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

Cinemark Holdings, Inc.’s total revenues for the three months ended September 30, 2016 increased 9.8% to $768.6 million from $700.1 million for the three months ended September 30, 2015. For the three months ended September 30, 2016, admissions revenues increased 9.4% to $472.9 million and concession revenues increased 13.6% to $261.4 million. Attendance increased 7.3% to 76.2 million patrons, concession revenues per patron increased 5.9% to $3.43 and average ticket price increased 2.0% to $6.21 for the three months ended September 30, 2016.

Net income attributable to Cinemark Holdings, Inc. for the three months ended September 30, 2016 increased 42% to approximately $65.7 million from $46.3 million for the three months ended September 30, 2015. Diluted earnings per share for the three months ended September 30, 2016 increased 40% to $0.56 from $0.40 for the three months ended September 30, 2015.

Adjusted EBITDA for the three months ended September 30, 2016 increased 16% to $184.9 million from $159.1 million for the three months ended September 30, 2015. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.

“The robust film environment, coupled with our focus and execution on our strategic initiatives, enabled us to deliver a 9.8% increase in total revenues, 16% growth in Adjusted EBITDA and a 42% increase in net income,” stated Mark Zoradi, Cinemark’s CEO. “We are pleased to see how our strategic investments and emphasis on enriching the guest experience favorably impacted our third quarter results. We remain opportunistic regarding these endeavors with an eye toward driving long-term shareholder value.”

Cinemark Holdings, Inc.’s total revenues for the nine months ended September 30, 2016 increased 3.4% to $2,217.9 million from $2,145.4 million for the nine months ended September 30, 2015. For the nine months ended September 30, 2016, admissions revenues increased 2.2% to $1,364.8 million and concession revenues increased 6.9% to $752.8 million. Attendance increased 4.0% to 221.7 million patrons, concession revenues per patron increased 3.0% to $3.40 and average ticket price was $6.16 for the nine months ended September 30, 2016.

Net income attributable to Cinemark Holdings, Inc. for the nine months ended September 30, 2016 increased 12% to $178.1 million from $159.1 million for the nine months ended September 30, 2015. Net income for the nine months ended September 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 nine months ended September 30, 2016increased 12% to $1.53 from $1.37 for the nine months ended September 30, 2015, even with the aforementioned loss on debt amendments and refinancing.

Adjusted EBITDA for the nine months ended September 30, 2016 increased approximately 6% to $537.9 millionfrom $508.0 million for the nine months ended September 30, 2015. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.

On September 30, 2016, the Company’s aggregate screen count was 5,865. As of September 30, 2016, the Company had signed commitments to open 7 new theatres and 60 screens by the end of 2016 and open 16 new theatres with 147 screens subsequent to 2016.

Conference Call/Webcast – Today at 8:30AM 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 522 theatres with 5,865 screens in 41 U.S. states, Brazil, Argentina and 13 other Latin American countries as of September 30, 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 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
September 30,

  

Nine months ended
September 30,
       

2016

    

2015

  

2016

    

2015
Statement of income data:                    

 
Revenues                      
  Admissions     $ 472,842       $ 432,136     $ 1,364,737       $ 1,335,761  
  Concession       261,391         230,233       752,798         704,190  
  Other       34,341         37,687       100,312         105,435  
Total revenues       768,574         700,056       2,217,847         2,145,386  
Cost of operations                      
  Film rentals and advertising       249,766         227,571       733,101         713,306  
  Concession supplies       41,888         36,039       116,999         109,445  
  Facility lease expense       82,848         80,604       241,904         242,612  
  Other theatre operating expenses       179,459         169,940       509,339         491,413  
  General and administrative expenses       35,290         39,099       109,143         116,301  
  Depreciation and amortization       54,187         47,543       155,874         139,444  
  Impairment of long-lived assets       406         633       2,323         4,955  
  (Gain) loss on sale of assets and other       6,940         (500 )     10,985         3,852  
Total cost of operations       650,784         600,929       1,879,668         1,821,328  
Operating income       117,790         99,127       338,179         324,058  
  Interest expense (1)       (26,659 )       (28,419 )     (81,980 )       (84,930 )
  Loss on debt amendments and refinancing       -         -       (13,284 )       (925 )
  Distributions from NCM       1,381         4,601       10,117         13,100  
  Foreign currency exchange gain (loss)       485         (11,935 )     2,883         (18,702 )
  Other income       14,055         13,436       29,627         27,155  
Income before income taxes       107,052         76,810       285,542         259,756  
Income taxes       40,926         30,109       106,002         99,263  
Net income       66,126         46,701       179,540         160,493  
Less: Net income attributable to noncontrolling interests       471         362       1,454         1,375  
Net income attributable to Cinemark Holdings, Inc.     $ 65,655       $ 46,339     $ 178,086       $ 159,118  

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

                      
  Basic       115,601         115,164       115,475         115,051  
  Diluted       115,793         115,356       115,706         115,279  
                         
  Weighted average diluted shares outstanding     $ 0.56       $ 0.40     $ 1.53       $ 1.37  
                         

Other financial data:

                      

Adjusted EBITDA (2)

     $ 184,891       $ 159,147     $ 537,933       $ 508,030  

________________________________

      

(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
      September 30,     December 31,
     

2016

    

2015
Balance sheet data:            
Cash and cash equivalents     $ 527,111     $ 588,539
Theatre properties and equipment, net     $ 1,613,109     $ 1,505,069
Total assets     $ 4,176,619     $ 4,126,497
Long-term debt, including current portion     $ 1,790,793     $ 1,781,335
Equity     $ 1,233,616     $ 1,110,813
             
             
     

Three months ended
September 30,

    

Nine months ended
September 30,
     

2016

    

2015

    

2016

    

2015
Other operating data:                        
  Attendance (patrons, in millions):                        
  Domestic     48.0     43.8     138.0     134.3
  International     28.2     27.2     83.7     78.9
  Worldwide     76.2     71.0     221.7     213.2
                           
  Average ticket price (in dollars):                        
  Domestic     $ 7.39     $ 7.27     $ 7.52     $ 7.37
  International     $ 4.18     $ 4.18     $ 3.91     $ 4.38
  Worldwide     $ 6.21     $ 6.09     $ 6.16     $ 6.27
                           
  Concession revenues per patron (in dollars):                        
  Domestic     $ 4.11     $ 3.85     $ 4.17     $ 3.90
  International     $ 2.27     $ 2.27     $ 2.12     $ 2.30
  Worldwide     $ 3.43     $ 3.24     $ 3.40     $ 3.30
                           
  Average screen count (month end average):                        
  Domestic     4,563     4,493     4,547     4,496
  International     1,317     1,250     1,299     1,214
  Worldwide     5,880     5,743     5,846     5,710
                           
               

Segment Information

(unaudited, in thousands)
               
       

Three months ended
September 30,

    

Nine months ended
September 30,
       

2016

    

2015

    

2016

    

2015
Revenues                        
  U.S.     $ 572,916       $ 509,330       $ 1,677,365       $ 1,576,107  
  International       199,476         194,497         551,212         580,335  
  Eliminations       (3,818 )       (3,771 )       (10,730 )       (11,056 )
  Total revenues     $

768,574

       $ 700,056       $ 2,217,847       $ 2,145,386  
Adjusted EBITDA                        
  U.S.     $ 137,540       $ 113,059       $ 409,018       $ 372,079  
  International       47,351         46,088         128,915         135,951  
  Total Adjusted EBITDA     $ 184,891       $ 159,147       $ 537,933       $ 508,030  
Capital expenditures                        
U.S.     $ 75,839       $ 48,868       $ 175,218       $ 167,082  
International       22,984         27,771         55,128         65,269  
Total capital expenditures     $ 98,823       $ 76,639       $ 230,346       $ 232,351  
                         
   
  Reconciliation of Adjusted EBITDA
  (unaudited, in thousands)
         
        Three months ended     Nine months ended
    September 30,     September 30,
       

2016

    

2015

    

2016

    

2015
Net income     $ 66,126       $ 46,701       $ 179,540       $ 160,493  
  Income taxes       40,926         30,109         106,002         99,263  
  Interest expense       26,659         28,419         81,980         84,930  
  Other income       (14,540 )       (1,501 )       (32,510 )       (8,453 )
  Loss on debt amendments and refinancing       -         -         13,284         925  
  Other cash distributions from equity investees (2)       1,391         4,370         9,660         12,679  
  Depreciation and amortization       54,187         47,543         155,874         139,444  
  Impairment of long-lived assets       406         633         2,323         4,955  
  (Gain) loss on sale of assets and other       6,940         (500 )       10,985         3,852  
  Deferred lease expenses - theatres (3)       70         (289 )       (111 )       (1,108 )
  Deferred lease expenses – DCIP equipment (4)       (232 )       (232 )       (698 )       (701 )
  Amortization of long-term prepaid rents (3)       371         519         1,357         1,901  
  Share based awards compensation expense (5)       2,587         3,375         10,247         9,850  
Adjusted EBITDA (1)     $ 184,891       $ 159,147       $ 537,933       $ 508,030  
                         
       

(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, (gain) 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 and nine months ended September 30, 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.