million due to higher showtime and pre-show revenues as well as growth in new media
initiatives.
Year to Date
Total media revenues increased $19.7 million in the nine months ended September 30, 2016 compared to the prior year
period. The increase resulted from the $6.1 million increase in Cineplex Media revenues due to higher showtime and pre-show
revenues as well as growth in new media initiatives, and a $13.6 million increase in Cineplex Digital Media revenues earned from
higher project installation and advertising revenue growth due to an expansion of the client base.
Other revenues
The following table highlights the movement in games and other revenues for the quarter and the year to date (in thousands of
dollars):
| Other revenues |
Third Quarter |
|
Year to Date |
|
| |
2016 |
2015 |
Change |
|
2016 |
2015 |
Change |
|
| Games - Cineplex exhibition (i) |
$ |
2,725 |
$ |
2,523 |
8.0 |
% |
$ |
7,882 |
$ |
7,016 |
12.3 |
% |
| The Rec Room - amusement and gaming |
|
204 |
|
- |
NM |
|
|
204 |
|
- |
NM |
|
| CSI excluding Cineplex exhibition games (i) |
|
24,042 |
|
- |
NM |
|
|
69,525 |
|
- |
NM |
|
| Other |
|
14,442 |
|
13,392 |
7.8 |
% |
|
43,892 |
|
38,707 |
13.4 |
% |
| Total other revenues |
$ |
41,413 |
$ |
15,915 |
160.2 |
% |
$ |
121,503 |
$ |
45,723 |
165.7 |
% |
| (i) |
Cineplex receives a venue revenue share on games revenues earned at in-theatre game rooms and XSCAPE
Entertainment Centres. Games - Cineplex exhibition reports the total of this venue revenue share which is consistent with
the historical presentation of Cineplex's Games revenues. CSI excluding Cineplex exhibition games reflects CSI's gross
gaming revenues, net of the venue revenue share paid to Cineplex reflected in Games - Cineplex exhibition above. |
Third Quarter
Other revenues increased 160.2% or $25.5 million in the third quarter of 2016 compared to the prior year period primarily due
to the consolidation of CSI following Cineplex's acquisition on October 1, 2015 of the 50% of CSI it did not already own ($24.0
million). Prior to October 1, 2015, Cineplex equity accounted for its 50% interest in CSI, with the results included in
"Share of income of joint ventures." Excluding CSI, Other revenues increased $1.5 million, or 9.1%.
Cineplex exhibition gaming revenues were higher than the prior year period despite the decrease in attendance due to more
XSCAPE locations open during the current period, leading to more opportunities for game play by those in attendance. The
opening of The Rec Room in Edmonton in mid-September contributed $0.2 million in revenues. The increase of $1.1
million (7.8%) in Other in the period was primarily due to higher revenues relating to enhanced guest service initiatives and the
inclusion of WGN which was acquired in September 2015 and is not fully reflected in the prior year comparative.
Year to Date
For the year to date period, Other revenues have increased 165.7% or $75.8 million, compared to the prior year period
primarily due to the consolidation of CSI ($69.5 million). Excluding CSI, Other revenues increased $6.3 million, or
13.7%.
Cineplex exhibition gaming revenues increased 12.3% due to a higher number of XSCAPE entertainment centres open in the current
period compared to the prior year period. The increase of $5.2 million in Other in the period was primarily additional
revenues arising from enhanced guest service initiatives and increased SCENE related revenues.
Film cost
The following table highlights the movement in film cost and the film cost percentage for the quarter and the year to date (in
thousands of dollars, except film cost percentage):
| Film cost |
Third Quarter |
|
Year to Date |
|
| |
2016 |
|
2015 |
|
Change |
|
2016 |
|
2015 |
|
Change |
|
| Film cost |
$ |
95,471 |
|
$ |
91,567 |
|
4.3 |
% |
$ |
293,534 |
|
$ |
273,893 |
|
7.2 |
% |
| Film cost percentage (i) |
|
53.0 |
% |
|
53.1 |
% |
-0.1 |
% |
|
54.9 |
% |
|
53.2 |
% |
1.7 |
% |
| (i) |
See non-GAAP measures section of this news release. |
Third Quarter
Film cost varies primarily with box office revenues, and can vary from quarter to quarter usually based on the relative
strength of the titles exhibited during the period. This is due to film cost terms varying by title and distributor. Film
cost percentage during the third quarter of 2016 was 53.0%, a 0.1% decrease from the prior year period.
Year to Date
The year to date increase in film cost expense was due to a combination of the 1.7% increase in the film cost percentage and
the higher box office revenues in the current period compared to the prior year period.
Cost of food service
The following table highlights the movement in cost of food service for both theatres and The Rec Room for the
quarter and the year to date (in thousands of dollars, except percentages and margins per patron):
| Cost of food service |
Third Quarter |
|
Year to Date |
|
| |
2016 |
|
2015 |
|
Change |
|
2016 |
|
2015 |
|
Change |
|
| Cost of food service - theatre |
$ |
24,286 |
|
$ |
22,325 |
|
8.8 |
% |
$ |
71,203 |
|
$ |
65,694 |
|
8.4 |
% |
| Cost of food service - The Rec Room |
|
70 |
|
|
- |
|
NM |
|
|
70 |
|
|
- |
|
NM |
|
| Total cost of food service |
$ |
24,356 |
|
$ |
22,325 |
|
9.1 |
% |
$ |
71,273 |
|
$ |
65,694 |
|
8.5 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Theatre concession cost percentage (i) |
|
22.2 |
% |
|
21.2 |
% |
1.0 |
% |
|
22.4 |
% |
|
21.6 |
% |
0.8 |
% |
| Theatre concession margin per patron (i) |
$ |
4.42 |
|
$ |
4.28 |
|
3.3 |
% |
$ |
4.36 |
|
$ |
4.22 |
|
3.3 |
% |
| (i) |
See non-GAAP measures section of this news release. |
Third Quarter
Cost of food service at the theatres varies primarily with theatre attendance as well as the quantity and mix of offerings
sold. Cost of food service at The Rec Room varies primarily with the volume of guests who visit the location as
well as the quantity and mix between food and beverage items sold.
The increase in the theatre cost of food service as compared to the prior year period was due to the higher food service
revenues as well as the 1.0% increase in the concession cost percentage during the period. The increase in the concession
cost percentage is due in part to the mix of food offerings. The addition of VIP theatres at three locations since the prior
year period has contributed to the changing mix including more items outside of the core concession offerings, which tend to have
higher costs.
The theatre concession margin per patron increased 3.3% from $4.28 in the third quarter of 2015 to $4.42 in the same period in
2016, reflecting the impact of the higher CPP during the period, partially offset by the impact of the higher theatre concession
cost percentage.
Cost of food service at The Rec Room reflects the costs incurred for the partial month of operations in the
period.
Year to Date
The increase in the theatre cost of food service as compared to the prior year period was due to the higher theatre food
service revenues, driven by the CPP increase. The theatre concession margin per patron increased from $4.22 in the prior
year period to $4.36 in the current period, reflecting the impact of the higher CPP in the current period.
Despite the 10% discount offered to SCENE members and SCENE points offered on select offerings, which contributes to a higher
concession cost percentage, Cineplex believes the SCENE program drives incremental attendance and purchase incidence which
increases food service revenues and CPP.
Depreciation and amortization
The following table highlights the movement in depreciation and amortization expenses during the quarter and the year to date
(in thousands of dollars):
| Depreciation and amortization expenses |
Third Quarter |
|
Year to Date |
|
| |
2016 |
2015 |
Change |
|
2016 |
2015 |
Change |
|
| Depreciation of property, equipment and leaseholds |
$ |
23,023 |
$ |
20,225 |
13.8 |
% |
$ |
66,828 |
$ |
59,098 |
13.1 |
% |
| Amortization of intangible assets and other |
|
3,680 |
|
1,886 |
95.1 |
% |
|
10,859 |
|
5,715 |
90.0 |
% |
| Depreciation and amortization expenses as reported |
$ |
26,703 |
$ |
22,111 |
20.8 |
% |
$ |
77,687 |
$ |
64,813 |
19.9 |
% |
The quarterly increase in depreciation of property, equipment and leaseholds of $2.8 million and year to date increase of $7.7
million was primarily due to the addition of equipment and leasehold improvements relating to assets acquired through
acquisitions and new construction. The increase in amortization of intangible assets and other is primarily due to
intangible assets acquired in the WGN and CSI transactions.
Loss on disposal of assets
The following table shows the movement in the loss on disposal of assets during the quarter and the year to date (in thousands
of dollars):
| Loss on disposal of assets |
Third Quarter |
|
Year to Date |
|
| |
2016 |
2015 |
Change |
|
2016 |
2015 |
Change |
|
| Loss on disposal of assets |
$ |
468 |
$ |
987 |
-52.6 |
% |
$ |
1,402 |
$ |
2,337 |
-40.0 |
% |
During the third quarter of 2016, Cineplex recorded a loss of $0.5 million on the disposal of assets that were sold or
otherwise disposed (2015 - $1.0 million). For the nine months ended September 30, 2016, disposal of assets resulted in a
loss of $1.4 million on the disposal of assets that were sold or otherwise disposed of (2015 - $2.3 million).
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 film entertainment and content, media, amusement gaming and leisure (including CSI, The Rec Room and
WGN) as well as Cineplex's ancillary businesses; and general and administrative expenses, which include costs related to managing
Cineplex's operations, including 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 and the year to date (in thousands of
dollars):
| Other costs |
Third Quarter |
|
Year to Date |
|
| |
2016 |
2015 |
Change |
|
2016 |
2015 |
Change |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Theatre occupancy expenses |
$ |
51,699 |
$ |
51,239 |
0.9 |
% |
$ |
155,052 |
$ |
152,821 |
1.5 |
% |
| Other operating expenses |
|
120,398 |
|
89,801 |
34.1 |
% |
|
352,425 |
|
259,952 |
35.6 |
% |
| General and administrative expenses |
|
17,030 |
|
15,703 |
8.5 |
% |
|
54,386 |
|
50,238 |
8.3 |
% |
| Total other costs |
$ |
189,127 |
$ |
156,743 |
20.7 |
% |
$ |
561,863 |
$ |
463,011 |
21.3 |
% |
Theatre occupancy expenses
The following table highlights the movement in theatre occupancy expenses for the quarter and the year to date (in thousands
of dollars):
| Theatre occupancy expenses |
Third Quarter |
|
Year to Date |
|
| |
2016 |
|
2015 |
|
Change |
|
2016 |
|
2015 |
|
Change |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Rent |
$ |
34,192 |
|
$ |
34,055 |
|
0.4 |
% |
$ |
102,568 |
|
$ |
101,512 |
|
1.0 |
% |
| Other occupancy |
|
18,009 |
|
|
17,806 |
|
1.1 |
% |
|
54,933 |
|
|
53,928 |
|
1.9 |
% |
| One-time items (i) |
|
(502 |
) |
|
(622 |
) |
-19.3 |
% |
|
(2,449 |
) |
|
(2,619 |
) |
-6.5 |
% |
| Total |
$ |
51,699 |
|
$ |
51,239 |
|
0.9 |
% |
$ |
155,052 |
|
$ |
152,821 |
|
1.5 |
% |
| (i) |
One-time items include amounts related to both theatre rent and other theatre occupancy costs. They are
isolated here to illustrate Cineplex's theatre rent and other theatre occupancy costs excluding these one-time,
non-recurring items. |
| |
|
Theatre occupancy continuity
|
Third Quarter
Occupancy |
|
Year to Date
Occupancy |
|
| 2015 as reported |
$ |
51,239 |
|
$ |
152,821 |
|
| Impact of new and acquired theatres |
|
438 |
|
|
2,073 |
|
| Impact of disposed theatres |
|
(43 |
) |
|
(276 |
) |
| Same theatre rent change (i) |
|
(88 |
) |
|
(141 |
) |
| One-time items |
|
119 |
|
|
170 |
|
| Other |
|
34 |
|
|
405 |
|
| 2016 as reported |
$ |
51,699 |
|
$ |
155,052 |
|
| (i) |
See non-GAAP measures section of this news release. |
Third Quarter
Theatre occupancy expenses increased $0.5 million during the third quarter of 2016 compared to the prior year
period. This increase was primarily due to the impact of new and acquired theatres net of disposed theatres ($0.4 million)
and less one-time credits as compared to the prior year period ($0.1 million).
Year to Date
The increase in theatre occupancy expenses of $2.2 million for the 2016 period compared to the prior year was due to the
impact of new and acquired theatres net of disposed theatres ($1.8 million) and higher other costs (including higher real estate
taxes) ($0.4 million) as compared to the prior year period.
Other operating expenses
The following table highlights the movement in other operating expenses during the quarter and the year to date (in thousands
of dollars):
| Other operating expenses |
Third Quarter |
|
Year to Date |
|
| |
2016 |
2015 |
Change |
|
2016 |
2015 |
Change |
|
| Theatre payroll |
$ |
35,532 |
$ |
35,530 |
- |
% |
$ |
107,430 |
$ |
103,554 |
3.7 |
% |
| Media |
|
17,929 |
|
12,819 |
39.9 |
% |
|
50,399 |
|
39,464 |
27.7 |
% |
| CSI |
|
20,421 |
|
- |
NM |
|
|
60,165 |
|
- |
NM |
|
| The Rec Room (i) |
|
357 |
|
- |
NM |
|
|
357 |
|
- |
NM |
|
| Other |
|
46,159 |
|
41,452 |
11.4 |
% |
|
134,074 |
|
116,934 |
14.7 |
% |
| Other operating expenses |
$ |
120,398 |
$ |
89,801 |
34.1 |
% |
$ |
352,425 |
$ |
259,952 |
35.6 |
% |
| (i) |
Includes operating costs of The Rec Room location in Edmonton. Pre-opening costs relating to
The Rec Room locations and overhead relating to management of The Rec Room portfolio are included in the
'Other' line. |
| |
|
Other operating continuity
|
Third Quarter
Other Operating |
|
Year to Date
Other Operating |
|
| 2015 as reported |
$ |
89,801 |
|
$ |
259,952 |
|
| Impact of new and acquired theatres |
|
961 |
|
|
3,556 |
|
| Impact of disposed theatres |
|
(79 |
) |
|
(356 |
) |
| Same theatre payroll change (i) |
|
(211 |
) |
|
2,391 |
|
| Marketing change |
|
(435 |
) |
|
1,653 |
|
| Media change |
|
5,110 |
|
|
10,935 |
|
| CSI change |
|
20,421 |
|
|
60,165 |
|
| Amusement gaming and leisure, excluding CSI |
|
4,178 |
|
|
10,138 |
|
| Other |
|
652 |
|
|
3,991 |
|
| 2016 as reported |
$ |
120,398 |
|
$ |
352,425 |
|
| (i) |
See non-GAAP measures section of this news release. |
Third Quarter
Other operating expenses during the third quarter of 2016 increased $30.6 million or 34.1% compared to the prior year period.
The major component of the increase is the inclusion of CSI which is not included in the prior year comparative ($20.4
million).
Excluding CSI, the remainder of the increase is primarily due to higher media costs as a result of increased business volumes
($5.1 million) and incremental amusement gaming and leisure costs (excluding CSI) of $4.2 million due to the prior period not
including a full quarter of WGN and minimal amounts from The Rec Room.
Year to Date
For the nine months ended September 30, 2016, other operating expenses increased $92.5 million or 35.6% compared to the prior
year period. The major component of the increase is the inclusion of CSI ($60.2 million). Excluding CSI operating
expenses increased $32.3 million, with the increases due to new theatre openings, higher business volumes in the media
businesses, as well as costs relating to WGN (which did not have a full period of operations in the prior year period) and
The Rec Room.
The $4.0 million increase in Other is due in part to higher same theatre costs, SCENE program costs ($1.2 million) and 3D and
IMAX royalty costs which are due to stronger performing premium product ($0.7 million).
General and administrative expenses
The following table highlights the movement in general and administrative ("G&A") expenses during the quarter and the year
to date, including Share based compensation costs, and G&A net of these costs (in thousands of dollars):
| G&A expenses |
Third Quarter |
|
Year to Date |
|
| |
2016 |
2015 |
Change |
|
2016 |
2015 |
Change |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| G&A excluding LTIP and option plan expense |
$ |
15,039 |
$ |
13,342 |
12.7 |
% |
$ |
44,835 |
$ |
40,948 |
9.5 |
% |
| LTIP (i) |
|
1,579 |
|
1,931 |
-18.2 |
% |
|
8,314 |
|
8,023 |
3.6 |
% |
| Option plan |
|
412 |
|
430 |
-4.2 |
% |
|
1,237 |
|
1,267 |
-2.4 |
% |
| G&A expenses as reported |
$ |
17,030 |
$ |
15,703 |
8.5 |
% |
$ |
54,386 |
$ |
50,238 |
8.3 |
% |
| (i) |
LTIP includes the expense for the LTIP program as well as the expense for the executive and Board deferred
share unit plans. |
Third Quarter
G&A expenses increased $1.3 million during the third quarter of 2016 compared to the prior year period due to higher head
office payroll expenses.
Year to Date
G&A expenses for the year to date period increased $4.1 million compared to the prior year period primarily due to higher
head office payroll expenses.
EARNINGS BEFORE INTEREST, INCOME TAXES, DEPRECIATION AND AMORTIZATION ("EBITDA") (see non-GAAP measures section of
this news release)
The following table presents EBITDA and adjusted EBITDA for the three months ended September 30, 2016 as compared to the prior
year period (in thousands of dollars, except adjusted EBITDA margin):
| EBITDA |
Third Quarter |
|
Year to Date |
|
| |
2016 |
|
2015 |
|
Change |
|
2016 |
|
2015 |
|
Change |
|
| EBITDA |
$ |
67,441 |
|
$ |
57,884 |
|
16.5 |
% |
$ |
166,898 |
|
$ |
161,222 |
|
3.5 |
% |
| Adjusted EBITDA |
$ |
67,260 |
|
$ |
59,081 |
|
13.8 |
% |
$ |
167,168 |
|
$ |
164,639 |
|
1.5 |
% |
| Adjusted EBITDA margin |
|
17.9 |
% |
|
18.0 |
% |
-0.1 |
% |
|
15.3 |
% |
|
17.1 |
% |
-1.8 |
% |
Adjusted EBITDA for the third quarter of 2016 increased $8.2 million, or 13.8%, as compared to the prior year
period. Adjusted EBITDA margin, calculated as adjusted EBITDA divided by total revenues, was 17.9% in the current period,
down from 18.0% in the prior year period. The increase in adjusted EBITDA was due to stronger results in all of Cineplex's
key businesses as well as the contribution from CSI due to 100% ownership in the current period compared to 50% in the prior
period. Higher costs attributable to Cineplex's emerging businesses as it executes on its diversification strategy impacted
margins in the current period, resulting in the small decrease period over period.
Adjusted EBITDA for the nine months ended September 30, 2016 increased $2.5 million, or 1.5%, as compared to the prior year
period. The increase was due to stronger operating results in all areas of the business. Adjusted EBITDA margin for the
period was 15.3%, a decrease of 1.8% from 17.1% in the prior year period. The adjusted EBITDA margin was impacted by the
higher costs attributable to Cineplex's emerging businesses as it executes on its diversification strategy.
ADJUSTED FREE CASH FLOW (see non-GAAP measures section of this news release)
For the third quarter of 2016, adjusted free cash flow per common share of Cineplex was $0.74 as compared to $0.57 in the
prior year period. The declared dividends per common share of Cineplex were $0.41 in the third quarter of 2016 and $0.39 in
the prior year period. During the year ended September 30, 2016, Cineplex generated adjusted free cash flow per Share of
$2.67, compared to $2.33 per Share in the year ended September 30, 2015. Cineplex declared dividends per Share of $1.59 and
$1.53, respectively, in each year. The payout ratios for these periods were approximately 59.3% and 65.5%, respectively.
NON-GAAP FINANCIAL MEASURES
EBITDA and Adjusted Free Cash Flow
EBITDA and adjusted free cash flow are not measures recognized by 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. 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.
EBITDA is calculated by adding back to net income, income tax expense, depreciation and amortization expense, and interest
expense net of interest income. Adjusted EBITDA is calculated by adjusting EBITDA for losses on disposal of assets, the
equity income of CDCP, the non-controlling interests' share of adjusted EBITDA of WGN and BSL, and depreciation, amortization,
interest and taxes of Cineplex's other joint ventures. Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by
total revenues.
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.
For a detailed reconciliation of net income to EBITDA and adjusted EBITDA and from cash provided by operating activities to
adjusted free cash flow, please refer to Cineplex's management's discussion and analysis filed on www.sedar.com.
Per Patron Revenue Metrics
Cineplex reviews per patron metrics as they relate to box office revenue and concession revenue such as BPP, CPP, BPP
excluding premium priced product, and concession margin per patron, as these are key measures used by investors to value and
assess Cineplex's performance, and are widely used in the theatre exhibition industry. Management of Cineplex defines these
metrics as follows:
Attendance: Attendance is calculated as the total number of paying patrons that frequent Cineplex's theatres
during the period.
BPP: Calculated as total box office revenues divided by total paid attendance for the period.
BPP excluding premium priced product: Calculated as total box office revenues for the period, less box office
revenues from 3D, UltraAVX, VIP and IMAX product; divided by total paid attendance for the period, less paid attendance for 3D,
UltraAVX, VIP and IMAX product.
CPP: Calculated as total theatre food service revenues divided by total paid attendance for the period.
Premium priced product: Defined as 3D, UltraAVX, IMAX and VIP film product.
Theatre concession margin per patron: Calculated as total theatre food service revenues less total theatre
food service cost, divided by total paid attendance for the period.
Same Theatre Analysis
Cineplex reviews and reports same theatre metrics relating to box office revenues, theatre food service revenues, theatre rent
expense and theatre payroll expense, as these measures are widely used in the theatre exhibition industry as well as other retail
industries.
Same theatre metrics are calculated by removing the results for all theatres that have been opened, acquired, closed or
otherwise disposed of subsequent to the start of the prior year comparative period. For the three months ended September 30,
2016 the impact of the three locations that have been opened or acquired and the one location that has been closed have been
excluded, resulting in 161 theatres being included in the same theatre metrics. For the nine months ended September 30, 2016
the impact of the six locations that have been opened or acquired and the three locations that have been closed have been
excluded, resulting in 158 theatres being included in the same theatre metrics.
Cost of sales percentages
Cineplex reviews and reports cost of sales percentages for its two largest revenue sources, box office revenues and food
service revenues as these measures are widely used in the theatre exhibition industry. These measures are reported as film
cost percentage and concession cost percentage, respectively, and are calculated as follows:
Film cost percentage: Calculated as total film cost expense divided by total box office revenues for the
period.
Theatre concession cost percentage: Calculated as total theatre food service costs divided by total theatre
food service revenues for the period.
Certain information included in this news release contains forward-looking statements within the meaning of applicable
securities laws. These forward-looking statements include, among others, statements with respect to Cineplex's objectives,
goals and strategies to achieve those objectives and goals, as well as statements with respect to Cineplex's beliefs, plans,
objectives, expectations, anticipations, estimates and intentions. The words "may", "will", "could", "should", "would",
"suspect", "outlook", "believe", "plan", "anticipate", "estimate", "expect", "intend", "forecast", "objective" and "continue" (or
the negative thereof), and words and expressions of similar import, are intended to identify forward-looking statements.
By their very nature, forward-looking statements involve inherent risks and uncertainties, including those described in
Cineplex's Annual Information Form ("AIF"), Cineplex's management's discussion and analysis ("MD&A") and in this news
release. Those risks and uncertainties, both general and specific, give rise to the possibility that predictions, forecasts,
projections and other forward-looking statements will not be achieved. Certain material factors or assumptions are applied in
making forward-looking statements and actual results may differ materially from those expressed or implied in such statements.
Cineplex cautions readers not to place undue reliance on these statements, as a number of important factors, many of which are
beyond Cineplex's control, could cause actual results to differ materially from the beliefs, plans, objectives, expectations,
anticipations, estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited
to, risks generally encountered in the relevant industry, competition, customer, legal, taxation and accounting matters.
The foregoing list of factors that may affect future results is not exhaustive. When reviewing Cineplex's forward-looking
statements, readers should carefully consider the foregoing factors and other uncertainties and potential events. Additional
information about factors that may cause actual results to differ materially from expectations and about material factors or
assumptions applied in making forward-looking statements may be found in the "Risks and Uncertainties" section of Cineplex's
MD&A.
Cineplex does not undertake to update or revise any forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by applicable Canadian securities law. Additionally, we undertake no obligation to
comment on analyses, expectations or statements made by third parties in respect of Cineplex, its financial or operating results
or its securities. All forward-looking statements in this news release are made as of the date hereof and are qualified by these
cautionary statements. Additional information, including Cineplex's AIF and MD&A, can be found on SEDAR at www.sedar.com.
About Cineplex Inc.
Cineplex is one of Canada's leading entertainment companies and operates one of the most modern and fully digitized motion
picture theatre circuits in the world. A top-tier Canadian brand, Cineplex operates numerous businesses including theatrical
exhibition, food service, amusement gaming, alternative programming (Cineplex Events), Cineplex Media, Cineplex Digital Media,
The Rec Room, 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 165 theatres with 1,683 screens from coast to coast, serving
approximately 77 million guests annually through the following theatre brands: Cineplex Cinemas, Cineplex Odeon, Cineplex VIP
Cinemas, Galaxy Cinemas, SilverCity Cinemas and Scotiabank Theatres. 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 www.sedar.com.
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, Gord Nelson, Chief Financial
Officer and Pat Marshall, Investor Relations Officer will host the call. The teleconference call
is scheduled for:
Tuesday, November 8, 2016
10:00 a.m. Eastern Time
In order to participate in the conference call, please dial 416-849-1847 or outside of Toronto dial 1-866-530-1554 at least five to ten minutes prior to 10:00 a.m.
Eastern Time. Please quote the conference ID 7406912 to access the call.
- If you cannot participate in the live mode, a replay will be available. Please dial 647-436-0148 or 1-888-203-1112 and enter code 7406912#. The replay will begin at 1:00
p.m. Eastern Time on Tuesday, November 8, 2016 and end at 1:00 p.m. Eastern Time on Tuesday, November 15, 2016.
- Note that media will be participating in the call in listen-only mode.
- Thank you in advance for your interest and participation.
| |
| Cineplex Inc. |
| Interim Condensed Consolidated Balance Sheets |
| (Unaudited) |
| (expressed in thousands of Canadian dollars) |
| |
| |
September 30, |
|
December 31, |
|
| |
2016 |
|
2015 |
|
| Assets |
|
|
|
|
|
|
| |
|
|
|
|
|
|
| Current assets |
|
|
|
|
|
|
| Cash and cash equivalents |
$ |
23,685 |
|
$ |
35,713 |
|
| Trade and other receivables |
|
67,116 |
|
|
121,398 |
|
| Income taxes receivable |
|
1,806 |
|
|
- |
|
| Inventories |
|
21,071 |
|
|
19,691 |
|
| Prepaid expenses and other current assets |
|
16,650 |
|
|
10,025 |
|
| |
|
130,328 |
|
|
186,827 |
|
| Non-current assets |
|
|
|
|
|
|
| Property, equipment and leaseholds |
|
543,837 |
|
|
533,192 |
|
| Deferred income taxes |
|
5,710 |
|
|
6,517 |
|
| Interests in joint ventures |
|
34,768 |
|
|
35,288 |
|
| Intangible assets |
|
123,120 |
|
|
132,140 |
|
| Goodwill |
|
807,953 |
|
|
807,953 |
|
| |
$ |
1,645,716 |
|
$ |
1,701,917 |
|
| |
|
|
|
|
|
|
| Liabilities |
|
|
|
|
|
|
| |
|
|
|
|
|
|
| Current liabilities |
|
|
|
|
|
|
| Accounts payable and accrued liabilities |
$ |
121,831 |
|
$ |
209,657 |
|
| Share-based compensation |
|
9,730 |
|
|
9,742 |
|
| Dividends payable |
|
8,571 |
|
|
8,238 |
|
| Income taxes payable |
|
4,419 |
|
|
30,464 |
|
| Deferred revenue |
|
133,688 |
|
|
159,568 |
|
| Current debt |
|
- |
|
|
3,737 |
|
| Finance lease obligations |
|
3,123 |
|
|
2,957 |
|
| Fair value of interest rate swap agreements |
|
2,055 |
|
|
1,414 |
|
| |
|
283,417 |
|
|
425,777 |
|
| Non-current liabilities |
|
|
|
|
|
|
| Share-based compensation |
|
18,687 |
|
|
18,907 |
|
| Long-term debt |
|
332,352 |
|
|
222,340 |
|
| Fair value of interest rate swap agreements |
|
5,021 |
|
|
4,188 |
|
| Finance lease obligations |
|
9,688 |
|
|
12,052 |
|
| Post-employment benefit obligations |
|
7,498 |
|
|
7,296 |
|
| Other liabilities |
|
128,706 |
|
|
131,874 |
|
| Deferred income taxes |
|
7,658 |
|
|
6,283 |
|
| Convertible debentures |
|
102,287 |
|
|
100,703 |
|
| |
|
611,897 |
|
|
503,643 |
|
| |
|
|
|
|
|
|
| Total liabilities |
|
895,314 |
|
|
929,420 |
|
| |
|
|
|
|
|
|
| Equity |
|
|
|
|
|
|
| |
|
|
|
|
|
|
| Share capital |
|
859,210 |
|
|
858,305 |
|
| Deficit |
|
(106,149 |
) |
|
(86,296 |
) |
| Hedging reserves and other |
|
(5,614 |
) |
|
(4,979 |
) |
| Contributed surplus |
|
(159 |
) |
|
(491 |
) |
| Cumulative translation adjustment |
|
(39 |
) |
|
934 |
|
| Total equity attributable to owners of Cineplex |
|
747,249 |
|
|
767,473 |
|
| Non-controlling interests |
|
3,153 |
|
|
5,024 |
|
| Total equity |
|
750,402 |
|
|
772,497 |
|
| |
$ |
1,645,716 |
|
$ |
1,701,917 |
|
| |
| Cineplex Inc. |
| Interim Condensed Consolidated Statements of Operations |
| (Unaudited) |
| (expressed in thousands of Canadian dollars, except net income per share) |
| |
| |
Three months ended September 30, |
|
Nine months ended September 30, |
|
| |
2016 |
|
2015 |
|
2016 |
|
2015 |
|
| Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
| Box office |
$ |
180,146 |
|
$ |
172,571 |
|
$ |
534,930 |
|
$ |
514,814 |
|
| Food service |
|
109,565 |
|
|
105,464 |
|
|
318,385 |
|
|
304,646 |
|
| Media |
|
44,828 |
|
|
34,296 |
|
|
118,072 |
|
|
98,388 |
|
| Other |
|
41,413 |
|
|
15,915 |
|
|
121,503 |
|
|
45,723 |
|
| |
|
375,952 |
|
|
328,246 |
|
|
1,092,890 |
|
|
963,571 |
|
| Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
| Film cost |
|
95,471 |
|
|
91,567 |
|
|
293,534 |
|
|
273,893 |
|
| Cost of food service |
|
24,356 |
|
|
22,325 |
|
|
71,273 |
|
|
65,694 |
|
| Depreciation and amortization |
|
26,703 |
|
|
22,111 |
|
|
77,687 |
|
|
64,813 |
|
| Loss on disposal of assets |
|
468 |
|
|
987 |
|
|
1,402 |
|
|
2,337 |
|
| Other costs |
|
189,127 |
|
|
156,743 |
|
|
561,863 |
|
|
463,011 |
|
| Share of income of joint ventures |
|
(911 |
) |
|
(1,260 |
) |
|
(2,080 |
) |
|
(2,586 |
) |
| Interest expense |
|
4,575 |
|
|
5,919 |
|
|
14,296 |
|
|
17,149 |
|
| Interest income |
|
(46 |
) |
|
(46 |
) |
|
(164 |
) |
|
(134 |
) |
| |
|
339,743 |
|
|
298,346 |
|
|
1,017,811 |
|
|
884,177 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Income before income taxes |
|
36,209 |
|
|
29,900 |
|
|
75,079 |
|
|
79,394 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
| Current |
|
9,002 |
|
|
8,761 |
|
|
17,853 |
|
|
21,836 |
|
| Deferred |
|
1,211 |
|
|
(300 |
) |
|
2,563 |
|
|
114 |
|
| |
|
10,213 |
|
|
8,461 |
|
|
20,416 |
|
|
21,950 |
|
| Net income |
$ |
25,996 |
|
$ |
21,439 |
|
$ |
54,663 |
|
$ |
57,444 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
| Owners of Cineplex |
$ |
26,410 |
|
$ |
21,520 |
|
$ |
55,962 |
|
$ |
57,525 |
|
| Non-controlling interests |
|
(414 |
) |
|
(81 |
) |
|
(1,299 |
) |
|
(81 |
) |
| Net income |
$ |
25,996 |
|
$ |
21,439 |
|
$ |
54,663 |
|
$ |
57,444 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic net income per share attributable to owners of Cineplex |
$ |
0.42 |
|
$ |
0.34 |
|
$ |
0.88 |
|
$ |
0.91 |
|
| Diluted net income per share attributable to owners of Cineplex |
$ |
0.41 |
|
$ |
0.34 |
|
$ |
0.88 |
|
$ |
0.90 |
|
| |
| Cineplex Inc. |
| Interim Condensed Consolidated Statements of Comprehensive Income |
| (Unaudited) |
| (expressed in thousands of Canadian dollars) |
| |
| |
Three months ended September 30, |
|
Nine months ended September 30, |
|
| |
2016 |
|
2015 |
|
2016 |
|
2015 |
|
| |
|
|
|
|
|
|
|
|
| Net income |
$ |
25,996 |
|
$ |
21,439 |
|
$ |
54,663 |
|
$ |
57,444 |
|
| Other comprehensive income (loss) |
|
|
|
|
|
|
|
|
|
|
|
|
| Items that will be reclassified subsequently to net income: |
|
|
|
|
|
|
|
|
|
|
|
|
| Income (loss) on hedging instruments |
|
467 |
|
|
(189 |
) |
|
(881 |
) |
|
(2,689 |
) |
| Associated deferred income taxes (expense) recovery |
|
(125 |
) |
|
50 |
|
|
246 |
|
|
718 |
|
| Foreign currency translation adjustment |
|
539 |
|
|
324 |
|
|
(1,209 |
) |
|
324 |
|
| Other comprehensive income (loss) |
|
881 |
|
|
185 |
|
|
(1,844 |
) |
|
(1,647 |
) |
| Comprehensive income |
$ |
26,877 |
|
$ |
21,624 |
|
$ |
52,819 |
|
$ |
55,797 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
| Owners of Cineplex |
$ |
27,244 |
|
$ |
21,705 |
|
$ |
54,354 |
|
$ |
55,878 |
|
| Non-controlling interests |
|
(367 |
) |
|
(81 |
) |
|
(1,535 |
) |
|
(81 |
) |
| Comprehensive income |
$ |
26,877 |
|
$ |
21,624 |
|
$ |
52,819 |
|
$ |
55,797 |
|
| |
| Cineplex Inc. |
| Interim Condensed Consolidated Statements of Changes in Equity |
| (Unaudited) |
| (expressed in thousands of Canadian dollars) |
| For the nine months ended September 30, 2016 and 2015 |
| |
| |
Share
capital |
|
Contributed
surplus |
|
Hedging
and other
reserves |
|
Cumulative
translation
adjustment |
|
Deficit |
|
Non-
controlling
interests |
|
Total |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance - January 1, 2016 |
$ |
858,305 |
|
$ |
(491 |
) |
$ |
(4,979 |
) |
$ |
934 |
|
$ |
(86,296 |
) |
$ |
5,024 |
|
$ |
772,497 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
55,962 |
|
|
(1,299 |
) |
|
54,663 |
|
| Other comprehensive (loss) |
|
- |
|
|
- |
|
|
(635 |
) |
|
(973 |
) |
|
- |
|
|
(236 |
) |
|
(1,844 |
) |
| Total comprehensive income |
|
- |
|
|
- |
|
|
(635 |
) |
|
(973 |
) |
|
55,962 |
|
|
(1,535 |
) |
|
52,819 |
|
| Dividends declared |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(75,815 |
) |
|
- |
|
|
(75,815 |
) |
| Share option expense |
|
- |
|
|
1,237 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
1,237 |
|
| Issuance of shares on exercise of options |
|
905 |
|
|
(905 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
| CSI non-controlling interests acquired |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(336 |
) |
|
(336 |
) |
| Balance - September 30, 2016 |
$ |
859,210 |
|
$ |
(159 |
) |
$ |
(5,614 |
) |
$ |
(39 |
) |
$ |
(106,149 |
) |
$ |
3,153 |
|
$ |
750,402 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance - January 1, 2015 |
$ |
854,073 |
|
$ |
4,952 |
|
$ |
(3,405 |
) |
$ |
- |
|
$ |
(123,771 |
) |
$ |
- |
|
$ |
731,849 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
57,525 |
|
|
(81 |
) |
|
57,444 |
|
| Other comprehensive (loss) |
|
- |
|
|
- |
|
|
(1,971 |
) |
|
324 |
|
|
- |
|
|
- |
|
|
(1,647 |
) |
| Total comprehensive income |
|
|
|
|
|
|
|
(1,971 |
) |
|
324 |
|
|
57,525 |
|
|
(81 |
) |
|
55,797 |
|
| Dividends declared |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(72,529 |
) |
|
- |
|
|
(72,529 |
) |
| Share option expense |
|
- |
|
|
1,267 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
1,267 |
|
| Issuance of shares on exercise of options |
|
522 |
|
|
(522 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
| WGN purchase obligation |
|
- |
|
|
(4,939 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(4,939 |
) |
| WGN non-controlling interests recognized on acquisition |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
4,939 |
|
|
4,939 |
|
| Balance - September 30, 2015 |
$ |
854,595 |
|
$ |
758 |
|
$ |
(5,376 |
) |
$ |
324 |
|
$ |
(138,775 |
) |
$ |
4,858 |
|
$ |
716,384 |
|
| |
| Cineplex Inc. |
| Interim Condensed Consolidated Statements of Cash Flows |
| (Unaudited) |
| (expressed in thousands of Canadian dollars) |
| |
| |
Three months ended September 30, |
|
Nine months ended September 30, |
|
| |
2016 |
|
2015 |
|
2016 |
|
2015 |
|
| Cash provided by (used in) |
|
|
|
|
|
|
|
|
|
|
|
|
| Operating activities |
|
|
|
|
|
|
|
|
|
|
|
|
| Net income |
$ |
25,996 |
|
$ |
21,439 |
|
$ |
54,663 |
|
$ |
57,444 |
|
| Adjustments to reconcile net income to net cash provided by operating activities |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Depreciation and amortization of property, equipment and leaseholds, and intangible assets |
|
26,703 |
|
|
22,111 |
|
|
77,687 |
|
|
64,813 |
|
| |
Amortization of tenant inducements, rent averaging liabilities and fair value lease contract
liabilities |
|
(2,657 |
) |
|
(1,947 |
) |
|
(7,143 |
) |
|
(5,950 |
) |
| |
Accretion of debt issuance costs and other non-cash interest, net |
|
259 |
|
|
1,403 |
|
|
402 |
|
|
3,995 |
|
| |
Loss on disposal of assets |
|
468 |
|
|
987 |
|
|
1,402 |
|
|
2,337 |
|
| |
Deferred income taxes |
|
1,211 |
|
|
(300 |
) |
|
2,563 |
|
|
114 |
|
| |
Interest rate swap agreements - non-cash interest |
|
(39 |
) |
|
62 |
|
|
767 |
|
|
149 |
|
| |
Non-cash share-based compensation |
|
412 |
|
|
429 |
|
|
1,237 |
|
|
1,266 |
|
| |
Accretion of convertible debentures |
|
531 |
|
|
493 |
|
|
1,583 |
|
|
1,484 |
|
| |
Net change in interests in joint ventures |
|
(1,553 |
) |
|
875 |
|
|
(1,851 |
) |
|
(2,224 |
) |
| Tenant inducements |
|
1,291 |
|
|
- |
|
|
3,685 |
|
|
757 |
|
| Changes in operating assets and liabilities |
|
(16,025 |
) |
|
(9,280 |
) |
|
(100,395 |
) |
|
(49,937 |
) |
| Net cash provided by operating activities |
|
36,597 |
|
|
36,272 |
|
|
34,600 |
|
|
74,248 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Investing activities |
|
|
|
|
|
|
|
|
|
|
|
|
| Proceeds from sale of assets |
|
- |
|
|
- |
|
|
108 |
|
|
108 |
|
| Purchases of property, equipment and leaseholds |
|
(28,787 |
) |
|
(25,560 |
) |
|
(76,325 |
) |
|
(72,885 |
) |
| Acquisition of businesses, net of cash acquired |
|
- |
|
|
(12,472 |
) |
|
(407 |
) |
|
(15,630 |
) |
| Intangible assets additions |
|
(329 |
) |
|
(355 |
) |
|
(610 |
) |
|
(469 |
) |
| Net cash received from CDCP |
|
1,568 |
|
|
407 |
|
|
2,370 |
|
|
1,163 |
|
| Net cash used in investing activities |
|
(27,548 |
) |
|
(37,980 |
) |
|
(74,864 |
) |
|
(87,713 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Financing activities |
|
|
|
|
|
|
|
|
|
|
|
|
| Dividends paid |
|
(25,713 |
) |
|
(24,603 |
) |
|
(75,482 |
) |
|
(72,204 |
) |
| Borrowings under credit facilities, net |
|
5,798 |
|
|
28,000 |
|
|
107,634 |
|
|
78,000 |
|
| Payments under finance leases |
|
(746 |
) |
|
(671 |
) |
|
(2,197 |
) |
|
(1,980 |
) |
| Deferred financing fees |
|
(22 |
) |
|
- |
|
|
(1,426 |
) |
|
- |
|
| Net cash (used in) provided by financing activities |
|
(20,683 |
) |
|
2,726 |
|
|
28,529 |
|
|
3,816 |
|
| Effect of exchange rate differences on cash |
|
231 |
|
|
77 |
|
|
(293 |
) |
|
77 |
|
| (Decrease) increase in cash and cash equivalents |
|
(11,403 |
) |
|
1,095 |
|
|
(12,028 |
) |
|
(9,572 |
) |
| Cash and cash equivalents - Beginning of period |
|
35,088 |
|
|
23,700 |
|
|
35,713 |
|
|
34,367 |
|
| Cash and cash equivalents - End of period |
$ |
23,685 |
|
$ |
24,795 |
|
$ |
23,685 |
|
$ |
24,795 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Supplemental information |
|
|
|
|
|
|
|
|
|
|
|
|
| Cash paid for interest |
$ |
2,965 |
|
$ |
2,354 |
|
$ |
10,839 |
|
$ |
9,632 |
|
| Cash paid for income taxes |
$ |
(712 |
) |
$ |
1,998 |
|
$ |
45,434 |
|
$ |
13,674 |
|
| Cineplex Inc. |
| Interim Consolidated Supplemental Information |
| (Unaudited) |
| (expressed in thousands of Canadian dollars) |
Reconciliation to Adjusted EBITDA
| |
Three months ended September 30, |
|
|
Nine months ended September 30, |
|
| |
2016 |
|
2015 |
|
|
2016 |
|
2015 |
|
| Net income |
$ |
25,996 |
|
$ |
21,439 |
|
|
$ |
54,663 |
|
$ |
57,444 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Depreciation and amortization |
|
26,703 |
|
|
22,111 |
|
|
|
77,687 |
|
|
64,813 |
|
| Interest expense |
|
4,575 |
|
|
5,919 |
|
|
|
14,296 |
|
|
17,149 |
|
| Interest income |
|
(46 |
) |
|
(46 |
) |
|
|
(164 |
) |
|
(134 |
) |
| Current income tax expense |
|
9,002 |
|
|
8,761 |
|
|
|
17,853 |
|
|
21,836 |
|
| Deferred income tax expense (recovery) |
|
1,211 |
|
|
(300 |
) |
|
|
2,563 |
|
|
114 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| EBITDA |
$ |
67,441 |
|
$ |
57,884 |
|
|
$ |
166,898 |
|
$ |
161,222 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Loss on disposal of assets |
|
468 |
|
|
987 |
|
|
|
1,402 |
|
|
2,337 |
|
| CDCP equity income (i) |
|
(889 |
) |
|
(428 |
) |
|
|
(1,945 |
) |
|
(720 |
) |
| Non-controlling interests adjusted EBITDA of WGN and BSL |
|
218 |
|
|
34 |
|
|
|
746 |
|
|
34 |
|
| Depreciation and amortization - joint ventures (ii) |
|
10 |
|
|
522 |
|
|
|
29 |
|
|
1,539 |
|
| Joint venture taxes and interest (ii) |
|
12 |
|
|
82 |
|
|
|
38 |
|
|
227 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Adjusted EBITDA |
$ |
67,260 |
|
$ |
59,081 |
|
|
$ |
167,168 |
|
$ |
164,639 |
|
| (i) |
CDCP equity income not included in adjusted EBITDA as CDCP is a limited-life financing vehicle that is
funded by virtual print fees collected from distributors. |
| (ii) |
Includes the joint ventures with the exception of CDCP (see (i) above). |
| |
| Cineplex Inc. |
| Interim Consolidated Supplemental Information |
| (Unaudited) |
| (expressed in thousands of Canadian dollars, except number of shares and per share
data) |
Adjusted Free Cash Flow
| |
Three months ended September 30, |
|
Nine months ended September 30, |
|
| |
2016 |
|
2015 |
|
2016 |
|
2015 |
|
| Cash provided by operating activities |
$ |
36,597 |
|
$ |
36,272 |
|
$ |
34,600 |
|
$ |
74,248 |
|
| Less: Total capital expenditures net of proceeds on sale of assets |
|
(28,787 |
) |
|
(25,560 |
) |
|
(76,217 |
) |
|
(72,777 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Standardized free cash flow |
|
7,810 |
|
|
10,712 |
|
|
(41,617 |
) |
|
1,471 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Add/(Less): |
|
|
|
|
|
|
|
|
|
|
|
|
| Changes in operating assets and liabilities (i) |
|
16,025 |
|
|
9,280 |
|
|
100,395 |
|
|
49,937 |
|
| Changes in operating assets and liabilities of joint ventures (i) |
|
642 |
|
|
(2,135 |
) |
|
(229 |
) |
|
(362 |
) |
| Tenant inducements (ii) |
|
(1,291 |
) |
|
- |
|
|
(3,685 |
) |
|
(757 |
) |
| Principal component of finance lease obligations |
|
(746 |
) |
|
(671 |
) |
|
(2,197 |
) |
|
(1,980 |
) |
| Growth capital expenditures and other (iii) |
|
22,621 |
|
|
16,797 |
|
|
60,438 |
|
|
51,211 |
|
| Share of income of joint ventures, net of non-cash depreciation (iv) |
|
44 |
|
|
1,436 |
|
|
202 |
|
|
3,632 |
|
| Non-controlling interest EBITDA of WGN and BSL |
|
218 |
|
|
34 |
|
|
746 |
|
|
34 |
|
| |
Net cash received from CDCP (iv) |
|
1,568 |
|
|
407 |
|
|
2,370 |
|
|
1,163 |
|
| Adjusted free cash flow |
$ |
46,891 |
|
$ |
35,860 |
|
$ |
116,423 |
|
$ |
104,349 |
|
| Average number of Shares outstanding |
|
63,491,658 |
|
|
63,086,232 |
|
|
63,436,252 |
|
|
63,064,784 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Adjusted free cash flow per Share |
$ |
0.739 |
|
$ |
0.568 |
|
$ |
1.835 |
|
$ |
1.655 |
|
| Dividends declared |
$ |
0.405 |
|
$ |
0.390 |
|
$ |
1.195 |
|
$ |
1.150 |
|
| (i) |
Changes in operating assets and liabilities are not considered a source or use of adjusted free cash flow.
|
| (ii) |
Tenant inducements received are for the purpose of funding new theatre capital expenditures and are not
considered a source of adjusted free cash flow. |
| (iii) |
Growth capital expenditures and other represent expenditures on Board approved projects, exclude
maintenance capital expenditures, and are net of proceeds on asset sales. Cineplex's revolving facility is available to
fund Board approved projects. |
| (iv) |
Excludes the share of income of CDCP, as CDCP is a limited-life financing vehicle funded by virtual
print fees collected from distributors. Cash invested into CDCP, as well as cash distributions received from CDCP, are
considered to be uses and sources of adjusted free cash flow. |