IMAX Tops Q3 Earnings & Revenues on Robust Theater Demand
IMAX Corp. (IMAX) reported strong financial results for the third quarter of 2014. Both the top and the bottom line outpaced the respective Zacks Consensus Estimate.
Quarterly total revenue was $60.7 million, up 17.8% year over year, which also surpassed the Zacks Consensus Estimate of $60 million. Quarterly GAAP net income was $4.9 million or 7 cents per share compared with $1.6 million or 2 cents per share in the year-ago quarter. However, adjusted third-quarter earnings per share of 11 cents exceeded the Zacks Consensus Estimate of 5 cents.
Quarterly gross margin came in at 58.3% against 53.4% in the prior-year quarter. Operating margin stood at 8.7% compared with 3.3% in the year-ago quarter. Adjusted EBITDA (earnings before interest, tax, depreciation and amortization) stood at $17.6 million versus $115.2 million in the prior-year quarter.
In the first nine months of 2014, IMAX generated around $71.9 million of cash from operations against $33 million in the same period last year. Free cash flow during the nine-month period was $47.2 million compared with $26.8 million in the prior-year period. At third-quarter 2014 end, IMAX had $93.7 million of cash and cash equivalents and no outstanding debt against $29.5 million of cash and no outstanding debt, at the end of 2013.
Segment Wise Results
Sales and Sales-type leases: Quarterly total revenue was $6.6 million, up 3.1% year over year. Joint-revenue sharing arrangement: Quarterly total revenue stood at $15.2 million, up 26.7% year over year. During the reported quarter, IMAX installed 14 new theaters against 13 in the prior-year quarter. Notably, the company had 422 theatres operating under joint revenue-sharing arrangements as of Sep 30, 2014, as against 351 theatres a year ago.
Production and IMAX DMR (Digital Re-Mastering): Quarterly total revenue was $18.4 million, up 3.4% year over year. The average global DMR box office per screen in the third quarter of 2014 was $227,900 compared with $207,500 in the prior-year quarter.
Category wise Results
In the third quarter of 2014, revenues from Equipments and product sales totaled $11.8 million, up 22.9% year over year. Services revenues increased 15.3% from the prior-year quarter to $33.2 million. Rental revenues were $13.6 million, jumping 23.6% year over year. Finance Income came in at $2.1 million, almost flat year over year.
Network Growth Statistics
Total theater installation, at the end of the reported quarter, was 20 against 28 at the end of the year-ago quarter. As of Sep 30, 2014, total theaters in backlog were 439 compared with 356 at the end of the previous-year quarter. Total IMAX theater network was 880 compared with 785 a year earlier.
Other Stocks to Consider
IMAX currently carries a Zacks Rank Ran #3 (Hold). Some other stocks in the broader media and broadcasting industry include DreamWorks Animation SKG Inc. (DWA), Lions Gate Entertainment Corp. (LGF) and Bona Film Group Limited (BONA), all carrying the same rank as IMAX.
Read the Full Research Report on LGF
Read the Full Research Report on IMAX
Read the Full Research Report on DWA
Read the Full Research Report on BONA
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