IMAX Corporation Reports Fourth-Quarter and 2017 Results

IMAX Corporation (NYSE:IMAX) recently reported fourth-quarter 2017 revenue of $125.6 million and net income attributable to common shareholders of $4.8 million, or $0.08 per diluted share, which includes a one-time tax charge of $9.3 million ($0.14 per diluted share) associated with the recent U.S. tax reform and a $2.5 million ($0.04 per diluted share) charge associated with the Company’s cost reduction exercise announced in June. Full-year 2017 revenue was $380.8 million and net income attributable to common shareholders was $2.3 million, or $0.04 per diluted share, which includes the one-time tax charge of $9.3 million ($0.14 per diluted share) and total restructuring charge of $16.2 million ($0.25 per diluted share).

Adjusted net income attributable to common shareholders for the fourth quarter was $21.8 million, or $0.34 per diluted share. Full-year 2017 adjusted net income attributable to common shareholders was $40.5 million, or $0.62 per diluted share.

“We saw tangible improvements to box office performance and operating leverage in the second half last year, largely the result of our implementing several initiatives aimed at refining our programming strategy and containing costs,” said Richard L. Gelfond, IMAX CEO. “IMAX domestic box office increased 17 percent in the second half, compared to an exhibitor industry decline of 6 percent. In international markets, we grew box office 14 percent over the same period. We believe this underscores the IMAX consumer value proposition for compelling content and highlights the importance of analysing our results separately from the overall industry’s. Moreover, our growing international presence in markets such as Japan – a market that housed our single strongest-performing theatre last year – continued to contribute meaningfully to our overall results.”

Fourth-Quarter 2017 Results

U.S. Tax Cuts and Jobs Act (Tax Act)

In the fourth quarter of 2017, IMAX incurred a discrete tax expense of $9.3 million, related to the enactment of the U.S. Tax Cuts and Jobs Act on Dec. 22, 2017. This non-recurring charge relates to the provisional re-measurement and write-down of the Company’s U.S. deferred tax assets and liabilities, given the changes enacted by the Tax Act.

Network Update

During the quarter, the Company installed 70 theatres, of which 69 were for new theatre locations and one was an upgrade. The total IMAX theatre network consisted of 1,370 systems as of Dec. 31, 2017, of which 1,272 were in commercial multiplexes. There were 499 theatres in backlog as of Dec. 31, 2017, compared to the 498 in backlog as of Dec. 31, 2016.

IMAX signed contracts for 23 new theatres across 12 countries in the fourth quarter of 2017.  For a breakdown of theatre system signings, installations, network and backlog by type for the fourth quarter of 2017, please see the end of this press release.

Box Office Update

Gross box office from IMAX DMR films increased by 13 percent to $278.1 million in the fourth quarter of 2017 from $246.5 million in the fourth quarter of 2016, resulting in higher DMR revenues. Gross box office per-screen for the fourth quarter of 2017 averaged $227,000 in comparison to $233,300 in the fourth quarter of 2016. Gross box office was generated primarily by the exhibition of 45 films (20 new and 25 carryovers), as compared to 24 films (17 new and 7 carryovers) exhibited in the fourth quarter of 2016.

For the entire report head here.

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