IMAX - Earnings call 3 2023 | IMAX Corporation

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the IMAX Corporation Third Quarter 2023 Earnings Conference Call. [Operator instructions]. Please note that today's conference is being recorded.I will now hand the conference over to your host, Jennifer Horsley, Head of Investor Relations. Please go ahead.

Jennifer Horsley

you Conference us Call. thank quarter today's and Earnings XXXX morning, for on joining third Good

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Richard L. Gelfond

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We to are growth with on track we're it been never to for the the XXXX I'll future has for global network. that better IMAX you. for a time year, Thank full across and continue. momentum strong growth to There deliver over drive and turn our continue excited IMAX, that, Natasha. And into

Natasha Fernandes

Rich, good everyone. and morning, Thanks,

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of are measures. well year to beat track guidance or our meet We all on full

of XXX billion, margin IMAX and year. office original full expect We systems at box XXX mid-XXs installations EBITDA for trending least IMAX higher of than $X.X the of expectations is adjusted to

the Office of putting Box XX% third year-over-year, at million year-to-date. at Now million quarter. $XXX $XXX closer up look a was for us

Rich highlighted, historical regularly on our share and As Hollywood outsized are we weekends language opening seeing above local norm.

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adjusted million XXX% a of model, in XX% leverage improvement across drove this and $XX our strong to business in As efforts. reflecting on IMAX the discipline a was a was Adjusted The versus excluding stock-based highest leverage XX%, QX cost X,XXX was the SG&A, quarters segments our EBITDA the with our history. growth of of model IMAX in points, million, EBITDA coupled year-over-year. XX% XXXX, result.From revenue, compensation, an percentage basis continued excellent operating a attributable one attributable our margin growth perspective, business $XX in approximately focus to of or

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Operator

with Thank ladies Now gentlemen. you line B. and Wold first question from coming the [Operator Instructions] of Riley. Eric

Eric Wold

prior one, to talk quarter of levels So ramp follow-up quick continues as a years. and leverage in guess, I impressive films the the with guess be boxes. pre-pandemic more Content strength guess number I one boxes that what the exceed along film question, on the you in changed the influence margins average levels? will versus afterwards. segment Solutions the within account coming taking stronger Can obviously, about to regions has structurally I performance. released of into into larger

Just that trying to segment sense go those of get time. over margins where can in a

Richard L. Gelfond

kinds is we then and margin we've influenced revenues if said look which years, by to box a you'll Yes, And deliver the increase, last the our and expansion, could the margin this are office we of that levels. the Eric, margins are at to that back XXXX see at you those thought driver. for box back of levels pandemic, office the where of time sort heavily primary as long that's few and

So margin the if I strong office these continue. at the increases levels continues continue the will think box will levels, margin where

Natasha Fernandes

works and if content differently that different lot and the that, convert local regions, about different much in does to distribute a then you remaster well think goes in as Eric. countries. And to not as cost us on following language to well. doing to just further market, the language we're as for And way dollar local

you costs, predictable, all relatively fixed revenue of growth. but office costs expansion the creates And remain our and so at look as that to box our continue

Richard L. Gelfond

from gross about language, that dwell don't countries too to as studios the Hollywood. as better much good sorry Yes, on margin in our we is paid several our on this, talk Hollywood meaning much is or local fact than but that one

you have costs flows as So through, lower and higher revenues. that

Eric Wold

have next the films move, that ship slate. about, Obviously, move this some out and already go grabs year, to where it the to replace Or does do later to? flexibility first than studio If you for becomes it upon and about in any rights that to they IMAX up see window. talked what for student original that you you'll another film agreed committed year there? Do window they your chooses choice window get to had give that

Richard L. Gelfond

grabs, The to Memorial exist. And of the to It's up at a Paramount marketing negotiate deal decided new would agreement the in No. this if kind playtime filmed a in time. days, with do as IMAX completely move for as what Eric. new example was last much Possible applies a be to Mission a it. specific And negotiation of have a was. few completely didn't specific good it's we that were when case, window. complete to cameras a movie then And X original the of it XXXX. and if how Day over It get and being we It's just

Operator

And of, ROTH Handler the our question line with coming next Eric MKM. from

Eric Handler

opportunities? what language film do you need such run as see see what Malaysia in if markets to a wanted now? what specific you And I you're Rich, talk could about you doing in markets the as to local do

Richard L. Gelfond

you could I Eric, what's first how amortize language the through office the is So start the the local much in the you network. box cost market? place mean, of So

an would in. in look there's you where play interest at other markets it Second, also whether

and I I'm play that and like probably would that countries. Malaysian not familiar that in Asian probably would India East, other the example, specifics, For with Malaysia they Middle but in places Southeast the and movies think play

how And that.And say and look country kind your of then, movie, be in your like other they the at filmmaker And I think you countries one is country. look you So look kind IMAX of movie? at not course, look origin, thing then market. I'd with an relationship but like at obviously movie then potential you and the doing of the with And P&L there. just run studio in model would and the you the the do that other for look of a that you would what it

increase been lot but you And of the because films. India, we've not just helps know, other for it's that much the to is in larger really doing a you reason PSAs us. your the do that help criteria help local better, and And growth potentially it I in a exhibitors market. in the So mentioned, extent the market as more because can language market

So be much the factors. pretty those would

Eric Handler

the curious you actually I of And to in way accelerate theatres. of at then bottlenecks to what are look theatres in of that existence, completed these in there your I'm sort already are now, your terms as be construction know backlog, don't you maybe process for But installation is terms with any need theatres?

Richard L. Gelfond

it than partner. our builds. I obviously, I mean of faster lot with local the think And retrofits, a it again, depends goes on schedule with mostly obviously exhibition new

signed deal in one on are that, you've to being, a slate. year. would Japan, even that obviously, and would it, year, Hengdian, would those The beyond put that matter some those less say thing new fact, got we I with as it only we've obviously. this with though film October, that Xth of a this of them in build in beyond and really AON, the the there. So I and are I that of in build be installed already just prepared announced a China X we even all we just my recall comments, deal signed said as I as theatre flexibility accelerate X retrofits building is because, the believe

that's fourth people for.And also, put the a down extremely for new quarter, little installs the the Christmas. could always one fourth there's open our basis they to a know, Christmas percentage in film not could want in, they be quarter. existing busy it's theatre out while, So quarter open you coming of before to they a look can as if typical the you historically fourth high. tends the in there's shut because on for time then and been that if and that a at And so up But seasonality, global partly,

Operator

line question And the JPMorgan. David coming our Karnovsky of next with from

David Karnovsky

take quarter. especially at looked revenue Your box Content rate of strong IMAX in Solutions the

if conversations screens how drove you domestic to or adding I to how higher you speak barrier what that to sustainable was there And update there? getting exclusivity And and you last could then some in and wondering about think with partners to zones. maybe Just Rich, see any to quarter, it just early penetration zones if then the I market? is? exhibition exclusivity wanted much spoke

Natasha Fernandes

at of we looked ever summer quarter. It our actually the local Hollywood the quarter good best language mix we was local language quarter, as and in China. had really for So content a

the runs rate versus Hollywood in China China. so higher in And take content

And as Creation the and bets China quarter with the the of a More ended titles, very and other on beginning local pushed last And helped Gods X, of couple No of the October language the we so for it Part holiday definitely days. us. between, also we

that of so And rate led wins a as well. the take lot

arrangements our worked for us Oppenheimer. of component had locations we in Oppenheimer's for rate film. just based other on that that film specific better The take is the that

take that also so the our rate optimized quarter. in And

Richard L. Gelfond

I'd a been discussions, the much we've of nothing we markets. the just say there during haven't growth continue to with quarter. there exclusive expect in that, announced, had from I And We they but in that those just theatres not the some of zones are results within setbacks. zones be today. David, exhibitors. barrier discussions. How There's terms continued but about So any adding to

for what think years. changes. on total a I X know we the And our review addressable that regular you and analysis market So is, is our that next basis,

And have think China, our over and something we theatres. you now I about X,XXX And was XXX estimate is for giving So our XXX In historical XX in a open or like original that. estimate perspective. backlog.

becomes our number zones target.Obviously, markets, one to is. that which examples. America, there's But a that So of penetrated most lot down North few moving the are there of open. you of influences a that zones addressable exclusivity are market interesting I'd like what closed a is because still give heavily

signings XX% in like of this before America something quarter And our were North year. this

good occasionally, people And a it's it the they but shut to had weeks, and point for in exhibitor something multiplex reason real someone estate just various within the an theatre, or for, so multiplex does down it room theatre. a ways reasons, whether that zone. down whatever of of also IMAX resold us we've lot reason another zones, lot very recently to growth. but up because And a resell it, in have those shut many down for is, in they still happens we exclusivity that because office it to if a will zones and there's whatever the go the give that X And shut protects of zone. box proof viability didnâ€™t we a demonstrated IMAX away.So happens, an gone So influence

Operator

And Macquarie. with our next Chad Beynon the of question coming from line

Chad Beynon

Natasha, balance anything situation, to IMAX where buybacks of Given and the be maybe about the is ready cash terms China change thinking does that's in how allocation, capital sheet or given used? you're some M&A,

Natasha Fernandes

operate to continuing business are we is. transaction, as China The

we that best Indian, We've our our we QX. signed deals in ever had had the best summer think title. returned. had We just China. doing been and market we the announced, deal think XX-system We've local I well that language has with

from capital after at quarter. as already is. it to $X as done look then share continue the so operate it will And subsequently, repurchases the And a little that did a million. well. million in the We continue consolidated at quarter, done over $X will as we've already. level, we allocation But We've perspective, China, we

we that continued strategy as our and we're about we opportunistic cash we undervalued, hand that so that on think have. the it about And be allocation, see that's with we'll capital if

Chad Beynon

just these new of about particularly concerts. events, thinking the some Rich, programming then, And

I talked on could local global more kind You does your content? coming the Or into to in kind we say, the but opportunities, PSAs not needed this there years artists, window that Are screens? or drive North of see these artistic the a Beyonce. Talking local language are are maybe Singer, language focused down that road, Taylor and where of just America. book Chinese Swift, guess Heads, big about a artist

Richard L. Gelfond

Beyonce, concert tapping are to into and When couple there to hone opportunities. that over definitely for local And probably in I of a last Taylor I was talent think And I we're asking as my talent couple is extremely markets particular starting for the whether market will we that think for yes. you I which as the not a model. replicate specifically, local it it's there is band so she's there have because how quarters think of talent lot of French particular to France. with you that. well was you like it but to want than is think in with about a the language a a if I a China, in There successful very because local were think models question, us other did we weeks a think Indochine, that. in, talent, opportunity bigger that are only I wondering Swift But But remind event to France. address led And that's a models ago, I also popular event I the aren't phone in of in using of were lot world around model And are replicate. an answer as successful wildly

Chad Beynon

Really nice Congrats. today. results

Operator

question And the Stephen Goldman our with next Sachs. coming line Laszczyk from of

Stephen Laszczyk

Rich. for is This

coming on talk Just this could the of could system a that some your It year-to-date. was like of there little signings suggest about we've I historically? next maybe you on little if pacing what signings bit seen quicker in in they sounds a balance. a just follow-up the that quicker Is of might this in installs years side. are for than vintage bit the few conversations on the signings over anything wondering expected XXX come

Richard L. Gelfond

Yes.

versus last the largely think better with their as been the they investment. but extremely XXX exhibition think And that's PSAs doing for function because IMAX on XX% obviously, same I quickly. performance, partners are we are of our much that I in all X.X coming mean, to still have months right, Certainly, I to And up and year, go. have you're So, we're more report performance. IMAX's well pretty well based we our

So their ROIs are better.

result, why quickly. that's a as so, coming in signings are more And

lot that think in what part growth the year, to of lot your the strong -- lot a as exhibitors around lot partly obviously, North of As And to world. in signing in to was detriment question. than builds attribute the builds a a a turn such retrofit, would rather a going box the also This at pace. new invest particularly install. I there there's speculation, because I faster think second there's I of of in about and And office.This I about capital of it's high AON but I a installing this been and the there's are saying, doing what X function Japan I of of mentioned ago America, mentioned year in the the think in seeing going Hengdian new a building a of And screens, is probably forward. cost earlier to also that's the rest far moment same

So again, saying, a up think those up our "Well, I to with installed the macro it higher base. our getting X- I capital is rather profitability plan a signing by also the and revenues cost.â€ So can and both they're increase some quicker trends which new speeding and a and at build, IMAX of we signings going are than think X-year

Stephen Laszczyk

for talk comments the a next of And follow-up the opportunity? bit the JV equipment on Could maybe back about year the CapEx a little install of course you Natasha. pacing more then on that X, or the expected over on the maybe Rich's of

Natasha Fernandes

backlog, sales just about look we it's JV our if think arrangements. I So to at XX-XX

historically, CapEx. JVs. if on we moving the we're cash, us And I Could an an market. for to there's PSA high so in out would rest on about look sitting I more of at the for course, supporting we split annual and XX-XX. even the world all start our of push as for regions opportunity JV is mean be is forward basis And us usually with

that would us when office fixed return content. one we you get the bigger think just between the margins this had costs about expand quarters and and box And your quarter a like with so significantly JVs

the opportunity but on cash you cash it's all And I have an think of part what's particular us how flow there hand so locations. do for much use return those and to on there's JVs, towards

pretty think is you'll backlog even. should committed high a and But mix there's think there be I So constantly markets. always weighted PSA because out see our opportunities I especially pipeline there

Operator

And coming our from Barrington of Research. with next James the question Goss line

Richard L. Gelfond

Goss. don't You here she on know you as Jim did you out? called mute, be Jim. might I

Operator

our to next go We'll question.

the line from Michael Company. of coming question next Hickey Our Benchmark with the

Michael Hickey

guys. congratulations, great and Natasha Jennifer, quarter. Rich, Great,

So phenomenal job.

X Just questions.

what did crossing Rich. You in touch can you 'XX. Obviously, of sort on this, here signings year-to-date

his you that labour on here Is at moved in feels slate. talked you but crystal point?And movie 'XX. dispute back for are read now maybe momentum a innings, pre-bending well. starting comfortable have mentioned that get the and fair we in to a assumption still this second the Tom a point growth I see definitely, the a to Natasha with now nice think this, you're about should the year, this can your insulation you growth come Rich, mean guidance final still we obviously, like some that signings bit -- to as think to can't below to be question, the I get so here some off ball I but where signings disruption installation you China

the didn't note late-breaking the you year. the of in amount films from have in Apple particular did planned from and earlier have that You films you

So just incredible comfortable at 'XX. local you curious, if box point global can streaming driving given so, is you're when that drive somewhat XX, here that this important And the you and and uncertainty, given to look language enthusiasm. from that not you your on sort confident maybe comfortable, at how are continue product China of office growth performance but the

Richard L. Gelfond

parse There I'll as and best X were can. them try as I through questions about

to install about signings The first it part, as relates and was guidance XXXX. I for think,

don't we in the next early know, year. guidance install you until give typically As

the of doing We middle are our budget in right now.

we're looking So that at carefully.

very installs suggest we budget. number few in the year. XX of a the this that should that we Some haven't But external our have year done the theatres initial, had yet stronger like of China fact be

a there's labour dispute the in caveat not lot I'm there. to yesterday terms So to met a again understanding open meeting of out they allow that.In today. they're world, specifically of prepared minute, and not on comment my into yet is And the real issues which me in evening the

so it's So things. thing this motion And emotion with you But these settled in predictions. relatively not for concrete much in hard think near But the will when this what the too be table, world, at I'm to future. not that term. settle think there's the in thing would worth, would and involved it's very clashes real the again, bargaining a distant make I

depends it when of settles. how mean, XXXX, I this it consistently, said affects terms it In I've

If said X an next This issue are control as XX% we one really Thanksgiving, with settles in So until to Butler. about been, seen months good feel said to finished our moved about our and the from film, of now, with good because the the slate have predict.But it was turns to on IMAX 'XX for break we're think, in Austin going very it. of the of better yes, one good with fact I'll XXX% X Dune People some and half a that a settle second that's lot have beyond the is the to couple during by it if including first filling. IMAX comments, have I out things doesn't us for of things of 'XX, months really And 'XX. cast, cameras. the Dune lot that There additions to have films film is cameras. haven't the been hard that a quarter have our

Kong, that quarter. Road, of us versus another of half So go well, year the then the movie half the got and of, very films a Zillow nice including to do things. first a of in bunch think, another anchor will other Apple I first in for Fury really year, through also first have a there you the are that's number And as the

So first pretty for the solid. it looks half,

coming of your and some asked this more There's rumoured as back content concerts, coming product language, again, question, much the if part on half, promising are the New to of even board. to be the settles, future. is going have alternative a Chinese in second streaming things lot local the For there go like out There on you strike Year. not-too-distant things I there.But very

answer I the quite way, if to question for want play So fall I the specifically us. middle but can right there, where of things think year certainly growth be don't XXXX strike, the your lot of because a in there's a in in we're

of far on the of concert little pretty is a behind XXXX at been bit of really if it's IMAX don't our The good that. this say, exhibition second is strike. it, programs because other needs period. or that the say thing an year IMAX who is needs is In movies you sort running but blockbuster year we It's because by too general, there where that half best the multiplex I with consistent multiplex. film of end kind films.So want at And maybe have obvious, enough of look it's on a lots to obvious, one program blockbuster ever, exhibitor hurt all to year, we're in streaming

say irrespective certainly the settles. I'll is I than of feel strike prospects, prospects thing our growth one when exhibitions better So about growth

Operator

remarks. turn coming showing the line no Rich James call I'll Barrington time. I'm question at next this any from questions back closing Our in further Gelfond over with for Research. to Mr. Goss the of the And queue

Richard L. Gelfond

that to improve an at at something in multiple ended our the what is we've quarter I last if I look call all and imaginable I there's is is and back just XXXX, deliver. a like just been it's to one basis. everybody years this where forever. going in come to And and shareholder way.When able that say, true day-to-day or And lot we've lot think And bought And of saying based out business, point whether this last or But where this should of and going consensus could promised at in or through last say at in business management's some films we've things on, streaming the we're in continues are see, we guess was bankruptcies our proven and then business, the concert operator. business. it's the to going the and which destroy stories you whether the we've industry. look really they're say exhibitor an even And the you just particular, final you then look to tells said is year. signings base, a haven't the on I and index, delivering few to has in come or guidance only in you not year, got thank whether to to And that I thing don't financial it's And in sit ecosystem in delivered they think our even to our the of being theatrical in is their our they And is, many that's if remember XXXX over feeds really them the have future, what for And the use that math. there's movie I delivered years a slate whether and for back streaming the and narratives pandemic to multiple proven And we since is a and And theoretical to of been lot false all couple leverage abstract today.I true. experience global blockbuster on with go across people thought mean you, all ways, our of is look I've EBITDA And Thank we've them a dead. results. our downs. in in position on must have Okay. shares. upside pre-pandemic one our look years in it's ups IMAX every the is the awful of you these supportive IMAX. credibility but those is consistently every small in a ahead. to which pen. down

at So valuation criteria as everyone out is to certainly been a for and rarely I'm figure today. good what urge am I I would those look confident IMAX. as

to thank us, again, we joining So year-end call. you and our for look forward

Operator

participation. for for conference Thank Ladies and does gentlemen, your you that our conclude today.

You disconnect. may now

IMAX (IMAX) 25 Oct 232023 Q3 Earnings call transcript