Exhibit 99.1
Regal Entertainment Group Reports Record Results for First Quarter 2007 and
Declares Quarterly Dividend
Knoxville, Tennessee — April 26, 2007 — Regal Entertainment Group (NYSE: RGC), a leading motion picture exhibitor owning and operating the largest theatre circuit in the United States, today announced fiscal first quarter 2007 results and declared a cash dividend of $0.30 per common share.
Total revenue for the first quarter ended March 29, 2007 was $625.0 million compared to total revenue of $585.1 million for the first quarter of 2006. Net income of $229.1 million in the first quarter of 2007 benefited from a $209.0 million after tax gain on the National CineMedia IPO transaction, and compared to net income of $11.2 million in the same period of 2006. Diluted earnings per share was $1.46 for the first quarter of 2007 compared to $0.07 during the first quarter of 2006. Adjusted earnings per diluted share(1) was $0.13 for the first quarter of 2007 compared to $0.08 during the first quarter of 2006. Adjusted EBITDA(2) of $120.5 million for the first quarter of 2007 represented an Adjusted EBITDA margin of approximately 19.3%. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.
Regal’s Board of Directors also today declared a cash dividend of $0.30 per Class A and Class B common share, payable on June 21, 2007, to stockholders of record on June 13, 2007. The Company intends to pay a regular quarterly dividend for the foreseeable future at the discretion of the Board of Directors depending on available cash, anticipated cash needs, overall financial condition, loan agreement restrictions, future prospects for earnings and cash flows as well as other relevant factors.
“Strong box office results produced record total revenue and Adjusted EBITDA during the first quarter of 2007,” stated Mike Campbell, CEO of Regal Entertainment Group. “After the successful completion of the initial public offering of National CineMedia, we are now looking forward to a blockbuster-filled summer film slate,” Campbell continued.
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. All statements included herein, other than statements of historical fact, may constitute forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from the Company’s expectations are disclosed in the risk factors contained in the Company’s 2006 Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 26, 2007. All forward-looking statements are expressly qualified in their entirety by such factors.
Conference Call:
Regal Entertainment Group management will conduct a conference call to discuss first quarter 2007 results on April 26, 2007 at 9:30 a.m. (Eastern Time). Interested parties can listen to the call live on the Internet through the investor relations section of the Company’s Web site: www.REGmovies.com, or by dialing 877-407-0778 (Domestic) and 201-689-8565 (International). Please dial in to the call at least 5 - 10 minutes prior to the start of the call or go to the Web site at least 15 minutes prior to the call to
download and install any necessary audio software. When prompted, ask for the Regal Entertainment Group conference call. A replay of the call will be available beginning approximately two hours following the call. Those interested in listening to the replay of the conference call should dial 877-660-6853 (Domestic) or 201-612-7415 (International) and enter account #286 and conference call ID #235352. In addition, this press release and other pertinent statistical and financial information are available in the investor relations section of the Company’s Web site: www.REGmovies.com.
About Regal Entertainment Group
Regal Entertainment Group (NYSE: RGC) is the largest motion picture exhibitor in the world. The Company’s theatre circuit, comprising Regal Cinemas, United Artists Theatres and Edwards Theatres, operates 6,340 screens in 529 locations in 39 states and the District of Columbia. Regal operates theatres in all of the top 25 and 43 of the top 50 U.S. designated market areas. We believe that the size, reach and quality of the Company’s theatre circuit not only provide its patrons with a convenient and enjoyable movie-going experience, but is also an exceptional platform to realize economies of scale in theatre operations.
Additional information is available on the Company’s Web site at www.REGmovies.com.
# # #
Financial Contacts: | Media Contact: |
| |
Don De Laria | Dick Westerling |
Regal Entertainment Group | Regal Entertainment Group |
Vice President — Investor Relations | Senior Vice President - Marketing |
865-925-9685 | 865-925-9539 |
don.delaria@REGmovies.com | dick.westerling@REGmovies.com |
Regal Entertainment Group
Consolidated Statements of Income Information
For the Fiscal Quarters Ended 3/29/07 and 3/30/06
(in millions, except per share data)
(unaudited)
| | Quarter Ended | |
| | Mar. 29, 2007 | | Mar. 30, 2006 | |
Revenues | | | | | |
Admissions | | $ | 426.7 | | $ | 392.0 | |
Concessions | | 168.3 | | 158.6 | |
Other operating revenues | | 30.0 | | 34.5 | |
Total revenues | | 625.0 | | 585.1 | |
| | | | | |
Operating expenses | | | | | |
Film rental and advertising costs | | 218.0 | | 197.0 | |
Cost of concessions | | 25.0 | | 24.1 | |
Rent expense | | 81.0 | | 77.6 | |
Other operating expenses | | 164.9 | | 158.6 | |
General and administrative expenses
(including share-based compensation expense
of $2.1 million and $2.0 million for the quarters
ended March 29, 2007 and March 30, 2006, respectively) | | 16.0 | | 15.9 | |
Depreciation and amortization | | 46.3 | | 49.7 | |
Net loss on disposal and impairment of operating assets | | 5.4 | | 5.7 | |
Joint venture equity including former employee compensation | | 3.4 | | 5.8 | |
| | | | | |
Income from operations | | 65.0 | | 50.7 | |
| | | | | |
Interest expense, net | | 31.0 | | 31.1 | |
Gain on NCM transaction | | (350.7 | ) | — | |
Loss on debt extinguishment | | — | | 0.9 | |
Income before income taxes | | 384.7 | | 18.7 | |
Provision for income taxes | | 155.6 | | 7.5 | |
Net income | | $ | 229.1 | | $ | 11.2 | |
| | | | | |
Diluted earnings per share | | $ | 1.46 | | $ | 0.07 | |
Adjusted earnings per diluted share(1) | | $ | 0.13 | | $ | 0.08 | |
| | | | | |
Weighted average number of diluted shares outstanding | | 157.2 | | 154.0 | |
Consolidated Summary Balance Sheet Information
(dollars in millions)
(unaudited)
| | As of | | As of | |
| | Mar. 29, 2007 | | Dec. 28, 2006 | |
Cash and cash equivalents | | $ | 807.7 | (1) | $ | 162.2 | |
Total assets | | 3,084.9 | | 2,468.8 | |
Total debt | | 1,981.7 | | 1,987.9 | |
Stockholders’ deficit | | (131.6 | ) | (22.2 | ) |
| | | | | | | |
(1) Includes funds used to pay a special dividend of $302.0 million on April 13, 2007.
Operating Data
(unaudited)
| | Quarter Ended | |
| | Mar. 29, | | Mar. 30, | |
| | 2007 | | 2006 | |
Theatres at period end | | 529 | | 546 | |
Screens at period end | | 6,340 | | 6,415 | |
Average screens per theatre | | 12.0 | | 11.7 | |
Attendance (in thousands) | | 58,621 | | 57,985 | |
Average ticket price | | $ | 7.28 | | $ | 6.76 | |
Average concessions per patron | | $ | 2.87 | | $ | 2.74 | |
Reconciliation of EBITDA to Net Cash Provided by Operating Activities
(dollars in millions)
(unaudited)
| | Quarter Ended | |
| | Mar. 29, | | Mar. 30, | |
| | 2007 | | 2006 | |
EBITDA | | $ | 462.0 | | $ | 99.5 | |
Interest expense, net | | (31.0 | ) | (31.1 | ) |
Provision for income taxes | | (155.6 | ) | (7.5 | ) |
Deferred income taxes | | (44.8 | ) | (1.1 | ) |
Loss on debt extinguishment | | — | | 0.9 | |
Changes in operating assets and liabilities | | 469.5 | | (56.0 | ) |
Other items, net | | 9.9 | | 16.2 | |
Net cash provided by operating activities | | $ | 710.0 | | $ | 20.9 | |
Reconciliation of EBITDA to Adjusted EBITDA
(dollars in millions)
(unaudited)
| | Quarter Ended | |
| | Mar. 29, | | Mar. 30, | |
| | 2007 | | 2006 | |
EBITDA | | $ | 462.0 | | $ | 99.5 | |
Gain on NCM transaction | | (350.7 | ) | — | |
Loss on disposal and impairment of operating assets | | 5.4 | | 5.7 | |
Share-based compensation expense | | 2.1 | | 2.0 | |
Joint venture employee compensation and depreciation and amortization | | 1.7 | | 2.1 | |
Loss on debt extinguishment | | — | | 0.9 | |
Restructuring expenses | | — | | 0.1 | |
Adjusted EBITDA(2) | | $ | 120.5 | | $ | 110.3 | |
Free Cash Flow
(dollars in millions)
(unaudited)
| | Quarter Ended | |
| | Mar. 29, | | Mar. 30, | |
| | 2007 | | 2006 | |
Net cash provided by operating activities | | $ | 710.0 | | $ | 20.9 | |
Capital expenditures | | (19.9 | ) | (18.5 | ) |
Proceeds from asset sales | | 3.1 | | 1.9 | |
Free cash flow(2) | | $ | 693.2 | | $ | 4.3 | |
Reconciliation to Diluted Earnings Per Share and Net Income
(dollars in millions, except per share data)
(unaudited)
| | Quarter Ended | |
| | Mar. 29, | | Mar. 30, | |
| | 2007 | | 2006 | |
Net income | | $ | 229.1 | | $ | 11.2 | |
Loss on debt extinguishment, net of related tax effects | | — | | 0.5 | |
Net income, excluding loss on debt extinguishment | | 229.1 | | 11.7 | |
Gain on NCM transaction, net of related tax effects | | (209.0 | ) | — | |
Net income, excluding loss on debt extinguishment and gain on NCM transaction | | 20.1 | | 11.7 | |
| | | | | |
Weighted average number of diluted shares | | 157.2 | | 154.0 | |
Adjusted earnings per diluted share(1) | | $ | 0.13 | | $ | 0.08 | |
Diluted earnings per share | | $ | 1.46 | | $ | 0.07 | |
(1) We have included adjusted earnings per diluted share, which is diluted earnings per share excluding loss on debt extinguishment, net of related tax effects, and gain on NCM transaction, net of related tax effects, because we believe it provides investors with a useful industry comparative and is a financial measure used by management to assess the performance of our Company.
(2) Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization expense, gain on NCM transaction, loss on disposal and impairment of operating assets, share-based compensation expense, joint venture employee compensation and depreciation and amortization, loss on debt extinguishment and restructuring expenses) was approximately $120.5 million, or 19.3% of total revenues, for the quarter ended March 29, 2007. We believe EBITDA, Adjusted EBITDA and Free Cash Flow provide useful measures of cash flows from operations for our investors because EBITDA, Adjusted EBITDA and Free Cash Flow are industry comparative measures of cash flows generated by our operations and because they are financial measures used by management to assess the liquidity of our Company. EBITDA, Adjusted EBITDA and Free Cash Flow are not measurements of liquidity under accounting principles generally accepted in the United States of America and should not be considered in isolation or construed as a substitute for other operations data or cash flow data prepared in accordance with accounting principles generally accepted in the United States of America for purposes of analyzing our liquidity. In addition, not all funds depicted by EBITDA, Adjusted EBITDA and Free Cash Flow are available for management’s discretionary use. For example, a portion of such funds are subject to contractual restrictions and functional requirements to pay debt service, fund necessary capital expenditures and meet other commitments from time to time as described in more detail in the Company’s 2006 Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 26, 2007. EBITDA, Adjusted EBITDA and Free Cash Flow, as calculated, may not be comparable to similarly titled measures reported by other companies.
