Marcus Theatres® achieves record results and continues to outperform the industry, despite a weaker film slate during the quarter
Second Quarter Fiscal 2017 Highlights
Total revenues for the second quarter of fiscal 2017 were a record
$152,775,000, a 13.2% increase from revenues of $134,978,000for the second quarter of fiscal 2016.
Operating income for the second quarter of fiscal 2017 was a record
$18,741,000, a 2.6% increase from operating income of $18,261,000for the second quarter of fiscal 2016.
Net earnings attributable to The
Marcus Corporationwere $10,124,000for the second quarter of fiscal 2017, an 8.4% increase from net earnings attributable to The Marcus Corporationof $9,336,000for the second quarter of fiscal 2016.
Net earnings per diluted common share attributable to The
Marcus Corporationwere $0.36for the second quarter of fiscal 2017, a 5.9% increase from net earnings per diluted common share attributable to The Marcus Corporationof $0.34for the second quarter of fiscal 2016.
First Half Fiscal 2017 Highlights
- Total revenues for the first half of fiscal 2017 were a record $310,729,000, a 19.3% increase from revenues of $260,422,000 for the first half of fiscal 2016.
- Operating income was $36,766,000 for the first half of fiscal 2017, a 24.2% increase from operating income of $29,607,000 for the first half of fiscal 2016.
- Net earnings attributable to The Marcus Corporation were $19,577,000 for the first half of fiscal 2017, a 32.4% increase from net earnings attributable to The Marcus Corporation of $14,788,000 for the first half of fiscal 2016.
- Net earnings per diluted common share attributable to The Marcus Corporation were $0.69 for the first half of fiscal 2017, a 30.2% increase from net earnings per diluted common share attributable to The Marcus Corporation of $0.53 for the first half of fiscal 2016.
“We are pleased that The
“Our performance for the first half of the fiscal year was strong, with two consecutive quarters of record results, including a 19.3% increase in revenues and a 32.4% increase in net earnings compared to the first half of fiscal 2016,” said Marcus.
Marcus Theatres reported a 22.7% increase in revenues and a 14.9% increase in operating income during the second quarter over the prior year period. Marcus Theatres outperformed the change in national box office revenues by nearly one percentage point on a comparable theatre basis compared to the same corresponding weeks in the prior year, according to Rentrak.
“The division’s outperformance was even more noteworthy considering we
incurred pre-opening expenses at two new theatres that opened during the
quarter and had a large number of screens out of service for renovations
to expand our DreamLoungerSM recliner seating and signature
food and beverage concepts to more locations,” said Marcus. “The 14
Wehrenberg Theatres® locations we acquired in
Marcus Theatres added DreamLounger recliner seating at seven existing
locations by the end of the quarter. “Additional DreamLounger upgrades
are currently underway at five more locations, including several
Wehrenberg theatres, which will elevate the moviegoing experience for
more valued guests and further expand our industry leadership with this
signature amenity,” said
In April, the division opened Marcus Southbridge Crossing Cinema, a
10-screen theatre in
Marcus Theatres’ new dining and movie concept, BistroPlexSM,
The five top-performing films for Marcus Theatres in the second quarter of fiscal 2017 were Guardians of the Galaxy Vol. 2, Wonder Woman, The Fate of the Furious, The Boss Baby and Beauty and the Beast.
Films that have performed well so far in the third quarter include Despicable
Me 3, Spider-man: Homecoming, War for the Planet of the Apes and Dunkirk.
Additional films opening through the end of the third quarter include Atomic
Blonde, The Emoji Movie,
Marcus Hotels & Resorts’ revenue per available room (RevPAR) for comparable company-owned properties decreased 1.5% in the second quarter; however, the division still outperformed the competitive set in its markets by nearly three percentage points during the second quarter and by nearly five percentage points during the first half of the year. RevPAR for the first half of the year was up 1.0%.
“The division’s lower RevPAR for the second quarter was due in large part to the timing of the Easter holiday, which fell in April this year and negatively impacted group business. We had a particularly strong June and division group room-night pace for the remainder of the year is trending ahead of last year,” said Marcus.
“A significant part of our strategy is reinvesting in our existing
properties to provide memorable experiences and the latest amenities. In
May, we opened 29 new spacious, all-season villas at the Grand Geneva®
Construction continues on the new Omaha Marriott Downtown at The Capitol
“We are actively seeking new management contracts to expand our hotel and resort portfolio and hope to have additional details to share in the second half of the year,” said Khairallah.
Conference Call and Webcast
A telephone replay of the conference call will be available through
Certain matters discussed in this press release are “forward-looking
statements” intended to qualify for the safe harbors from liability
established by the Private Securities Litigation Reform Act of 1995.
These forward-looking statements may generally be identified as such
because the context of such statements include words such as we
“believe,” “anticipate,” “expect” or words of similar import. Similarly,
statements that describe our future plans, objectives or goals are also
forward-looking statements. Such forward-looking statements are subject
to certain risks and uncertainties which may cause results to differ
materially from those expected, including, but not limited to, the
following: (1) the availability, in terms of both quantity and audience
appeal, of motion pictures for our theatre division, as well as other
industry dynamics such as the maintenance of a suitable window between
the date such motion pictures are released in theatres and the date they
are released to other distribution channels; (2) the effects of adverse
economic conditions in our markets, particularly with respect to our
hotels and resorts division; (3) the effects on our occupancy and room
rates of the relative industry supply of available rooms at comparable
lodging facilities in our markets; (4) the effects of competitive
conditions in our markets; (5) our ability to achieve expected benefits
and performance from our strategic initiatives and acquisitions; (6) the
effects of increasing depreciation expenses, reduced operating profits
during major property renovations, impairment losses, and preopening and
start-up costs due to the capital intensive nature of our businesses;
(7) the effects of weather conditions, particularly during the winter in
the Midwest and in our other markets; (8) our ability to identify
properties to acquire, develop and/or manage and the continuing
availability of funds for such development; and (9) the adverse impact
on business and consumer spending on travel, leisure and entertainment
resulting from terrorist attacks in
|THE MARCUS CORPORATION|
|Consolidated Statements of Earnings|
|(in thousands, except per share data)|
13 Weeks Ended
26 Weeks Ended
|June 29,||June 30,||June 29,||June 30,|
|Food and beverage||18,777||18,248||33,817||32,793|
|Costs and expenses:|
|Food and beverage||15,501||14,538||28,968||27,299|
|Advertising and marketing||6,022||5,505||11,584||10,493|
|Depreciation and amortization||12,303||10,360||24,551||20,551|
|Other operating expenses||7,612||7,116||15,955||15,073|
|Total costs and expenses||134,034||116,717||273,963||230,815|
|Other income (expense):|
|Gain (loss) on disposition of property, equipment and other assets||428||(604||)||29||(717||)|
|Equity earnings from unconsolidated joint ventures, net||32||130||87||109|
|Earnings before income taxes||16,076||15,339||30,905||24,150|
|Net earnings (loss) attributable to noncontrolling interests||1||10||(335||)||(162||)|
|Net earnings attributable to The Marcus Corporation||$||10,124||$||9,336||$||19,577||$||14,788|
|Net earnings per common share attributable to|
|The Marcus Corporation - diluted||$||0.36||$||0.34||$||0.69||$||0.53|
|Weighted average shares outstanding - diluted||28,486||27,814||28,435||27,795|
|THE MARCUS CORPORATION|
|Condensed Consolidated Balance Sheets|
|June 29,||December 29,|
|Cash, cash equivalents and restricted cash||$||15,886||$||8,705|
|Accounts and notes receivable||24,762||14,761|
|Refundable income taxes||8,221||1,672|
|Other current assets||13,299||11,005|
|Property and equipment, net||822,729||789,198|
|Liabilities and Shareholders' Equity:|
|Taxes other than income taxes||18,093||17,261|
|Other current liabilities||55,484||63,568|
|Current portion of capital lease obligation||6,832||6,598|
|Current maturities of long-term debt||11,993||12,040|
|Capital lease obligation||22,630||26,106|
|Deferred income taxes||47,825||46,433|
|Deferred compensation and other||46,091||45,064|
|Total Liabilities and Shareholders' Equity||$||968,514||$||911,266|
|THE MARCUS CORPORATION|
|Business Segment Information|
|13 Weeks Ended June 29, 2017|
|Operating income (loss)||17,960||5,783||(5,002||)||18,741|
|Depreciation and amortization||7,808||4,401||94||12,303|
|13 Weeks Ended June 30, 2016|
|Operating income (loss)||15,630||7,011||(4,380||)||18,261|
|Depreciation and amortization||6,089||4,183||88||10,360|
|26 Weeks Ended June 29, 2017|
|Operating income (loss)||42,651||3,071||(8,956||)||36,766|
|Depreciation and amortization||15,601||8,758||192||24,551|
|26 Weeks Ended June 30, 2016|
|Operating income (loss)||33,435||4,459||(8,287||)||29,607|
|Depreciation and amortization||11,947||8,424||180||20,551|
Corporate items include amounts not allocable to the business segments. Corporate revenues consist principally of rent and the corporate operating loss includes general corporate expenses. Corporate information technology costs and accounting shared services costs are allocated to the business segments based upon several factors, including actual usage and segment revenues.
The Marcus Corporation
Douglas A. Neis