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8-K - FORM 8-K - Cinemark Holdings, Inc.d84008e8vk.htm
Exhibit 99.1
(LOGO)
CINEMARK HOLDINGS, INC. REPORTS Q2 2011 ADJUSTED EBITDA OF $149.8 MILLION ON REVENUES OF $620.6 MILLION
Plano, TX, August 5, 2011 — 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, 2011.
Cinemark Holdings, Inc.’s revenues for the three months ended June 30, 2011 increased 15.1% to $620.6 million from $539.4 million for the three months ended June 30, 2010. For the three months ended June 30, 2011, admissions revenues increased 15.0% to $405.9 million and concession revenues increased 14.6% to $189.3 million. The increases were primarily related to a 9.8% increase in attendance, a 4.6% increase in average ticket price and a 4.4% increase in concession revenues per patron.
Adjusted EBITDA for the three months ended June 30, 2011 increased 19.7% to $149.8 million from $125.1 million for the three months ended June 30, 2010. 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, 2011 was $40.4 million compared to $39.7 million for the three months ended June 30, 2010. Net income for the three months ended June 30, 2011 included a loss on early retirement of debt of approximately $4.9 million, before income taxes. The loss on early retirement of debt was recorded as a result of a prepayment of $157.2 million of our term loan debt utilizing a portion of the proceeds from the issuance of our new $200 million aggregate principal amount of 7.375% senior subordinated notes due 2021, at par value, which occurred during June 2011.
“This quarter Cinemark generated its highest ever quarterly worldwide attendance and as a result we achieved our highest ever quarterly Adjusted EBITDA. This record performance extended our domestic industry box office out-performance streak to eleven straight quarters,” stated Cinemark Chief Executive Officer Alan Stock. “Our international circuit continues to distinguish itself with attendance growth of approximately four times the US industry rate for the quarter.”
Cinemark Holdings, Inc.’s revenues for the six months ended June 30, 2011 increased 4.5% to $1,103.7 million from $1,056.0 million for the six months ended June 30, 2010. During the six months ended June 30, 2011, admissions revenues increased 3.1% to $717.6 million and concession revenues increased 5.6% to $336.0 million. The increases were primarily related to a 2.0% increase in average ticket price, a 4.5% increase in concession revenues per patron and a 1.0% increase in attendance.
Adjusted EBITDA for the six months ended June 30, 2011 increased 2.3% to $252.5 million from $246.9 million for the six months ended June 30, 2010. 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, 2011 was $65.4 million compared to $74.8 million for the six months ended June 30, 2010. Net income for the six months ended June 30, 2011 included a loss on early retirement of debt of approximately $4.9 million, before income taxes, as discussed above.
On June 30, 2011, the Company’s aggregate screen count was 4,983. As of June 30, 2011, the Company had signed commitments to open seven new theatres with 68 screens by the end of 2011 and open 18 new theatres with 190 screens subsequent to 2011.
The Company’s board of directors declared a cash dividend for its 2011 second quarter of $0.21 per share of common stock. The dividend will be paid on September 1, 2011 to stockholders of record on August 17, 2011.
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 www.cinemark.com in the Investor Relations section and archived for a limited time immediately following the call.

 


 

Call Replay: until August 8, 2011 via (855) 259-2056 or (404) 537-3406, passcode: 86621313.
About Cinemark Holdings, Inc.
Cinemark is a leading domestic and international motion picture exhibitor, operating 436 theatres with 4,983 screens in 39 U.S. states, Brazil, Mexico and 11 other Latin American countries as of June 30, 2011. For more information go to www.cinemark.com.
Contacts:
Robert Copple — 972/665-1500
Robert Rinderman — Jaffoni & Collins — 212/835-8500 or CNK@jcir.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 March 1, 2011 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.

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Cinemark Holdings, Inc.
Financial and Operating Summary
(unaudited, in thousands)
                                 
    Three months ended June 30,     Six months ended June 30,  
    2011     2010     2011     2010  
Statement of income data:
                               
Revenues
                               
Admissions
  $ 405,917     $ 353,085     $ 717,609     $ 696,075  
Concession
    189,353       165,230       336,034       318,334  
Other
    25,323       21,054       50,086       41,591  
     
Total revenues
    620,593       539,369       1,103,729       1,056,000  
Cost of operations
                               
Film rentals and advertising
    222,620       193,550       387,773       382,369  
Concession supplies
    29,628       24,494       52,910       46,900  
Facility lease expense
    69,367       61,990       135,793       124,705  
Other theatre operating expenses
    123,605       113,898       233,511       221,661  
General and administrative expenses
    31,187       24,946       60,173       50,476  
Depreciation and amortization
    39,897       34,915       79,037       69,006  
Impairment of long-lived assets
    1,594       4,688       2,609       5,035  
Loss on sale of assets and other
    5,694       1,191       6,166       4,358  
     
Total cost of operations
    523,592       459,672       957,972       904,510  
     
Operating income
    97,001       79,697       145,757       151,490  
Interest expense (1)
    (29,777 )     (28,605 )     (59,067 )     (54,615 )
Distributions from NCM
    1,559       1,332       11,422       11,278  
Loss on early retirement of debt
    (4,945 )           (4,945 )      
Other income (expense)
    443       (1,454 )     5,473       (642 )
     
Income before income taxes
    64,281       50,970       98,640       107,511  
Income taxes
    23,272       10,211       32,309       30,041  
     
Net income
  $ 41,009     $ 40,759     $ 66,331     $ 77,470  
Less: Net income attributable to noncontrolling interests
    598       1,077       957       2,695  
     
Net income attributable to Cinemark Holdings, Inc.
  $ 40,411     $ 39,682     $ 65,374     $ 74,775  
     
Earnings per share attributable to Cinemark Holdings, Inc.’s common stockholders:
                               
Basic
  $ 0.35     $ 0.35     $ 0.57     $ 0.67  
     
Diluted
  $ 0.35     $ 0.35     $ 0.57     $ 0.67  
     
 
                               
Weighted average diluted shares outstanding
    113,209       111,552       113,080       111,299  
     
 
                               
Other financial data:
                               
Adjusted EBITDA (2)
  $ 149,791     $ 125,116     $ 252,497     $ 246,897  
     
     
(1)
  Includes amortization of debt issue costs and excludes capitalized interest.
(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,  
    2011     2010  
Balance sheet data:
               
Cash and cash equivalents
  $ 550,904     $ 464,997  
Theatre properties and equipment, net
  $ 1,218,221     $ 1,215,446  
Total assets
  $ 3,503,509     $ 3,421,478  
Long-term debt, including current portion
  $ 1,570,604     $ 1,532,441  
Equity
  $ 1,079,091     $ 1,033,152  

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    Three months ended     Six months ended  
    June 30,     June 30,  
    2011     2010     2011     2010  
Other operating data:
                               
Attendance (patrons):
                               
Domestic
    43,915       41,658       77,304       81,231  
International
    22,245       18,526       42,627       37,460  
     
Worldwide
    66,160       60,184       119,931       118,691  
     
 
                               
Average ticket price (in dollars):
                               
Domestic
  $ 6.64     $ 6.47     $ 6.53     $ 6.51  
International
  $ 5.16     $ 4.51     $ 4.99     $ 4.47  
Worldwide
  $ 6.14     $ 5.87     $ 5.98     $ 5.86  
 
                               
Concession revenues per patron (in dollars):
                               
Domestic
  $ 3.19     $ 3.12     $ 3.17     $ 3.06  
International
  $ 2.23     $ 1.91     $ 2.14     $ 1.87  
Worldwide
  $ 2.86     $ 2.74     $ 2.80     $ 2.68  
 
                               
Average screen count (month end average):
                               
Domestic
    3,835       3,827       3,829       3,827  
International
    1,132       1,070       1,126       1,068  
     
Worldwide
    4,967       4,897       4,955       4,895  
     
Segment Information
(unaudited, in thousands)
                                 
    Three months ended     Six months ended  
    June 30,     June 30,  
    2011     2010     2011     2010  
Revenues
                               
U.S.
  $ 444,479     $ 410,964     $ 775,345     $ 799,579  
International
    178,720       129,641       333,191       258,912  
Eliminations
    (2,606 )     (1,236 )     (4,807 )     (2,491 )
 
                       
Total revenues
  $ 620,593     $ 539,369     $ 1,103,729     $ 1,056,000  
 
                       
Adjusted EBITDA (1)
                               
U.S.
  $ 110,015     $ 96,548     $ 178,806     $ 185,953  
International
    39,776       28,568       73,691       60,944  
 
                       
Total adjusted EBITDA
  $ 149,791     $ 125,116     $ 252,497     $ 246,897  
 
                       
Capital expenditures
                               
U.S.
  $ 27,977     $ 23,508     $ 39,445     $ 36,008  
International
    21,556       13,935       45,857       20,952  
 
                       
Total capital expenditures
  $ 49,533     $ 37,443     $ 85,302     $ 56,960  
 
                       

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Reconciliation of Adjusted EBITDA
(unaudited, in thousands)
                                 
    Three months ended     Six months ended  
    June 30,     June 30,  
    2011     2010     2011     2010  
Net income
  $ 41,009     $ 40,759     $ 66,331     $ 77,470  
Income taxes
    23,272       10,211       32,309       30,041  
Interest expense
    29,777       28,605       59,067       54,615  
Loss on early retirement of debt
    4,945             4,945        
Other (income) expense
    (443 )     1,454       (5,473 )     642  
Depreciation and amortization
    39,897       34,915       79,037       69,006  
Impairment of long-lived assets
    1,594       4,688       2,609       5,035  
Loss on sale of assets and other
    5,694       1,191       6,166       4,358  
Deferred lease expenses — theatres (2)
    243       801       539       1,551  
Deferred lease expenses — DCIP equipment (3)
    627       113       1,111       146  
Amortization of long-term prepaid rents (2)
    617       438       1,284       779  
Share based awards compensation expense (4)
    2,559       1,941       4,572       3,254  
     
Adjusted EBITDA (1)
  $ 149,791     $ 125,116     $ 252,497     $ 246,897  
     
     
(1)
  Adjusted EBITDA as calculated in the chart above represents net income before income taxes, interest expense, loss on early retirement of debt, other (income) expense, depreciation and amortization, impairment of long-lived assets, loss on sale of assets and other, changes in deferred lease expense, amortization of long-term prepaid rents and share based awards compensation expense. Adjusted EBITDA is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to net income as an indicator of operating performance or as an alternative to cash flow provided by operating activities as a measure of liquidity (as determined in accordance with GAAP). Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. We have included Adjusted EBITDA because we believe it provides management and investors with additional information to measure our performance and liquidity, estimate our value and evaluate our ability to service debt. In addition, we use Adjusted EBITDA for incentive compensation purposes.
(2)
  Non-cash expense included in facility lease expense.
(3)
  Non-cash expense included in other theatre operating expenses.
(4)
  Non-cash expense included in general and administrative expenses.

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