National CineMedia, Inc. Reports Results for Fiscal First Quarter 2013
~ Provides Second Quarter and Reaffirms Full Year 2013 Outlook ~
~ Announces Quarterly Cash Dividend ~
Total revenue for the first quarter 2013 increased 3.9% to
The Company announced today that its Board of Directors has authorized
the Company's first quarter cash dividend of
"Our strong Q1 results reflected our continued focus on expanding our network geographic reach, our strategy to secure more content partner and other client commitments upfront and a great effort by our media sales teams", said Kurt Hall National CineMedia's Chairman and CEO. Mr. Hall continued, "With the strength of our Q1 and Q2 local and regional business and strong late Q2 national scatter activity, we appear to also be benefiting from the steady economic recovery and the impact of time shifting and programming fragmentation in the media marketplace. These macro trends also appear to be helping online and mobile video which has further expanded the video advertising marketplace in which we compete."
2013 Outlook
For the second quarter of 2013, the Company expects total revenue to be
in the range of
The Company reaffirms its outlook of total revenue in the range of
Conference Call
The Company will host a conference call and audio webcast with
investors, analysts and other interested parties
The replay of the conference call will be available until
About
NCM operates NCM Media Networks, a leading integrated media company
reaching U.S. consumers in movie theaters, online and through mobile
technology. The NCM Cinema Network and NCM Fathom present cinema
advertising and events across the nation's largest digital in-theater
network, comprised of theaters owned by
Forward-Looking Statements
This press release contains various forward-looking statements that
reflect management's current expectations or beliefs regarding future
events, including statements regarding guidance and the dividend policy.
Investors are cautioned that reliance on these forward-looking
statements involves risks and uncertainties. Although the Company
believes that the assumptions used in the forward looking statements are
reasonable, any of these assumptions could prove to be inaccurate and,
as a result, actual results could differ materially from those expressed
or implied in the forward looking statements. The factors that
could cause actual results to differ materially from those expressed or
implied in the forward-looking statements are, among others, 1) the
level of expenditures on cinema advertising; 2) increased competition
for advertising expenditures; 3) technological changes and innovations;
4) popularity of major motion picture releases and level of theatre
attendance; 5) shifts in population and other demographics that affect
theatre attendance; 6) our ability to renew or replace expiring
advertising and content contracts; 7) our need for additional funding,
risks and uncertainties relating to our significant indebtedness; 8)
fluctuations in operating costs; 9) changes in interest rates, and 10)
changes in accounting principles. In addition, the outlook provided does
not include the impact of any future unusual or infrequent transactions;
unidentified restructuring charges; sales and acquisitions of operating
assets and investments; any future noncash impairments of goodwill,
intangible and fixed assets; amounts related to securities litigation;
or the related impact of taxes that may occur from time to time due to
management decisions and changing business circumstances. The Company is
currently unable to forecast precisely the timing and/or magnitude of
any such amounts or events. Please refer to the Company's
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Quarter Ended |
Quarter Ended |
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| REVENUE: | ||||||||
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Advertising (including revenue from founding |
$ | 73.7 | $ | 66.3 | ||||
| Fathom Events | 8.5 | 12.8 | ||||||
| Total | 82.2 | 79.1 | ||||||
| OPERATING EXPENSES: | ||||||||
| Advertising operating costs | 5.7 | 4.7 | ||||||
| Fathom Events operating costs | 5.8 | 9.0 | ||||||
| Network costs | 5.0 | 5.1 | ||||||
| Theatre access fees—founding members | 15.6 | 15.7 | ||||||
| Selling and marketing costs | 15.4 | 14.5 | ||||||
| Administrative and other costs | 7.7 | 8.2 | ||||||
| Depreciation and amortization | 5.4 | 4.9 | ||||||
| Total | 60.6 | 62.1 | ||||||
| OPERATING INCOME | 21.6 | 17.0 | ||||||
| NON-OPERATING EXPENSES: | ||||||||
| Interest on borrowings | 13.3 | 14.1 | ||||||
| Interest income | (0.1 | ) | (0.1 | ) | ||||
|
Accretion of interest on the discounted income taxes |
3.4 | 3.0 | ||||||
| Change in derivative fair value | - | (0.7 | ) | |||||
| Amortization of terminated derivatives | 2.5 | 0.3 | ||||||
| Total | 19.1 | 16.6 | ||||||
| INCOME BEFORE INCOME TAXES | 2.5 | 0.4 | ||||||
| Expense (Benefit) for Income Taxes | 0.6 | (0.3 | ) | |||||
| CONSOLIDATED NET INCOME | 1.9 | 0.7 | ||||||
|
Less: Net Income Attributable to Noncontrolling |
2.9 | 1.6 | ||||||
| NET LOSS ATTRIBUTABLE TO NCM, INC. | $ | (1.0 | ) | $ | (0.9 | ) | ||
| LOSS PER SHARE: | ||||||||
| Basic | $ | (0.02 | ) | $ | (0.02 | ) | ||
| Diluted | $ | (0.02 | ) | $ | (0.02 | ) | ||
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| Cash and cash equivalents | $ | 73.8 | $ | 72.4 | ||||
| Short-term marketable securities | 25.0 | 34.2 | ||||||
| Receivables, net | 63.8 | 98.5 | ||||||
| Property and equipment, net | 26.0 | 25.7 | ||||||
| Total Assets | 831.0 | 810.5 | ||||||
| Long-term borrowings | 879.0 | 879.0 | ||||||
| Total equity/(deficit) | (428.4 | ) | (439.1 | ) | ||||
| Total Liabilities and Equity | 831.0 | 810.5 | ||||||
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Quarter | Quarter | ||
| Ended | Ended | |||
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| Total Screens at Period End (1) (6) | 19,292 | 19,073 | ||
| Founding Member Screens at Period End (2) (6) | 15,478 | 15,259 | ||
| Total Digital Screens at Period End (3) | 18,444 | 17,840 | ||
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Total Attendance for Period (4) (6) (in millions) |
154.6 | 169.0 | ||
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Founding Member Attendance for Period (5) (6) (in millions) |
128.8 | 142.6 | ||
| Capital Expenditures (in millions) |
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| (1) | Represents the total screens within NCM LLC's advertising network. | |
| (2) | Represents the sum of founding member screens. | |
| (3) | Represents the total number of screens that are connected to the digital content network. | |
| (4) | Represents the total attendance within NCM LLC's advertising network. | |
| (5) | Represents the total attendance within NCM LLC's advertising network in theatres operated by the founding members. | |
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| Quarter | Quarter | |||||||
| Ended | Ended | |||||||
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| Advertising Revenue | $ | 73.7 | $ | 66.3 | ||||
| Total Revenue | 82.2 | 79.1 | ||||||
| Operating Income | 21.6 | 17.0 | ||||||
| Total Attendance (1) | 154.6 | 169.0 | ||||||
| Advertising Revenue / Attendee | $ | 0.477 | $ | 0.392 | ||||
| OIBDA | $ | 27.0 | $ | 21.9 | ||||
| Adjusted OIBDA | 29.1 | 24.8 | ||||||
| Adjusted OIBDA Margin | 35.4 | % | 31.4 | % | ||||
| Loss Per Share — Basic | $ | (0.02 | ) | $ | (0.02 | ) | ||
| Loss Per Share — Diluted | $ | (0.02 | ) | $ | (0.02 | ) | ||
| (1) | Represents the total attendance within NCM LLC's advertising network. | |
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(See attached tables for the non-GAAP reconciliation) |
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Non-GAAP Reconciliations |
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Unaudited |
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OIBDA, Adjusted OIBDA and Adjusted OIBDA Margin |
|
Operating Income Before Depreciation and Amortization ("OIBDA"),
Adjusted OIBDA and Adjusted OIBDA margin are not financial measures
calculated in accordance with generally accepted accounting
principles (GAAP) in |
The following table reconciles consolidated net income to OIBDA and Adjusted OIBDA for the periods presented (dollars in millions):
| Quarter | Quarter | |||||||
| Ended | Ended | |||||||
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| Consolidated net income | $ | 1.9 | $ | 0.7 | ||||
| Income tax expense (benefit) | 0.6 | (0.3 | ) | |||||
| Interest and other costs | 19.1 | 16.6 | ||||||
| Depreciation and amortization | 5.4 | 4.9 | ||||||
| OIBDA | 27.0 | 21.9 | ||||||
| Share-based compensation costs (1) | 2.1 | 2.9 | ||||||
| Adjusted OIBDA | $ | 29.1 | $ | 24.8 | ||||
| Total Revenue | $ | 82.2 | $ | 79.1 | ||||
| Adjusted OIBDA margin | 35.4 | % | 31.4 | % | ||||
|
(1) |
Share-based payment costs are included in network operations, selling and marketing and administrative expense in the accompanying financial statements. | |
Outlook (in millions)
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Quarter Ending |
Year Ending |
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Low |
High |
Low |
High |
|||||||||
| Consolidated net income | $ | 28.0 | $ | 28.5 | $ | 101.5 | $ | 103.5 | ||||
| Income tax expense | 5.0 | 6.0 | 18.0 | 20.0 | ||||||||
| Interest and other | 18.0 | 20.0 | 74.0 | 78.0 | ||||||||
| Depreciation and amortization | 5.0 | 6.0 | 22.5 | 23.5 | ||||||||
| OIBDA | 56.0 | 60.5 | 216.0 | 225.0 | ||||||||
| Share-based compensation costs (1) | 2.0 | 2.5 | 9.0 | 10.0 | ||||||||
| Adjusted OIBDA | $ | 58.0 | $ | 63.0 | $ | 225.0 | $ | 235.0 | ||||
| Total Revenue | $ | 117.0 | $ | 122.0 | $ | 455.0 | $ | 465.0 | ||||
| (1) | Share-based compensation costs are included in network operations, selling and marketing and administrative expense in the accompanying financial statements. | |
Net Loss and Loss Per Share Excluding Derivative Related Items
Net loss excluding derivative related items and loss per share excluding
derivative related items are not financial measures calculated in
accordance with generally accepted accounting principles (GAAP) in
The following table reconciles net loss and loss per share as reported to net loss excluding derivative related items and loss per share excluding derivative related items for the periods presented (dollars in millions):
| Three Months | Three Months | |||||||
| Ended | Ended | |||||||
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| Net loss as reported | $ | (1.0 | ) | $ | (0.9 | ) | ||
|
Change in derivative fair value |
- | (0.7 | ) | |||||
| Amortization of terminated derivatives | 2.5 | 0.3 | ||||||
| Effect of noncontrolling interest (53.1% and 51.4%, respectively) | (1.3 | ) | 0.2 | |||||
| Effect of provision for income taxes (38% effective rate) | (0.4 | ) | 0.1 | |||||
| Net effect of derivative related items | 0.8 | (0.1 | ) | |||||
| Net loss excluding derivative related items | $ | (0.2 | ) | $ | (1.0 | ) | ||
| Weighted Average Shares Outstanding as reported | ||||||||
| Basic | 54,611,614 | 54,141,234 | ||||||
| Diluted | 54,611,614 | 54,141,234 | ||||||
| Weighted Average Shares Outstanding as adjusted | ||||||||
| Basic | 54,611,614 | 54,141,234 | ||||||
| Diluted | 55,201,670 | 54,141,234 | ||||||
| Basic loss per share as reported | $ | (0.02 | ) | $ | (0.02 | ) | ||
| Net effect of derivative related items | 0.02 | - | ||||||
| Basic loss per share excluding derivative related items | $ | 0.00 | $ | (0.02 | ) | |||
| Diluted loss per share as reported | $ | (0.02 | ) | $ | (0.02 | ) | ||
| Net effect of derivative related items | 0.02 | - | ||||||
| Diluted loss per share excluding derivative related items | $ | 0.00 | $ | (0.02 | ) | |||
INVESTOR CONTACT:
investors@ncm.com
or
MEDIA
CONTACT:
amy.finnerty@ncm.com
Source:
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