|
·
|
our revenue for the 2012 Quarter was $62.7 million, compared to $54.2 million in the same Quarter in 2011, an increase of 15.5% primarily due to an increase in revenue of $6.2 million from our U.S. cinema circuit driven by an increase in U.S. box office attendance of 518,000;
|
|
·
|
our EBITDA(1) for the 2012 Quarter was $9.3 million compared to $6.2 million in the same Quarter in 2011, an increase of 50.3% driven by our increase in box office attendance;
|
|
·
|
On January 10, 2012, Shadow View Land and Farming, LLC, a limited liability company owned by our Company, acquired a 202-acre property, zoned for the development of up to 843 single-family residential units, located in the City of Coachella, California. The property was acquired at a foreclosure auction for $5.5 million. The property was acquired as a long-term investment in developable land with the intention of using it in the interim for agricultural purposes. Half of the funds used to acquire the land were provided by Mr. James J. Cotter, our Chairman, Chief Executive Officer and controlling shareholder. Upon the approval of our Conflicts Committee, these funds were converted on January 18, 2012 into a 50% interest. The limited liability company is administratively managed by our Company.
|
|
·
|
on February 29, 2012, we acquired for $1.8 million from the original lender a promissory note which is currently in default and which we believe to be indirectly secured by the 50% membership interest in the Angelika Film Center, LLC not already owned by our Company.
|
|
·
|
the development, ownership and operation of multiplex cinemas in the United States, Australia and New Zealand; and
|
|
·
|
the development, ownership, and operation of retail and commercial real estate in Australia, New Zealand, and the United States, including entertainment-themed retail centers (“ETRC”) in Australia and New Zealand and live theater assets in Manhattan and Chicago in the United States.
|
|
·
|
in the United States, under the
|
|
o
|
Reading brand (http://www.readingcinemasus.com),
|
|
o
|
Angelika Film Center brand (http://www.angelikafilmcenter.com),
|
|
o
|
Consolidated Theatres brand (http://www.consolidatedtheatres.com),
|
|
o
|
City Cinemas brand (http://www.citycinemas.com),
|
|
o
|
Beekman Theatre brand (http://www.beekmantheatre.com),
|
|
o
|
The Paris Theatre brand (http://www.theparistheatre.com), and
|
|
o
|
Liberty Theatres brand (http://libertytheatresusa.com/);
|
|
·
|
in Australia, under the Reading brand (http://www.readingcinemas.com.au); and
|
|
·
|
in New Zealand, under the
|
|
o
|
Reading (http://www.readingcinemas.co.nz) and
|
|
o
|
Rialto (http://www.rialto.co.nz) brands.
|
|
·
|
With respect to our cinema operations:
|
|
o
|
The number and attractiveness to movie goers of the films released in future periods;
|
|
o
|
The amount of money spent by film distributors to promote their motion pictures;
|
|
o
|
The licensing fees and terms required by film distributors from motion picture exhibitors in order to exhibit their films;
|
|
o
|
The comparative attractiveness of motion pictures as a source of entertainment and willingness and/or ability of consumers (i) to spend their dollars on entertainment and (ii) to spend their entertainment dollars on movies in an outside the home environment; and
|
|
o
|
The extent to which we encounter competition from other cinema exhibitors, from other sources of outside of the home entertainment, and from inside the home entertainment options, such as “home theaters” and competitive film product distribution technology such as, by way of example, cable, satellite broadcast, DVD rentals and sales, and so called “movies on demand;”
|
|
·
|
With respect to our real estate development and operation activities:
|
|
o
|
The rental rates and capitalization rates applicable to the markets in which we operate and the quality of properties that we own;
|
|
o
|
The extent to which we can obtain on a timely basis the various land use approvals and entitlements needed to develop our properties;
|
|
o
|
the risks and uncertainties associated with real estate development;
|
|
o
|
The availability and cost of labor and materials;
|
|
o
|
Competition for development sites and tenants; and
|
|
o
|
The extent to which our cinemas can continue to serve as an anchor tenant which will, in turn, be influenced by the same factors as will influence generally the results of our cinema operations;
|
|
·
|
With respect to our operations generally as an international company involved in both the development and operation of cinemas and the development and operation of real estate; and previously engaged for many years in the railroad business in the United States:
|
|
o
|
Our ongoing access to borrowed funds and capital and the interest that must be paid on that debt and the returns that must be paid on such capital;
|
|
o
|
The relative values of the currency used in the countries in which we operate;
|
|
o
|
Changes in government regulation, including by way of example, the costs resulting from the implementation of the requirements of Sarbanes-Oxley;
|
|
o
|
Our labor relations and costs of labor (including future government requirements with respect to pension liabilities, disability insurance and health coverage, and vacations and leave);
|
|
o
|
Our exposure from time to time to legal claims and to uninsurable risks such as those related to our historic railroad operations, including potential environmental claims and health related claims relating to alleged exposure to asbestos or other substances now or in the future recognized as being possible causes of cancer or other health-related problems;
|
|
o
|
Changes in future effective tax rates and the results of currently ongoing and future potential audits by taxing authorities having jurisdiction over our various companies; and
|
|
o
|
Changes in applicable accounting policies and practices.
|
|
|
Three Months Ended
March 31,
|
|||||||
|
Statements of Operations
|
2012
|
2011
|
||||||
|
Revenue
|
$ | 62,652 | $ | 54,242 | ||||
|
Operating expense
|
||||||||
|
Cinema/real estate
|
49,128 | 43,904 | ||||||
|
Depreciation and amortization
|
4,197 | 4,129 | ||||||
|
General and administrative
|
4,420 | 4,235 | ||||||
|
Operating income
|
4,907 | 1,974 | ||||||
|
Interest expense, net
|
(3,759 | ) | (3,930 | ) | ||||
|
Other income
|
368 | 345 | ||||||
|
Income tax expense
|
(1,625 | ) | (636 | ) | ||||
|
Net income attributable to noncontrolling interest
|
(130 | ) | (233 | ) | ||||
|
Net loss
|
$ | (239 | ) | $ | (2,480 | ) | ||
|
Basic loss per share
|
$ | (0.01 | ) | $ | (0.11 | ) | ||
|
Diluted loss per share
|
$ | (0.01 | ) | $ | (0.11 | ) | ||
|
EBITDA*
|
$ | 9,342 | $ | 6,215 | ||||
| EBITDA* change | $3,127 | |||||||
|
*
|
EBITDA presented above is net loss adjusted for interest expense (net of interest income), income tax expense, depreciation and amortization expense, and an adjustment for discontinued operations (this includes interest expense and depreciation and amortization for the discontinued operations).
|
|
Three Months Ended
March 31,
|
||||||||
|
2012
|
2011
|
|||||||
|
Net loss
|
$ | (239 | ) | $ | (2,480 | ) | ||
|
Add:Interest expense, net
|
3,759 | 3,930 | ||||||
|
Add:Income tax provision
|
1,625 | 636 | ||||||
|
Add:Depreciation and amortization
|
4,197 | 4,129 | ||||||
|
EBITDA
|
$ | 9,342 | $ | 6,215 | ||||
|
Reading International, Inc. and Subsidiaries
|
||||||||
|
Condensed Consolidated Statements of Operations
|
||||||||
|
(U.S. dollars in thousands, except per share amounts)
|
||||||||
|
|
Three Months Ended
March 31,
|
|||||||
|
|
2012
|
2011
|
||||||
|
|
|
|
||||||
|
Operating revenue
|
|
|
||||||
|
Cinema
|
$ | 57,402 | $ | 49,473 | ||||
|
Real estate
|
5,250 | 4,769 | ||||||
|
Total operating revenue
|
62,652 | 54,242 | ||||||
|
|
||||||||
|
Operating expense
|
||||||||
|
Cinema
|
46,333 | 41,473 | ||||||
|
Real estate
|
2,795 | 2,431 | ||||||
|
Depreciation and amortization
|
4,197 | 4,129 | ||||||
|
General and administrative
|
4,420 | 4,235 | ||||||
|
Total operating expense
|
57,745 | 52,268 | ||||||
|
|
||||||||
|
Operating income
|
4,907 | 1,974 | ||||||
|
|
||||||||
|
Interest income
|
201 | 433 | ||||||
|
Interest expense
|
(3,960 | ) | (4,363 | ) | ||||
|
Other expense
|
(45 | ) | (19 | ) | ||||
|
Income (loss) before income tax expense and equity earnings of unconsolidated joint ventures and entities
|
1,103 | (1,975 | ) | |||||
|
Income tax expense
|
(1,625 | ) | (636 | ) | ||||
|
Loss before equity earnings of unconsolidated joint ventures and entities
|
(522 | ) | (2,611 | ) | ||||
|
Equity earnings of unconsolidated joint ventures and entities
|
413 | 364 | ||||||
|
Net loss
|
$ | (109 | ) | $ | (2,247 | ) | ||
|
Net income attributable to noncontrolling interests
|
(130 | ) | (233 | ) | ||||
|
Net loss attributable to Reading International, Inc. common shareholders
|
$ | (239 | ) | $ | (2,480 | ) | ||
|
Basic and diluted loss per share attributable to Reading International, Inc. shareholders
|
$ | (0.01 | ) | $ | (0.11 | ) | ||
|
Weighted average number of shares outstanding – basic
|
22,710,713 | 22,709,672 | ||||||
|
Weighted average number of shares outstanding – diluted
|
22,710,713 | 22,709,672 | ||||||
|
|
||||||||
|
Reading International, Inc. and Subsidiaries
|
|
|
||||||
|
Condensed Consolidated Balance Sheets
|
|
|
||||||
|
(U.S. dollars in thousands)
|
|
|
||||||
|
|
March 31,
2012
|
December 31,
2011
|
||||||
|
ASSETS
|
|
|||||||
|
Current Assets:
|
|
|
||||||
|
Cash and cash equivalents
|
$ | 29,097 | $ | 31,597 | ||||
|
Receivables
|
6,391 | 6,973 | ||||||
|
Inventory
|
769 | 1,035 | ||||||
|
Investment in marketable securities
|
45 | 2,874 | ||||||
|
Restricted cash
|
2,404 | 2,379 | ||||||
|
Deferred tax asset
|
3,560 | 1,985 | ||||||
|
Prepaid and other current assets
|
6,091 | 3,781 | ||||||
|
Assets held for sale
|
-- | 1,848 | ||||||
|
Total current assets
|
48,357 | 52,472 | ||||||
|
|
||||||||
|
Property held for and under development
|
99,203 | 91,698 | ||||||
|
Property & equipment, net
|
215,523 | 215,428 | ||||||
|
Investment in unconsolidated joint ventures and entities
|
7,766 | 7,839 | ||||||
|
Investment in Reading International Trust I
|
838 | 838 | ||||||
|
Goodwill
|
22,805 | 22,277 | ||||||
|
Intangible assets, net
|
17,417 | 17,999 | ||||||
|
Deferred tax asset, net
|
10,171 | 12,399 | ||||||
|
Other assets
|
9,444 | 9,814 | ||||||
|
Total assets
|
$ | 431,524 | $ | 430,764 | ||||
|
|
||||||||
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
|
Current Liabilities:
|
||||||||
|
Accounts payable and accrued liabilities
|
$ | 16,071 | $ | 16,905 | ||||
|
Film rent payable
|
6,225 | 6,162 | ||||||
|
Notes payable – current portion
|
29,888 | 29,630 | ||||||
|
Taxes payable
|
14,235 | 14,858 | ||||||
|
Deferred current revenue
|
9,147 | 10,271 | ||||||
|
Other current liabilities
|
172 | 137 | ||||||
|
Total current liabilities
|
75,738 | 77,963 | ||||||
|
|
||||||||
|
Notes payable – long-term portion
|
140,661 | 143,071 | ||||||
|
Notes payable to related party – long-term portion
|
9,000 | 9,000 | ||||||
|
Subordinated debt
|
27,913 | 27,913 | ||||||
|
Noncurrent tax liabilities
|
11,293 | 12,191 | ||||||
|
Other liabilities
|
35,045 | 35,639 | ||||||
|
Total liabilities
|
299,650 | 305,777 | ||||||
|
Commitments and contingencies
|
||||||||
|
Stockholders’ equity:
|
||||||||
|
Class A non-voting common stock, par value $0.01, 100,000,000 shares authorized,
|
||||||||
|
31,887,536 issued and 21,507,273 outstanding at March 31, 2012 and 31,675,518
|
||||||||
|
issued and 21,311,348 outstanding at December 31, 2011
|
220 | 220 | ||||||
|
Class B voting common stock, par value $0.01, 20,000,000 shares authorized and
|
||||||||
|
1,495,490 issued and outstanding at March 31, 2012 and at December 31, 2011
|
15 | 15 | ||||||
|
Nonvoting preferred stock, par value $0.01, 12,000 shares authorized and no issued
|
||||||||
|
or outstanding shares at March 31, 2011 and December 31, 2011
|
-- | -- | ||||||
|
Additional paid-in capital
|
135,351 | 135,171 | ||||||
|
Accumulated deficit
|
(66,318 | ) | (66,079 | ) | ||||
|
Treasury shares
|
(4,512 | ) | (4,512 | ) | ||||
|
Accumulated other comprehensive income
|
62,993 | 58,937 | ||||||
|
Total Reading International, Inc. stockholders’ equity
|
127,749 | 123,752 | ||||||
|
Noncontrolling interests
|
4,125 | 1,235 | ||||||
|
Total stockholders’ equity
|
131,874 | 124,987 | ||||||
|
Total liabilities and stockholders’ equity
|
$ | 431,524 | $ | 430,764 | ||||
|
|
||||||||