Reading International, Inc. (NASDAQ: RDI) announced today
results for its quarter and year ended December 31, 2012.
2012 Twelve Month Highlights
- our revenue for the 2012 Twelve Months
was $254.4 million compared to $245.0 million in the 2011 Twelve
Months, an increase of $9.5 million or 3.9%, driven primarily by a
$9.5 million increase in the U.S.;
- our EBITDA(1) for the 2012 Twelve
Months was $36.8 million compared to $35.6 million in the 2011
Twelve Months, an increase of $1.2 million or 3.3% driven primarily
by the $1.6 million increase in other income (expense);
- our revenue for the 2012 Quarter was
$65.1 million compared to $57.4 million in the 2011 Quarter, an
increase of $7.7 million or 13.4%, driven primarily by a $4.0
million increase in the U.S.;
- our EBITDA(1) for the 2012 Quarter was
$8.8 million compared to $4.5 million in the 2011 Quarter, an
increase of $4.3 million or 95.6%, driven primarily by a $4.0
million increase in New Zealand;
- on January 10, 2012, Shadow View Land
and Farming, LLC, a limited liability company managed by our
Company and owned on a 50/50 basis with Mr. James J. Cotter,
acquired for $5.5 million a 202-acre property, zoned for the
development of up to 843 single-family residential units, located
in the City of Coachella, California;
- on February 8, 2012, we renewed our
existing $36.9 million (NZ$45.0 million) New Zealand credit
facility with a 3-year credit facility through Westpac;
- on June 28, 2012, Sutton Hill
Properties LLC (“SHP”), one of our consolidated subsidiaries, paid
off its Eurohypo AG, New York Branch loan with proceeds from a new
$15.0 million term loan from Sovereign Bank, N.A.;
- on September 21, 2012, we opened an
8-screen art cinema in the Mosaic District in the greater
Washington D.C. metropolitan area;
- on September 30, 2012, we entered into
an agreement with an affiliate of Cinedigm Digital Cinema Corp with
respect to our conversion of substantially all of our U.S. cinemas
which are not already equipped with digital projection to digital
projection;
- on October 31, 2012, we replaced our GE
Capital Term Loan of $27.7 million with a new credit facility from
Bank of America of $30.0 million and renewed and increased our
existing $3.0 million line of credit with Bank of America to $5.0
million;
- on December 1, 2012, we entered into a
master operating equipment lease financing agreement with Banc of
America Leasing to finance the acquisition of up to $15.5 million
in digital projection equipment.
_____________________
(1) The Company defines EBITDA as net income (loss) before net
interest expense, income tax benefit, depreciation, and
amortization. The company defines adjusted EBITDA as EBITDA
adjusted for unusual or infrequent events or items that are of a
non-cash nature. EBITDA and adjusted EBITDA are presented solely as
supplemental disclosures as we believe they are relevant and useful
measures to compare operating results among our properties and
competitors, as well as measurement tools for the evaluation of
operating personnel. EBITDA and adjusted EBITDA are not measures of
financial performance under the promulgations of generally accepted
accounting principles (“GAAP”). EBITDA and adjusted EBITDA should
not be considered in isolation from, or as substitutes for, net
loss, operating loss or cash flows from operations determined in
accordance with GAAP. Finally, EBITDA and adjusted EBITDA are not
calculated in the same manner by all companies and accordingly, may
not be appropriate measures for comparing performance among
different companies. See the “Supplemental Data” table attached for
a reconciliation of EBITDA to net income (loss).
Fourth Quarter 2012 Discussion
Revenue from operations increased from $57.4 million in the 2011
Quarter to $65.1 million in the same Quarter in 2012, a $7.7
million or a 13.4% increase.
Cinema segment revenue increased by $7.8 million or 14.9%
primarily due to an increase in our worldwide box office admissions
of 477,000 and a increase in the U.S. average price per ticket of
1.9%; offset by, decrease in our Australian and New Zealand average
ticket prices of 3.2% and 7.3%, respectively. The New Zealand and
U.S. box office admissions increased resulting from the reopening
of an earthquake damaged New Zealand multiplex in early January
2012, and the opening of our U.S. AFC Mosaic cinema in the greater
Washington D.C. metropolitan area in September 2012. Both the
Australian and New Zealand results were affected by an increase in
the value of the Australian and New Zealand dollars compared to the
U.S. dollar, in the 2012 period compared to the same period in
2011.
The top three grossing films for the 2012 Quarter in our
worldwide cinema circuit were “Skyfall” “The Twilight Saga:
Breaking Dawn Part 2” and “Taken 2.” These three films accounted
for approximately 30.1% of our cinema box office revenue. The top
three grossing films for the 2011 Quarter in our worldwide cinema
circuit were “The Twilight Saga: Breaking Dawn Part I,” “Real
Steel,” and “Puss in Boots.” These three films accounted for
approximately 21.3% of our 2011 Quarter cinema box office
revenue.
Our 2012 quarterly real estate segment revenue decreased by
$98,000 in the 2012 Quarter primarily related to a decrease in
rental income from our live theatre venues in the U.S. in 2012
compared to the same period in 2011; offset by, higher rents and
occupancy associated with our Australian and New Zealand retail
properties. As indicated above, both the Australian and New Zealand
results were also affected by an increase in the value of the
Australian and New Zealand dollars compared to the U.S. dollar in
the 2012 period compared to the same period in 2011.
As a percentage of revenue, operating expense was 79.4% of
revenue in the 2012 Quarter compared to 81.2% in the 2011 Quarter,
primarily related to our revenues increasing while rent and labor
costs remained somewhat fixed.
Depreciation expense decreased for the 2012 Quarter by $119,000
or 2.9% compared to the same period in 2011 due to certain
Australian and New Zealand cinema assets coming to the end of their
depreciable lives in 2011.
We recorded a real estate impairment loss in 2012 of $1.5
million related to our Coachella property. As noted above, this
property is 50% owned by Mr. James J. Cotter who shares in any
impairment loss to the extent of his ownership interest. In 2011,
we recorded a $369,000 impairment loss in related to our Taringa
real estate property. We subsequently sold the Taringa property on
February 21, 2012 for $1.9 million (AUS$1.8 million).
General and administrative expense decreased by $853,000 or
20.0% in the 2012 Quarter compared to the 2011 Quarter, primarily
related to the one-time additional labor costs incurred during
2011, associated with the transfer of our accounting functions from
the U.S. and Australia to New Zealand, as well as some cost savings
resulting from the synergies gained as a result of this move.
Driven by the above factors, our operating income for the 2012
Quarter increased by $2.5 million to an operating income of $4.5
million compared to an operating income of $2.0 million in the same
quarter last year.
Net interest expense decreased by $1.6 million for the 2012
Quarter compared to the 2011 Quarter. The decrease in interest
expense during the 2012 Quarter was primarily due to a smaller
increase in the fair value of our interest rate swaps in 2012 than
that noted for the same period in 2011 and to a decrease in
interest rates specifically from our Trust Preferred Securities.
Effective May 1, 2012, that interest rate changed from a fixed rate
of 9.22%, which was in effect for the past five years, to a
variable rate of 3-month LIBOR plus 4.00%, which will reset each
quarter through to the end of the loan, unless we choose to fix the
rate again.
For the 2012 Quarter, we recorded a $176,000 other loss which
consisted of approximately $705,000 of other asset losses
principally from the write off of deferred financing costs
associated with our GE Capital term loan; offset by, $531,000 in
income from unconsolidated entities. For the 2011 Quarter, we
recorded a $1.6 million other loss which consisted of $2.6 million
in losses from unconsolidated entities primarily related to an
impairment charge related to our investment in Rialto Entertainment
of $2.9 million; offset by, a $1.1 million gain primarily related
to an initial insurance payment received against our business
interruption claim for the temporary closure of our cinema in
Christchurch, New Zealand.
For the 2012 Quarter, our income tax expense increased by $2.3
million compared to the 2011 Quarter primarily associated with the
reduction of deferred tax assets in our Reading Australia
operations.
For the 2012 Quarter, we recorded a loss from discontinued
operations of $284,000 and, for the 2011 Quarter, we recorded an
income from discontinued operations of $62,000 associated with our
Indooroopilly property which was sold for $12.4 million in November
2012.
Noncontrolling interest income (expense) increased from an
expense of $273,000 for the 2011 Quarter to an income of $641,000
for the 2012 Quarter primarily related to the $1.5 million
impairment loss of our Coachella property in which the minority
shareholder participates to the extent of his 50% ownership.
As a result of the above, we reported a net loss of $1.3 million
for the 2012 Quarter compared to a net loss of $5.0 million in the
2011 Quarter.
Our EBITDA(1) at $8.8 million for the 2012
Quarter was $4.3 million or 95.6% higher than the EBITDA(1) for
the 2011 Quarter of $4.5 million, driven primarily by the $2.5
million increase in operating income and by the aforementioned $1.6
million other loss in the 2011.
Our adjusted EBITDA(1) for the 2012 Quarter was
$10.2 million after excluding:
- the $1.5 million impairment expense
related to our Coachella property.
Our adjusted EBITDA(1) for 2011 Quarter was
$7.8 million after excluding:
- the $2.9 million impairment loss on our
interest in Rialto Entertainment and
- the $369,000 impairment loss associated
with the impairment of our Taringa, Australia real estate
property.
This resulted in a increase of $2.4 million in adjusted
EBITDA(1) or 31.3%, from the 2011 Quarter to the 2012 Quarter.
Twelve Months 2012 Summary
Revenue from operations increased from $245.0 million in 2011 to
$254.4 million in 2012, a $9.5 million or a 3.9% increase.
Cinema segment revenue increased $8.9 million driven by an
increase in U.S. and New Zealand box office admissions of 722,000
and 236,000, respectively. The uplift in box office admissions in
the U.S. was primarily from the acquisition of a cinema from a
third party in August 2011 and our newly opened AFC Mosaic Cinema
in the greater Washington D.C. metropolitan area while the increase
in New Zealand was primarily as a result of the reopening of an
earthquake damaged New Zealand multiplex in early January 2012.
These changes resulted in an increase in box office revenue of $7.0
million and an increase in concessions and other revenue of $4.9
million. Our Australian cinema revenue decreased by $3.0 million
primarily relating to an 91,000 decrease in box office admissions
coupled with a 3.9% decrease in the average ticket price per
admission resulting from a more competitive ticket pricing model.
This decrease included the temporary closure of our Townsville
cinema in Australia due to the renovation of the cinema during the
second quarter. Our Australian and New Zealand revenue was also
impacted by a slight increase in the value of the Australian and
New Zealand dollar compared to the U.S. dollar for the 2012 Twelve
Months compared to the same period in 2011.
The top three grossing films for the Twelve Months in our
worldwide cinema circuit were “The Avengers,” “The Dark Knight
Rises,” and “Skyfall.” These three films accounted for
approximately 10.8% of our cinema box office revenue. The top three
grossing films for the 2011 twelve months in our worldwide cinema
circuit were “Harry Potter and the Deathly Hallows Part II,”
“Transformers 3: Dark of the Moon,” and “The Hangover 2.” These
three films accounted for approximately 10.6% of our 2011 cinema
box office revenue.
Additionally, our real estate segment revenue increased by
$597,000 compared to the same period last year. Our Australian and
New Zealand real estate revenue increased primarily due to higher
rents in 2012 compared to the same period in 2011. Our U.S. real
estate revenue decreased by $115,000 relating to a decrease in
rental income from our live theater venues.
As a percentage of revenue, operating expense at 79.3% of
revenue in 2012 increased compared to the 78.5% in 2011, primarily
driven by the real estate segment which had higher repair,
maintenance, and insurance costs for our operating properties,
coupled with legal costs incurred in 2012 associated with
protecting the property rights of our Burwood property and with our
residual railroad properties.
Depreciation expense decreased for the 2012 Twelve Months by
$546,000 or 3.3% compared to the same period in 2011 due to certain
Australian cinema assets coming to the end of their depreciable
lives in 2011.
We recorded a real estate impairment loss in 2012 of $1.5
million related to our Coachella property as discussed above.
General and administrative expense decreased by $1.3 million or
7.5%, primarily related to the same reasons noted above for the
quarterly results.
Driven by the above factors, our operating income for the Twelve
Months of 2012 increased by $949,000 to $19.1 million compared to
$18.2 million in the same period last year.
Net interest expense decreased by $4.6 million for the 2012
Twelve Months compared to the 2011 Twelve Months. The decrease in
interest expense during the 2012 Twelve Months was due to the same
reasons noted above for the quarterly results.
For the 2012 Twelve Months, we recorded $1.2 million in other
income which consisted of approximately $1.6 million of income from
unconsolidated entities; offset by, $418,000 of other asset losses
principally from the write off of deferred financing costs
associated with our GE Capital term loan. For the 2011 Twelve
Months, we recorded a $462,000 other loss which consists of $1.6
million in losses from unconsolidated entities primarily related to
an impairment charge to our investment in Rialto Entertainment of
$2.9 million; offset by $1.1 million of other income primarily
related to an initial insurance payment received against our
business interruption claim for the temporary closure of our cinema
in Christchurch, New Zealand.
The 2012 Twelve Months income tax expense was $4.9 million
compared to an income tax benefit of $12.3 million for the 2011
Twelve Months. The year over year change was primarily related to a
reduction in deferred tax assets in Australia, caused by the sale
of certain assets, plus a reduction in loss carryforwards available
to offset future Australia taxable income. For 2011, the change was
primarily a one-time tax provision adjustment of $14.4 million in
2011 caused by a reduction in the valuation allowance related to
our Australian operations.
For the 2012 and 2011 Twelve Months, we recorded income (loss)
from discontinued operations of ($405,000) and $1.9 million,
respectively, associated with our Indooroopilly property and with a
gain on the sale of a discontinued cinema operation for the 2011
Twelve Months. The 2012 Twelve Months loss from discontinued
operations includes a $318,000 impairment loss for the sale of our
Indooroopilly property on November 2012 for $12.4 million.
Noncontrolling interest income (expense) increased from an
expense of $940,000 for the 2011 Twelve Months to an income of
$492,000 for the 2012 Twelve Months due to the same reasons noted
above for the 2012 Quarter.
As a result of the above, we reported a net loss of $914,000 for
the Twelve Months of 2012 compared to a net income of $10.0 million
in 2011, driven primarily by the $14.4 million 2011 tax benefit
relating to the valuation allowance adjustment.
Our EBITDA(1) at $36.8 million for the 2012
Twelve Months was $1.2 million or 3.3% higher than the
EBITDA(1) for the 2011 Twelve Months of $35.6 million, driven
primarily by the $1.6 million increase in other income
(expense).
Our adjusted EBITDA(1) for the 2012 Twelve
Months was $38.6 million after excluding:
- the $1.5 million impairment expense
related to our Coachella property; and
- the $318,000 impairment expense related
to our sold Indooroopilly property.
Our adjusted EBITDA(1) for 2011 Twelve Months
was $37.3 million after excluding:
- the $1.7 million gain on sale of assets
of our Elsternwick Cinema in Melbourne, Australia;
- the $2.9 million impairment loss on our
interest in Rialto Entertainment; and
- the $369,000 impairment loss associated
with the discontinuation of our Taringa, Australia real estate
development project.
This resulted in an increase in our adjusted
EBITDA(1) of $1.3 million or 3.5%, from the 2011
Twelve Months to the 2012 Twelve Months.
Balance Sheet and Liquidity
Our total assets at December 31, 2012 were $428.6 million
compared to $430.8 million at December 31, 2011. The currency
exchange rates for Australia and New Zealand as of December 31,
2012 were $1.0393 and $0.8267, respectively, and as of December 31,
2011, these rates were $1.0251 and $0.7805, respectively. As a
result, currency had a positive effect on the balance sheet at
December 31, 2012 when compared to December 31, 2011.
On February 8, 2012, we received an approved amendment from
Westpac renewing our existing $36.9 million (NZ$45.0 million) New
Zealand credit facility with a 3-year credit facility. The renewed
facility calls for a decrease in the overall facility by $4.1
million ($5.0 million) to $32.8 million (NZ$40.0 million) credit
facility and an increase in the facility margin of 0.55% to 2.00%.
No other significant changes to the facility were made.
On June 28, 2012, Sutton Hill Properties LLC (“SHP”), one of our
consolidated subsidiaries, paid off its Eurohypo AG, New York
Branch loan with a new $15.0 million term loan (the “Sovereign Bank
Loan”) from Sovereign Bank, N.A. The Sovereign Bank Loan has a
one-year term ending on June 27, 2013, with a one year extension
option to June 26, 2014 subject to an extension fee equal to 1.00%
of the ending principal balance and a compliance requirement with
certain special covenants. The terms of the loan require interest
only payments at LIBOR plus a 5.00% margin to be calculated and
paid monthly. This loan is secured by SHP’s interest in the Cinemas
1, 2, & 3 land and building. The loan covenants include
maintaining a loan to value ratio of at least 50% of fair market
value and an 11% debt yield (with a numerator of the cash available
for debt service and a denominator of the outstanding principal
balance of the loan). The Sovereign Bank Loan is further secured by
a guaranty provided by Reading International, Inc. and by its
noncontrolling interest member, Sutton Hill Capital, LLC.
On October 31, 2012, we replaced our GE Capital Term Loan of
$27.7 million with a new credit facility from Bank of America (the
“BofA Revolver”) of $30.0 million with an interest rate of between
2.50% and 3.00% above LIBOR and an expiration date of October 31,
2017. Although the BofA Revolver does not require a fixed interest
swap agreement, we will continue to use our existing fixed interest
rate swap of $29.1 million until its term date of December 31,
2013. The BofA Revolver requires principal payments of $3.0 million
per year with a balloon payment of $18.0 million at the expiration
date. The BofA Revolver contains other customary terms and
conditions, including representations and warranties, affirmative
and negative covenants, events of default and indemnity provisions.
The most restrictive covenant of the facility requires that we must
maintain a fixed charge coverage ratio at a certain level.
We entered into a master operating equipment lease financing
agreement with Banc of America Leasing & Capital, LLC to
finance the acquisition of up to $15.5 million in digital
projection equipment for our U.S. cinema operations.
Our cash position at December 31, 2012 was $46.5 million
including an $8.0 million time deposit in Australia. Of the $46.5
million, $17.5 million was in Australia, $22.7 million was in the
U.S., and $6.3 million was in New Zealand. As part of our main
credit facilities in Australia, New Zealand and the U.S., we are
subject to certain debt covenants which limit the transfer or use
of cash outside of the various regional subsidiaries in which the
cash is held. As such, at December 31, 2012 we have approximately
$7.5 million of cash worldwide that is not restricted by loan
covenants.
At December 31, 2012, we had undrawn funds of $10.4 million
(AUS$10.0 million) available under our NAB line of credit in
Australia, $9.9 million (NZ$12.0 million) available under our
renewed New Zealand Corporate Credit facility, and $3.0 million
available under our Bank of America revolving loan credit facility
in the U.S. Accordingly, we believe that we have sufficient
borrowing capacity under our various credit facilities, together
with our $46.5 million cash balance including $8.0 million of time
deposits, to meet our anticipated short-term working capital
requirements.
Our working capital at December 31, 2012 was a negative $21.4
million compared to a negative $12.8 million at December 31, 2011.
This increase in negative working capital resulted primarily from
our Village East option liability becoming a current liability
during 2012.
Stockholders’ equity was $131.0 million at December 31, 2012
compared to $125.0 million at December 31, 2011, primarily related
to a $2.9 million increase in noncontrolling interest and an
increase in accumulated other comprehensive income of $2.4 million
primarily associated with the increase in foreign currency exchange
noted above.
About Reading International, Inc.
Reading International (http://www.readingrdi.com) is in the
business of owning and operating cinemas and developing, owning and
operating real estate assets. Our business consists primarily
of:
- 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.
Reading manages its worldwide cinema business
under various different brands:
- in the United States, under the
- Reading brand
(http://www.readingcinemasus.com),
- Angelika Film Center brand
(http://www.angelikafilmcenter.com),
- Consolidated Theatres brand
(http://www.consolidatedtheatres.com),
- City Cinemas brand
(http://www.citycinemas.com),
- Beekman Theatre brand
(http://www.beekmantheatre.com),
- The Paris Theatre brand
(http://www.theparistheatre.com), and
- Liberty Theatres brand
(http://libertytheatresusa.com/);
- in Australia, under the Reading brand
(http://www.readingcinemas.com.au); and
- in New Zealand, under the
- Reading
(http://www.readingcinemas.co.nz) and
- Rialto (http://www.rialto.co.nz)
brands.
Forward-Looking Statements
Our statements in this press release contain a variety of
forward-looking statements as defined by the Securities Litigation
Reform Act of 1995. Forward-looking statements reflect only our
expectations regarding future events and operating performance and
necessarily speak only as of the date the information was prepared.
No guarantees can be given that our expectation will in fact be
realized, in whole or in part. You can recognize these statements
by our use of words such as, by way of example, “may,” “will,”
“expect,” “believe,” and “anticipate” or other similar
terminology.
These forward-looking statements reflect our expectation after
having considered a variety of risks and uncertainties. However,
they are necessarily the product of internal discussion and do not
necessarily completely reflect the views of individual members of
our Board of Directors or of our management team. Individual Board
members and individual members of our management team may have
different views as to the risks and uncertainties involved, and may
have different views as to future events or our operating
performance.
Among the factors that could cause actual results to differ
materially from those expressed in or underlying our
forward-looking statements are the following:
- With respect to our cinema operations:
- The number and attractiveness to movie
goers of the films released in future periods;
- The amount of money spent by film
distributors to promote their motion pictures;
- The licensing fees and terms required
by film distributors from motion picture exhibitors in order to
exhibit their films;
- 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
- 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:
- The rental rates and capitalization
rates applicable to the markets in which we operate and the quality
of properties that we own;
- The extent to which we can obtain on a
timely basis the various land use approvals and entitlements needed
to develop our properties;
- the risks and uncertainties associated
with real estate development;
- The availability and cost of labor and
materials;
- Competition for development sites and
tenants; and
- 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:
- 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;
- The relative values of the currency
used in the countries in which we operate;
- Changes in government regulation,
including by way of example, the costs resulting from the
implementation of the requirements of Sarbanes-Oxley;
- 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);
- 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;
- 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
- Changes in applicable accounting
policies and practices.
The above list is not necessarily exhaustive, as business is by
definition unpredictable and risky, and subject to influence by
numerous factors outside of our control such as changes in
government regulation or policy, competition, interest rates,
supply, technological innovation, changes in consumer taste and
fancy, weather, and the extent to which consumers in our markets
have the economic wherewithal to spend money on beyond-the-home
entertainment.
Given the variety and unpredictability of the factors that will
ultimately influence our businesses and our results of operation,
no guarantees can be given that any of our forward-looking
statements will ultimately prove to be correct. Actual results will
undoubtedly vary and there is no guarantee as to how our securities
will perform either when considered in isolation or when compared
to other securities or investment opportunities.
Finally, we undertake no obligation to publicly update or to
revise any of our forward-looking statements, whether as a result
of new information, future events or otherwise, except as may be
required under applicable law. Accordingly, you should always note
the date to which our forward-looking statements speak.
Additionally, certain of the presentations included in this
press release may contain “pro forma” information or “non-US GAAP
financial measures.” In such case, a reconciliation of this
information to our US GAAP financial statements will be made
available in connection with such statements.
Reading
International, Inc. and Subsidiaries Supplemental Data
Reconciliation of
EBITDA to Net (Loss) Income
(dollars in thousands, except per share amounts)
Three Months Ended Twelve Months Ended
December
31,
December
31,
2012 2011 2012
2011 Revenue $ 65,117 $ 57,421 $ 254,430 $
244,979 Operating expense Cinema/real estate 51,725 46,623 201,674
192,405 Depreciation and amortization 4,033 4,152 16,049 16,595
Impairment expense 1,463 369 1,463 369 General and administrative
3,416 4,269 16,117 17,432
Operating income 4,480 2,008 19,127 18,178 Interest expense,
net (2,818 ) (4,422 ) (16,426 ) (21,038 ) Other income (expense)
(176 ) (1,562 ) 1,202 (462 ) Income tax benefit (expense) (3,120 )
(847 ) (4,904 ) 12,330 Income (loss) from discontinued operations
(284 ) 62 (405 ) 1,888 Noncontrolling interest income (expense) 641
(273 ) 492 (940 ) Net income (loss) (1,277 ) (5,034 )
(914 ) 9,956 Basic earnings (loss) per share $ (0.06 ) $
(0.21 ) $ (0.04 ) $ 0.44 Diluted earnings (loss) per share $
(0.06 ) $ (0.22 ) $ (0.04 ) $ 0.43 EBITDA* $ 8,755
$ 4,477 $ 36,800 $ 35,624
EBITDA* change $4,278 $1,176
*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).
Reconciliation of EBITDA to the net loss is presented below:
Three
Months Ended Twelve Months Ended
December
31,
December
31,
2012 2011
2012 2011
Net income (loss) $ (1,277 ) $ (5,034 ) $ (914 ) $
9,956 Add: Interest expense, net 2,818 4,422 16,426 21,038 Add:
Income tax benefit (expense) 3,120 847 4,904 (12,330 ) Add:
Depreciation and amortization 4,033 4,152 16,049 16,595 Adjustment
for discontinued operations 61 90 335 365
EBITDA $ 8,755 $ 4,477 $ 36,800
$ 35,624
Reading International, Inc. and Subsidiaries Condensed
Consolidated Statements of Operations (U.S. dollars in
thousands, except per share amounts) Year Ended
December 31, 2012
2011
2010 Operating revenue Cinema $ 234,703
$ 225,849 $ 211,073 Real estate 19,727
19,130 18,249
Total operating revenue 254,430
244,979 229,322
Operating expense Cinema 190,511 182,215
171,795 Real estate 11,163 10,190 9,049 Depreciation and
amortization 16,049 16,595 15,563 General and administrative 16,117
17,432 17,607 Impairment expense 1,463
369 2,239
Total operating expense 235,303
226,801 216,253
Operating income 19,127 18,178 13,069 Interest
income 800 1,482 1,351 Interest expense (17,226 ) (22,520 ) (13,637
) Net gain (loss) on sale of assets 144 (67 ) 352 Other income
(expense) (563 ) 1,157
(347 )
Income (loss) before income
tax expense and equity earnings of unconsolidated joint ventures
and entities 2,282 (1,770 ) 788 Income tax benefit (expense)
(4,904 ) 12,330
(14,264 )
Income (loss) before equity
earnings of unconsolidated joint ventures and entities (2,622 )
10,560 (13,476 ) Equity earnings (loss) of unconsolidated joint
ventures and entities 1,621
(1,552 ) 1,345
Income
(loss) before discontinued operations (1,001 ) 9,008 (12,131 )
Income (loss) from discontinued operations, net of tax (85 ) 232 97
Gain (loss) on sale of discontinued operations
(320 ) 1,656 --
Net income (loss) $ (1,406 ) $ 10,896 $ (12,034 ) Net
(income) loss attributable to noncontrolling interests
492 (940 )
(616 )
Net income (loss) attributable to Reading
International, Inc. common shareholders $ (914 )
$ 9,956 $ (12,650 )
Basic income (loss) per common share attributable to Reading
International, Inc. shareholders: Earnings (loss) from
continuing operations $ (0.02 ) $ 0.36 $ (0.56 ) Earnings (loss)
from discontinued operations, net (0.02 )
0.08 --
Basic income (loss) per share attributable to Reading
International, Inc. shareholders $ (0.04 )
$ 0.44 $ (0.56 )
Diluted
income (loss) per common share attributable to Reading
International, Inc. shareholders: Earnings (loss) from
continuing operations $ (0.02 ) $ 0.35 $ (0.56 ) Earnings (loss)
from discontinued operations, net (0.02 )
0.08 --
Diluted income (loss) per share attributable to Reading
International, Inc. shareholders $ (0.04 )
$ 0.43 $ (0.56 )
Weighted average
number of shares outstanding–basic 23,028,596 22,764,666
22,781,392
Weighted average number of shares
outstanding–diluted 23,028,596
22,993,135
22,781,392
Reading
International, Inc. and Subsidiaries Condensed Consolidated
Balance Sheets (U.S. dollars in thousands)
December 31, 2012
2011 ASSETS Current
Assets: Cash and cash equivalents $ 38,531 $ 31,597 Time
deposits 8,000 -- Receivables 8,514 6,973 Inventory 918 1,035
Investment in marketable securities 55 2,874 Restricted cash 2,465
2,379 Deferred tax asset 3,659 1,985 Prepaid and other current
assets 3,576 3,781 Assets held for sale --
14,495
Total current
assets 65,718 65,119 Operating property, net 202,778
203,780 Investment and development property, net 94,922 90,699
Investment in unconsolidated joint ventures and entities 7,715
7,839 Investment in Reading International Trust I 838 838 Goodwill
22,898 22,277 Intangible assets, net 15,661 17,999 Deferred tax
asset, net 8,989 12,399 Other assets 9,069
9,814
Total assets
$ 428,588 $ 430,764
LIABILITIES AND STOCKHOLDERS' EQUITY Current
Liabilities: Accounts payable and accrued liabilities $ 18,909
$ 16,905 Film rent payable 6,657 6,162 Notes payable – current
portion 19,714 29,630 Notes payable to related party – current
portion 9,000 -- Taxes payable 15,234 14,858 Deferred current
revenue 11,587 10,271 Other current liabilities
6,032 137
Total
current liabilities 87,133 77,963 Notes payable –
long-term portion 139,970 143,071 Notes payable to related party –
long-term portion -- 9,000 Subordinated debt 27,913 27,913
Noncurrent tax liabilities 8,859 12,191 Other liabilities
33,759 35,639
Total liabilities
297,634 305,777
Commitments and contingencies (Note 19)
Stockholders’ equity:
Class A non-voting common stock, par value
$0.01, 100,000,000 shares authorized, 31,951,945 issued and
21,587,775 outstanding at December 31, 2012 and 31,675,518 issued
and 21,311,348 outstanding at December 31, 2011
223 220
Class B voting common stock, par value
$0.01, 20,000,000 shares authorized and 1,495,490 issued and
outstanding at December 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 December 31, 2012 and December 31, 2011
-- --
Additional paid-in capital
136,754 135,171 Accumulated deficit (66,993 ) (66,079 ) Treasury
shares (4,512 ) (4,512 ) Accumulated other comprehensive income
61,369 58,937
Total Reading International, Inc. stockholders’
equity 126,856 123,752 Noncontrolling interests
4,098 1,235
Total
stockholders’ equity 130,954
124,987
Total liabilities and stockholders’
equity $ 428,588 $ 430,764
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