OREANDA-NEWS. Cinemark Holdings, Inc. (NYSE: CNK), one of the largest motion picture exhibitors in the world, today reported results for the three and six months ended June 30, 2016.

Cinemark Holdings, Inc.’s total revenues for the three months ended June 30, 2016 were $744.4 million compared to $799.9 million for the three months ended June 30, 2015. For the three months ended June 30, 2016, admissions revenues were $456.1 million and concession revenues were $253.6 million. Concession revenues per patron increased 2.7% to $3.47 and average ticket price was $6.25 for the three months ended June 30, 2016.

Adjusted EBITDA for the three months ended June 30, 2016 was $168.4 million compared to $194.5 million for the three months ended June 30, 2015. 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 June 30, 2016 was approximately $53.9 million compared to $70.3 million for the three months ended June 30, 2015. Diluted earnings per share for the three months ended June 30, 2016 was $0.46 compared to $0.61 for the three months ended June 30, 2015.

“While our industry faced a challenging second quarter box office hurdle, given last year’s all-time record-setting benchmark, we are pleased that our continued execution on our key initiatives yet again enabled Cinemark to outperform the industry. Our U.S. segment surpassed the North American industry’s box office by 120 basis points in the second quarter, marking 27 out of the past 30 quarters of outperformance. Furthermore, our international segment continues to demonstrate recession-resistant strength, having attracted a consistent number of patrons despite last year’s all-time high, as well as the economic and political challenges that exist across Latin America,” stated Mark Zoradi, Cinemark’s Chief Executive Officer. Mr. Zoradi continued, “Year-to-date industry box office has increased more than 3% through July, which has surpassed everyone's expectations, and we remain enthusiastic about the film content for the remainder of this year, as well as coming years, and how it will appeal to our patrons.”

Cinemark Holdings, Inc.’s total revenues for the six months ended June 30, 2016 increased to $1,449.3 million from $1,445.3 million for the six months ended June 30, 2015. During the six months ended June 30, 2016, admissions revenues were $891.9 million and concession revenues increased 3.7% to $491.4 million. Attendance increased 2.3% to 145.5 million patrons. Concession revenues per patron increased 1.5% to $3.38 and average ticket price was $6.13 for the six months ended June 30, 2016.

Adjusted EBITDA for the six months ended June 30, 2016 increased 1.2% to $353.0 million, compared to $348.9 million for the six months ended June 30, 2015. 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 six months ended June 30, 2016 was $112.4 million compared to $112.8 million for the six months ended June 30, 2015. Net income for the six months ended June 30, 2016 was impacted by a loss on debt amendments and refinancing of $13.3 million, which was primarily due to the refinancing of the Company’s 7.375% senior subordinated notes with an add-on to the Company’s 4.875% senior notes. Diluted earnings per share for the six months ended June 30, 2016 was consistent with the six months ended June 30, 2015 at $0.97, even with the aforementioned loss on debt amendments and refinancing.

On June 30, 2016, the Company’s aggregate screen count was 5,888. As of June 30, 2016, the Company had signed commitments to open nine new theatres and 69 screens by the end of 2016 and open 12 new theatres with 109 screens subsequent to 2016.

 

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)
                   
      Three months ended June 30, Six months ended June 30,
     

2016

  

2015

2016

  

2015
Statement of income data:          
Revenues              
  Admissions   $ 456,075     $ 502,963   $ 891,895     $ 903,625  
  Concession     253,592       259,530     491,407       473,957  
  Other     34,737       37,439     65,971       67,748  
Total revenues     744,404       799,932     1,449,273       1,445,330  
Cost of operations              
  Film rentals and advertising     250,421       278,125     483,335       485,735  
  Concession supplies     39,208       40,903     75,111       73,406  
  Facility lease expense     80,252       82,391     159,056       162,008  
  Other theatre operating expenses     173,367       168,844     329,880       321,473  
  General and administrative expenses     35,987       39,277     73,853       77,202  
  Depreciation and amortization     52,358       46,569     101,687       91,901  
  Impairment of long-lived assets     1,425       3,528     1,917       4,322  
  Loss on sale of assets and other     5,824       5,802     4,045       4,352  
Total cost of operations     638,842       665,439     1,228,884       1,220,399  
Operating income     105,562       134,493     220,389       224,931  
  Interest expense (1)     (27,262 )     (28,304 )   (55,321 )     (56,511 )
  Loss on debt amendments and refinancing     (98 )     (925 )   (13,284 )     (925 )
  Distributions from NCM     193       —     8,736       8,499  
  Foreign currency gain (loss)     512       1,439     2,398       (6,767 )
  Other income     7,078       6,961     15,572       13,719  
Income before income taxes     85,985       113,664     178,490       182,946  
Income taxes     31,617       42,774     65,076       69,154  
Net income   $ 54,368     $ 70,890   $ 113,414     $ 113,792  
Less: Net income attributable to noncontrolling interests     462       632     983       1,013  
Net income attributable to Cinemark Holdings, Inc.   $ 53,906     $ 70,258   $ 112,431     $ 112,779  

Earnings per share attributable to Cinemark Holdings, Inc.’s common stockholders:

              
  Basic   $ 0.46     $ 0.61   $ 0.97     $ 0.97  
  Diluted   $ 0.46     $ 0.61   $ 0.97     $ 0.97  
                 
  Weighted average diluted shares outstanding     115,758       115,328     115,660       115,215  
                 
Other financial data:              
Adjusted EBITDA (2)   $ 168,395     $ 194,498   $ 353,042     $ 348,883  

________________________________
(1) Includes amortization of debt issue 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   As of
    June 30,   December 31,
   

2016

  

2015
Balance sheet data:        
Cash and cash equivalents   $ 583,600   $ 588,539
Theatre properties and equipment, net   $ 1,590,780   $ 1,505,069
Total assets   $ 4,215,693   $ 4,126,497
Long-term debt, including current portion   $ 1,789,392   $ 1,781,335
Equity   $ 1,200,066   $ 1,110,813
         
         
    Three months ended   Six months ended
    June 30,   June 30,
   

2016

  

2015

  

2016

  

2015
Other operating data:                
  Attendance (patrons, in millions):                
  Domestic     45.5     49.0     90.0     90.5
  International     27.5     27.7     55.5     51.7
  Worldwide     73.0     76.7     145.5     142.2
                   
  Average ticket price (in dollars):                
  Domestic   $ 7.59   $ 7.67   $ 7.59   $ 7.42
  International   $ 4.03   $ 4.60   $ 3.77   $ 4.49
  Worldwide   $ 6.25   $ 6.56   $ 6.13   $ 6.35
                   
  Concession revenues per patron (in dollars):                
  Domestic   $ 4.26   $ 3.98   $ 4.20   $ 3.92
  International   $ 2.17   $ 2.33   $ 2.05   $ 2.31
  Worldwide   $ 3.47   $ 3.38   $ 3.38   $ 3.33
                   
  Average screen count (month end average):                
  Domestic     4,566     4,498     4,543     4,497
  International     1,298     1,209     1,291     1,196
  Worldwide     5,864     5,707     5,834     5,693
                           
           
  Segment Information
  (unaudited, in thousands)
           
      Three months ended   Six months ended
      June 30,   June 30,
     

2016

  

2015

  

2016

  

2015
Revenues                
  U.S.   $ 560,534     $ 592,482     $ 1,104,449     $ 1,066,777  
  International     187,561       211,505       351,736       385,838  
  Eliminations     (3,691 )     (4,055 )     (6,912 )     (7,285 )
  Total revenues   $ 744,404     $ 799,932     $ 1,449,273     $ 1,445,330  
Adjusted EBITDA                
  U.S.   $ 127,845     $ 144,649     $ 271,478     $ 259,020  
  International     40,550       49,849       81,564       89,863  
  Total Adjusted EBITDA   $ 168,395     $ 194,498     $ 353,042     $ 348,883  
Capital expenditures                
U.S.   $ 58,182     $ 43,947     $ 99,380     $ 118,214  
International     25,597       26,018       32,144       37,498  
Total capital expenditures   $ 83,779     $ 69,965     $ 131,524     $ 155,712  
                                 
   
  Reconciliation of Adjusted EBITDA
  (unaudited, in thousands)
       
      Three months ended   Six months ended
  June 30,   June 30,
     

2016

  

2015

  

2016

  

2015
Net income   $ 54,368     $ 70,890     $ 113,414     $ 113,792  
  Income taxes     31,617       42,774       65,076       69,154  
  Interest expense     27,262       28,304       55,321       56,511  
  Other income     (7,590 )     (8,400 )     (17,970 )     (6,952 )
  Loss on debt amendments and refinancing     98       925       13,284       925  
  Other cash distributions from equity investees (2)     184       1,045       8,270       8,309  
  Depreciation and amortization     52,358       46,569       101,687       91,901  
  Impairment of long-lived assets     1,425       3,528       1,917       4,322  
  Loss on sale of assets and other     5,824       5,802       4,045       4,352  
  Deferred lease expenses - theatres (3)     26       (351 )     (182 )     (819 )
  Deferred lease expenses – DCIP equipment (4)     (233 )     (234 )     (465 )     (469 )
  Amortization of long-term prepaid rents (3)     514       669       985       1,382  
  Share based awards compensation expense (5)     2,542       2,977       7,660       6,475  
Adjusted EBITDA (1)   $ 168,395     $ 194,498     $ 353,042     $ 348,883