UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of the Securities Exchange Act of
1934
Date of
report (Date of earliest event reported): August 7, 2009
Reading International,
Inc.
(Exact
Name of Registrant as Specified in its Charter)
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Nevada
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1-8625
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95-3885184
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(State
or Other Jurisdiction
of
Incorporation)
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(Commission
File
Number)
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(IRS
Employer
Identification
No.)
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500 Citadel Drive, Suite 300, Commerce,
California
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90040
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant's
telephone number, including area code: (213) 235-2240
N/A
(Former
Name or Former Address, if Changed Since Last Report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
2.02. Results of Operations and Financial
Condition.
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On August 7, 2009, Reading
International, Inc. issued a press release announcing information regarding its
results of operations and financial condition for the quarter ended June 30,
2009, a copy of which is attached as Exhibit 99.1.
Item 9.01. Financial
Statements and Exhibits.
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99.1
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Press
release issued by Reading International, Inc. pertaining to its results of
operations and financial condition for the quarter ended June 30,
2009.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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READING
INTERNATIONAL, INC.
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Date:
August 7, 2009
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By:
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/s/
Andrzej Matyczynski
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Name:
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Andrzej
Matyczynski
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Title:
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Chief
Financial Officer
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Reading
International Announces Record 2nd Quarter
2009 Results
·
Revenue from operations at $54.4 million, the second
highest ever reported
· Net
Income of $9.9 million, the
second highest ever reported, was $9.6 million higher than the
$284,000 in the 2008
Quarter
·
EBITDA(1) of $16.7 million, the highest
ever reported, was $7.5
million higher than the $9.2 million in the 2008
Quarter
· Net
Worth increased to $93.8
million at June 30, 2009 from $69.4 million at December 31,
2008
Los Angeles, California, - (PR
NEWSWIRE) –August 7, 2009 – Reading International, Inc. (NASDAQ: RDI)
announced today results for its quarter ended June 30, 2009.
2009
Highlights
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·
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our
EBITDA(1)
for the 2009 June quarter was $16.7 million compared to $9.2 million in
the 2008 quarter, an increase of
80.7%;
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·
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for
the 2009 six months our EBITDA(1)
was $21.9 million compared to $16.2 million in 2008, an increase of
35.6%;
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·
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we
had significant local currency cinema revenue growth in both Australia and
New Zealand, with Australia showing a 33% increase and New Zealand a 15.5%
increase over the June quarter in 2008. In Australia, in local
currency, this quarter’s revenue at AUS$27.0 million was a record
high;
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·
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the
first fully comparable quarter to the prior year in our US cinema
operations, since our Consolidated Entertainment acquisition resulted in a
revenue increase for such operations of $1.0 million or 3.6%, over the
prior year quarter;
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·
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we
reduced our general and administrative expenses by 13.8% for the quarter
and 9.7% for the half year, compared to prior
year;
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·
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during
first quarter of 2009, we reacquired 45.8% of our outstanding Trust
Preferred Securities (“TPS”) for $11.5 million thereby extinguishing $22.9
million of our debt related to these securities on April 30,
2009. This resulted in us recognizing an $11.5 million gain on
retirement of subordinated debt in the current quarter offset by a $0.7
million write off of deferred financing costs associated with this
transaction;
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·
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the
anticipated purchaser of our Auburn property elected not to proceed,
allowing us to take into income $1.5 million (AUS$2.0 million) in
previously made option payments;
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·
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the
decrease in the value of the Australian and New Zealand dollars vis-à-vis
the US dollar from $0.9562 and $0.7609, respectively, as of June 30, 2008
to $0.8055 and $0.6447, respectively, as of June 30, 2009, had
a dampening effect on our reported operational earnings for the
2009 quarter compared to the 2008 quarter even though our operational
income in the local currencies increased by 47.2% in Australia and 43.0%
in New Zealand; and
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·
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primarily
as a result of the stronger operating income, the TPS gain, and the fact
that both the Australian dollar and the New Zealand dollar have recaptured
some of their value since year end, when such currencies traded at $0.6983
and $0.5815, respectively, our stockholders’ equity has risen to $93.8
million at June 30, 2009 compared to $69.4 million at December 31,
2008.
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Subsequent
to June 30, 2009, as part of the terms of settlement, we and Magoon Acquisition
and Development, LLC (“Magoon LLC”) closed on the sale of our respective
interests in Malulani Investments, Limited (“MIL”) and The Malulani Group,
Limited (collectively, “MMG”) and settled certain litigation with MMG and
certain of their officers and Directors. As a result of the sale and
the settlement (which was negotiated in March 2009), on July 2, 2009, we
received $2.5 million in cash and $6.75 million in notes aggregating $9.25
million, and a ten-year tail interest in MIL. Under the terms of our
Shareholders’ Agreement with Magoon LLC, substantially all of the proceeds of
this sale and settlement will be allocated to us, until we have recouped our
initial investment in MIL and all costs advanced by us with respect to the
litigation.
Second
Quarter 2009 Discussion
On
February 22, 2008, we acquired 15 cinemas with 181 screens in Hawaii and
California, the Consolidated Entertainment acquisition. This quarter
was the first fully comparable year-to-year quarter for our US cinema
operations. These assets provided an operating income before
depreciation and amortization in the second quarter of 2009 of $3.4 million
compared to the $2.0 million provided in the same quarter of 2008.
Revenue
from operations increased from $53.8 million in the 2008 quarter to $54.4
million in 2009, a 1.2% increase. The cinema revenue increase of $1.7
million was driven by a $1.0 million increase in the US, a $1.2 million increase
in Australia and a decrease in New Zealand of $0.5 million. The
results of Australia and New Zealand were affected negatively by the previously
mentioned currency exchange movements even though we noted significantly higher
revenues in the local currencies for the period in both Australia and New
Zealand. The top 3 grossing films for the quarter in our circuit
worldwide were: “Transformers:
Revenge of the Fallen,” “The Hangover” and “X-Men Origins: Wolverine,”
which between them accounted for approximately 20.4% of our cinema box
office revenue. The real estate revenue was down by $1.1 million from
quarter to quarter, as a result of the negative currency exchange effects in
Australia and New Zealand as well as lower live theatre rentals in the
US. In local currencies, real estate revenue was flat in both
Australia and New Zealand.
As a
percentage of revenue, operating expense, at 76.8% in the 2009 quarter was lower
than the 82.0% of the 2008 quarter. This decrease was in part related
to the final allocation for accounting purposes of a greater portion of the
purchase price paid for our Consolidated Entertainment cinemas to goodwill than
originally estimated. This change, effective in the fourth quarter of
2008, has resulted in higher straight-line rent and acquired lease costs in 2008
than in 2009. This increase was offset in part by a decrease in
depreciation and amortization expense, discussed below, also resulting from this
final allocation of the purchase price paid for the Consolidated Entertainment
cinemas. Additionally we noted decreased cinema costs from our
Australia and New Zealand cinema operations primarily due to the impact of
currency exchange rates.
Depreciation
and amortization decreased by $2.2 million, or 39.9%, from $5.5 million in the
2008 quarter to $3.3 million in the 2009 quarter, primarily due to the
previously mentioned purchase accounting finalization for our acquired
Consolidated Entertainment cinema assets.
2
As the
sale of our Auburn property is no longer proceeding, we have moved the property
back to continuing operations, and as a result we expensed $549,000 as catch-up
depreciation, classified as loss on transfer of real estate from held for sale
to continuing operations.
General
and administrative expense decreased by $676,000 or 13.8%, from $4.9 million to
$4.2 million in the 2009 quarter. This decrease was primarily related
to cost cutting measures implemented worldwide; one-time 2008 purchase related
costs of our Consolidated Entertainment acquisition; and the impact of currency
exchange rate decreases.
Driven by
the above factors our operating income for the quarter increased by $5.3 million
to $4.5 million compared to a loss of $762,000 in the same quarter last
year.
Interest
expense decreased by $168,000 from $3.0 million in the 2008 quarter to $2.9
million in the 2009 quarter. This was primarily related to our
ceasing to capitalize interest on our development properties, where development
has been substantially curtailed, which resulted in an interest expense
increase, which was offset by a reduction in interest expense due to the
mark-to-market of our interest rate swaps.
For the
2009 quarter, we recorded an “other loss” of $1.8 million compared to an “other
income” of $1.9 million for the 2008 quarter, a $3.6 million
change. For the 2009 quarter, the $1.8 million other loss included a
$2.2 million loss on currency transactions and a $1.3 million other than
temporary loss on our Becker marketable securities offset by a $1.5 million gain
on the Auburn option termination. The 2008 quarter other income of
$1.9 million was primarily related to a gain on currency transactions of
$447,000, a $314,000 receipt related to our Burstone litigation, and $910,000 of
Hurricane Georges insurance proceeds related to damage caused in 1998 to one of
our previously owned cinemas in Puerto Rico.
During
the 2009 quarter, we recorded a $10.7 million gain on retirement of subordinated
debt (TPS), net of a $749,000 loss on deferred financing costs associated with
the subordinated debt.
In the
2008 quarter we recorded a gain on sale of investment in an unconsolidated
entity of $2.5 million from the sale of our 50% interest in the cinema at Botany
Downs in Auckland, New Zealand.
As a
result of the above, we reported a net income of $9.9 million for the 2009
quarter compared to a net income of only $284,000 in the 2008
quarter.
Our
EBITDA(1) at
$16.7 million for the 2009 quarter was $7.5 million higher than the 2008 quarter
of $9.2 million, predominantly driven by better operating margins (approximately
$3.1 million) plus the gain on the TPS retirement (approximately $10.7 million)
offset by the “other income (loss)” change (approximately $3.6 million) and the
2008 gain on sale (approximately $2.5 million).
Our adjusted EBITDA(1) for the 2009 quarter was $8.5
million after excluding:
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the
$10.7 million gain on the retirement of our TPS
debt;
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the
$1.5 million gain from Auburn option
payments;
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the
$549,000 loss on transfer of
Auburn;
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the
realized transactional currency loss of $2.2 million;
and
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·
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the
$1.3 million other than temporary loss on our Becker marketable
securities.
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3
Our adjusted EBITDA(1) for the 2008 quarter was $5.0
million after excluding:
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·
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the
$2.5 million gain on sale of Botany;
and
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·
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the
$1.7 million in one-time and realized transactional currency
gains.
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First
Half 2009 Summary
Our
Consolidated Entertainment acquisition provided an operating income before
depreciation and amortization in the 2009 six-months of $5.4 million compared to
the $1.8 million provided in the 2008 six-months.
Revenue
from operations increased from $93.5 million in 2008 to $101.5 million in 2009,
an 8.6% increase. The cinema revenue increase of $9.8 million was
driven by an increase of $13.7 million in the US and decreases in Australia of
$1.4 million and New Zealand of $2.5 million. The decreases in
Australia and New Zealand were currency exchange driven as the local currency
revenues were up 22.7% in Australia and 3.3% in New Zealand, compared to the
2008 six-months. The top 3 grossing films for the six-months in our
circuit worldwide were: “Slumdog Millionaire,” “The
Hangover” and “Fast and
Furious,” which between them accounted for approximately 11.4% of our cinema box
office revenue. The real estate revenue was down by $1.8 million from
2008 to 2009, as a result of the negative currency exchange effects in Australia
and New Zealand as well as lower live theatre rentals in the US. In
local currencies, real estate revenue was flat in both Australia and New
Zealand.
As a
percentage of revenue, operating expense, at 77.5% in 2009 was lower than the
78.7% of 2008. The reduction was primarily driven by the same reasons
as the quarter, above.
Depreciation
and amortization decreased by $2.2 million, or 23.8%, from $9.4 million in 2008
to $7.2 million in 2009, primarily due to the previously mentioned purchase
accounting adjustments for our acquired Consolidated Entertainment cinema
assets.
As the
sale of our Auburn property is no longer proceeding, we have moved the property
back to continuing operations, and as a result we expensed $549,000 as catch-up
depreciation, classified as loss on transfer of real estate from held for sale
to continuing operations.
General
and administrative expense decreased by $929,000 or 9.7%, from $9.6 million to
$8.7 million in 2009. This decrease was primarily driven by the same
reasons as the quarter, above.
Driven by
the above factors, our operating income for the 2009 six-months increased by
$5.6 million to $6.4 million, compared to income of $875,000 in the 2008
six-months.
Interest
expense increased by $1.4 million, from $5.9 million in the 2008 six-months to
$7.3 million in the 2009 six-months. This was primarily related to
our ceasing to capitalize interest on our development properties, where
development has been substantially curtailed, which resulted in an interest
expense increase.
In 2009,
we recorded an “other loss” of $2.1 million compared to an “other income” of
$3.6 million for the same period in 2008, a $5.7 million change. The
2009 other loss of $2.1 million included a $2.2 million loss on currency
transactions, a $2.1 million other than temporary loss on our Becker marketable
securities, and a $1.5 million gain on the Auburn option
termination. The 2008 other income of $3.6 million was primarily
related to a gain on currency transactions of $447,000; a $1.1 million receipt
related to our Burstone litigation; $910,000 of insurance proceeds related to
damage caused by Hurricane Georges in 1998 to one of our previously owned
cinemas in Puerto Rico; and the settlement in our credit card dispute of
$385,000.
4
During
the 2009 six-months, we recorded a $10.7 million gain on retirement of
subordinated debt (TPS), net of a $749,000 loss on deferred financing costs
associated with the subordinated debt.
In 2008
we recorded a gain on sale of investment in an unconsolidated entity of $2.5
million from the sale of our 50% interest in the cinema at Botany Downs in
Auckland, New Zealand.
As a
result of the above, we reported a net income of $6.5 million for the 2009
six-months compared to a net income of only $56,000 in the 2008
six-months.
Our
EBITDA(1) at
$21.9 million for the 2009 six-months was $5.7 million higher than the 2008
six-months of $16.2 million, predominantly driven by better operating margins
(approximately $3.3 million) plus the gain on the TPS retirement (approximately
$10.7 million) offset by the “other income (loss)” change (approximately $5.7
million) and the 2008 gain on sale (approximately $2.5 million).
Our adjusted EBITDA(1) for the 2009 six-months was $14.5
million after excluding:
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the
$10.7 million gain on the retirement of our TPS
debt;
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the
$1.5 million gain from Auburn option
payments;
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the
$549,000 loss on transfer of
Auburn;
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the
realized transactional currency loss of $2.2 million;
and
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the
$2.1 million other than temporary loss on our Becker available-for-sale
shares.
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Our adjusted EBITDA(1) for the 2008 quarter was $10.9
million after excluding:
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·
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the
$2.5 million gain on sale of Botany;
and
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·
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the
$2.8 million in one-time and realized transactional currency
gains.
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Balance
Sheet
Our total
assets at June 30, 2009 were $379.0 million compared to $371.9 million at
December 31, 2008. The currency exchange rates for Australia and New
Zealand as of June 30, 2009 were $0.8055 and $0.6447, respectively, and as of
December 31, 2008, these rates were $0.6983 and $0.5815,
respectively. As a result, currency had a positive effect on the
balance sheet at June 30, 2009 compared to December 31, 2008.
Our cash
position at June 30, 2009 was $21.2 million compared to $30.9 million at
December 31, 2008, reflecting the $11.5 million used to effectively repurchase
$22.9 million of our TPS in the first quarter of 2009.
At the
present time we have approximately $3.8 million (AUS$5.5 million) in undrawn
funds under our Australian Corporate Credit Facility. During May
2009, we extended the term of our New Zealand facility to March 31, 2012 and
reduced the available borrowing amount to $29.0 million (NZ$45.0
million). As a result, we currently have undrawn funds of $19.3
million (NZ$30.0 million) available under our line of credit in New
Zealand. Accordingly, we believe that we have sufficient borrowing
capacity under our Australian Corporate Credit Facility and our New Zealand line
of credit to meet our anticipated short-term working capital
requirements.
Our
working capital at June 30, 2009 became negative by $10.2 million and compares
to a positive working capital of $12.5 million at December 31, 2008, again
driven by the TPS repurchase and the recharacterization of two loans that have
become short-term in nature, totaling $12.5 million.
Stockholders’
equity was $93.8 million at June 30, 2009 compared to $69.4 million at December
31, 2008.
5
Subsequent
Events
Malulani
Investments Litigation
On July
2, 2009, we settled our lawsuit with MMG and certain of its officers, directors
and affiliates.
Change
in Stock Exchange
On August
4, 2009, we moved our stock listings for both our classes of voting and
nonvoting stock from the AMEX to the NASDAQ exchange. The ticker
symbols for each of the stocks remained the same, namely RDI for the nonvoting
stock and RDIB for the voting stock.
Australia
Construction Loan
Our
Australian Construction Loan effectively matures on September 30,
2009. As such, we used our available cash reserves to pay off the
loan on July 31, 2009.
Indooroopilly
Lease
On July 24, 2009, we signed a lease
with the City of Brisbane, Australia to lease our Indooroopilly building to them
for an initial three year period with two-three year options.
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:
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the
development, ownership and operation of multiplex cinemas in the United
States, Australia and New Zealand;
and
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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.
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Reading
manages its worldwide cinema business under various different
brands:
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in
the United States, under the
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o
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Reading
brand,
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o
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Angelika
Film Center brand (http://angelikafilmcenter.com/),
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o
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Consolidated
Theatres brand (http://www.consolidatedtheatres.com/),
and
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o
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City
Cinemas brand;
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in
Australia, under the Reading brand (http://www.readingcinemas.com.au/);
and
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in
New Zealand, under the
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o
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Reading
(http://www.readingcinemas.co.nz)
and
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o
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Rialto
(http://www.rialto.co.nz)
brands.
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6
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:
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·
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With
respect to our cinema operations:
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o
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The
number and attractiveness to movie goers of the films released in future
periods;
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o
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The
amount of money spent by film distributors to promote their motion
pictures;
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o
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The
licensing fees and terms required by film distributors from motion picture
exhibitors in order to exhibit their
films;
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o
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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
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o
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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 and VHS rentals and sales, and so called “movies
on demand;”
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·
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With
respect to our real estate development and operation
activities:
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o
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The
rental rates and capitalization rates applicable to the markets in which
we operate and the quality of properties that we
own;
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o
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The extent to which we can
obtain on a timely basis the various land use approvals and entitlements
needed to develop our
properties;
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o
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the
risks and uncertainties associated with real estate
development;
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o
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The
availability and cost of labor and
materials;
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o
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Competition
for development sites and tenants;
and
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o
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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;
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7
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·
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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:
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o
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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;
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o
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The
relative values of the currency used in the countries in which we
operate;
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o
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Changes
in government regulation, including by way of example, the costs resulting
from the implementation of the requirements of
Sarbanes-Oxley;
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o
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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);
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o
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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;
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o
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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
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o
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Changes
in applicable accounting policies and
practices.
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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, it naturally follows that 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,
please understand that 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.
For more
information, contact:
Andrzej
Matyczynski, Chief Financial Officer
Reading
International, Inc. (213) 235 2240
(1) The Company
defines EBITDA as net income (loss) before net interest expense, income tax
benefit, depreciation, and amortization. EBITDA is presented solely
as a supplemental disclosure as we believe it to be a relevant and useful
measure to compare operating results among our properties and competitors, as
well as a measurement tool for evaluation of operating
personnel. EBITDA is not a measure of financial performance under the
promulgations of generally accepted accounting principles
(“GAAP”). EBITDA should not be considered in isolation from, or as a
substitute for, net loss, operating loss or cash flows from operations
determined in accordance with GAAP. Finally, EBITDA is not calculated
in the same manner by all companies and accordingly, may not be an appropriate
measure for comparing performance amongst different companies. See
the “Supplemental Data” table attached for a reconciliation of EBITDA to net
income (loss).
8
Reading
International, Inc. and Subsidiaries
Supplemental
Data
Segment Reporting
(Unaudited)
(dollars
in thousands, except per share amounts)
|
Statements of Operations
|
Three
Months Ended
June 30,
|
Six
Months Ended
June 30,
|
||||||
|
2009
|
2008
|
2009
|
2008
|
|||||
|
Revenue
|
$54,422
|
$53,751
|
$101,500
|
$93,478
|
||||
|
Operating
expense
|
||||||||
|
Cinema/real
estate
|
41,775
|
44,076
|
78,688
|
73,595
|
||||
|
Depreciation
and amortization
|
3,324
|
5,528
|
7,168
|
9,411
|
||||
|
Loss
on transfer of real estate from held for sale to continuing
operations
|
549
|
--
|
549
|
--
|
||||
|
General
and administrative
|
4,233
|
4,909
|
8,668
|
9,597
|
||||
|
|
||||||||
|
Operating income
(loss)
|
4,541
|
(762
|
) |
6,427
|
875
|
|||
|
|
||||||||
|
Interest
expense, net
|
(2,871
|
) |
(3,039
|
) |
(7,261
|
) |
(5,876
|
) |
|
Other
income (loss)
|
(1,757
|
) |
1,860
|
(2,057
|
) |
3,592
|
||
|
Gain
on retirement of subordinated debt
|
10,714
|
--
|
10,714
|
--
|
||||
|
Gain
on sale of investment in an unconsolidated entity
|
--
|
2,450
|
--
|
2,450
|
||||
|
Income
tax expense
|
(647
|
) |
(407
|
) |
(999
|
) |
(824
|
) |
|
Net
(income) loss attributable to the noncontrolling interest
|
(90
|
) |
182
|
(328
|
) |
(161
|
) | |
|
Net income
|
$ 9,890
|
$ 284
|
$
6,496
|
$ 56
|
||||
|
|
|
|||||||
|
Basic
and diluted earnings per share
|
$ 0.44
|
$ 0.01
|
$ 0.29
|
$ 0.00
|
||||
|
EBITDA*
|
$16,732
|
$ 9,258
|
$
21,924
|
$16,167
|
||||
|
EBITDA*
change
|
$7,474
|
$5,757
|
||||||
|
*
|
EBITDA
presented above is net income 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 income (loss) is presented below:
|
Three
Months Ended
June 30,
|
Six
Months Ended
June 30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Net
earnings
|
$ | 9,890 | $ | 284 | $ | 6,496 | $ | 56 | ||||||||
|
Add:Interest
expense, net
|
2,871 | 3,039 | 7,261 | 5,876 | ||||||||||||
|
Add:Income
tax provision
|
647 | 407 | 999 | 824 | ||||||||||||
|
Add:Depreciation
and amortization
|
3,324 | 5,528 | 7,168 | 9,411 | ||||||||||||
|
EBITDA
|
$ | 16,732 | $ | 9,258 | $ | 21,924 | $ | 16,167 | ||||||||
9
Reading
International, Inc. and Subsidiaries
Supplemental
Data
Segment Reporting
(Unaudited)
(dollars
in thousands)
|
Three
months ended June 30, 2009
|
Cinema
|
Real
Estate
|
Intersegment
Eliminations
|
Total
|
||||||||||||
|
Revenue
|
$ | 51,215 | $ | 5,432 | $ | (2,225 | ) | $ | 54,422 | |||||||
|
Operating
expense
|
41,320 | 2,680 | (2,225 | ) | 41,775 | |||||||||||
|
Depreciation
& amortization
|
2,576 | 754 | -- | 3,330 | ||||||||||||
|
Loss
on transfer of real estate held for sale to Continuing
Operations
|
-- | 549 | -- | 549 | ||||||||||||
|
General
& administrative expense
|
765 | 189 | -- | 954 | ||||||||||||
|
Segment
operating income
|
$ | 6,554 | $ | 1,260 | $ | -- | $ | 7,814 | ||||||||
|
Three
months ended June 30, 2008
|
Cinema
|
Real
Estate
|
Intersegment
Eliminations
|
Total
|
||||||||||||
|
Revenue
|
$ | 49,488 | $ | 5,813 | $ | (1,550 | ) | $ | 53,751 | |||||||
|
Operating
expense
|
43,330 | 2,296 | (1,550 | ) | 44,076 | |||||||||||
|
Depreciation
& amortization
|
4,060 | 1,287 | -- | 5,347 | ||||||||||||
|
General
& administrative expense
|
1,129 | 432 | -- | 1,561 | ||||||||||||
|
Segment
operating income
|
$ | 969 | $ | 1,798 | $ | -- | $ | 2,767 | ||||||||
|
Reconciliation
to net income attributable to Reading International, Inc.
shareholders:
|
2009
Quarter
|
2008
Quarter
|
||||||
|
Total
segment operating income
|
$ | 7,814 | $ | 2,767 | ||||
|
Non-segment:
|
||||||||
|
Depreciation and amortization
expense
|
(6 | ) | 181 | |||||
|
General and administrative
expense
|
3,279 | 3,348 | ||||||
|
Operating
income (loss)
|
4,541 | (762 | ) | |||||
|
Interest expense,
net
|
(2,871 | ) | (3,039 | ) | ||||
|
Gain on retirement of
subordinated debt (trust preferred securities)
|
10,714 | -- | ||||||
|
Other income
(loss)
|
(1,921 | ) | 1,671 | |||||
|
Income tax
expense
|
(647 | ) | (407 | ) | ||||
|
Equity earnings of
unconsolidated joint ventures and entities
|
164 | 189 | ||||||
|
Gain on sale of investment in an
unconsolidated entity
|
-- | 2,450 | ||||||
|
Net
income
|
9,980 | 102 | ||||||
|
Net
(income) loss attributable to the noncontrolling interest
|
(90 | ) | 182 | |||||
|
Net
income attributable to Reading International, Inc. common
shareholders
|
$ | 9,890 | $ | 284 | ||||
10
Reading
International, Inc. and Subsidiaries
Supplemental
Data
Segment Reporting
(Unaudited)
(dollars
in thousands)
|
Six
months ended June 30, 2009
|
Cinema
|
Real
Estate
|
Intersegment
Eliminations
|
Total
|
||||||||||||
|
Revenue
|
$ | 94,651 | $ | 11,390 | $ | (4,541 | ) | $ | 101,500 | |||||||
|
Operating
expense
|
77,596 | 5,633 | (4,541 | ) | 78,688 | |||||||||||
|
Depreciation
& amortization
|
5,485 | 1,435 | -- | 6,920 | ||||||||||||
|
Loss
on transfer of real estate held for sale to Continuing
Operations
|
-- | 549 | -- | 549 | ||||||||||||
|
General
& administrative expense
|
1,567 | 370 | -- | 1,937 | ||||||||||||
|
Segment
operating income
|
$ | 10,003 | $ | 3,403 | $ | -- | $ | 13,406 | ||||||||
|
Six
months ended June 30, 2008
|
Cinema
|
Real
Estate
|
Intersegment
Eliminations
|
Total
|
||||||||||||
|
Revenue
|
$ | 84,831 | $ | 11,763 | $ | (3,116 | ) | $ | 93,478 | |||||||
|
Operating
expense
|
72,301 | 4,410 | (3,116 | ) | 73,595 | |||||||||||
|
Depreciation
& amortization
|
6,669 | 2,382 | -- | 9,051 | ||||||||||||
|
General
& administrative expense
|
1,898 | 598 | -- | 2,496 | ||||||||||||
|
Segment
operating income
|
$ | 3,963 | $ | 4,373 | $ | -- | $ | 8,336 | ||||||||
|
Reconciliation
to net income attributable to Reading International, Inc.
shareholders:
|
2009
Six Months
|
2008
Six Months
|
||||||
|
Total
segment operating income
|
$ | 13,406 | $ | 8,336 | ||||
|
Non-segment:
|
||||||||
|
Depreciation and amortization
expense
|
248 | 360 | ||||||
|
General and administrative
expense
|
6,731 | 7,101 | ||||||
|
Operating
income
|
6,427 | 875 | ||||||
|
Interest expense,
net
|
(7,261 | ) | (5,876 | ) | ||||
|
Gain on retirement of
subordinated debt (trust preferred securities)
|
10,714 | -- | ||||||
|
Other income
(loss)
|
(2,716 | ) | 3,045 | |||||
|
Income tax
expense
|
(999 | ) | (824 | ) | ||||
|
Equity earnings of
unconsolidated joint ventures and entities
|
659 | 547 | ||||||
|
Gain on sale of investment in an
unconsolidated entity
|
-- | 2,450 | ||||||
|
Net
income
|
6,824 | 217 | ||||||
|
Net
income attributable to the noncontrolling interest
|
(328 | ) | (161 | ) | ||||
|
Net
income attributable to Reading International, Inc. common
shareholders
|
$ | 6,496 | $ | 56 | ||||
11
Reading
International, Inc. and Subsidiaries
Condensed
Consolidated Statements of Operations (Unaudited)
(U.S.
dollars in thousands, except per share amounts)
|
Three
Months Ended
June
30,
|
Six
Months Ended
June
30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Revenue
|
||||||||||||||||
|
Cinema
|
$ | 51,215 | $ | 49,488 | $ | 94,651 | $ | 84,831 | ||||||||
|
Real
estate
|
3,207 | 4,263 | 6,849 | 8,647 | ||||||||||||
| 54,422 | 53,751 | 101,500 | 93,478 | |||||||||||||
|
Operating
expense
|
||||||||||||||||
|
Cinema
|
39,095 | 41,780 | 73,055 | 69,185 | ||||||||||||
|
Real
estate
|
2,680 | 2,296 | 5,633 | 4,410 | ||||||||||||
|
Depreciation
and amortization
|
3,324 | 5,528 | 7,168 | 9,411 | ||||||||||||
|
Loss
on transfer of real estate held for sale to continuing
operations
|
549 | -- | 549 | -- | ||||||||||||
|
General
and administrative
|
4,233 | 4,909 | 8,668 | 9,597 | ||||||||||||
| 49,881 | 54,513 | 95,073 | 92,603 | |||||||||||||
|
Operating
income (loss)
|
4,541 | (762 | ) | 6,427 | 875 | |||||||||||
|
Interest
income
|
219 | 365 | 737 | 603 | ||||||||||||
|
Interest
expense
|
(3,090 | ) | (3,404 | ) | (7,998 | ) | (6,479 | ) | ||||||||
|
Gain
on retirement of subordinated debt (trust preferred
securities)
|
10,714 | -- | 10,714 | -- | ||||||||||||
|
Other
income (loss)
|
(1,921 | ) | 1,671 | (2,716 | ) | 3,045 | ||||||||||
|
Income
(loss) before income tax expense and equity earnings of unconsolidated
joint ventures and entities
|
10,463 | (2,130 | ) | 7,164 | (1,956 | ) | ||||||||||
|
Income
tax expense
|
(647 | ) | (407 | ) | (999 | ) | (824 | ) | ||||||||
|
Income
(loss) before equity earnings of unconsolidated joint ventures and
entities
|
9,816 | (2,537 | ) | 6,165 | (2,780 | ) | ||||||||||
|
Equity
earnings of unconsolidated joint ventures and entities
|
164 | 189 | 659 | 547 | ||||||||||||
|
Gain
on sale of investment in an unconsolidated entity
|
-- | 2,450 | -- | 2,450 | ||||||||||||
|
Net
income
|
$ | 9,980 | $ | 102 | $ | 6,824 | $ | 217 | ||||||||
|
Net
(income) loss attributable to noncontrolling interest
|
(90 | ) | 182 | (328 | ) | (161 | ) | |||||||||
|
Net
income attributable to Reading International, Inc. common
shareholders
|
$ | 9,890 | $ | 284 | $ | 6,496 | $ | 56 | ||||||||
|
Basic
and diluted earnings per share attributable to Reading International, Inc.
common shareholders
|
$ | 0.44 | $ | 0.01 | $ | 0.29 | $ | 0.00 | ||||||||
|
Weighted
average number of shares outstanding – basic
|
22,653,050 | 22,476,355 | 22,616,193 | 22,476,355 | ||||||||||||
|
Weighted
average number of shares outstanding – dilutive
|
22,687,273 | 22,763,826 | 22,650,415 | 22,763,826 | ||||||||||||
12
Reading
International, Inc. and Subsidiaries
Condensed
Consolidated Balance Sheets (Unaudited)
(U.S.
dollars in thousands)
|
June
30,
2009
|
December
31, 2008
|
|||||||
|
ASSETS
|
||||||||
|
Current
Assets:
|
||||||||
|
Cash
and cash equivalents
|
$ | 21,199 | $ | 30,874 | ||||
|
Receivables
|
6,891 | 7,868 | ||||||
|
Inventory
|
700 | 797 | ||||||
|
Investment
in marketable securities
|
1,324 | 3,100 | ||||||
|
Restricted
cash
|
855 | 1,656 | ||||||
|
Prepaid
and other current assets
|
2,821 | 2,324 | ||||||
|
Total
current assets
|
33,790 | 46,619 | ||||||
|
Property
held for and under development
|
82,708 | 69,016 | ||||||
|
Property
& equipment, net
|
181,090 | 173,662 | ||||||
|
Investments
in unconsolidated joint ventures and entities
|
11,701 | 11,643 | ||||||
|
Investment
in Reading International Trust I
|
838 | 1,547 | ||||||
|
Goodwill
|
36,004 | 34,964 | ||||||
|
Intangible
assets, net
|
23,901 | 25,118 | ||||||
|
Other
assets
|
8,984 | 9,301 | ||||||
|
Total
assets
|
$ | 379,016 | $ | 371,870 | ||||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
|
Current
Liabilities:
|
||||||||
|
Accounts
payable and accrued liabilities
|
$ | 12,483 | $ | 13,170 | ||||
|
Film
rent payable
|
6,437 | 7,315 | ||||||
|
Notes
payable – current portion
|
13,809 | 1,347 | ||||||
|
Taxes
payable
|
6,348 | 6,425 | ||||||
|
Deferred
current revenue
|
4,730 | 5,645 | ||||||
|
Other
current liabilities
|
149 | 201 | ||||||
|
Total
current liabilities
|
43,956 | 34,103 | ||||||
|
Notes
payable – long-term portion
|
169,089 | 172,268 | ||||||
|
Notes
payable to related party – long-term portion
|
14,000 | 14,000 | ||||||
|
Subordinated
debt – trust preferred securities
|
27,913 | 51,547 | ||||||
|
Noncurrent
tax liabilities
|
6,603 | 6,347 | ||||||
|
Deferred
non-current revenue
|
588 | 554 | ||||||
|
Other
liabilities
|
23,037 | 23,604 | ||||||
|
Total
liabilities
|
285,186 | 302,423 | ||||||
|
Commitments
and contingencies
|
||||||||
|
Stockholders’
equity:
|
||||||||
|
Class
A Nonvoting Common Stock, par value $0.01, 100,000,000 shares authorized,
35,661,806 issued and 21,084,582 outstanding at June 30, 2009 and
35,564,339 issued and 20,987,115 outstanding at December 31,
2008
|
216 | 216 | ||||||
|
Class
B Voting Common Stock, par value $0.01, 20,000,000 shares authorized and
1,495,490 issued and outstanding at June 30, 2009 and at December 31,
2008
|
15 | 15 | ||||||
|
Nonvoting
Preferred Stock, par value $0.01, 12,000 shares authorized and no
outstanding shares
|
-- | -- | ||||||
|
Additional
paid-in capital
|
134,237 | 133,906 | ||||||
|
Accumulated
deficit
|
(62,981 | ) | (69,477 | ) | ||||
|
Treasury
shares
|
(4,306 | ) | (4,306 | ) | ||||
|
Accumulated
other comprehensive income
|
24,865 | 7,276 | ||||||
|
Total
Reading International, Inc. stockholders’ equity
|
92,046 | 67,630 | ||||||
|
Noncontrolling
interest
|
1,784 | 1,817 | ||||||
|
Total
stockholders’ equity
|
93,830 | 69,447 | ||||||
|
Total
liabilities and stockholders’ equity
|
$ | 379,016 | $ | 371,870 | ||||
13