PLANO, Texas--(BUSINESS WIRE)--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, 2016 and announced that its Board of Directors has increased its cash dividend by 7.4% to $1.16 per share of common stock on an annualized basis, effective immediately. The fourth quarter dividend of $0.29 will be paid on March 20, 2017 to stockholders of record on March 8, 2017.
Cinemark Holdings, Inc.’s total revenues for the three months ended December 31, 2016 were $700.9 million compared to $707.2 million for the three months ended December 31, 2015. For the three months ended December 31, 2016, admissions revenues were $424.4 million and concession revenues were $237.3 million. Average ticket price was $6.48 and concession revenues per patron was $3.62 for the three months ended December 31, 2016.
Net income attributable to Cinemark Holdings, Inc. for the three months ended December 31, 2016 was $77.0 million compared to $57.8 million for the three months ended December 31, 2015. The Company recorded a net income tax benefit of $2.2 million during the three months ended December 31, 2016, which was primarily a result of the implementation of a foreign holding and financing structure that increased the Company’s ability to use foreign tax credits that had previously carried a full valuation allowance. Diluted earnings per share for the three months ended December 31, 2016 was $0.66 compared to $0.50 for the three months ended December 31, 2015.
Adjusted EBITDA for the three months ended December 31, 2016 was $168.2 million compared to $174.8 million for the three months ended December 31, 2015. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release and at investors.cinemark.com.
“It was a banner year for the North American industry box office, achieving its 4th all-time high in the past 5 years,” stated Mark Zoradi, Cinemark’s Chief Executive Officer. “Cinemark’s domestic operations outperformed the North American industry box office by 100 basis points, and globally we set numerous records, including total revenues of nearly $3 billion, net income of $255 million and Adjusted EBITDA of more than $706 million. Furthermore, our ability to increase our dividend, while continuing to actively invest in growth initiatives, is indicative of the consistent strength of our balance sheet, as well as our confidence in Cinemark.”
Cinemark Holdings, Inc.’s total revenues for the year ended December 31, 2016 increased 2.3% to $2,918.8 million from $2,852.6 million for the year ended December 31, 2015. For the year ended December 31, 2016, admissions revenues increased 1.3% to $1,789.2 million and concession revenues increased 5.7% to $990.1 million. Average ticket price was $6.23 and concession revenues per patron was $3.45 for the year ended December 31, 2016.
Net income attributable to Cinemark Holdings, Inc. for the year ended December 31, 2016 was $255.1 million compared to $216.9 million for the year ended December 31, 2015. Diluted earnings per share for the year ended December 31, 2016 was $2.19 compared to $1.87 for the year ended December 31, 2015.
Adjusted EBITDA for the year ended December 31, 2016 increased 3.4% to $706.1 million from $682.8 million for the year ended December 31, 2015. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release and at investors.cinemark.com.
As of December 31, 2016, the Company’s aggregate screen count was 5,903 and the Company had commitments to open eight new theatres and 69 screens during 2017 and seven new theatres and 76 screens subsequent to 2017.
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 526 theatres with 5,903 screens in 41 U.S. states, Brazil, Argentina and 13 other Latin American countries as of December 31, 2016. 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, 2017 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, | |||||||||||||||||||
|
2016 |
2015 |
2016 |
2015 |
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| Statement of Income Data: | ||||||||||||||||||||
| Revenues | ||||||||||||||||||||
| Admissions | $ | 424,400 | $ | 429,758 | $ | 1,789,137 | $ | 1,765,519 | ||||||||||||
| Concession | 237,305 | 232,780 | 990,103 | 936,970 | ||||||||||||||||
| Other | 39,213 | 44,685 | 139,525 | 150,120 | ||||||||||||||||
| Total revenues | 700,918 | 707,223 | 2,918,765 | 2,852,609 | ||||||||||||||||
| Cost of operations | ||||||||||||||||||||
| Film rentals and advertising | 229,554 | 232,334 | 962,655 | 945,640 | ||||||||||||||||
| Concession supplies | 37,470 | 34,825 | 154,469 | 144,270 | ||||||||||||||||
| Salaries and wages | 81,932 | 78,838 | 325,765 | 301,099 | ||||||||||||||||
| Facility lease expense | 79,390 | 77,149 | 321,294 | 319,761 | ||||||||||||||||
| Utilities and other | 90,420 | 86,649 | 355,926 | 355,801 | ||||||||||||||||
| General and administrative expenses | 34,212 | 40,435 | 143,355 | 156,736 | ||||||||||||||||
| Depreciation and amortization | 53,197 | 49,762 | 209,071 | 189,206 | ||||||||||||||||
| Impairment of long-lived assets | 513 | 3,846 | 2,836 | 8,801 | ||||||||||||||||
| Loss on sale of assets and other | 9,474 | 4,291 | 20,459 | 8,143 | ||||||||||||||||
| Total cost of operations | 616,162 | 608,129 | 2,495,830 | 2,429,457 | ||||||||||||||||
| Operating income | 84,756 | 99,094 | 422,935 | 423,152 | ||||||||||||||||
| Interest expense (1) | (26,333 | ) | (27,811 | ) | (108,313 | ) | (112,741 | ) | ||||||||||||
| Loss on debt amendments and refinancing | (161 | ) | – | (13,445 | ) | (925 | ) | |||||||||||||
| Distributions from NCM | 4,539 | 5,040 | 14,656 | 18,140 | ||||||||||||||||
| Foreign currency exchange gain (loss) | 3,572 | 1,909 | 6,455 | (16,793 | ) | |||||||||||||||
| Other income | 8,731 | 9,679 | 38,358 | 36,834 | ||||||||||||||||
| Income before income taxes | 75,104 | 87,911 | 360,646 | 347,667 | ||||||||||||||||
| Income taxes | (2,183 | ) | 29,676 | 103,819 | 128,939 | |||||||||||||||
| Net income | $ | 77,287 | $ | 58,235 | $ | 256,827 | $ | 218,728 | ||||||||||||
| Less: Net income attributable to noncontrolling interests | 282 | 484 | 1,736 | 1,859 | ||||||||||||||||
| Net income attributable to Cinemark Holdings, Inc. | $ | 77,005 | $ | 57,751 | $ | 255,091 | $ | 216,869 | ||||||||||||
| Earnings per share attributable to Cinemark Holdings, Inc.’s common stockholders: | ||||||||||||||||||||
| Basic | $ | 0.66 | $ | 0.50 | $ | 2.19 | $ | 1.87 | ||||||||||||
| Diluted | $ | 0.66 | $ | 0.50 | $ | 2.19 | $ | 1.87 | ||||||||||||
| Weighted average diluted shares outstanding | 115,852 | 115,463 | 115,783 | 115,399 | ||||||||||||||||
| Other Financial Data: | ||||||||||||||||||||
| Adjusted EBITDA (2) | $ | 168,170 | $ | 174,752 | $ | 706,103 | $ | 682,782 | ||||||||||||
| (1) | Includes amortization of debt issuance costs. | |
| (2) | Adjusted EBITDA is a non-GAAP financial measure. A reconciliation of net income, the most directly comparable GAAP measure, to Adjusted EBITDA is provided in the financial schedules accompanying this press release. |
| As of | ||||||||
| December 31, | ||||||||
|
2016 |
2015 |
|||||||
| Balance Sheet Data (unaudited, in thousands): | ||||||||
| Cash and cash equivalents | $ | 561,235 | $ | 588,539 | ||||
| Theatre properties and equipment, net | $ | 1,704,536 | $ | 1,505,069 | ||||
| Total assets | $ | 4,306,633 | $ | 4,126,497 | ||||
| Long-term debt, including current portion | $ | 1,788,112 | $ | 1,781,335 | ||||
| Equity | $ | 1,272,960 | $ | 1,110,813 | ||||
|
Segment Information (1) |
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|
(unaudited, in thousands) |
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| Three Months Ended | Year Ended | |||||||||||||||||||
| December 31, | December 31, | |||||||||||||||||||
|
2016 |
2015 |
2016 |
2015 |
|||||||||||||||||
| Revenues | ||||||||||||||||||||
| U.S. | $ | 553,328 | $ | 561,626 | $ | 2,230,693 | $ | 2,137,733 | ||||||||||||
| International | 150,361 | 148,400 | 701,573 | 728,735 | ||||||||||||||||
| Eliminations | (2,771 | ) | (2,803 | ) | (13,501 | ) | (13,859 | ) | ||||||||||||
| Total revenues | $ | 700,918 | $ | 707,223 | $ | 2,918,765 | $ | 2,852,609 | ||||||||||||
| Adjusted EBITDA | ||||||||||||||||||||
| U.S. | $ | 139,395 | $ | 144,287 | $ | 548,413 | $ | 516,366 | ||||||||||||
| International | 28,775 | 30,465 | 157,690 | 166,416 | ||||||||||||||||
| Total Adjusted EBITDA | $ | 168,170 | $ | 174,752 | $ | 706,103 | $ | 682,782 | ||||||||||||
| Capital expenditures | ||||||||||||||||||||
| U.S. | $ | 67,053 | $ | 56,131 | $ | 242,271 | $ | 223,213 | ||||||||||||
| International | 29,509 | 43,244 | 84,637 | 108,513 | ||||||||||||||||
| Total capital expenditures | $ | 96,562 | $ | 99,375 | $ | 326,908 | $ | 331,726 | ||||||||||||
| (1) | For additional segment results and discussion, including a presentation of results for our international segment in constant currency, see the “Results of Operations” section of Item 7 in the Company’s Annual Report on Form 10-K filed February 23, 2017. |
| Reconciliation of Adjusted EBITDA | ||||||||||||||||||||
| (unaudited, in thousands) | ||||||||||||||||||||
| Three months ended | Year ended | |||||||||||||||||||
| December 31, | December 31, | |||||||||||||||||||
|
2016 |
2015 |
2016 |
2015 |
|||||||||||||||||
| Net income | $ | 77,287 | $ | 58,235 | $ | 256,827 | $ | 218,728 | ||||||||||||
| Income taxes | (2,183 | ) | 29,676 | 103,819 | 128,939 | |||||||||||||||
| Interest expense | 26,333 | 27,811 | 108,313 | 112,741 | ||||||||||||||||
| Other income | (12,303 | ) | (11,588 | ) | (44,813 | ) | (20,041 | ) | ||||||||||||
| Loss on debt amendments and refinancing | 161 | — | 13,445 | 925 | ||||||||||||||||
| Other cash distributions from equity investees (2) | 12,255 | 6,348 | 21,916 | 19,027 | ||||||||||||||||
| Depreciation and amortization | 53,197 | 49,762 | 209,071 | 189,206 | ||||||||||||||||
| Impairment of long-lived assets | 513 | 3,846 | 2,836 | 8,801 | ||||||||||||||||
| Loss on sale of assets and other | 9,474 | 4,291 | 20,459 | 8,143 | ||||||||||||||||
| Deferred lease expenses – theatres (3) | 61 | 234 | (50 | ) | (874 | ) | ||||||||||||||
| Deferred lease expenses – projectors (4) | (242 | ) | (231 | ) | (940 | ) | (932 | ) | ||||||||||||
| Amortization of long-term prepaid rents (3) | 470 | 460 | 1,826 | 2,361 | ||||||||||||||||
| Share based awards compensation expense (5) | 3,147 | 5,908 | 13,394 | 15,758 | ||||||||||||||||
| Adjusted EBITDA (1) | $ | 168,170 | $ | 174,752 | $ | 706,103 | $ | 682,782 | ||||||||||||
| (1) | Adjusted EBITDA as calculated in the chart above represents net income before income taxes, interest expense, other income, loss on debt amendments and refinancing, other cash distributions from equity investees, 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. Adjusted EBITDA margin represents Adjusted EBITDA divided by total revenues. | |
| (2) | Represents cash distributions received from equity investees that were recorded as a reduction of the respective investment balances. Adjusted EBITDA for the three months and year ended December 31, 2015 has been adjusted to reflect a comparable presentation. | |
| (3) | Non-cash expense included in facility lease expense. | |
| (4) | Non-cash expense included in other theatre operating expenses. | |
| (5) | Non-cash expense included in general and administrative expenses. |
