Quarter Ended

Nine Months Ended

September 30,

September 30,

% Change

September 30,

September 30,

% Change

(Dollars in millions, except EPS)

2015

2014

Better/(Worse)

2015

2014

Better/(Worse)

Revenue

$

$

%

$

$

%

    - US

%

%

    - Australia

%

%

    - New Zealand

%

%

Segment operating income (1)

$

$

%

$

$

%

Basic EPS (2)

$

$

%

$

$

%

EBITDA (1)

$

$

%

$

$

%

·

EBITDA for the current nine-month period represents the highest figure in the history of the Company.

·

Net income and EPS for the current nine-month period represent the second best results in the history of the Company.

·

Cinema activities

§

In October, we reopened our Carmel Mountain theater in San Diego as an Angelika Film Center and Café featuring luxury recliners. Dedicated to exhibiting quality films and events, the sleek and modern Angelika Film Center & Cafe is a unique venue for San Diego’s culturally rich

community, offering diverse programming and a creative menu of craft beverages and foods. Each of the 12 elegantly-appointed auditoria at the new Angelika feature full-recliner luxury seats in a stadium setting, pristine digital projection by Barco, the leader in digital cinema technology, Dolby 7.1 sound system, and reserved seating for a leisurely cinematic experience. With state-of-the-art digital presentation capabilities and events specialists, the Angelika is an ideal venue for a range of meetings and events, from corporate presentations to private gatherings.

§

In September 2015, we reopened our completely refurbished Reading Cinemas at Harbour Town Shopping Center on the Gold Coast in Queensland, Australia, which is the largest theater by screen count on the Gold Coast and is a key asset within the group, having entertained more than ten million customers over the past fifteen years. The highlight of this renovation was the inclusion of our premium large format auditorium, TITAN XC (Extreme Cinema), which features a 66-feet wide ‘wall-to-wall’ screen and Dolby Atmos, a fully immersive sound system.  The renovation also included finish upgrades in the cinema’s affordable luxury ‘dine-in’ cinema, combining a fully licensed lounge bar and a full food menu.

§

Reflecting our dedication to providing our guests a premium presentation, the Company entered into its first license agreement with IMAX.   The Company is in the process of converting one of its auditoriums at the cinema at the Valley Plaza Mall in Bakersfield, California to an IMAX presentation. 

·

Real estate activities

§

We are continuing to progress the development of our Union Square property located in Manhattan. We have (i) received authorization from the Landmarks Commission to redevelop the property, adding approximately 23,000 square footage of rentable space to the current 46,000 square foot building for a total of approximately 69,000 square feet of rentable space, (ii) entered into a Development Management Agreement with Edifice Real Estate Partners, LLC, to assist in the supervision and administration of the project, (iii) entered into a real estate brokerage agreement with Newmark Grubb Knight Frank to serve as our exclusive marketing agent, and  (iv) retained Gensler to assist with space layout and interior design. We filed our application for a variance with the Board of Standards and Approvals and on October 8, 2015, the Manhattan Community Board 5 recommended approval of our variance application. We now have vacant possession of most of the building and arrangements for the vacation of the first floor retail space by the end of the year.  While no assurances can be given, it is our current intention to commence pre-construction in the first quarter of 2016.

§

Regarding our Cinemas 1, 2, 3 property in Manhattan, we have received the consent of our minority member to the redevelopment of the property. We are evaluating the potential to redevelop the property as a mixed use retail and residential and/or hotel property.  We are currently working with the owners of the adjacent property on a feasibility study  for the joint development of our properties as a mixed-use property. The combination of the properties would accommodate up to approximately 94,120 square feet of leasable space, calculated without reference of up to approximately 15,050 square feet of bonus space, depending upon use and availability of transferable development rights at commercially reasonable prices.

§

In Australia, we received Brisbane City Planning Council approval in June 2015 for the construction of an eight-screen cinema complex with 10,000 square feet (950 square meters) of specialty retail to be located below the cinema and additional mezzanine level parking at our existing Newmarket (Brisbane, Australia) shopping center.  Construction is expected to commence in the second quarter of 2016, with a projected opening in the fourth quarter of 2017.   On March 6, 2015, we acquired an adjacent 23,000 square foot parcel currently improved with a 21,000 square foot office building.  It is our intention to integrate this property into our Newmarket shopping center over time.

§

In Australia, we have also been active in the upgrading of our Red Yard entertainment themed retail center (“ETRC”) Sydney. We are in the process of adding approximately 27,000 additional square foot of retail, majority of which is pre-leased.

§

In New Zealand, we received town planning approval in May 2015 from the Wellington City Council for a $10.9 million (NZ$17.0 million) supermarket development project at our Courtenay Central ETRC (Wellington, New Zealand).  We are currently reviewing the supermarket design and construction costs and expect to advance negotiations with our lessee in November 2015. In addition, we currently intend to add approximately 4,500 square feet of additional general retail within the existing shopping center shell.  We are currently upgrading our parking structure to a level where it will be the safest (from an earthquake perspective) parking structure in Wellington which we believe will give us a competitive advantage not only in terms of term parking but also as an amenity to our shopping center and cinema.

Quarter Ended

Nine Months Ended

September 30,

September 30,

% Change

September 30,

September 30,

% Change

(Dollars in thousands)

2015

2014

Better / (Worse)

2015

2014

Better / (Worse)

Segment revenue

  Cinema

     United States

$

$

 -

%

$

$

%

     Australia

%

%

     New Zealand

%

%

       Total

$

$

%

$

$

 -

  Real estate

     United States

$

$

%

$

$

%

     Australia

%

%

     New Zealand

%

%

       Total

$

$

%

$

$

%

  Inter-segment elimination

%

%

Total segment revenue

$

$

%

$

$

%

Segment operating income (loss)

  Cinema

     United States

$

$

%

$

$

%

     Australia

%

%

     New Zealand

%

%

       Total

$

$

%

$

$

%

  Real estate

     United States

$

$

%

$

$

%

     Australia

%

%

     New Zealand

%

%

       Total

$

$

%

$

$

%

Total segment operating income (1)

$

$

%

$

$

%

Quarter Ended

Nine Months Ended

September 30,

September 30,

% Change

September 30,

September 30,

% Change

(Dollars in thousands)

2015

2014

Better/(Worse)

2015

2014

Better/(Worse)

Segment operating income

$

$

%

$

$

%

Non-segment:

  General and administrative expense

%

%

  Interest expense, net

%

%

  Gain on sale of assets

 -

nm

>100%

  Other

%

%

Total non-segment expense

$

$

$

$

Income before income taxes

%

%

Income tax expense

%

%

Net income

$

$

%

$

$

%

Net loss attributable to noncontrolling interests

 -

nm

>100%

Net income attributable to RDI common stockholders

$

$

%

$

$

%

As of September 30, 2015

(Dollars in thousands)

Contractual Capacity

Capacity Used

Unused Capacity

Bank of America Credit Facility (USA)

$

$

$

Bank of America Line of Credit (USA)

 -

NAB Corporate Term Loan (AU) (1)

 -

NAB Corporate Credit Facility (AU) (1)

 -

Westpac Corporate Credit Facility (NZ) (1)

Total

$

$

$

Quarter Ended

Nine Months Ended

September 30,

September 30,

September 30,

September 30,

(Dollars in thousands)

2015

2014

2015

2014

Net Income

$

$

$

$

Add: Interest expense, net

Add: Income tax expense

Add: Depreciation and amortization

EBITDA

$

$

$

$

·

the development, ownership, and operation of multiplex cinemas in the United States, Australia and New Zealand; and

·

the development, ownership, and operation of retail and commercial real estate in Australia, New Zealand, and the United States, including entertainment-themed retail centers (“ETRC”) in Australia and New Zealand and live theater assets in Manhattan and Chicago in the United States.

·

in the United States, under the

o

Reading Cinema brand (http://www.readingcinemasus.com);

o

Angelika Film Center brand (http://www.angelikafilmcenter.com);

o

Consolidated Theatres brand (http://www.consolidatedtheatres.com);

o

City Cinemas brand (http://www.citycinemas.com);

o

Beekman Theatre brand (http://www.beekmantheatre.com);

o

The Paris Theatre brand (http://www.theparistheatre.com);

o

Liberty Theatres brand (http://libertytheatresusa.com); and

o

Village East Cinema brand (http://villageeastcinema.com)

·

in Australia, under the

o

Reading Cinema brand (http://www.readingcinemas.com.au);  

o

Newmarket brand (http://readingnewmarket.com.au);  and

o

Red Yard brand (http://www.redyard.com.au)

·

in New Zealand, under the

o

Reading brand (http://www.readingcinemas.co.nz);

o

Rialto brand (http://www.rialto.co.nz);

o

Reading Properties brand (http://readingproperties.co.nz);

o

Courtenay Central brand (http://www.readingcourtenay.co.nz); and

o

Steer n’ Beer restaurant brand (http://steernbeer.co.nz)

·

With respect to our cinema operations:

o

The number and attractiveness to movie goers of the films released in future periods;

o

The amount of money spent by film distributors to promote their motion pictures;

o

The licensing fees and terms required by film distributors from motion picture exhibitors in order to exhibit their films;

o

The comparative attractiveness of motion pictures as a source of entertainment and willingness and/or ability of consumers (i) to spend their dollars on entertainment and (ii) to spend their entertainment dollars on movies in an outside the home environment; and

o

The extent to which we encounter competition from other cinema exhibitors, from other sources of outside of the home entertainment, and from inside the home entertainment options, such as “home theaters” and competitive film product distribution technology such as, by way of example, cable, satellite broadcast, DVD rentals and sales, and online streaming.

·

With respect to our real estate development and operation activities:

o

The rental rates and capitalization rates applicable to the markets in which we operate and the quality of properties that we own;

o

The extent to which we can obtain on a timely basis the various land use approvals and entitlements needed to develop our properties;

o

the risks and uncertainties associated with real estate development;

o

The availability and cost of labor and materials;

o

Competition for development sites and tenants;

o

The extent to which our cinemas can continue to serve as an anchor tenant that will, in turn, be influenced by the same factors as will influence generally the results of our cinema operations; and

o

Certain of our activities are in geologically active areas, creating a risk of damage and/or disruption of real estate and/or cinema businesses from earthquakes.

·

With respect to our operations generally as an international company involved in both the development and operation of cinemas and the development and operation of real estate; and previously engaged for many years in the railroad business in the United States:

o

Our ongoing access to borrowed funds and capital and the interest that must be paid on that debt and the returns that must be paid on such capital;

o

The relative values of the currency used in the countries in which we operate;

o

Changes in government regulation, including by way of example, the costs resulting from the implementation of the requirements of Sarbanes-Oxley;

o

Our labor relations and costs of labor (including future government requirements with respect to pension liabilities, disability insurance and health coverage, and vacations and leave);

o

Our exposure from time-to-time to legal claims and to uninsurable risks such as those related to our historic railroad operations, including potential environmental claims and health related claims relating to alleged exposure to asbestos or other substances now or in the future recognized as being possible causes of cancer or other health-related problems;

o

Changes in future effective tax rates and the results of currently ongoing and future potential audits by taxing authorities having jurisdiction over our various companies; and

o

Changes in applicable accounting policies and practices.

Quarter Ended

Nine Months Ended

September 30,

September 30,

September 30,

September 30,

2015

2014

2015 (1)

2014

Operating revenue

Cinema

$

$

$

$

Real estate

Total operating revenue

Operating expense

Cinema

Real estate

Depreciation and amortization

General and administrative

Total operating expense

Operating income

Interest income

Interest expense

Net gain on sale of assets

--

Other (expense) income

Income before income tax expense and equity earnings of unconsolidated joint ventures and entities

Equity earnings of unconsolidated joint ventures and entities

Income before income taxes

Income tax expense

Net income

$

$

$

$

Net loss attributable to noncontrolling interests

--

Net income attributable to Reading International, Inc. common stockholders

$

$

$

$

Basic earnings per share attributable to Reading International, Inc. stockholders

$

$

$

$

Diluted earnings  per share attributable to Reading International, Inc. stockholders

$

$

$

$

Weighted average number of shares outstanding–basic

Weighted average number of shares outstanding–diluted

September 30,

December 31,

2015

2014

ASSETS

Current Assets:

Cash and cash equivalents

$

$

Receivables

Inventory

Investment in marketable securities

Restricted cash

Deferred tax asset, net

Prepaid and other current assets

Land held for sale

Total current assets

Operating property, net

Land held for sale

Investment and development property, net

Investment in unconsolidated joint ventures and entities

Investment in Reading International Trust I

Goodwill

Intangible assets, net

Deferred tax asset, net

Other assets

Total assets

$

$

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:

Accounts payable and accrued liabilities

$

$

Film rent payable

Notes payable – current

Taxes payable - current

Deferred current revenue

Other current liabilities

Total current liabilities

Notes payable – long-term

Subordinated debt

Noncurrent tax liabilities

Other liabilities

Total liabilities

Commitments and contingencies

Stockholders’ equity:

Class A non-voting common stock, par value $0.01, 100,000,000 shares authorized,

 32,794,718 issued and 21,617,910 outstanding at September 30, 2015 and 32,254,199

 issued and 21,741,586 outstanding at December 31, 2014

Class B voting common stock, par value $0.01, 20,000,000 shares authorized and

  1,680,590 issued and outstanding at September 30, 2015 and 1,495,490 issued and

  outstanding at December 31, 2014

Nonvoting preferred stock, par value $0.01, 12,000 shares authorized and no issued

  or outstanding shares at September 30, 2015 and December 31, 2014

--

--

Additional paid-in capital

Accumulated deficit

Treasury shares

Accumulated other comprehensive income

Total Reading International, Inc. stockholders’ equity

Noncontrolling interests

Total stockholders’ equity

Total liabilities and stockholders’ equity

$

$