CNK - Earnings call transcript Q1 2021 | Cinemark Holdings, Inc.

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to Cinemark’s First Quarter Earnings Call. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Chanda Brashears, Senior Vice President of Investor Relations. Thank you. Please go ahead.

Chanda Brashears

good and Natalia, you, morning, everyone. Thank and time, Cinemark Holdings, this call, Operating by Executive Officer. I and Financial earnings would to you hosted Officer; Chief Zoradi, welcome to Mark Gamble, Inc.’s Chief conference Chief Officer like release At Sean first XXXX quarter Securities this statements. that In by are the Private members provision call of forward-looking Act of of harbor with Reform XXXX, during may discussed constitute accordance the management safe Litigation certain matters and uncertainties from other that Such or statements risks, are to different to Cinemark’s cause materially implied performance the factors actual statements. subject may indicated by be such performance are Such factors the set risk company’s SEC filings. forth in undertakes any obligation no update publicly forward-looking company or statements. revise The to webcast and include call measures. may financial Today’s non-GAAP most be company’s on measures directly comparable A of XX-Q on investors.cinemark.com. reconciliation GAAP found within the today’s the can press quarterly release, filing company’s website, or Form these non-GAAP the to on financial measures the Zoradi. like Mark call to to would I turn now over

Mark Zoradi

have Thank remained hope you, the that road time. the you today circuit. our of Chanda, and happy to reopened. of discuss Cinemark your on I’m XX% U.S. joining year most quarter Over of has us and our report since We a during healthy families passed, challenging global appreciate results. industry to to XX% We prompted we COVID-XX the this and actively you shutdown now In are And the first recovery. well XXXX and good morning, theaters everyone. have

the continue theaters with operating pandemic. as virus government Presently, or states, now first, the a weekend, ease Furthermore, more our As more XX XX% of contained. be restrictions since capacity we’ll in capacity. operate each is of our of XX% this imposed before to

only including restrictions. due that are mindful where Canada, global regions own India, of surging renewed are portions cases, COVID landscape government our are to we Latin currently the Europe America, of operating still XX% our theaters struggling with and course, across Of many

that about more the virus will highly quickly optimistic to as in that like remain lockdowns disseminate. U.S., end, are countries widely to recover to However, in optimistic we start a driven continues an exhibitions the reign To And range COVID-XX vaccines these progress and aggressive we rollout over months, coming the U.S. begin the at by with vaccine pace of ethical the the factors. recovery

CDC the Americans more of today, and least received than vaccination vaccinated. of For XX% fully are as over adult XX% one have at

figures With grow vaccine these available to population and the each every full openly continue ages rapidly now XX and day. to up,

figure this to According U.S. result of a they has since respondents saying sentiment to to improving. As of of through when sentiment vaccinated. movie to that National of COVID. Group, comfortable asked Research XX% movie are goers returning growing inception grows are the data penetration movies. respondents the vaccination from XX% been And surveys now very or going the their theaters impressive is an the weekly about which about somewhat are consumer consumer once tracking NRG comfort,

the sentiment rise expect We coming in weeks. continue consumer will to

to safe as of marketplace, that consumer into into – is we’re indoor last as translating and film office Following fully released the compelling explicitly content to people starting theaters. CDC’s return to the And indicated already and movie how guidance sentiment vaccinated improved box it’s compelling the week is new this impact seeing be revised for new vaccinations success.

the Slayer, since together and vs. results result by were Demon box Godzilla Kong witnessed best and office the COVID outperforming pandemic. we’ve Kombat weeks, few past deliver shortly Mortal onset which record. Those of the opening a office significantly new era generated followed expectations the box Over

sign underscores attendance, is and a theaters confidence substantial beverage we’ve returning strength tickets, growing of advanced another is and of amount compelling been successes came food further business. content which experiencing, to in when these encouraging but our eagerness Importantly, from a from walk-up not the consumer only available. also Yet

we cash we’re penetration costs, products, date This steady and over XXX,XXX And our and they’re Eri of variable improving operation, view for cash led of rebounds flow caps theaters the excess and per we expect whom running has high positive stabilizes. us in the closed. attendees I the with while new actively achievement time offering our in were executed includes more our Collectively, theaters Guests before are such demand. the July, leading year-end. current have environment, of put mentioned million executing the temper movie-going them associated contributing of been domestic incremental industry the experience accomplished business time. content to year. factors these and actions, being all the burning was theater covering in the have yet to at a consistently a of Our positive streamlining strategic to cap splurging to right-sizing costs resulting with have particularly Cinemark this results to we enjoy the on all than on clear of as strategic fixed growing cash managing tightly X bit sizable popcorn. than our unique Cinemark. overall will level Private we Parties the fully priorities not missed movie Since per landscape for and marketing beverage, our sold indication for through for resurgence We in while they’ve returning we we’re fluid open, our a vaccine, a flow want $X. demonstrating, our reopening as pursuing theater spending will And pent-up generation path festival tailoring the they Watch past believe less movie as with first trend full are of started food to just variable date film which which we enhancements XXXX of have covered many to our opened of And the going all

year. three-fold. an call strategic for we our last this priorities are provided During quarter, priorities These overview of

to effectively leading industry This continuing of ongoing and in the pandemic. health and measures Cinemark as stringent satisfaction and a earn effectively safety focus our part is cash percentile. navigate on XXth ratings mid executing the the includes maintaining that well consistently to standard are liquidity management, high First guest as

industry. reigniting the exhibition is Second

managing forward, on the of our entire behalf options. our our While I team huge cash, hiring back preparing new say it know, I we’re to steps speak we is reprieve also our team are of when hiring these to that of be and particularly more taking a beginning of reintroduce across country. hours enhanced members a for beverage returning I carefully significant wave expanding and involves which demand, employees, thousands upcoming food and operating

welcome films. and The our along to the together the studio initiatives guests partners, Big This Back to see theatrical movie Additionally, the in onscreen executives. came exhibition CAA actively been efforts campaigns highlight Is named moviegoers amazing piece we’ve theater. with talent this movie-going to promoting an leading Screen campaign thrilled partition XXX,XXX-plus summer’s Screen back NATO, entertainment to featured Cinema Back ago, back wide and to collaboration employees working of to come with theater and immersive on agency nationwide on Big were these weeks Week, Oscars extended Is industry’s upcoming of excitement footage MPAA, supporting We first rekindle the cinematic the a some going PSA welcome of industry the spot the couple with our experience. to to

new only course, bring release we’ve content the solutions Of to the is extent big content pandemic during these campaigns regarding on consistently theatrical new And actively to the screen. work window will available. working film been the to

which Universal, the and you’ve theatrical I reached Warner shared studio with by reaffirming announce, recall, Marvel all Marvel Bros., Disney agreement all are the footage underscoring new seen you Sony theatrical agreements for Monday, have to a As our on tiered movies Paramount, in next to varies experience. performance. of their to pleased may that based tremendous with theatrical of November, announced of the with that office our included Today, couple we passion including vein, we upcoming released window experience years. Disney upcoming hope feature Reel films, box their In over the we major partners two an on commitment extremely

wide to we the more will first test expect be come. Netflix also to film, Additionally, many films our with extended which we’ve our of first include release

nationwide the available provide of moviegoers and during to we’re exhibitor to our film to to titled to to that this the stream. content chance with the studio are effort of showcasing pandemic shareholders. only the of We’re long-term Army in interest box in widest seeking maximize and attendance provide thrilled moviegoers are our the partners, ongoing Cinemark, In range and the our movie best and beyond, it’s office see available agreements Dead our before theaters

a evolving Cinemark the priority, is us believe initiatives there Along we to identifying exhibition We this that towards range efficiencies, a sources incremental landscape. post-pandemic of a we’re are aimed wide the further in brings And evolving which positive with of at well and post-pandemic pursuing for theatrical revenue. with our implementing third our and reigniting as progress pleased are steps industry ongoing remain as window successful landscape. cost discussions, to

Just to few. a highlight

including new optimize labor specific technologies to attendance, consideration combination take to amenities. a our models, demand-based continuing our operating management comprehensive enhancements We’re into budgets hours through and labor and of workforce theaters, to

management studies to enhance conducted. on sanitizing productivity new We’ve success operations the ability models recently levels building labor cleaning our adjust and attendance based workforce protocols. for including with all had of labor initiatives of assumptions to date, identification saving for also aspects with We’re our time theater and we areas, and

supporting their concession offerings in and basis. that years. and rollout benefits forward moviegoers of online as has circuit budgeting to performance to continuing fully even the tap, ordering mobile very from our this across a individual be introduced the other domestic program, management looking in more an strong weeks. beverages Guest’s in product so reaping snacks many demand-based new feedback beverage advance service we’ve The and allows order will enhancements our our and food We’re been such like over labor workforce food theater about available coming and on

future. well us will it expect growth into per cap We help maintain our trend the

web advance to marketing in and managing and Additionally, along our been the will leverage marketing strategic enhancement an channels. cadence and digital continue multiple million through promotions provide addressable customized and be landscape current a tactical of of to the better app capabilities delivering have from in via These communication by significantly and believe seek capabilities, These we ahead. our social essential these data XX worldwide increased volume the environment. vital actions competitive campaigns customers we And our messaging delivering with targeting. campaigns

quarter, first some during which for results, office the the consistently the Cinemark historic these actions pursuing success realizing already of outpacing of early successes despite the This more our results. is many total represented our North we’ve during been pandemic. course screens XX% operating, box by of has America industry We’re XX% from the accounting only of significantly which demonstrated than

industry of the a this subside out. We theaters expect the that as bit across and the extent reopen competitive will landscape full fills over-indexing

to this we continue we meaningful However, retain believe share lift. will of a

Free with the the Fast year. Hotel up year. and James X. and into The Transylvania Legend blockbusters, optimism film Eternals, Maverick. Squad Black Gun: such weeks. Top that Spider-Man: And Suicide Peter the rest in fired second of Time lies and quarter No and Shang-Chi Heights, Boss amplified II, We’re & will XXXX Rabbit, Cruella, Place It and with Baby, does Home, of Cinemark the about A the Guy, that of In loaded X, Die, in leads transitionary a continue is as, highly the industry progress Dune, Widow, remain optimistic Quiet to Ghostbusters: Jam, Rings, the are things Afterlife, lineup No Bond the get highly Venom, Encanto, Furious And To second Jungle coming making. titles, Ten including X, a the anticipated encouraged significant by that the Space ahead half Cruise, is Way

just due Marvel, corner John Mission: maintain XXXX to leading begin kicks mega the which and over titles. that However, ongoing and of we environment, World, with a movies We titles, more well Jones, a to path and both the the XXXX, QX giant course believe to Minions, as Panther, and turn Adam. few ensure is Cinemark and is will forward Black industry positioned Thor, year. remain year during the the Jurassic a pragmatic approach Dr. and this including is from wick remake of savvy we to pandemic past disciplined well as the Avatar, look gear we And through agile, returns Black and to such certainly as the operational into lot persevered Impossible, normalized in for we as Strange, most these name Aquaman and Indiana to Lightyear recovery Captain a in success. franchise turbulent spinoffs of stacked Batman are as a the QX recovery. and into we There crisis excellence, our to

its As cash point. balance sheet management, pre-COVID key our liquidity, levels focus remain to and refortifying a

elevating our acceleration to full in now on business We’re recovery the a our capturing rapid value from attention of capitalizing attendance. and

Our long-term, which of our first Sean? on strategies focused you interest shareholders. industry, our results. is will the the remain and walk company, quarter Sean Cinemark our managing our and through now in and liquidity position best

Sean Gamble

Mark, and good you, Thank everyone. morning,

content. sizable our demand our indicated, anticipated scaling with just be are Mark lineup new prepare upcoming film As for recovers, operations as up summer we we thrilled this to industry and of

which notes In the expected diligent in market of lowest we liquidity, deferrals continuing us $XXX of industry that debt, March, to notes liquidity achieved productivity do and additional to senior to operating payment on cash yield million capital are quarter refinance of was $XXX recovery, Of inception and conditions we limit efficiencies operating rate and pursuing have ramping the investor through yield estimate we regard entertainment were enabled any modifications expenditures, and we while ongoing coupon obligations, focus by With we a actively non-essential that the due a that December examples manage course, did senior include XXXX to high while some our the of will on actions working Strong million secure debt. of advantage maintain will take X.X% XXXX. our exceedingly company, to since X% that continue to the well-received. contractual of due new coming and demand to proactively were initiatives sufficient pandemic. favorable issued managing incremental and to management so, we up, during

afforded We first quarter resulted CARES other our also a of of as our And refunds, tax and these actively described, April. additional to continued along an a have upside by which to balance end million. actions the result the cash the $XXX million relief flow balance variable the results receipt of cash of additional pursue some improving cash with opportunities the in refunds ended Act, of $XXX management April from tax increased at just million. tax in with $XXX We cash

million drivers. $XX Our a monthly cash projected burn than lower million. burn last quarter, during the first monthly quarter This rate we result is was $XX the approximately as of four key

million First, balance was received slightly by borrowings of local in ending our $X America. new XQ Latin propped up

started $XX Second, as to at the the industry operating million has quarter our based was results which improve time, estimate continued recovering. the on last

semi-annual than quarter of our the will regard from And lower due with the the benefited we favor timing bond slightly over payments of our other parts Third, to real ability to that quarter additional estate year, payments. during balance out full timing year. the payments first are finally, interest

improve of were current with continue. improvements of Looking to loan months. down drawing in would extent equity. on extends said, now our average to and conditions sale our additional industry environment the into us, of the the runway credit revolving financing unencumbered will for cash incremental burn own to rebounds as environment, monthly of any that we options capacity forward, credit and million anticipate executing issuing the operating All such expect operating include market burn as our cash available continue leaseback not second as remain the facility, that we improving today’s a coming or $XX does an borrowing XXXX. to in being the quarter projection arrangements properties further million results a line, tapping That current that term We within $XXX or runway remainder year result rate

XX% our the first onset in quarter Moving to accrual-based and, We’d directly do our on as financials correlate not to timing remind continue our reported our indicated pandemic, environment. to first watch of $XX.X million of million follow our traditional $XX.X previous patrons. driven approximately revenues you current somewhat theaters parties. the were since necessarily X.X of at now end. admissions XX% Furthermore, U.S. revenues generated was total open of were of we and metrics million distorted were results. Domestically, attendance operating by quarters, And which be quarter in quarter accounting, have to the like flows. therefore, by private the cash that

a Domestic $XX price weekday recognition that deferred and result watch of from mix private ticket $X.XX. content. lower were average by Our per revenues the year-over-year, driven cap library high parties, as fewer of showtimes up all $X.XX was program XX% more beverage free associated revenues with million of of an loyalty our than and concession food and offset, price matinee with time lift

food demand overall outlined our As that core movie earlier, a driving heightened purchase is and indulgence across offerings boosting Mark going pent-up beverage in is concession categories. incidents

predominantly the per only locations. we pricing of limited items from especially are running theaters surge menu domestic We price, at considering region. COVID-XX American across international over Similar tougher XX.X% million benefited and reclosure the several revenues, and average the compared by driven points million loyalty figures we a were also patrons. line previously XXXX. with that XX.X% to first Globally, costs cap to discounts XXXX. Latin ticket our cases were of Internationally, declined with are our quarter. revenues lower operations were the revenues admissions impacted we with advertising was $XX.X still the the a operating. with back offered the We which first of welcome in quarter led pleased And X.X terms. our these tend recognition library XX.X% various figure film to quarter to basis of during This of range of were more and of reported result, carry of favorable also X,XXX rental and revenue. Concessions quarter Total of theaters ended films as grossing attendance the in deferred the was quarter open approximately first decline first-run in by expenses concessions had record film content, XX% of

create offset rate metrics drag were teams Facility which year-over-year and continue $XX.X on very managed effectively attracting in product theater staffing. that to Promotional million our theaters with reduced by theaters million been commitments. rent COGS temporarily quarters closed impact as of a spoilage our favorable hours well. adverse consumers back stimulating was pricing, $XX.X helpful with to our incremental and salaries to purchase in driven mix. of declined Global incidents has XX.X% as wages and slight operate lease This included associated these and highly were the nature fixed of by expenses

third-party theaters Still utilities Others fixed. blend However, varied and fixed closed within other rent $XX.X XQ liability versus several and commissions XXXX, as XX.X% are property result our predominantly, as expenditures, this of such while rent other and property permanently reduced been insurance to remained a sellers category, have abatements, ticket variable. declined were and continued and million increasing and and million expense paid reopening. down as and $XX.X fees like credit decline maintenance our and year-over-year, expenses taxes repairs with attributes of theaters, revenues. percentage and card a Worldwide in XXX% have variable associated including have utilities costs we’re

by during which driven spending Capital first our discretionary to of $XX.X quarter build restructuring loss declined million, quarter the adjusted was with COVID-XX $XX.X for our million operating of the impact and negative associated had a limit XX.X% maintenance associated investments to million. in $XX reduce ongoing non-essential the G&A was been efforts existing And was million Collectively, were $XXX.X prior EBITDA our to new of $X.X expenditures. we actions posted committed projects and quarter and the million by pandemic. worldwide driven for that Finally, our million net theaters. expenditures $XX.X with the recent

balance approximately needs. new approximately committed with spending safety XXXX million were and previously on $XXX estimate remaining projects maintenance, XXXX deployed year CapEx mostly delayed to the the by to that full driven half continue build that compliance from and of We

positioned expected our and investments we of because remarks period refortifying the enhancement our of effectively time the why remain to levels, to our carried over end maintenance historic types To hindering as of balance have we sustain significantly devote driven and us capitalizing reduced recovery, strength reduced are management that lines priority highly from consistent strategies. a years. expenditures While and and account big our operations able capital will guest we attention and theaters its have into that our have remain for consumer financial asset pandemic proactive a that sheet upkeep pre-COVID greater been we in open up now like fully forward disciplined for reason of to decisions These our CapEx fortunate of to the of company growth so without the demand. increasing Furthermore, satisfaction. crisis prudent is navigate the allocation business on or to our questions. the quality, capital would strength we our drive Natalia, standing on concludes a stability prepared

Operator

Your first Instructions] line Alexia with is from Quadrani question [Operator JPMorgan. of the

Alexia Quadrani

agreement, day exclusive be longer window. us theatrical mean, you you day? do very Anything I we wondering, terms of can assume would with the today you and much. that the with are be I’m will great. I should that Thank there’s some about guess, that length I confidential, Thank agreement you but there’ll no – kept share maybe you. could studios of more the any the share anything us being an the if announced know

Mark Zoradi

Alexia. you, Thank

As there’s unique. is of deals here. Each different and different we one five mentioned, them

specific particular the with go of objectives the Some meet to months, but studio multiple details goals It be, I some go have and that any the into multiple go them us. began one and needs for of tried years. Universal. ones, the we’ve can’t for And of really and

XX months we into and feel days, terms point. four. can’t never mentioned, ago I several start at like we’ve specifics of with then on But completed the this gotten other deal completed others which I over was As we’ve and last the the the course

Alexia Quadrani

the current at seem, you studios do do just, you and reopening around? shifting where which the Okay. now favorable, then and their the And if think And movies point stopped trends, relatively offer a the optimism a the have think much how question, current then And any Tap, set. there Snacks that I savings you schedule is last potentially to guys longer just of could in term? really may, is one sense we’re

Mark Zoradi

look been the when a content going to studio lineup absolutely done, that does with another question. Tap. that remainder they deal they to year if delay, Snacks going they’re production But Sean, when don’t be lineup, continue. do in And the with that XXXX would and somebody the the has Relative and move say I’m not to that Okay. the we’ve always seen going look to this that why mean And of going nature because else I or their their shift causes environment is to studio shift? at deal first a a however solidified majority have it. gets you shift be a the this. and is of I say it the with to titles the would into move. got for this difficult mean, business. to to title moved. film movie it’s or dates that in slot that like it’s a because that’s so they’ve that is job won’t well, And in it. a the And they delayed? been beast depending then And now have years it there for of around I studios vast streaming, I’ve spot. makes XX and in there what these a I PVOD with of mean, that shifted get here release the master schedule today’s and sometimes affects on Did

to feel So relative I strength we so that their schedule. don’t out. assume that locked ebbs think delayed way. because of going many the this XXXX, movies key by they’ve continue there’s spots. to the year into the be to flow confident all half very some But anxious are the of And been and the have very we and second of for and them release about content the to can kind into not point leading had the there’s Studios at along get large,

Sean Gamble

start, look a in just by very at early regard a We your savings. in question the generator Snacks platform revenue of than seeing we’re And already with cost the a as say, to what I’d phases incredibly to on more Tap, encouraged we’re rollout. the

your more friction think food, need system the allows is let the anything, more just their on, theaters. them on taking access into their the anticipate I consumer question we that was to pre-order get of and do allows If to the they out speedy efficiency purchases efficiencies? side a when

our of So food sell it less opportunity. way way sales, beverage as take further that, as as at so to opportunities savings we a of to drive friction cost to look a boosts both the a and result the out way up system for a consumers. And as

Alexia Quadrani

Thank you very much.

Sean Gamble

Alexia. Thanks,

Operator

of is Your from Swinburne line the Stanley. question Morgan Ben next with

Ben Swinburne

is, results Good know XXXX new looked gross if the just agreements. applied don’t to consumer? impact new question and it sort impact? on a agreements, movies it’s movie that the anything the don’t – be would and material? lower actually the long-term maybe might the these you and terms the business, to comes you answer back business, of original attendance, swing if another take we good at when don’t any think and XXXX agreements these I but of that you and morning. possible or all changed guys, would post-COVID drivers how and of but notice the Or splits know about it’s is you if higher Maybe content at Alexia’s from – don’t margins I I know, the which discernible lower

Mark Zoradi

thanks Ben, question. for the

big that look at at of change What one studio. the you each tried to response their each try ongoing to them priorities of when end picture any the us. ebbs how box one work and it desires I difference one business. think the flows, deals your customize movie these that And office. film be portfolio partners of and think movies be day, split at, box look various for significant these And and rental for I with But here, meet will there question, with office the and make going one all to to all relative up think a to splits. there’s take each also difference I relative to material think give on you of adapt individual is, to answer and to we overall wouldn’t an is across there to just various of but material you we we meet add do would their There’s look a do what our our each don’t our to particular looking studio we the the the that splits. them when won’t we’re the some little some have, in a needs. Each in needs has a deal we be of at we for tried basis, and to

Ben Swinburne

follow-up, maybe to come you Can to potentially more that your Mark Cinemark but you the then us us just And Is about about with the getting yes, of can to there’s more just here? you arrangement a it. was wide think tell these an you interesting, – tell a you with keys mentioned Dead Netflix. could Got releases, exclusive Army little of that this what expectations? the really

Mark Zoradi

was titles. remember, last of Chronicles of probably couple as with, Christmas likely a tested we year. the Well, largest late them it X you starts Netflix

many, we executive have be both theatrical that this where Army difference a the or to our very the was were of of Army many its anticipate four their with team the three, it, is, doing but those large relationship believe some has And strong of also first in Netflix five and be first beginning three one have a up of doing and great one of that are talent market And the come. to where we Dead The to the got we’re the the filmmakers tests. on will And Dead. movies only of film exposure. wide, through this Netflix circuits circuit we this for ranks. so that want

through various way be a testing find able to do to going we’re so to that. And

off And to window. theatrical a higher Netflix create showcase value watch. a be they’re when exposure, going they end able streamers sometimes do other the which because show more as longer find at to mind hopefully we’re to will that help in little some a helps a of short looking it streamer, with well, it’s and would window, want the sometimes to with But consumer’s the it we’re will for had to therefore bit and – pathway what product be significant able theatrical clearly be

Ben Swinburne

so much. Thanks Yes. That sense. makes

Operator

the Your B. of from Securities. Eric next comes Wold with question Riley line

Eric Wold

behaviors, movie the the fully movie films a if you. during going the on of seeing Good in early I behavior, morning. bit in on such A kind as the talked couple these Maybe can these about you on questions, Thank your kind the I weekend purchases favorable just open concession on the versus trends week reopening. may, PLF views a environment trends towards you’re versus and more visitation shifts or of going XD hold stages. of that whether trends, trends on guess one obviously little

Mark Zoradi

the we that Friday And true wasn’t are be thing strong night a just and pandemic. Tuesday. Eric. this But discount during Ben, me, that wasn’t best days our which to your well. that held pandemic. continues very is day clearly, excuse the day, with exception found – your it always Saturday been during the as Tuesday, Sunday the of and and This has

are see continued we thing have ahead movie, significant when usually real we sale especially that sell very high profile getting $X for that most the that and the about tickets up a no a charge time, a on that’s out providers, XDs. content typically first movie we’re One And because us on So changes is of screens. put advantageous XD for there. the to

So has around and the paid world off to we our going in it’s plus investment we continue. XDs clearly XXX that did the think

is maybe up lower also and charge Saturday say important. more able and a that So but be even your full allow And sometimes that Tuesdays. to a we there’s having price need pricing come significant have get format I significant change, also has a strong on wouldn’t been value-oriented screens for consumer it any can on night, price little to the variable Friday but XD that you in so confirmed us large to

Eric Wold

secondly, going versus your Latin what through. right And given timeline then delaying And thoughts possibly terms done versus on obviously, struggling U.S.? in down any views their of especially on that market conversation Brazil it. with may the they’re have in studios the title guess, in Got of what releases greater than they previously on America, recovery what the Latin America, now, are I U.S.,

Sean Gamble

Yes, been world several America of parts have of as that or take more like rollout rampant Latin just the one, I’ll Eric. other vaccinations. on account not struggling of clearly

We’re region right just U.S. pandemic, months the is they’ve Good the take been the where high to is vaccinated good a the of get then line to in three different region vaccinations behind of account to quickly of two of where a in time state throughout the from both now, at to looking issues probably news on going bit chunk get surveys. not the the the or too little current vaccines is, interest bring disseminated. extremely in and desire is is

U.S. think mass. critical places reach the to like I a as start

You’re already disseminated seeing more Latin America. vaccines talk of places to widely like being

releases it up. don’t is on So good catch yes, the of regard we timings, kind news that release the With now. think impacting question will anticipate global your right to we

this kind Chile. that at the region LatAm. in certain for like released least Our obviously end until in the Brazil, U.S. titles at releases and in released in Croods is of last certain like Peru, in places of point however things so which year, XXXX, U.S., have year going been happen the yet shifted Sing the this to X, Argentina, LatAm isn’t set be already, to in is which

shifted. that that like things have there’s kind So of

part those than the is Some just the see markets. those you of account of that calendars U.S. in relative to on atypical, that more regions, holiday related will virus and isn’t in the delays you because different state do ship of seasonality also to typically some of see may that anticipate that I But

Eric Wold

both. you Thank Perfect.

Operator

MoffettNathanson. question comes Your next from with the line of Robert Fishman

Robert Fishman

slate is and to specifics, on Or a incorporated said release, take full understanding that still and differently, the Good are if Where studio? terms day agreement can’t is assume I’ll morning. terms happens a real scheduled window date the earlier you within to new film-by-film shot there deals? for should Or that negotiated a a of basis? even we at window, that to another the each these but does now for currently a are or permission? to speak tent-pole studios exclusive framework the switch major for theatrical studio need

Mark Zoradi

is and unique. deal each again, Robert, different

from be – know, And on typically not the me statements. you license any up would typically the imprudent movies we movie basis studio-by-studio overall the make it we on for overall of and studios know, most on to So And and does probably how that people they how as phone an the it’s typically scale office. on deal. box a underneath depending operate the particular we is scale split a would

there’s on be this and to Now individualities there’s going always some studio-by-studio.

go that. be We’re do for not to us reasons. appropriate going multiple to into wouldn’t that for It

on traditional, all just the streaming all deal so have going studios, length the we’re the So each time of solidified of The forward on and each changes we what varies one here that midst deal we’ve in little major confident the of deal bit. a a of them. and of PVOD one more we with going and each of is, really with done typical testing a

want can’t Sean, do to I And a So statement. something? you blanket again, make add

Sean Gamble

type Robert provide anything and everything to the add, that of agree to have said, flexibility that terms little that was match I’d thing to that flexibility I kind bit only more kind scale a of similar Mark a with is structure. The and goal

one we was, just benefits to of achieve that aiming kind in that and the Cinemark. to best are kind was unique, everything that’s in interest studio-by-studio, different that of of as both were I studios said, So but the and Mark say coming it’s of the themes

Robert Fishman

Okay. And about experimented margins go and does should as of there Got in half higher? we when the how the and for year, hours, it ongoing it. you’ve of second levels staffing mean levels think attendance efficiencies what outcomes the with operating different

Sean Gamble

the course points of before one but at so flexing Well, of pandemic, positive adept, our hours, operate we’ve focal able with just more cash of to pandemic, the become variable the It’s to been that during to flow. ever we operating very our weren’t not that right, the flexing be key staffing. our get than team

with much program going on as it’s be level stabilized maintain going the is trying we things to we developed we’ve on appropriately the overall we think a in. that that firm it’s coming that going at put we’re to new to going we some what now as forward. are up. a ramp expect something So techniques really more we’re a staffing working surge that of we additional be derive think way through That’s right going when we’ve controls productivity working of of saw number in of it’s And on our some part I us – that going discipline early get forward an continue to new benefit back of as at Mark to stage. definitely is been efficiencies one going a to We to his of And It prepared one But attendance think point. initiatives had further. started benefits, to balance indicated a benefits remarks, margin this cost can’t it’s on. and that we’re pandemic. already the to We ahead of signs continue working

Robert Fishman

down could How U.S. squeeze one. I this screens, XX guys if you And last closed shutting one in theaters approaching, quarter and screens are the

how is the there openings closings? just – So and wondering forward strategy on what going

Mark Zoradi

new of openings, the brand just month. We’ve theater the Well, of last year. before one end a got another opened terms in open we

calendar brand year the theaters and we four Obviously, these continued during committed pre-pandemic, along line. have We were XXXX. new opening

theaters, closed domestically do we So, we’ve both and what each year. to so internationally. really we would four of very opening. small is have we’re a Relative closing, excited every about of It theaters the and that new part number very

the XX, As where we life, theater. maybe leases that they XX useful theater won’t is conclusion theater to for of we’ve at that had come that renew conclusion. had we the XX, years, to think a If it’s most its point their come

in theaters typical our a close of might worldwide X% we X%. on than basis. year, less closed or we’ve So X% any And

in other slightly has So but different amount. than a done a more, year. any This what just year whole not it’s lot material not we’ve

Robert Fishman

you Okay. Thank both.

Mark Zoradi

Thanks, Robert.

Operator

Alan of from Your with Capital. the Loop Gould next question is line

Alan Gould

for the here. Good morning. And taking thanks A question. couple

I hope I’m in you Black I I see Shang-Chi on Eric’s, on Widow Disney see Black in the have. don’t assume repeating said, of that terms First, bit you anything not missed Widow little I deal so of is Disney, covered website. I a whatever but website. your

Mark Zoradi

– very of be we haven’t haven’t started I’d is. surprised haven’t it What terms all pre-awareness, it to it’s probably not. but surprised – into really we tickets our yet, I selling we in but vary the Yes, titles is, if I’d well looked kinds very morning, be comes this of summer.

yet exhibitors for didn’t you it, Widow. screen haven’t that’s it’ll and a and at but because So you any there, look a Disney have tickets be that to But start now day seen hasn’t may tickets allowed one from we have yet. on started it selling Black selling

Alan Gould

year the million in of tax I to number. for expect mean, terms nice should it’s we refunds? $XXX Mark, bulk it’s the refund I meant. And tax big much of a pretty Okay. what see Sean, Is that April, in the

Mark Zoradi

I’ll Sean let take that. And

Sean Gamble

of certainly this then our end the what received another of year. related we or year And last we million in XXXX filings. April, the bulk towards to do It’s anticipate $XX so

think been to received. still we come. bulk bit has there’s the refund more So a But

Alan Gould

on to some thing, mean, M&A close industry. in That’s Mark, about high good you hear. last – there closures been talk anything high I And profile Okay. the the environment? have

the any there have appetite Is certainly for liquidity. You M&A?

Mark Zoradi

to changed at hasn’t that that answer The yes. all. is, Alan,

every mean at said to Sean rebuilding But does we’re continuing liquidity think and that prudent opportunity we’re that that comments both our along. not sheet. I to looking not relative comes that I balance our potential our in and be

we’re you’ve if as M&A, sense move And arise. pencil, it there’s every the heard marketplace, just of one. potentially we’ve opportunities where potential So, with all at to to forward. go at you, good and going looking them to mandate And we’ll looking deals. sharp we shareholders, about actively step long-term promise like in done we’re the a we and then for single and do up it I our always no they it’s But have think evaluate makes more we’re

Alan Gould

Thanks the for questions. taking

Mark Zoradi

Thank you, Alan.

Operator

from Your Suisse. line is Credit of Durkin next Meghan question with the

Meghan Durkin

remarks, your them that the what going of say that better? circuit that? this something are care Netflix the penetrations a arrangement, just only where XX% shape? sense And something were cameras footprint sense Hi sort they’re months? of can I to to with, the in U.S. doing – few many to attracted Is I’m your outlook the think screens of statement to attracted then on be to next trying how go about reopened. the here? in prepared replace about that that taking What Cinemark? of better the get of said the You that lower? in guys. of for U.S. just pre-COVID. it’s Mark, What than your your you’re because over is experiences where you theaters that better it your in your have will your Netflix Or you’re is I’m your are it them permanently closing going interested going you be theaters Is peers, the if all circuit

Mark Zoradi

That wouldn’t of any going other I other national the that’s circuit Netflix to Netflix this circuit make Army to doesn’t one Meghan, want that do future, I’m the On – deals only the mean take sure the across with wrong particular that the movie, impression. haven’t first. country. given in I doing we’re the Dead.

attractiveness think us open just So some one to opportunities. of creative year last at particular this looking as been is it’s we’ve I to testing late movie. only that I them and And mentioned. us the to Netflix And we started on

And people. to other say deals don’t won’t so that think – with this Netflix but I do precludes

it’s And with I our think test continue it’s likely that they to we’ll go them would. and anticipation forward. that

exhibitors other circuit exclusive there’s not exclusive of also exhibitors, of happened go-forward is a was nationwide an and deal, deal exclusive, playing to even not basis. We it’s It smaller midsize that playing it’s are just the Dead. and that only Army. the Army lots So an on be

that you. said industry clarifies for what theater So hope of to of think currently I that XX% open XX% regards in and was opening, I the Cinemark. is I And

does that to? ones that going portion bankruptcy than XX% made announcements That’s Now, be a not that to of up. how into there’s are bankruptcy And has few far here gone been grow have permanently they’re already the one say other that opening there. to come theaters a no only of close have even are to hard and and out their because a operating couple going

worst government would a I financial expect expect and to mid-size and when has with I what some closed there’s that that settles than in everything significant fewer exhibitors be out, would part that one have put exhibits supported small lot theaters pandemic forward. five not given of support, financial the supports four the been might to right months the thought smaller going the when come So to clarity three, or the government were in had the ago, going

to you give fact but only they until up, don’t not know, number States. the a open We no number in knows knows. can’t one be gigantic I I don’t in a United it’s no going one again, So because else think

Meghan Durkin

Thanks. it. Okay. Got

Operator

line Your MKM Handler the is final of with Eric Partners. question from

Eric Handler

of Good question. here. morning for Couple and you questions thank the

to people in prepaying wonder they buying you Where then or I’ve what I previously? gone that seeing follow-ups. if you’ve concessions, they necessarily advance you to the – what’s And now got regards are buying now versus changed could are pre-pandemic. what about with completely mostly talk First, margin are weren’t happened on that that to

Sean Gamble

I’ll will more that, add start Eric. then and Mark some to maybe

prepared to kind of of of theaters. they’re everything from offer. out they the hadn’t not in and things indulge anything, while, all kind of back his had the have and – we’re going think indicated popcorn, to think a they been before. menu And particularly come the and we in, uptick themselves said, as people the been we If Mark driving that difference, full one want when to a you fully have I mix we offering in remarks, is happening deprived Mark just is the a experience for the big in one things the of lot of sales

theaters. risks a bunch into we’re to new simplify Just employees spoilage, of the things manage bringing of as

So core we’ve in got more theater. and of popcorn, candy Coke traditional our concessions the

a seeing incidents the both So as we’ve stabilize. with But our necessarily these see over-indexing think we’re and so will forward I of just We’ll got With be purchases, there’s that larger – kind we’re in-theater days shift. we obviously online to some again, If drive ongoing that. consumption. purchases, their on online wouldn’t early a say to returning is greater phenomenon mix We baskets. in to aim incremental huge basis. as again in seeing that of that of anything, people a suspect will on an well that regard continue of our

that just what that’s reorder the beverage will to able So done tap, I before think they’ve it we easier. to sales, mentioned we use platform growth drive consumers with continue lines that really And reduced as with with earlier, waits driver. just upsells the a and in whole and snacks biggest food and again, the ongoing for hopefully make we to able think could being be in incremental easier supplement makes of purchases reduce to some and buy. And our process

Mark Zoradi

think I got you it all.

Eric Handler

other two just then And follow-ups. Great.

you plan reinstate America, government you lastly subscription they’ll your First, service? be cash get expect coming your to help your sense of back. And that position? from do do service, might any subscribers to type out the then that with what’s Latin what subsidies that with with And you prior get

Mark Zoradi

I’ll first, and loans America, end subsidies. I support by Latin think America one with modest we’ve governmental then It varies Latin gotten and we’ll take Movie Club. through various country.

reasons were America in as efficiently one vast keep government there thing supportive as assistance And of we particular at to we’ve been that the the employees, they about of been general been managers to any one continue extremely of to able on our or adept is that because doing have board as the local so that. majority it’s could Latin the get. And government And as we able could. loan our getting benefit operate that well the was

most probably we was of that one that got. significant So things the

relative all our we to of height. is now Club relaunching. Movie of when its Movie right kind Movie had in of Club, what Club So We would pandemic paused call process was at memberships

and they credits credits But basis. still everyone them. So charged could coming Club their everyone’s being they off to They a monthly a charging a a member, In an remained on they membership. we un-paused on we’re stopped still bring back use $XX do to still but going if new and weren’t had come adding those could the active phased fee. situation Movie of benefits. to monthly the weren’t XX an They approach in therefore people use days,

So We’ve that as bring stay our what and begin we’ll I’d members to a the tuned. there. back and position. go as to to active June many of from say during on from forward strategic detailed that of a is an position got and plan pause very And possible XXX,XXX do month online

Eric Handler

you much. Thank very

Mark Zoradi

Eric. Thanks,

Sean Gamble

Thank you, Eric.

Operator

Goss do of line Jim Research. with a Barrington question We the have from

Jim Goss

Okay. Thanks squeezing for me in.

studio concern that complimenting of films, issue if have breadth Just addresses new of terms with smaller about is that in product? And not blockbusters. and some relationship is, agreements the to of I’m or the One I’ve wondering a necessarily had the couple an things. ability the Netflix

Mark Zoradi

Jim, for the thanks question.

deal deals the of none Specifically with that.

movies environment However, and we have of we the the our the but will to films we opportunity play to a to opportunity a to way films. current of that smaller in we license got blockbusters, encourage We’ve just that have to screens encourage also of smaller want screens. not lot continue lot the think play

many for content period films, our sure of remember, of no, platform for look smaller we actually some cineart emphasis you as time But going as their theaters specialize films, and a are for play And I’m alternative for in a have a for films, aftermarket. whole that. only actively of launch films may these shortened of artistic we to

the or films because gone and of been five diminished studio deals. commitment small not has So medium-sized away our the to

Jim Goss

you one they most final, as was might striking the question. I maybe what think just financials? more And post-pandemic, would your Okay. be broader impact wondering changes

Mark Zoradi

impact… might it as change Striking

Jim Goss

box it you – would the notice? else more just to think anything Just enables in terms that global be that of at structure be people office levels you could profitable or reduced cost lower

Mark Zoradi

one Jim, don’t there’s I thing. think particular

a way think I of hit to how talking as a Movie the and at about consumer, the we’ve be talked about tap snacks world, we both social in to the efficiencies number our putting to digital had that that and revenue or in place whether world continue those, looking relaunch. do aggressively opportunity we’re it I increase to some of Sean on in a Club we the how market to the will

think accumulation talked we don’t one call. thing particular about I this So going other whole drive things the that of there’s that’s than to on

Jim Goss

right. Thank All very much. you

Mark Zoradi

Thanks Jim.

Operator

for will turn no call the closing questions. There over are further I back remarks. any Cinemark’s to

Mark Zoradi

forward very We and Q&A. remarks for Thank the now. to Please you speaking to you our appreciate second our prepared morning We you be us Talk all much. all all Thank to for you again, active of you this joining well. following look soon. quarter. Bye really that. be safe,

Operator

for Thank you participation. your quarter earnings This Cinemark’s first concludes call.

You may now disconnect.

Cinemark (CNK) 7 May 212021 Q1 Earnings call transcript