Highlights
SHANGHAI, Feb. 27, 2019 /PRNewswire/ -- IMAX China Holding, Inc. ("IMAX China" or the "Company", HKG: 1970) today reported full-year 2018 Greater China revenue of $117.5 million and gross profit of $75.3 million, or 64.0% of revenues. Adjusted profit for the year came in at $44.3 million, a slight decrease of 3.6% from the prior year. Due to better box office results, gross margin and adjusted profit margin increased 280 and 140 basis points respectively. For adjustments to profit for the year and financial results, please refer to the annual result announcement posted with the Hong Kong Stock Exchange, or to the annual result announcement posted on the Investor Relations section of the IMAX China web site (http://www.imax.cn/investor).
"Over the last six months, our box office performance and revenue generating power of the network has been on the upswing. Our achievements set the stage for IMAX China to have a blockbuster year in 2019. We further differentiated The IMAX Experience®, increased awareness of the IMAX brand and refined our programming strategy, which helped deliver our strongest box office year ever in China," said IMAX China Chairman Richard L. Gelfond. Most importantly, our box office momentum has continued into 2019. To date, we have delivered $78 million of box office in China, up 61%. Driving this growth were blockbusters from Alita: Battle Angel to The Wandering Earth. The latter film has become our highest grossing film of all time in China, surpassing Avengers: Infinity War. In addition to the film's stellar box office performance, we believe it will serve as a catalyst for more IMAX-friendly films to be made in China. Overall, we believe our recent box office momentum, coupled with our exciting new IMAX with Laser experience and refined marketing approach will continue to drive more box office dollars through our network."
IMAX China Dividend
IMAX China today announced that its Board of Directors recommended the payment of a final dividend of $0.02 per share. The dividend will need to be voted on by the shareholders at the Company's annual meeting.
Network Update
There were 639 systems in the IMAX theatre network in Greater China as of Dec. 31, 2018, of which 624 were in commercial multiplexes and 11 were IMAX with Laser systems. Currently, 410 of these theatres operate under revenue-sharing arrangements and 229 operate under sales and sales-type lease arrangements. There were also 272 theatres in backlog as of Dec. 31, 2018, of which 196 are for revenue-sharing arrangements. The Company also installed 101 theatre systems in 2018, which is down from the 120 installations recognized during 2017.
"The story is quite simple. Beginning in 2017 we made a series of strategic decisions to turnaround our business," said Gelfond. "From top to bottom, the evidence is clear in 2018 that these initiatives are working as our growth, margin and return metrics are on solidly positive trend lines. We have confidence each of these trends will continue in 2019 and our margin and return improvement should accelerate as we continue to execute against the initiatives we laid out."
Box Office Update
Gross box office from IMAX DMR® titles in Greater China was $336.6 million in 2018, compared with $290.8 million in the prior-year period.
Greater China Key Metrics
Twelve months ended December 31, |
||||
2018 |
2017 |
|||
Greater China Signings |
||||
Sales & Sales-type Lease |
30 |
55 |
||
Revenue Share |
30 |
40 |
||
Total |
60 |
95 |
||
Greater China Theatre Installations |
||||
Sales & Sales type Lease |
27 |
41 |
||
Revenue Share |
70 |
79 |
||
IMAX with Laser Upgrade |
4 |
0 |
||
Total |
101 |
120 |
||
Greater China Network |
||||
Commercial Multiplex |
624 |
527 |
||
Institutional |
15 |
17 |
||
Total |
639 |
544 |
||
Greater China Backlog |
272 |
309 |
||
IMAX Greater China Box Office |
$337 million |
$291 million |
||
IMAX Greater China PSA |
$616,000 |
$665,900 |
||
Film Count |
||||
PRC |
45 |
44 |
||
HK/ Taiwan Only |
12 |
7 |
||
Total |
57 |
51 |
||
Confirmed Film Slate for 2019
To date, the Company's controlling shareholder, IMAX Corporation has announced the following 21 titles for release in 2019. While not all of these titles are guaranteed to be released in China, IMAX China has access to them in the event they secure official Chinese release dates. The Company intends to announce and exhibit additional titles upon confirmation of film release dates in China. All release dates below relate to their US release date unless otherwise noted.
Conference Call
The Company will host a conference call today at 8:00 AM Hong Kong Time to discuss its full-year 2018 financial results. To access the call via telephone, interested parties in the US and Canada should dial +1 (866) 548-4713 approximately 5 to 10 minutes before the call begins. Hong Kong callers should dial +852 800-961-105 and other international callers should dial (647) 484-0477. The conference ID for the call is 6014172. A replay of the call will be available via webcast at www.imax.cn/investor/l-en or via telephone by dialing (888) 203-1112 (US and Canada), or (647) 436-0148 (international). The Conference ID for the telephone replay is 6014172.
About IMAX China
IMAX China is a subsidiary of IMAX Corporation, and is incorporated under the laws of Cayman Islands. IMAX China was established by IMAX Corporation specifically to oversee the expansion of IMAX's business throughout Greater China. IMAX China trades on the Hong Kong Stock Exchange under the stock code "HK.1970."
About IMAX Corporation
IMAX, an innovator in entertainment technology, combines proprietary software, architecture and equipment to create experiences that take you beyond the edge of your seat to a world you've never imagined. Top filmmakers and studios are utilizing IMAX theatres to connect with audiences in extraordinary ways, and, as such, IMAX's network is among the most important and successful theatrical distribution platforms for major event films around the globe.
IMAX is headquartered in New York, Toronto and Los Angeles, with additional offices in London, Dublin, Tokyo, and Shanghai. As of December 31, 2018, there were 1,505 IMAX theater systems (1,409 commercial multiplexes, 14 commercial destinations, 82 institutional) operating in 80 countries. On Oct. 8, 2015, shares of IMAX China, a subsidiary of IMAX Corp., began trading on the Hong Kong Stock Exchange under the stock code "HK.1970."
IMAX®, IMAX® 3D, IMAX DMR®, Experience It In IMAX®, An IMAX 3D Experience®, The IMAX Experience®, IMAX Is Believing® and IMAX nXos® are trademarks of IMAX Corporation. More information about the Company can be found at www.imax.com. You may also connect with IMAX on Facebook (www.facebook.com/imax), Twitter (www.twitter.com/imax) and YouTube (www.youtube.com/imaxmovies).
This press release contains forward looking statements that are based on IMAX Corporation and IMAX China management's assumptions and existing information and involve certain risks and uncertainties which could cause actual results to differ materially from future results expressed or implied by such forward looking statements. Important factors that could affect these statements include, but are not limited to, references to future capital expenditures (including the amount and nature thereof), business and technology strategies and measures to implement strategies, competitive strengths, goals, expansion and growth of business, operations and technology, plans and references to the future success of IMAX Corporation, IMAX China or any other consolidated subsidiaries of IMAX Corporation (each, a "Group Member", and collectively, "IMAX Group") and expectations regarding the future operating, financial or technological results of any Group Member. These forward-looking statements are based on certain assumptions and analyses made by the IMAX Group in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances. However, whether actual results and developments will conform with the expectations and predictions of any Group Member is subject to a number of risks and uncertainties, including, but not limited to, risks associated with investments and operations in foreign jurisdictions and any future international expansion, including those related to economic, political and regulatory policies of local governments and laws and policies of the United States and Canada; risks related to IMAX Group's growth and operations in China; the performance of IMAX DMR films; the signing of theater system agreements; conditions, changes and developments in the commercial exhibition industry; risks related to currency fluctuations; the potential impact of increased competition in the markets within which any Group Member operates; competitive actions by other companies; the failure to respond to change and advancements in digital technology; one Group Member's largest customer accounting for a significant portion of its revenue and backlog; risks related to new business initiatives; conditions in the in-home and out-of-home entertainment industries; the opportunities (or lack thereof) that may be presented to and pursued by a Group Member; risks related to cyber-security; risks related to any Group Member's inability to protect its intellectual property; general economic, market or business conditions; the failure to convert theater system backlog into revenue; changes in laws or regulations; the failure to fully realize the projected cost savings and benefits from any Group Member's restructuring initiative; and other factors, many of which are beyond the control of any Group Member. These factors, other risks and uncertainties and financial details are discussed in IMAX Corporation's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
