CINEPLEX GALAXY Income Fundirfiles.cineplex.com/investors/presentations/2010/... · 2009...
Transcript of CINEPLEX GALAXY Income Fundirfiles.cineplex.com/investors/presentations/2010/... · 2009...
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CINEPLEX GALAXYIncome Fund
Q32010
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Cineplex Entertainment
Largest
Company in
Most
Successful
and
Motion Picture
Theatre Exhibition
Canada
129
Theatres
with
1,342
Screens
The
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Box Office Market Share - 2009
Empire12.9%
Other6.9%
AMC6.7%
Landmark2.4%
Guzzo3.3%
CineplexEntertainment
67.8%
Market Share
of Canadian Box Office Revenues
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Exhibition
OverviewBusiness
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2008
Cineplex
Entertainment
Q3/10YTD
2009
Industry Box Office
* Source: Motion Picture Theatre Associations of Canada
Canadian
Industry*+4.2%
+13.7%
+12.8%
+5.8% +4.5%
+3.3%
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Films for 2010
October 8th
Secretariat
A
December 22ndNovember 19th
True Grit
Due Date
November 5thOctober 22nd
Paranormal Activity
Harry Potter and the Deathly Hallows: Part
1Morning Glory
November 12th
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December 17th
Jackass 3D
October 15th
December 10th
Chronicles of Narnia:The Voyage of the
Dawn Treader
October 22nd
Saw VII - 3D
November 5th
Megamind
December 17th
Yogi Bear TRON Legacy
Tangled
November 26th
3D Films for Q4
December 22nd
Gulliver’s Travels
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Evolving the Entertainment Experience
MediaMerchandising
Exhibition
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Media
MerchandisingLoyalty
Interactive
Evolving the Entertainment Experience
AlternativeProgramming
Exhibition
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2009 Accomplishments
Exhibition
- Record 70 million visitors, (+ 10.2%)
- Record Box Office Revenue, (+ 13.7%)
- Record Box Office per Patron, (+ 3.2%) to $8.30
- Opened Cineplex Odeon Westmount and VIP Cinemas in London, ON
- Retrofitted four theatres
- Installed 106 digital projectors and 100 RealD 3D systems
SCENE
- Increased membership by 735,000 members
- Reached 2 million member milestone – October
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2009 Accomplishments
Media
- Record revenues of $66.8 million, (+ 9.5%)
- Completed acquisition of Onsite Media Network Inc. and renamed to Cineplex Digital Media
- Recognized by Marketing Magazine as one of Canada’s Top 10 Media Players of the Year
Merchandising
- Record concession revenues, (+14.5%)
- Record annual CPP of $4.12, (+ 3.9%)
- Opened XSCAPE Entertainment Centre at SilverCity Newmarket Cinemas
- Launched speed of service initiatives (Zoning)
- Rationalization of Branded Food Offerings
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2009 Accomplishments
1. Cineplex.com- #1 destination of choice for movie-goers in Canada
- Redesigned website to add enhanced search capability/widgets/improved navigation
2. e-commerce- The Cineplex Store
- Gift cards online
- Earn and redeem SCENE points online
- Signed a license agreement with Roxio CinemaNow - to power a new digital moviedownload service at cineplex.com
- Online ticketing- Significant increase in online ticket sales (54.2%)
- PRINT SKIP SCAN service expanded to 92 locations
3. Mobile- Mobile site developed and launched
- m.cineplex.com
Interactive
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2009 Accomplishments
- The Met Opera’s Live in High Definition series expanded to 90+ theatres
- Launched The Met Summer Series
- Expanded alternative content offerings
- Concerts, sporting events, speaker series
- Launched new partnership with the UK’s National Theatre (5 performances)
Alternative Programming
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Loyalty
Media
Interactive
Merchandising
Exhibition
Evolving the Entertainment Experience
AlternativeProgramming
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Exhibition
2010:
Digital rollout will expand to replace 35mm projectors
Expand VIP Cinemas
UltraAVX - Audio Visual Experience
New builds (CrossIron Mills -Calgary, AB, Chilliwack, BC)
Theatre Upgrades and Retrofits
70 million people visited our theatres in 2009
Exhibition fuels ALL core businesses
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Digital Projection and 3D
Additional 3D screens to be added
(overall target 30-35% of circuit)
Canadian digital financing structure
- Anticipate Q1 2011 launch
- Anticipate taking 18 months to complete rollout
Digital
New Builds
As of Dec. 31, 2008 As of Dec. 31, 2009 As of Sept. 30, 2010
Digital Screens 84 190 342
REALD Systems 49 149 300
Locations 46 89 116
100%
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3D Impact
Game changer – guests love 3D
Drives increased attendance
Drives increased box office revenues (premium price)
Provides incremental growth potential moving forward
- Media – advertising revenues
- Alternative Programming – 3D sports, concerts, live theatre, opera and more!
- Other core businesses benefit e.g. Merchandising, SCENE
2008 2009 Q3 YTD 2009 Q3 YTD 2010
% of Total Box Office
Revenues from IMAX and 3D3.4% 14.4% 16.4% 25.1%
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New Theatres and Retrofits - 2009
Retrofits
New Theatres Screens Open
London, ON 8 + 3 VIP May 8, 2009Cineplex Odeon
Calgary, AB 10 2009(Cineplex Odeon Westhills)
Belleville, ON 8 2009(Galaxy Cinemas)
Vernon, BC 7 2009(Galaxy Cinemas)
Lethbridge, AB 6 2009(Galaxy Cinemas)
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Cineplex Odeon Westmount & VIP Cinemas
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SilverCity CrossIron Mills Cinemas &
XSCAPE Entertainment Centre
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Calgary, AB 7 + XSCAPE June 2010(SilverCity CrossIron Mills)
Chilliwack, BC 8 November 2010(Galaxy)
Victoria, BC 7 Spring 2011(Cineplex Odeon WestshoreCinemas)
Edmonton, AB 8 + 3 VIP 2012(Cineplex Odeon Windermere)
New Theatres and Retrofits - 2010+
New Theatres Screens Opening
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Exhibition Summary
SCENE
Discount Tuesdays
New Builds and Retrofits
Evolving the Entertainment Experience
- Digital and 3D
- UltraAVX - Audio Visual Experience
- XSCAPE Entertainment Centres
- VIP Cinemas
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Exhibition
Evolving the Entertainment Experience
AlternativeProgramming
Loyalty
Media
Interactive
Merchandising
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The Metropolitan Opera
World Wrestling Entertainment
Bollywood and Ethnic Movies
Concerts and Live Events
UFC
2010 Olympic Games at 64
Cineplex theatres across Canada
Future
- 3D sports, 3D concerts,
live theatre productions,
speaker series
Alternative Programming
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Loyalty
Media
Interactive
Merchandising
Exhibition
Evolving the Entertainment Experience
AlternativeProgramming
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Merchandising CPP Revenue Growth
Pro Forma2005
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Merchandising
Expand speed of service initiatives (Zoning)
Rationalization of Branded Food Offerings
Expand in-house brand – Outtakes
Strategically add XSCAPE Entertainment Centres
2010:
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XSCAPE Entertainment Centre
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Loyalty
Media
Interactive
Merchandising
Exhibition
Evolving the Entertainment Experience
AlternativeProgramming
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Cineplex Media
94%
Market Share
On screen advertising -Full Motion and Digital Pre-show
Famous and Famous Quebec Magazines
Cineplex.com advertising
Specialty Media -backlits, banners, popcorn bags, in-theatre sampling, kiosks, etc.
Cineplex Digital Media -Theatre and External Networks
Sponsorship and Naming Rights
Other exhibitor representation commissions
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Cineplex Media Revenue Summary
$47.1
$56.2$61.0
$66.8
2006 2007 2008 20092005
$34.2
($millions)
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Cineplex Media Revenue by Component
2009
Digital Pre-Show34%
Magazine6%
Lobby/Monitors2%
Commissions2%Website
5%
Full Motion47%
Barter & Other4%
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Cineplex Digital Media - Theatre Lobby Network
Upgrading digital signage in
100 theatres
- Lobby Network and Service Level
2010 completion
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Cineplex Digital Media - External Network
Acquired Onsite Media in 2009
Stadium Network: Ottawa, Calgary, Vancouver, Edmonton
Office Network: 26 Brookfield properties -Toronto, Ottawa, Calgary, Edmonton, Vancouver
Plans to expand External Network
Potential acquisition opportunities
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Digital Display & Communications Inc.Acquired in July 2010
Award-winning digital signage company
DDC designs, installs, maintains and operates networks for retail, financial, hospitality and entertainment industries
DDC’s ‘service model’ networks combined with Cineplex Digital Media’s ‘advertising model’ networks, sales force and entertainment content provide significant opportunities for growth
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Loyalty
Media
Interactive
Merchandising
Exhibition
Evolving the Entertainment Experience
AlternativeProgramming
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SCENE Loyalty Program
Program launched (January 24, 2007)
Reached 1 million members (July 22, 2008)
Reached 2 million members (October 24, 2009)
At September 30, 2010 - 2.6 million members
Number of members (millions)
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Gain a more thorough understanding of guests
Mine membership data to generate insights
Communicate directly and regularly
Drive Increased frequency of visitation
Drive increased purchase incidence
Generate additional revenue
Continued member acquisition
Add program partners
Use database to target members
- Studios – film sequels or series
- Advertisers – targeted database
Cineplex targeted offers
- Drive frequency and purchase incidenceMonetize program
SCENE Loyalty Program
Scene Objectives: Future Initiatives:
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39
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40
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Loyalty
Media
Interactive
Merchandising
Exhibition
Evolving the Entertainment Experience
AlternativeProgramming
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2010:
Adding more robust rich content
New blogging/search enhancements
New search engine optimization (SEO) initiatives
Increased page views and unique visitors
Increased online advertising revenue
Interactive - Cineplex.com
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Further enhancements / in-house systemSignificant increases in online ticket sales
Interactive - e-commerce
Cineplex Store:
2010:
Online Ticketing:
2010:
Fastest, easiest and most convenient way to purchase tickets -- PRINT SKIP SCAN
Online sales of gift cards, DVDs, Blu-ray, new release and catalogue movies
Earn and redeem SCENE points
Launched digital movie download service on
November 17, 2010
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m.cineplex.com
SMS Mobile Platform
Cineplex Apps - Blackberry, iPhone, Android
Mobile Payment and Ticketing
SMS – contests, games, promotions, segmented alerts
Mobile Advertising Delivery
Interactive - Mobile
Mobile:
2010:
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Financial
Highlights
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Record Annual Results
*Indicates Annual Record
2009 2008 %
Box Office $581.1* $510.9 13.7%
Concession 288.3* 251.6 14.5
Other 95.0* 87.1 9.0
Total Revenue 964.3* 849.7 13.5
Adjusted EBITDA 159.9* 140.5 13.8
EBITDA Margin 16.6% 16.5% 0.1
Attendance 70.0* 63.5 10.2
BPP $8.30* $8.05 3.2
CPP $4.12* $3.96 3.9
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Cineplex Regal Cinemark Carmike AMC
BPP 3.2% 6.0% 2.4% 4.7% 4.5%
Box Office revenue growth
13.7% 5.8% 14.8% 10.6% 3.6%
CPP growth 3.9% 2.6% 0.6% -0.2% 0.5%
Concession revenue growth
14.5% 2.3% 12.7% 5.5% -0.4%
Total Revenue
growth13.5% 4.4% 13.4% 8.9% 2.4%
EBITDA growth 13.8% 2.1% 20.3% 10.0% 2.7%
Attendance
growth10.2% -0.3% 12.0% 5.7% -0.9%
Cineplex vs. US Exhibitors - 2009 vs. 2008
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Attendance(millions)
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Box Office Revenue
Box Office Revenue Box Office per Patron
($millions)
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Concession Revenue
Concession Revenue CPP
($millions)
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Other Revenue
$67.9
$81.0$87.1
$95.0
($millions)
$44.3
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Adjusted EBITDA*
Adjusted EBITDA Adjusted EBITDA Margin
($millions)
*Cineplex Entertainment Limited Partnership
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Q3 2010 Results(millions)
Cineplex Galaxy Income Fund
Q3 2010 Q3 2009 %Q3 2010
YTD
Q3 2009
YTD%
Box Office $157.9 $155.9 1.3% $462.7 $437.5 5.8%
Concession 80.1 78.0 2.7% 227.6 215.3 5.7%
Other 31.1 23.7 31.3% 79.7 64.3 23.9%
Total Revenue 269.0 257.5 4.5% 770.0 717.2 7.4%
Adjusted EBITDA 55.2 47.2 16.8% 132.1 121.8 8.5%
EBITDA Margin 20.5% 18.3% 2.2% 17.2% 17.0% 0.2%
Attendance 18.9 18.8 0.7% 53.6 52.9 1.4%
BPP $8.35 $8.30 0.6% $8.63 $8.27 4.4%
CPP $4.24 $4.15 2.2% $4.24 $4.07 4.2%
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Credit Facilities
Covenant Leverage Ratio
Maturity Capacity Drawn
Term Facility July 2012 $235.0 $235.0
Revolving Facility July 2012 130.0 0
Total $365.0 $235.0
($millions)
2.89 2.39 1.94 1.88 1.64 1.57
2005 2006 2007 2008 2009 Sept. 30, 2010
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Distributions
Payout Ratio
Distributions
112%
80%69% 67% 59% 57%
2005 2006 2007 2008 2009
LTM Sept. 302010
2020 - 505 Burrard St
LTM Sept. 302010
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Corporate Conversion Plan
Conversion Date - January 1, 2011
Plan of Arrangement - Business Corporations Act (Ontario)
Management Information Circular – Nov 1, 2010
Special Meeting – Dec 2, 2010
Tax-Deferred Rollover Basis for Canadian Resident
Unitholders
Eligibility for dividend tax credits
Initial Dividends
- $1.26 annually payable monthly
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Questions
Answersand