CNK - Earnings call transcript Q2 2024 | Cinemark Holdings, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Welcome to the Cinemark Holdings, Inc.

Second Quarter 2024 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the call over to Chanda Brashears, SVP of Investor Relations.

Chanda Brashears

Good morning, everyone. I would like to welcome you to Cinemark Holdings, Inc.'s second quarter 2024 earnings release conference call hosted by Sean Gamble, President and Chief Executive Officer; and Melissa Thomas, Chief Financial Officer.

would on remind be this I or that forward-looking begin, made comments conference we like everyone to statements statements. Before call may

company's could to concerning The statements projections release, the at variety financial may found results projections comparable materially These be most objectives, recently Sean from and cause XX-Q matters statements that, include, forward-looking risks filed GAAP are due financial factors XX-K. Also, results intentions. these necessarily ir.cinemark.com. With directly Forward-looking today's company's of to is Gamble. like and would I can may earnings certain uncertainties. differ call measures in turn may but on the expectations or a or the measures. actual differ to include factors. the of in limited reconciliation measures non-GAAP other now financial most company's A to that involve company's most company's Information website over plans, the the non-GAAP to filed to not contained financial materially of call recently

Sean Gamble

everyone. Chanda, appreciate you, morning, XXXX to We second good and today you joining results. discuss our Thank us quarter

remarks topics. going X I'm this prepared to on focus my During morning, main

experiences, which wide release robust volume. sustained enthusiasm immersive positive forward-looking related to to our favorable indicators for First, performance industry be validated for consumer by and outlook continues cinematic film long-term a provides along with

to and shareholder highs. us competitively, strength growth, the driven are screen of overall positions This when film our team company, advance that for the Second, deliver which continued example and a well past results vibrant as widely value. To were These of the evident theatrical a experiences years continued big of start, the sustainable multitude apparent outperform by witnessed believe after diverse we titles strong operational enthusiasm consistent as and actions July. marketed ongoing X now, impact that and solid record-setting execution Cinemark's this effectively. to content that future our well consumer third, quarter financially elevated skilled operationally, our profitability exceptionally non-traditional outsized and compelling and and of include strategic of And the of we sensational quarter business. clear to XQ to for genres be indication brought the performance and a have results to first across example remains larger-than-life during performance range trend in was provide and our

generating adult the in Apes AXX's installment Challengers, surpassing exceeded War, of of May, XX%. of than by dystopian expectations, of adventure the For Kingdom the domestic exceptional preceding delivered box And beginning opening office. drama Civil example, $XX delivered its action Shortly of the run more full the biggest Planet ever. saga, at million thereafter, April, results, weekend then

moviegoing comedy Family the it Garfield from Inside expectations took astounding The the that beginning May away Place: was with One or also second opening next followed as strong action volume $XXX blew growing. which in Ride has included of is already X, play-through Me in with the globally continued far. animated weekend. the a then releases the in than With more as with film quarter Out Out new run to the The June, month, fantastic Movie quarter and Despicable A grossing family Quiet results kicked that Die theatrical Bad moviegoing Boys: a Day solid and in has suspense IF and film, family billion resurgence heart-warming escalated with during with over steadier XQ. Along well domestically Inside thriller And off X time made $X.X recently million continued heights highest of and that July of by film of an second million $XXX still past cadence over yet all momentum to a so the eclipsed opening ongoing build worldwide another and X,

film ever of Longlegs break-out up biggest the And storm box thriller and XX%. Twisters up anticipated for the July, highly domestically delivered more grossing debut, than $XXX our million title just Wolverine, hit, it our box summer opening course Disney for Adventure, date of biggest its more over company. million tore release IndiLABEL Cinemark, opening most all R-rated domestic over Superhero the past Marvel's became ever. becoming Additionally, It created globally. the the biggest million $XXX opening million industry in Deadpool more And a weekend and industry. history Action yielding a July Neon's and horror this time in than domestic opening and by with the office, domestically of office, produced highest which at exceeded of weekend, than to stirring $XX over $XX estimates the

consumer year's undeterred, categories to across volume to like Apple how last to based films content. theaters how billion growing over success of with been years in increasing Amazon levels So consumer of all quarter highly pandemic year's to non-traditional well ahead exhibition quarter on in was of continues fluctuations third next projections that corner enthusiasm expansion nearly rebound were to partners, has Hollywood. first our view the the even the of scale discussions drag and toward date We ongoing half. Furthermore, $X the started and then of it North individual industry by traditional pre-pandemic theatrical about in second our continued internal our the theatrical strikes American of studio couple optimistic confronted second robust drove this the and of release further volume thrilled and title performance continued in turning has see the the temporary back we to films box and results has theatrical generate the as office demonstrate by strong compelling studios content release caused that enthusiasm into remain

Next, I'd second Cinemark's on like to comment results. quarter

our of we peers, far exceeding Cinemark, year-over-year basis office and and extended during outpaced our was outsized results. once second and quarter plethora compared box of films in office XXX industry outperforming in pronounced the produced the expectations, quarter basis our Latin by domestically a meaningfully second nearly XXX and at overall propelled again more track even demand than moviegoing industry record recovery further our 'XX, box performance consumer industry strong results industry basis quarter points domestically our office and surpassed As to lengthy points, XQ the Notably, beyond America. Moreover, internationally. by points X,XXX box both

strong outperformance, in year-over-year Our headwinds strike-induced results, control XX% with and expense the fluctuations, even strong caused a management attendance. decline yielded facing of disciplined bottom-line office agile volume quarter's dynamic coupled box that

delivered quarter, of of and EBITDA million free adjusted a with adjusted EBITDA the $XXX flow. we margin During cash XX.X% $XXX million

many impressive by of ongoing to Our grow second new impact sources of operating initiatives the amplified and results our build audiences, hone our revenue quarter were capabilities. industry-leading

as mix constraints from global the skewed content attendance releases across levels. and circuit of seating Additionally, our capacity benefited well results particularly as due to associated that also our well minimal film reduced volume film

drivers Some elevate our many and helped the examples impactful the our initiatives quarter during results ongoing were following. include that of strategic derived from

further the showtimes non-traditional emerging heightened our from levels membership satisfaction Movie office achieved approximately of number as pursue our $X.XX categories content concession service. management. anime, of expanded of we efficiencies, to per our loyal We platforms improved of domestic through XX% also continued and our such earn since overall ever cap the increasing despite in highest our and of growing the surveyed by almost and guests and films multi-cultural of high through continuing extensive And offerings, due beverage our and enhancement reach while fewer update releases. Through Club hours. planning our theater last base, U.S. generated We ratings X.X purchasing rigorous food strategies, day over to XX% per the guest faith-based domestic we labor to to our million of titles box per space We we with actively execution, XX% customer operating subscribers. pricing offer of continued

were and we direct make of continue are company. And and again, significant quarter is me thrilled believe brings the our which the to topic, the impact of Cinemark. overall with we advancing results my in to So deliver we third able made have to they are a reflection that the strength

years guests, well actions experience and and enhance last strategic as is provide to to our capabilities move uniquely quarter, As many situated we the believe as forward. market of prosper our and position Cinemark an that we highlighted we capital we deployment operating advantaged grow following maintains as

strength expertise, the investments over resourcefulness, our the and company largest as a benefit management our already we I determination from extensive markets. of time foremost, made that and and develop in as of to and unparalleled is creativity to maintain mentioned, First sustained and to none. Furthermore, key domain have is second loyal global assets for team theater our that high-quality base customer differentiator industry-leading practices we in and to collection continue addition well with stability our the our

the For most more past wide. circuit in domestic conversions, we resulting extensive high-return of the invested recliner instance, over nearly all XX% $XXX penetration than exhibitors million recliner have decade, and major in

second compared represented into the it in auditoriums quarter Latin XD world our XXX 'XX. office, And generated while only points We have in exhibitor-branded XD with the America. XXX screens, company alone, of was total XD Cinemark format XQ which and premium box global of built basis the largest up our X% nearly across large U.S. XX% the to

that the revenue now footprint associated motion across D-BOX largest developed We of world extends have XXX auditoriums since of growth with the seats XX% in the pandemic. globally also

presentation $XXX having -- to best-in-class with on the per $XX And per has theaters, maintain regarded million far is projectors that the CapEx of sound with technology, as raise have long condition in of our circuit through a of ongoing Barco theater site projectors. been next million projection basis. business, beyond to leading we level Xenon the peers including our historically continue Our the quality our major overall standard spent the rollout laser and XXXX, to we approximately our Barco which and overall to of XXXX year exception

the the North #X of top XX Latin to year yielded approximately savings. well over to of collectively market XX approximately XX screen ongoing And have America, a new We series markets generate forma At established leading pro the with or global theaters office #X the pandemic, rent we footprint $XX annual exited million over we XX of industry share. alone, time, renegotiated performing past beyond results we And attendance exhibitors. the that have the XX% have Since arrangements America, In lower-performing theaters. continue we we our that consistently highest are opened the a we also of the are box continue with pandemic. in per we leader that prior lease distinctive across optimize. same targets the to

again further during Melissa position. financial was our We results. initiatives result capital our delivered EBITDA disciplined many as in As cash and quarter management, our industry-leading of the a about apparent adjusted Cinemark XQ consistently history flow, free solid of in a long we refortify once maintains balance also and strategic our further sheet. to second moment And made will steps comment a

great we So Cinemark believe in shape. is

positioned range well Melissa? to information the more So about to the will is this distinctive this will over to who and is a thrive call in results. share of pass wide advantages now years Melissa, come. I quarter's

Melissa Thomas

in Good expectations for and exceeded our bolstered and performance morning, Cinemark which Sean. the the the team coupled the June with our remarkable operational upside joining benefited office box success the you, led with This today. results. the the Thank were and leverage of quarter. call to box second you strong our excellence We thank office, of pleased everyone, quarter's meaningfully financial operating

our box than million we strikes. EBITDA in XX of adjusted the of adjusted we a million XX.X% generated grew entertained due margin Hollywood across and In $XXX.X softer million worldwide. of the we footprint global a share. our despite quarter delivered guests and hosted We quarter, guests second office robust EBITDA, revenue second the yielding the to U.S., of $XXX.X the During typical impact XX.X market million

of year-over-year growth The our average capacity strategic X million footprint, box $X.XX. expansion our by market in successful price revenue strategic the the was admissions price ticket Our domestic million resonated and average constraints quarter. revenue driven exceptionally our softer lack a by increased our share $XXX.X initiatives. We across of execution to generated for X% concession factors; a that $XXX.X initiatives. primary and office pricing given driven ticket We well was second in of film primarily reported slate

reduced primarily second achieved driven cap of $X.XX, the and incidence high per inflationary were new pleased XXXX, second with concession $XXX.X segment. recovery to all-time that time welcomed rates compared outpacing X X% in a has resulting XX.X strategic margin. Shifting our of Our and adjusted held our We of that measures. the quarter, in of with International quarter all increasing the $XX.X the million revenue of a our become in the year-over-year the attendance $XXX In by in million pricing to XX% strong moviegoers second attendance. U.S., EBITDA, Latin Out XX% down content Inside EBITDA primarily operations theaters Other a generated quarter America, mix of concession flat despite adjusted year-over-year, million due less performance for We the film purchases. largely highest region. outsized which to revenue due domestic favorable total, million attended for during was our

of was to quarter. share this Our able strength international film market and on in team grow the capitalize the

resulting revenue EBITDA revenue EBITDA, $XX.X million a the international adjusted generated revenue second $XX.X Our operations in and million we total and million $XXX.X international revenue, in of quarter. Collectively, margin. admissions of delivered XX.X% concession million $XX.X other of adjusted of $XX.X strong million of

devaluation, EBITDA in of American The international tenure to our headwind quarter, teams was footprint. our in and navigate inflationary the currency as Latin local offset a Foreign remained which tremendous economic by adjusted political Argentina, value to across we and landscape continue the largely particularly year-over-year dynamics. expertise provide

expenses. of concession global of of as due advertising to quarter revenue Concession second grossing basis overall points with compared mix Film down films. and admissions were XXX expense titles a revenue, concentration the was the XXXX of lower Moving percent some measures with high the an cost the and period rental of $XX.X second increase XXX XX.X%, XX.X% costs to a partially mitigate salaries certain to points year. basis in pricing concession by on shrink, inflationary by compared year-over-year, same and quarter, were of taken driven wages pressure. Global categories offset of XX% down million higher and last pressures the

X% operating of salaries by our by revenue, decline labor and and offset theater million, driven due percent less wage a management up with $XX.X the to in revenue, decline a partially leverage operating inflation As year-over-year, and and expense to initiatives benefits rent rate XXX associated due was year-over-year, renegotiations lower percentage wages were primarily of points hours. attendance, reduced in decline total lease Facility lease the primarily closures. from successful basis

of other XX% variable basis impacts drove expense the attendance, with As that a a increased and foreign expense $XXX.X total lease revenue, a property declined taxes. XXXX, partial XXX driven versus and by points. Utilities was offset. currency decrease second and facility decline a costs primarily percent pressures quarter million, semi-variable in Inflationary

increased fluctuations benefits $XX net diligent utilities and and a income Holdings, levels. currency share spending other As XXX wage was to increased primarily a and in impacts our partial Favorable revenue, as we due higher points. attributable the remain percent the $X.XX. and foreign compensation G&A delivered in related and of staffing per of taxes. million from basis Inc. total discretionary offset earnings with million Globally, well we second Cinemark $XX.X diluted quarter of year-over-year, second payroll inflation share-based as quarter to and and drove

ended after We May. cash the sheet. with million of flow, $XXX free flat second senior redeeming notes QX We even on hand, $XXX million XXXX balance secured of the $XXX million the levels, generated to cash in shareholder Turning remaining bolstered by value. quarter with maximizing a associated disciplined working the which office capital the June the was timing allocation approach of strong to associated standpoint, capital long-term continue film and take benefits goal box rental we with with payments. From balanced of a of and

X on shareholders success; capital returning to the strengthening two, the for outlined a near-term sheet with investments As our excess to investor accretive financially have allocation company allocation first pandemic; deck, strategy; priorities. Starting capital pillars in and with focus X we first balance post our three, one, pillar. our making long-term to capital our position

the May, made balance at over have of during refortifying delevering taken notes progress of few months. advancements X.XX% sheet date million and with $XXX redeemed our over notable significant past remaining We par, pandemic. In we out million to $XXX the retiring debt the secured senior

the our $XXX our savings the term points, proactively majority XX notes tender of March conditions market of in interest interest million due the successfully and We our Xx, and basis we cash within reduce this due our capitalized of annually. In notes Inside target $X.X XXXX than X% be net to range our on in sheet. unsecured notes executed our July, vast enhanced million of for with expectations have we Out resulting by our better with Concurrently, ended XXXX. quarter in actions XXXX a issuance May rate due favorable with coming these addressed addressed commitment unsecured our ratio of also repriced flexibility Collectively, the We the risk largely remainder loan outperformance the the the was strengthening to to leverage to X. management, second significant extended a of and underscore months. balance which and maturities cash

forward, leverage of in maturity cash recovery and strong their we to Looking given flow our our upon million cash convertible coupled notes $XXX amount August with repay around hand the industry turn in optimism our position generation, XXXX. free principal the of financial to intend on

not balance do we maturity our addressed, expect the As address be call cash as convertible remain have feature, to interim provisional prepare a the the will the notes. fully Once in have our notes nearest convertible we been notes XXXX. elevated will

allocation capital to our Turning second pillar.

actively accretive company position have for long-term. pursued to over success strategic the We investments our financially and

contributed our We capital key believe investments a continue consistent have to to industry differentiator outperformance. are us for our that

further invest XXXX expenditures the global capital $XXX our office During of to towards cash We box and range million our to capital normalized we million for $XXX on million as be with enhancing $XXX circuit. full quarter, remain million flow year in the maintaining second to deployed and track rebound. $XX anticipated free

half optimistic and regarding the in XXXX year the box of highly second remain beyond. this we Looking ahead, and for office

to around recovery industry, we've excess year. Returning in later priorities, we us remains update this progress our of on our our our strategy our allocation process optimism third to allocation has strategy in fourth our our comprehensive a flexibility significant and our and February. In of capital connection opportunity historically to for capital with we look capital continue pillar, our be earnings to shareholders XXXX allocation, financial part will that has as call coupled solid possibility excess made of ability move capital and performance on on allocation forward shareholders, including important delevering. the capital the re-evaluating quarter our key a you been closing, returning consideration us deliver We capital the an consistently providing provided near-term Following budgeting with to ahead.

disciplined a have of capital. concludes good focused and highly of on our shareholder prepared questions. we value. Operator, long-standing line history We to we open operators remarks, And and now like would that the for stewards up creating remain long-term

Operator

[Operator from coming with question of Macquarie. Beynon Chad Instructions] is Our first line the

Aaron Lee

is quarter. This for Really Chad. nice on Aaron

some ticket a more has average in be we'll really I Your comps increased standpoint now, for XD ticket. high potentially difficult price but row with facing years several a think from mix

So about drive how you higher slate the anticipated given 'XX are and to initiatives? just in your thinking 'XX prices the pricing and ability

Melissa Thomas

the Aaron, thanks question. for

So office. opportunity see to find to overall our optimal box grow continue average maximizes into analytics and to data continue that that modestly to in just we're do and more attendance pricing broadly, we our leaning prices ticket

runway there. we we So do believe have still

of Eras the international with to year, again, dynamics expected mix. you'll though region. there fluctuations fluctuate would given that, And to As respect concert Taylor you modest then year FX the we'll in see the look given side, or it's ATPs full QX face last some of comp within Tour important continue may that highlight Particularly in on this I keep that on fluctuate Swift film challenging a QX may just film based beyond quarter-to-quarter at mind to growth XXXX, year.

Aaron Lee

about quick across as consumers And like large Got offering have and looks your more greater circuit? appetite opportunity Understood. premium formats box for a as to to a appear the talk you your office, your you expand is mentioned. that driving XD it. follow-up, of Can what

Sean Gamble

I uptick amenities take would in it's consumer say, overall I'll and our a for that. I've of general definitely, to as enhanced appeal food that as in post-pandemic. for well well as motion certainly continuing an Sure, grow deploy. premium one. to as performance XDs we're Yes, bit There's that D-BOX continued opportunities with offerings, just the been of Aaron, pleased to something beverage seats, been look

the which believe XD, on that Specifically your with regard available. are auditoriums the of of to scale are was question, some I that just governors

of in and undermines enough opportunity of where on. looking an we're may existing otherwise point enhanced it's So the we kind for large XD. screen so of it with the But theaters that larger have that a a having important a the case second sound be screen,

to there we're And XDs we're of to have the continuing more certain opportunities those in deploying opportunities look terms And opening continue So our way a theater returns. of the the to of cases, of that generating out where we're terms we runway the in putting are theater. the just may to in those. designed been long the have circuit. seats, really we opportunity in to across theaters, for strong definitely, we very deploy multiple right circuit overall a opportunity add of new those gate. D-BOX have In we're, wherever Those there. I'd early penetration across terms say, of actually

that real see we as possibility. a So too

further generating of see plenty of ROI our varied So when We look and at ongoing kinds premium we opportunity still it's amenities. opportunities. CapEx part of further for

Operator

coming next David of from question line Karnovsky with JPMorgan. is Our the

David Karnovsky

level out Sean, performance periods. forward? highlighted relative segment you mix a the going of looks even control? more your from you this that listed some share in And market the that the you sustain that Maybe to your kind gains on quarter factors between little can expect are outsized of would gain you prior this the bit to increases and film

Sean Gamble

share really our the in Sure. Yes, quarter. pleased with results we're

particularly right more office, our mentioned, of X/X Obviously, mix the again films, I'd Kingdom skew just in quarter the as was we than like I box team. domestically. kind as benefit sweet also of from Quiet Godzilla solid x by addition Place, with of benefited domestic titles that in those an the the about internationally. in our circuit came to that say, which to, really is spot, that flag for benefit our of We Just family Kong, saw execution circuit. for strong well Apes, Planet saw content example, our from We

got definitely we So there. a lift

we that to volume overall since thing say other been depressed. film that The I'd volume see pandemic, -- has continue know, the is, you as somewhat

So limit can we share situations expansion. encountered seating haven't our occupancy where really limit our many we can hitting constraints capacity our where kind overall of thresholds that we're that hit ability maximum

So we benefited from that as well.

So about thresholds. as to we look reasonable forward, seating the capacity more continue a situations of hitting is certainly that we we comments of we've to made improvement expectation, is are think as points those encounter basis we XXX start where those

some of as third quarter example, see last already the we July, examples certainly examples that. to of year. Just that we've This of saw an started in

more end. So mix. from then, as comes and productive. SKUs as We've see can which theater means or even some optimizing problem just see that where ways, content the our kind of more basis seen course, circumstance of we to to capacity upper to that, that. market more our to and fluctuations that's on highly of continue was this fully XXX expect In points content a cause share, recent going And was in quarter, more back, about examples of we're It have. good we're a

that's limits how gains. on that push going We're attendance performance performance. we quarter our with can future to far and expectations our push are pleased the But and box again, office do this some the continue of obviously benefited forward. to maximize what share gains our everything can we from to and we we go things the as key our into So

David Karnovsky

one And side. more on expense the Okay. maybe

box. during and these So you've salaries of to periods manage able anticipated been slower wages

film 'XX and for talked in 'XX. have You a to supply recovery

as you've necessitate over look and office innovations that years you staffing you past lot a of couple more line better these or that box leverage the of utilize seen some So the get to does medium-term, recovers? operating the on that as box can over greater hours

Melissa Thomas

that I'll question. take

we or our on salaries attendance hours. do flex based and and projected our expense, labor So go-forward up regarding levels hours wages operating down

labor attendance. our start salaries to So to higher do But hours box we benefit we the increase expect from past the seeing, been we accommodate we have scale to wages environment, office been I expect we've turn would extent couple in see been and just to same productivity as to office that gains these and of not the as quarters. in the softer experiencing have box over still

other and think the wages out salaries is I thing in I just wage would to call the keep on side, rates. mind,

So do some pressure annually. was to there. that continue saw X% to to in we what X% line range expect in with we which pre-pandemic, see It's

to continue, opportunities further those of We takes. are and the continue for course, to look drive and to productivity efficiencies, puts but

Operator

Eric is Our question MKM. come ROTH of next from the with line Handler

Eric Handler

have XXXX. a when PowerPoint chart compelling, movie Sean, coming at and people in you in content 'XX, great is some showing to quarter, it's clear you big content really and 'XX got really your in then up you that are when fourth looks the presentation, theaters. good When look the look franchises the you've at

think aware to do slate well And over than of improve your of you the say good But consumers the would right I the maybe so MoviePass Wall it hyper So Street seeing helps what you is? can how is do aware next how you're more just even X-plus are reinvigorate years. content now? probably that what subscriptions the slate

Sean Gamble

observation. agree. for for Well, the thanks, we the and mean, question I Eric,

that. definitely it those we of think do at question of how think we you're which quite larger is I and And we generally right, when that's by is -- that I awareness it films, mean, get have insiders think I we is of looks consumer on industry what promising. today line some to broader sight understood look certainly

mean, that for awareness by the as as titles, what's we gain as there's think both the get nearer I the coming a the campaigns just there's exhibitors of range to place take ways to term. marketing I well obviously, classic in near ways. those by studios

back I #X, in. the this more right a and benefits We release. in by to got then in come desire talk more More are the coming think a to cadence market, the more about going terms and in the what's right of momentum seeing down the cadence one volumes a People marketplace great just but as we we we get there of, being now, result in sheets in, what through it steady also of as come exposed volume really place there great marketplace. is there for to trailers, is where steady of through pipeline. get is films they

in the think So sustained we going habit real of content more other a ingredient have theaters important to that's to of and theaters, exposure other getting more I volume people as into that things. get

to Beyond that, out do focal broaden just big -- how do other happening they read to spread the of one we priorities more coming PR. and narratives there's NATO's of to how about create how portrayed to of work about and news terms say, of consumers in try that sometimes conversations It's about. positive false help get what's of I'd counteract range points a awareness the industry and can moviegoing, which of some about these

I just the and to big of is part them through by and a coming people films where just scenario that exposed more there regularly marketplace are there's more back getting focal the to point, range think large movies. a things, in but to So getting are marketing

Eric Handler

your great. the financial not And now. industry I one if in definitely mean, as right then a is follow-up, Okay, position the of, best

There's you developments? in right But real can new of seeing you I'm we terms what are development do haven't to so curious, in the much now in seen particularly late, along. estate theater only So much new projects U.S. of push

Sean Gamble

pandemic past was you Well, of too whole anything, obviously, out, industry which theaters, development more slowed lower-performing the bad the more to closed the so in years, of some a as yielding point of have been if isn't thing. pipeline pipeline. mode build slow, certainly those theaters contraction in lesser kind film is venues. a over new And like was kind few that were It's pipeline the in the due pruning that ways of theaters some

that since which We've pandemic, with as to success of looking and the we're pipeline at committed in had remarks, prepared have pandemic. we've our projects opened I great new reactivated have my to We the prior that builds projects. new incubating had, were we mentioned

we've pandemic. have our than better the before out to On in whole, been do expectations set what those the performing

So well. time. all take years to going we've time, of projects construction as work landlords, movie, government whole permitting and take deals some bit of take just others little pipeline. I because a with the to making reactivated these can it just have with like through process, that expect can It's the a

expect as I tempered continue still it to few taking be place that that of also recovery. next of more I going a to that of albeit more you'll over the bit bit everybody will just -- see is through So will a expect years, start

continuing back. Our to whole still industry is recover, volume still is coming

activity little So of of as is build new kind cycle, everyone still governing a I any factor that that still a through will bit ramps how be up. think working on fast

Operator

is Our from Stanley. coming next question Ben the Swinburn Morgan of with line

Benjamin Swinburne

but remarks, and little Sean, your in maybe I hit on from couple expectations next hearing studio the terms always -- the side from we give a your of in just latest us releases. of supply know it prepared wide could And greatest film always 'XX years. I you you benefit

time think the And then updated I a higher felt follow-up those 'XX. last us, Melissa. for you than would think I you I had be

Sean Gamble

today, sit I have mean, most to. because speaking Well, XXXX line we more of that's here about as we where the sight specifically Sure.

were were releases. around somewhere be a the year, we would this estimating At So overall earlier, seeing kind we XX few more. we're of volume point, into wide coming

that further to at bit a the little been releases have which prior from about about films that pandemic about time, last XXX down for since see still which this smaller a There's from a down XX% and So or was so that's great we're bit average XXX. XXX the recovery. looking year, dated been of Obviously, to is little year. wide few

what and As we better they sense of the year. the until year. this line towards of end towards we dating have all predates their studios the That's for of some this of a good the are, end don't look typical to XXXX, fully what announce to but larger process, and get a get you that COVID, sight just we the more titles have -- the generally even

lingering definitely, of in 'XX. of little but we recovery pre-pandemic see volume in So have nice we strikes terms probably we conversations, do in have to, of rebound points we from bounce a a There's of data XXXX where were and a Hollywood But we where have our in line the landed we have trajectory volume year, to the don't the overall we'll continue and impact somewhere that that bit the access between the from different year expect overall last to that. sight discussions complete next back progressing to marketplace. been upon

Benjamin Swinburne

gave back lot to on just helpful. chew of prepared a That's you things. remarks. Melissa, come couple in us And a want the to I to

technical. you redeem planning the little On my cash. guess, to guys with question convert, is I a are that

liability your August? And I the piece plan if then amounts. budgeting well also February. said and there mentioned You grows, the has talking were redeem plans in process really of all wondering you you principal be stock stock do return do it in that the and and cash stock as in of a now or between to about performed to sort might next of think capital I'm

You as capital returning shareholders. to framed excess them

So if being your too ask a noticed a I that dividend obviously Historically, I'm little I but wanted like payer, into buybacks as vague. much maybe has to I been were you it reading a includes more consideration. seemed language, Cinemark but guess,

as if wonder you I So the considering guys Board were maybe was? buybacks well or

Melissa Thomas

those questions, for Thanks Ben.

$XX.XX, the dilution cash. movements spread question Ultimately, or approach expect, capital and extent the our protects the your a stock convert, exceeds evaluating then with on the a extent which will your purchased our allocation incremental contingent have on impact stock considerations price our potential up comprehensive with as hand shares decision we cash would other the strategy. $XX.XX. taking, you to the flexibility allocation, price to on call be to first either respect are the in and factors. And we upon amount to that question settle to we that to of from $XX.XX, To so price So us the stock exceeds regard capital

that So looking buybacks pillars, as looking is across well you dividends. at can inclusive all X stock assume of that as

Operator

next is with from Jim line Goss Barrington Our coming of the question Research.

James Goss

the films is and it wondering flow, primarily being right film just if do dependent the of a or this you numbers more attitudes, seem appeal now view with it's on the slate? Sean, optimistic demographic attendee released? I'm about game and I'm of if discussion mix you the quality of You feel wondering how

Sean Gamble

I'd pre-pandemic. film seen we perform volume, where it office released. at saw was And of fewer can that, overall even Well, clearly quite with even say, being we at I We've July box really of think it a to look comparable Sure. overall as exceeded with both. a it's office where titles July, think levels factor reduced box examples of last I XXXX of kind number

clearly resonates to volume have more aspect that seen. compelling would that. But content of we've have over series the through them many audiences you years. to the like opportunities examples. with So I last say, We've breakouts, is of one well critical went just films those a of for a I want seen piece, those several

exposed you coming of people is it coming have kind that you This get box of People oftentimes get those to then going opportunities begets helps. moviegoing break-outs, office. volume variety the nice industry habit, just where audiences for because and a momentum what's which earlier, an mentioned And films to of continued of more into those films. that sufficient kind can to as for and into propel often get We the then all to mode that keep of moviegoing. that that I speak want to up. like You that opportunity of

and encouraged as So thus terms listen the elements a -- we're we're again, it's we from encouraged different strength that. in. really look see the have coming volume we're appeal certainly both of we to in filling and back overall we line indicators regarding and what what's the down far of And of to by of quality standpoint

James Goss

one I wonder concessions And most what to higher Okay. share I trends you price the next a And -- recovery levels pricing there's attendance Melissa the effective really know analytics of priority been couple you that maybe allow several you might lot next how lot data and premium -- years physical is cap. focused into Cinemark of increases per of over And is optimism? and how attendance that's the leaning benefit other, recovery move really And office attendance and always has might talk the mix. determine on if you're strategy. mentioned going from a into where the years? about to to the Box view

Sean Gamble

right. volume. you're think hand mean, I I Well, goes with that the hand in

helps I keeps It to those driving think to is driving again, frequency office. for because attendance create and line. people that box to and just exposed getting And our focus food of attendance maximize helps primary what's coming it the opportunities sales. down beverage

So it becomes positive a circle.

can strategies earlier. what we're and can So what get when looking plays to as it gains, do conscious we we we Clearly, to we're strategically. very also do When way, by mentioned but of attendance think about that looking pricing -- Melissa into the we're price trends ultimately our too, attendance. at it pricing, approach to

where food incidence that affecting negatively we're and spot not So negatively of attendance beverage. sweet it's or of affecting consumption finding we're not really that of goal

people the So actually both just stimulate receive we're back positive, looking box positive attendance can into particularly up office of that come marketplace they all those the winds in think come may made people movies for and enhancements continuing not have more been what we and the there a on think who looks just in, -- for trends been have theaters moviegoing. the when frequently, that. And as we continuum that

Operator

Wells from Our is line Omar next Mejias with the Fargo. question coming of

Omar Mejias Santiago

your of give your update continue to -- Could expansion content remarks, as enhance the a forward? alternative And continue performance? that us to first, if are plans in content an expect traditional volumes. film on going you mentioned office what driver of you non-traditional for to maybe Sean, supply prepared box you

Sean Gamble

at with building to been build. space there fruition. finally pleased been of felt examples some categories. seen titles, multi-cultural faith-based that this we've content; it's to many for of those I huge been in success never momentum living long great while think see up content a disappointment. it personally, me different And know to I the film, was many, now that anime, like There's was prior all always across we've Look, I Yes. was least of non-traditional alternative potential kind the films. a for concert Sure. pandemic, in

where that getting there's because a compelling out of it's So those now. success, more made place space. more it to that And in content are that audiences seeking getting feels like of more. There's content

studios phenomenal had like now got success faith-based of I releases out, year. X You've think last announced year. Angel this that's They Studios films they've putting

more the of more year scale. that smaller So We BTS examples and lead obviously Beyonce purchased with saw and Swift last Taylor Sony there's many Metallica films. been with Obviously, concert-based of Crunchyroll. more will They're of really Coldplay types strong. Anime to in that and been heavily has that. We're those leaning a growing optimistic into that space. area. in that There's

and more there's coming into the market. compelling more So that of content

about This about can basis. Last was what XX% to remain quarter, a about year our us. was again, XX% it office. optimistic past it we for It on go-forward year. was So do a box continue of banner

pleased. really So

more so And overall or versus X% -- while, of and go it's we of we years. to said represent percentage like we a historically could the for we X% we future X% Now bit continue look been content rebounding that But we to expect that box that over we think see down as a may have non-traditional more content Hollywood office. just long as ahead.

Omar Mejias Santiago

Melissa maybe for That's per And on very helpful. cap.

for some provide rate incidence of grew this success? Could much that was ahead? drivers the you are the per some you clear that improvement a of over sign on cap X%, yet flat initiatives year-over-year, us how color room that And key mentioned You strategic have working.

Melissa Thomas

Sure.

we've increase for offset the So pressures our our side experienced. to strategic pricing by actions that of per largely inflationary QX, cap some driven on the was

of on to maximize cognizant attendance push seen very we've price first ticket mentioned, Again, want we're food beverage. foremost. how and on Sean able to So prices, in similar we're we to as and success being cognizant average

optimal beverage conducive as slate just and well find hasn't concession X The food purchases. film been the to quarters, as drive the On to the we're looking side, our incidents. last ultimately pricing as

we concession flat But action-oriented despite that typically hold that So into have some horror initiatives a were in been and year-over-year we've higher able does a of dynamic. audience we that brings content purchase. more given to incidents the that leaning pleased that were

you our As be modifying most things traffic, about of the flow that capabilities, putting in doing on would of self-service concessions we're excited about, we're that would ordering. some I say, mobile think

foods have We our offering. also hot enhanced

So that, ultimately as as scaling to we've drive we pursuing merchandise delivery third-party well from initiatives seen are sales incidence offer higher. products, pushing more rates certainly some we're as other success that some

of and we at the we're where grow. to film about we fluctuate good quarter-to-quarter, feel will have still opportunity believe we cap plenty So slate our but have per

Operator

Benchmark Our Mike next question with The is line coming of Hickey Company. from the

Michael Hickey

concession job Melissa. on admission topic great of dovetails all-time the exiting on I XQ a quarter. here pre-pandemic answer your think and and looking Omar's concession trend your this looking a revenue to But and a think it but been is you at your this domestic to So has concession compare your that guess, about XX%. was -- and at obviously the I ratio bit record on XX%. a question that's I -- And pandemic,

cap durable. very relative it but sort we then bit, curious a And driver the keep So I'm mix to could here to total for key the the down fact, on seems is but driving what said, this guess basis, is, on per a be just I you of on waiting be seems what question there? And just I think to of come concession volume what's growing. curious, the Melissa, -- seems it in sort heard admission it you

look it at product be challenges? when to back to economic think Sean If mix how know years the think pre-pandemic? And Doesn't seem to of through equal in portion piece. couple continue play we you about do but is your should the consumer and that last view Obviously, attendance I that's volume theater, straying wondering fed will think you larger in case pre-pandemic. said be full fact the next of you of the fact a be getting forward you on when maybe some into there. And a we and durable, some then, durable when So seen guess to restaurants. curious see in the I it of you product have in as we've the all

So maybe opportunity margin What too. your attendance total towards ultimately is of pre-pandemic? mean to concession sort does that versus mix

Melissa Thomas

Mike. on that, So I can start

rates majority you even is the incidence of lesser by relative hot the strategic look earlier. as incidence the as XXXX, cap XX%. product One percentage at domestic north rate then concession of icy the of that up purchases, of basis a I Coke versus And things is admissions. well per concessions we offerings, if to is that initiatives And driven seeing we're per cap and pizza of a And including and higher higher as extent, blend as popcorn that growth a of mentioned, on that such and mentioned say expanded some of to so foods as execution well core alcohol, the price. that our

-- So coming start incidence we out did of would we -- could did the normalize. that pandemic, think potentially rates

haven't efforts ultimately believe to incidence are seen do rates drive we that. been leaning And that we've into We causing to hold. our that them

going even we're with a as where about going feel then year look margin being at than talk about of since those to were we able from forward kind at, full XXXX. And margin and we we higher drivers So EBITDA XXXX good concession pre-pandemic deliver standpoint, of are what to forward. revenue adjusted that. caps the back EBITDA but in to that's grow ability ultimately, to margins, look be pre-pandemic, margin important our a would we was element And driver get feel our to back it we to sustain to adjusted to an get that certainly -- try per and as key

Sean Gamble

historically, to At And things going grow add, would of know. mentioned, just Melissa kinds caps, pressures initiatives People least continue has certainly it. then when probably lines skip I just Mike, we per caps beverage. the to the per is and feeders, have one don't while successful buying to been areas food we're you the see with just we've that is to #X they'll pursue deterrent full of and the long that

of we and with lower because more thus those attendance, we've of future haven't like we could lines. lines. the admission worked delivery been mobile in marketplace as to films volume people And of by hard a films into have That where sort full lower the is on to on that situations ratio. that working that, as again, pressure who had which the put to ahead, that can lower to kinds easier of seat, pressure. see So that where of you concession the little we avoid doing that. Obviously, much buying really of to order bit of That we've are back, avoid in for find try allow that initiatives theaters a comes thus makes to slate that something said, it people things a platforms could it

theaters we'll So a go and attendance see with got that more we'll we're all many continue as those fuller to by will our that more in but and sustain very have of we to have type to we growth hopefully, lot our with sustain But initiatives forward. going marketplace, our obviously, we of volume those have on forward the see. impact pleased working that to boost that the caps per had things we're

Operator

the B. Securities. line next of coming Wold is from Our Riley with question Eric

Eric Wold

film beyond? scheduling do from coming that start to years, general in you that question, us could recently film slate couple availability the a that And could discussions more industry. during they from days streaming I discussions maybe go studios of high-level a kind change hear in of date came performs? Are guess, it's how around just on Sean. not that kind the streaming essentially you into Are I they'll a 'XX think completely in when And becomes with But around you what on with to the marketing guess, on the theater or of kind windows? flexible subscribers of date? the a past robust whole disappeared any depending windows, in exhibition about predetermined platform? issue has how may pandemic update they and as of

Sean Gamble

of bit that during It's it's conversation lot might component. a to a the with amongst that just public exhibitors, that impact pandemic. we I right albeit studios ongoing there in say, going windows continue Great of with say, all on little eye Obviously, less try behavior. I as amongst evaluate would have on was the focus on where evolving consumer stable experimentation would now dynamic is an been we public stable, the now. holistically Sure. probably question. are kind to any a was more just it's

the commented, Before things we I certainly more giving a which we've risk now opportunity them the into a derisks, more mid-tier it in other for things put smaller it connecting, the a many rigid, things to just connect. because losses of our Likewise, respects, were curtail reduces window, run positive, long flexible view get and it's for films success for in know the those looking aren't titles as us, screens. and some faster home to window and we're on things if when don't to studios

in ways. Generally, films, compelling around those XX for of of, point more respects, more what films. that's coalescing are works larger some starting of films for kind it So we're kind still kind finding both is things days compelling those

to terms in out at trying still continue there something we it. figure to depending to us the But kind to is that's for on all to their landed is the it and and where much carefully maximize spot movies on be this a far, we're sweet mean, on studios and that watch are through. Thus point as the we're exhibitor seeing to as probably ultimate seeing not all largely our of as that films discussion They're maximize performance just the side having us size, well. we well scale playing impact opportunity it's kind able effect again, are on why moviegoing? hasn't the time, financial what's But ranging. in smaller gains point which been optimal to for films of we're Some of I as for skewing in their any little. of evaluating, a we've people's major as on how go decisions thus far, kind of

Operator

line Our is from of with MoffettNathanson. coming next Fishman Robert question the

Robert Fishman

Melissa, Sean if for I one One and can. for then

just taking about Sony's versus you note, a investment meet portfolios tuck-ins appetite position, So smaller of us the both on update Sean, in on your thoughts can even just preference given a related side? acquisition And your you can U.S. you they any criteria? and if in acquisitions, from for return of larger both financial have do internationally? share maybe the strong And terms other your on Alamo it

Sean Gamble

and we circuit look, our that footprint, equation. our mean, which yes, circuit. as a about M&A our have and growing I Well, optimizing of Sure. recalibrating talked evolving strengthening includes is piece and certainly

So we the I -- would on generally there. time. in M&A indicated can appetite assets have we've our certainly focus is past, believe assured is for as returns the high-quality that over solid deliver say,

that don't the right mentioned, as the sake. strain As pursue we our it's just don't are growth forward. following that in approach we growth's We we success like balance really for move also investments targeting sheet. We've approach I've believe had accretive great past and

say, handful hasn't the look limited. M&A we -- been on None to we'll but of There have strategic there continue been a assets on when -- close in the out industry, met view say, there out a keep what's has keep the There fairly would the to market. I have of marketplace. investment our a that those, we there. would I So or close come what's thresholds, across activity watch

markets, smaller with say, again, that's that. we in evaluate quality back a they a and comes deliver We out thinking the best assurance we're looking Latin circuit favor say clearly, say, going depend. directionally, the And But being I'm to in the do In in we're our the for would to fit tend returns keep it to just close really then going would we're continue I everything that I all assets, larger deeper able it when terms more and of forward opportunities there just going eye. broader. versus way we I'd versus America. about bit of opportunities, talking we're to our circuit. as like to how markets U.S., move to the

Robert Fishman

On Alamo?

Sean Gamble

monetize then their IP, And interesting types that. IP, -- ways their they've what an looking their from acquisition their talked that gaming on at commented I the Sony mid-range in their mean, sorry. Yes, Sony. plan. We quarter I'm know further do opportunities based experiential about Alamo. by earnings on it's even question second film has on looking of We for to know to IP and last

that, fits into category. We for a time. supporter demonstration clearly a fact certainly, a of actually are of physically that is transaction big theatrical And this that So know long, the Sony a circuit this has purchasing long experience themselves. entering space they this and been the

of that's think future of their exhibition. feelings I just the theatrical underscores

mean, think this that, I And think beyond But continue view of marketplace. positive. to plus we'll a as as again, learn as I that their the see in at look about we plans. more they future So talk terms we on I probably their a

Robert Fishman

And I just Okay. Melissa. if can quickly one squeeze for

forward of ramps office big back to us of the terms outside give sustainability, as a there with about, conversation, these you with cost the from of done share the efficiencies just slower talked of office you in terms of any of the lessons other But can box up? salaries coming box the that that you given are confidence going -- the periods learned margin sustainability side, Just which lot talk in cost about outside that.

Melissa Thomas

Sure.

largest our we cost cost and I as one efficiencies, variable is -- about wages. So of think our salaries mean, of the sustainability

most we area about So gained we've and of talked say where the would that that has productivity I been side. our

As we box scales. scale, office the

than other and film I think of in of just things mind that historically couple past concentration our margin our of -- given the keep -- box and is, been a expense rental been. couple an the films the over I office, they standpoint have mix rates lower would of from have quarters

of would that mix overall year that to as starts concentration expect would and film change the the and we So half normalize. in beyond second rental rates

its is on The nature the other out international, just type expense that in call thing box in X given is facility lease I office particularly generated. would variable more side,

and as gained scale we've costs I other as to of learnings we've drivers the have labor, just expect biggest would box say, some scaling. and the be the we utilities result naturally there other And then learned well. increase that theater that would other the So scales. would that a within been efficiencies as box the office there of But office will

Operator

question Laszczyk line next the Sachs. Our Stephen is of with coming from Goldman

Stephen Laszczyk

Maybe for theaters. to the underperforming you strategy mentioned exit Sean,

curious so from opportunity the theaters? you've I done side think be more less financially how maybe then think much I productive perhaps And close about would there just on to you to on XX is how that you think margin or date. the long-term recalibration? benefit

Sean Gamble

going I the on question on the could piece. last I think didn't forward Sure. repeat sorry, closing. part? what hear last we I'm got you the

Stephen Laszczyk

benefit. that benefit potential the and strategy financial of margin the Just long-term

Sean Gamble

I you. as we've a Yes, recently as of exited closing titles pandemic. that Got bigger amount were there think far was affected more goes, theaters as

theaters the at were Now lease the were majority end those that of life. of their

they would say I a and the older more were bit financially. So on cusp

theaters. So our positive by the those on whole, bottom-line have those benefits to organization yielded exiting

just historically, few may getting with have into that run where we're a newer and theaters then operation we open a theaters would year state as repurposing older close year. it's that case, a been we generally, theaters forward, I look course. their in a And we've think normal we that more of in theaters few

theater about a We'll as as a year, -- our earlier, we're when Generally, just we'll pipeline. expect a to margin on negative positive. happening, it's for we're perspective see even we margin I number looking type norm in our as adding what token, can't closing cases, that's but where the to business. build will all M&A benefit we margins But and situation circumstances continue have these question we've a the that that the we it's theaters just pursue enhance reason It's is part and reactivated talked closures future of both of which a new on potential of at we we to has of your of from margins. So same well. Net-net, the forward, impact, it's think I happening that actually in our certain new as go activities, a impact. comes rare. be expect each

Stephen Laszczyk

for one maybe Great. And then Melissa.

international of difficult you the looking there about bit that continued that environment couple at of talk a on in Could the next little moment? side, markets. more you maybe or And been the the any volatility there's some quarters? front are some aspects inflationary easing operating of ahead, environment then On the over your see becoming more

Melissa Thomas

Thanks question, Stephen. for the

international So to volatility side, continue do in Argentina. we see on the

Argentina contend numbers FX seeing you're devaluation our So and with year-over-year. to that continues in

Now Argentina environment. highly is inflationary also a

been we're inflation offset some seeing the that FX the devaluation country. providing has So in to

in the of when one quarter, in essentially dynamics saw our per you than the which to Now that prices May, of our did within activity at particularly and softer rate we look that months box office you was a April led rate inflation. and QX at the slower promotional of average the price ticket cap, have increase

see So the highly to in but we on at the It landscape that. economic teams did international Argentina. who the in in situation, continues some quarter dynamic again, we experienced pressure a navigating be ground related to are have

Sean Gamble

XXXX. our American pleased we've really the in fluid the of the circuit I EBITDA case right just somewhat mean, from last situation whole. the been higher our XXXX. And Latin results been last of was Argentina, the really just an and in the in than have has strong. higher America been which was economic the standpoint, of midst I performance would is know overall again, which extreme that Latin describing, attendance we on add, mean, probably year, with Melissa political year than was I environment now,

the and really are as environment the contend examples at do of have may with Latin at U.S. our recovered we some that still teams, further this and in are adept Melissa in impact. market, be result stage. on a with from of otherwise actually teams of or the what our on team's great America a see moviegoing just we strong These dealing than here to challenging pressures we are the well has facing midst that, marketplace very said, even this performance a cultures. Again, So just standpoint able we to pricing whole,

Again, lagged America that strong at face bit a on Latin the a in for released marketplaces, been that's But pressure how content on content has little as may of a we're while far that's pandemic also really these that in the is whole, degree, resonated due testament during look we to how pleased has in has how to So that certain second a and performed. availability half. resonated, changed. of We thus the those markets. with the to vaccines, moviegoing

Operator

closing to I We have reached and the session. back now to end the question turn over for of our floor Gamble remarks. like any answer would Sean

Sean Gamble

morning, to remains continue Thank to release to very look closing, we like volume of as is results. We all of I'd great Consumer once move our speaking forward our well again joining The much. discussed, Have us In believe about the wide key are exceptionally we that prosper to of third just we Cinemark day. positive. this forward. see our reiterate And have appreciate you a you quarter recovery we to and positioned we following indicators continue again related and with a continued experiences, interest industry you Cinemark. theatrical in future to as enthusiasm robust.

Operator

your does conclude today's This We teleconference. you. participation. Thank appreciate

at You may disconnect lines your day. time. the of this rest Enjoy your

Cinemark (CNK) 2 Aug 242024 Q2 Earnings call transcript