Record operating income for Marcus® Hotels & Resorts helps to offset impact of weaker film slate for Marcus Theatres®
Second Quarter Highlights
-
Total revenues for the second quarter of the transition period ending
December 31, 2015 were$115,676,000 , a slight decrease from revenues of$116,061,000 for the second quarter of fiscal 2015. -
Operating income was
$10,554,000 for the second quarter of the transition period, a 9.2% decrease from operating income of$11,620,000 for the second quarter of fiscal 2015. -
Net earnings attributable to The
Marcus Corporation were$4,945,000 for the second quarter of the transition period, a 5.3% decrease from net earnings attributable to TheMarcus Corporation of$5,223,000 for the second quarter of fiscal 2015. -
Net earnings per diluted common share attributable to The
Marcus Corporation were$0.18 for the second quarter of the transition period, a 5.3% decrease from net earnings per diluted common share attributable to TheMarcus Corporation of$0.19 for the second quarter of fiscal 2015.
First 26 Weeks Highlights
-
Total revenues for the first 26 weeks of the transition period ending
December 31, 2015 were$264,866,000 , a 6.9% increase from revenues of$247,830,000 for the first 26 weeks of fiscal 2015. -
Operating income was
$36,410,000 for the first 26 weeks of the transition period, a 6.1% increase from operating income of$34,309,000 for the same period in the prior year. -
Net earnings attributable to The
Marcus Corporation were$19,596,000 for the first 26 weeks of the transition period, an 11.0% increase from net earnings attributable to TheMarcus Corporation of$17,655,000 for the first 26 weeks of fiscal 2015. -
Net earnings per diluted common share attributable to The
Marcus Corporation were$0.70 for the first 26 weeks of the transition period, a 9.4% increase from net earnings per diluted common share attributable to TheMarcus Corporation of$0.64 for the first 26 weeks of fiscal 2015.
“Although the theatre division had a challenging second quarter, both
divisions still achieved record operating income for the first 26 weeks
of the transition period. Second quarter results for Marcus Hotels &
Resorts benefited from a higher average daily rate and strong cost
controls, which helped to offset the impact of a weaker film slate and a
significant number of screens out of service for upgrades for Marcus
Theatres,” said
“Marcus Theatres reported record second quarter revenues, as well as record revenues and operating income for the first 26 weeks of the transition period. Our second quarter box-office results generally matched the industry, in spite of an unprecedented number of screens out of service as we prepared for the major opening today of Star Wars: The Force Awakens. Over the past three weeks, we have returned to our nearly two-year record of outperforming the industry as newly renovated screens have come on line,” said Marcus.
“Our successful food and beverage concepts continued to generate significant revenues, with concession revenues per person up 6.6% for the second quarter and 10.1% for the first 26 weeks,” said Rolando B. Rodriguez, president and chief executive officer of Marcus Theatres.
“We recently added 17 newly renovated premium large format screens with DreamLoungerSM recliner seating to our circuit. We now offer premium large format screens in more than 61% of our company-owned, first run theatres, which we believe is the highest percentage among the top chains in the industry. This positions us very well to capitalize on what is expected to be a record-breaking performance for the highly anticipated sequel to the epic Star Wars series,” said Rodriguez.
Rodriguez said the five top-performing films for Marcus Theatres in the
second quarter were The Martian, The Hunger Games: Mockingjay
– Part 2,
“Looking ahead, potential hits in the pipeline include two other films opening tomorrow, Sisters and Alvin and the Chipmunks – The Road Chip. Five additional pictures, The Big Short, Daddy’s Home, Point Break, Joy and Concussion all open next week, followed by films such as The Revenant, The Hateful Eight and Ride Along 2 in early January,” said Rodriguez.
“We are in the process of renovating five additional theatres, each with DreamLounger recliner seating and selected food and beverage outlets. These renovations, plus two new UltraScreen® auditoriums also under construction, are scheduled to be completed during the first half of 2016. In November, we opened the Midwest’s first 4-D movie theatre at our Gurnee Mills Cinema in Gurnee Mills, Ill. This new technology immerses movie-goers into the action like never before, with special effects including motion, wind, lightning flashes and scents. All of these investments are designed to create the ultimate movie-going experience for our guests,” said Rodriguez.
“Marcus Hotels & Resorts achieved record operating income for both the second quarter and first 26 weeks as a result of increased revenues at comparable hotels and a strong focus on operational improvements. Revenue per available room (RevPAR) for comparable company-owned hotels increased 2.4% in the second quarter,” said Marcus.
“The hotel division achieved a 33.1% increase in operating income in the
second quarter and a 14.4% increase in operating income for the first 26
weeks, compared to the same periods last year. Our team is focused on
delivering exceptional guest experiences, managing costs and increasing
profitability in all areas of our properties,” said
“As part of our strategy to increase our number of rooms under management, we recently expanded our hotel development team with the addition of a senior executive experienced in operations, business development, marketing, feasibility and valuation. The team is aggressively pursuing our strategy to add high-quality management contracts and sourcing potential hotel investment opportunities. We have a number of good potential opportunities in the pipeline, and are continuing to move forward with our growth strategy,” said Khairallah.
Marcus noted that during the second quarter, the company completed the
previously announced sale of its former company-owned and operated
Change in Fiscal Year End
As previously announced, the company has changed its fiscal year end
from the last Thursday in May to the last Thursday in December. As a
result, the company plans to report its financial results for the
31-week period from
Conference Call and Webcast
A telephone replay of the conference call will be available through
About The
Celebrating its 80th anniversary in 2015,
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 adverse 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 | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||
13 Weeks Ended |
26 Weeks Ended |
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November 26, |
November 27, |
November 26, |
November 27, |
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2015 |
2014 |
2015 |
2014 |
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Revenues: | ||||||||||||||||||
Theatre admissions | $ | 31,741 | $ | 32,794 | $ | 79,963 | $ | 74,139 | ||||||||||
Rooms | 29,464 | 29,678 | 63,650 | 64,359 | ||||||||||||||
Theatre concessions | 21,006 | 20,484 | 52,786 | 45,406 | ||||||||||||||
Food and beverage | 19,216 | 20,134 | 38,025 | 36,289 | ||||||||||||||
Other revenues | 14,249 | 12,971 | 30,442 | 27,637 | ||||||||||||||
Total revenues | 115,676 | 116,061 | 264,866 | 247,830 | ||||||||||||||
Costs and expenses: | ||||||||||||||||||
Theatre operations | 29,217 | 27,953 | 70,896 | 62,816 | ||||||||||||||
Rooms | 10,298 | 10,725 | 21,485 | 22,127 | ||||||||||||||
Theatre concessions | 6,517 | 5,841 | 15,555 | 12,562 | ||||||||||||||
Food and beverage | 14,519 | 15,924 | 29,281 | 27,987 | ||||||||||||||
Advertising and marketing | 5,822 | 6,710 | 12,311 | 14,098 | ||||||||||||||
Administrative | 14,787 | 12,955 | 29,353 | 25,347 | ||||||||||||||
Depreciation and amortization | 10,242 | 10,156 | 20,668 | 19,234 | ||||||||||||||
Rent | 2,159 | 2,160 | 4,352 | 4,314 | ||||||||||||||
Property taxes | 4,003 | 3,719 | 7,824 | 7,625 | ||||||||||||||
Other operating expenses | 7,558 | 8,298 | 16,731 | 17,411 | ||||||||||||||
Total costs and expenses | 105,122 | 104,441 | 228,456 | 213,521 | ||||||||||||||
Operating income | 10,554 | 11,620 | 36,410 | 34,309 | ||||||||||||||
Other income (expense): | ||||||||||||||||||
Investment income | 20 | 25 | 25 | 50 | ||||||||||||||
Interest expense | (2,382 | ) | (2,388 | ) | (4,783 | ) | (4,792 | ) | ||||||||||
Loss on disposition of property, equipment and other assets | (226 | ) | (495 | ) | (31 | ) | (501 | ) | ||||||||||
Equity earnings (losses) from unconsolidated joint ventures, net | 39 | 27 | 20 | (14 | ) | |||||||||||||
(2,549 | ) | (2,831 | ) | (4,769 | ) | (5,257 | ) | |||||||||||
Earnings before income taxes | 8,005 | 8,789 | 31,641 | 29,052 | ||||||||||||||
Income taxes | 2,897 | 3,398 | 12,080 | 11,385 | ||||||||||||||
Net earnings | 5,108 | 5,391 | 19,561 | 17,667 | ||||||||||||||
Net earnings (loss) attributable to noncontrolling interests | 163 | 168 | (35 | ) | 12 | |||||||||||||
Net earnings attributable to The Marcus Corporation | $ | 4,945 | $ | 5,223 | $ | 19,596 | $ | 17,655 | ||||||||||
Net earnings per common share attributable to | ||||||||||||||||||
The Marcus Corporation - diluted | $ | 0.18 | $ | 0.19 | $ | 0.70 | $ | 0.64 | ||||||||||
Weighted ave. shares outstanding - diluted | 27,945 | 27,568 | 27,913 | 27,589 |
THE MARCUS CORPORATION | ||||||||||
Condensed Consolidated Balance Sheets | ||||||||||
(In thousands) | ||||||||||
(Unaudited) | (Audited) | |||||||||
November 26, | May 28, | |||||||||
2015 | 2015 | |||||||||
Assets: | ||||||||||
Cash and cash equivalents | $ | 24,273 | $ | 15,483 | ||||||
Accounts and notes receivable | 12,873 | 16,339 | ||||||||
Refundable income taxes | - | 4,022 | ||||||||
Deferred income taxes | 3,187 | 2,997 | ||||||||
Other current assets | 6,507 | 6,732 | ||||||||
Property and equipment, net | 662,698 | 680,117 | ||||||||
Other assets | 90,049 | 83,352 | ||||||||
Total Assets | $ | 799,587 | $ | 809,042 | ||||||
Liabilities and Shareholders' Equity: | ||||||||||
Accounts payable | $ | 21,701 | $ | 36,776 | ||||||
Income taxes | 1,172 | - | ||||||||
Taxes other than income taxes | 16,075 | 15,099 | ||||||||
Other current liabilities | 50,693 | 50,574 | ||||||||
Current portion of capital lease obligation | 5,146 | 5,053 | ||||||||
Current maturities of long-term debt | 19,672 | 17,742 | ||||||||
Capital lease obligation | 15,714 | 18,317 | ||||||||
Long-term debt | 217,457 | 229,669 | ||||||||
Deferred income taxes | 46,149 | 47,502 | ||||||||
Deferred compensation and other | 44,283 | 42,075 | ||||||||
Equity | 361,525 | 346,235 | ||||||||
Total Liabilities and Shareholders' Equity | $ | 799,587 | $ | 809,042 |
THE MARCUS CORPORATION | ||||||||||||||||
Business Segment Information | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In thousands) | ||||||||||||||||
Theatres |
Hotels/ |
Corporate |
Total | |||||||||||||
13 Weeks Ended November 26, 2015 | ||||||||||||||||
Revenues | $ | 56,463 | $ | 59,089 | $ | 124 | $ | 115,676 | ||||||||
Operating income (loss) | 7,329 | 7,628 | (4,403 | ) | 10,554 | |||||||||||
Depreciation and amortization | 5,594 | 4,501 | 147 | 10,242 | ||||||||||||
13 Weeks Ended November 27, 2014 | ||||||||||||||||
Revenues | $ | 56,275 | $ | 59,626 | $ | 160 | $ | 116,061 | ||||||||
Operating income (loss) | 9,783 | 5,729 | (3,892 | ) | 11,620 | |||||||||||
Depreciation and amortization | 5,005 | 5,035 | 116 | 10,156 | ||||||||||||
26 Weeks Ended November 26, 2015 | ||||||||||||||||
Revenues | $ | 139,787 | $ | 124,830 | $ | 249 | $ | 264,866 | ||||||||
Operating income (loss) | 25,389 | 19,140 | (8,119 | ) | 36,410 | |||||||||||
Depreciation and amortization | 11,280 | 9,101 | 287 | 20,668 | ||||||||||||
26 Weeks Ended November 27, 2014 | ||||||||||||||||
Revenues | $ | 125,662 | $ | 121,873 | $ | 295 | $ | 247,830 | ||||||||
Operating income (loss) | 24,637 | 16,733 | (7,061 | ) | 34,309 | |||||||||||
Depreciation and amortization | 9,735 | 9,282 | 217 | 19,234 | ||||||||||||
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. | ||||||||||||||||
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View source version on businesswire.com: http://www.businesswire.com/news/home/20151217005373/en/
Source: The
The Marcus Corporation
Douglas A. Neis
(414) 905-1100