Mr. Ellis Jacob reports

CINEPLEX REPORTS RECORD THIRD QUARTER 2023 RESULTS

Cineplex Inc. has released its financial results for the three and nine months ended Sept. 30, 2023.

Third-quarter highlights:

• All-time quarterly record revenues of $463.6-million and all-time quarterly record adjusted EBITDAaL (earnings before interest, taxes, depreciation, amortization and special losses) of $83.1-million on net income of $29.7-million;
• Adjusted EBITDAaL margin of 17.9 per cent, outpacing Q3 2019 by 310 basis points;
• Record third-quarter box office revenues of $188.2-million, outperforming North American box office by 310 basis points;
• Record per-patron results, with record third-quarter BPP (box office revenue per patron) of $12 and CPP (concession revenue per patron) of $8.44;
• Continued strong performance of the diversification strategy, with the location-based entertainment (LBE) business generating record third-quarter revenues of $34.2-million;
• Balance sheet strengthening through combined second-quarter and third-quarter credit facility repayments of $55-million.

"We just closed our best third quarter in Cineplex history, due to a record-breaking box office and successful results from our diversified businesses," said Ellis Jacob, president and chief executive officer, Cineplex.

Mr. Jacob added: "Our content broadening strategy, paired with our premium experiences, continue to set us apart as we respond to consumer demand for an immersive and premium theatrical experience. This past quarter, we achieved record box office revenues of $188.2-million and, once again, outpaced the North American box office by a notable 310 basis points.

"Over the past two quarters, strong EBITDAaL results have enabled us to repay $55-million in bank debt as part of our focus in deleveraging the balance sheet and strengthening the capital base. Looking ahead, we will maintain our successful strategies that focus on diversification and content, personalized campaigns to maximize attendance and improvement of our liquidity positions and balance sheet."

Third quarter and October box office results

An attached table compares 2023 monthly box office revenues with 2019 monthly box office revenues.

Key developments in the third quarter of 2023

Film entertainment and content

Theatre exhibition:

• Reported third-quarter record box office revenues of $188.2-million, an increase of $63.5-million, or 50.9 per cent, from $124.7-million due to a 41.6-per-cent increase in theatre attendance as a result of a strong film slate during the quarter, including Barbie, Oppenheimer and Mission Impossible: Dead Reckoning.
• Reported a third-quarter record BPP of $12, 75 cents, or 6.7 per cent, higher than the $11.25 reported during the prior year.
• Welcomed nearly 700,000 guests on Aug. 27, 2023, in celebration of National Cinema Day, marking the second-busiest day in Cineplex history.
• Launched the new Cineplex mobile app, providing guests with an improved experience while browsing for movies and theatres, purchasing movie tickets, discovering exciting events at The Rec Room and Junxion, and using CineClub discounts and Scene+ rewards.
• Continued to enhance the theatre circuit at SilverCity St. Vital Cinemas in Winnipeg, Man., with a retrofit of all recliner seating at three auditoriums, with one auditorium also enhanced with an UltraAVX screen and another auditorium also enhanced with D-Box seating.

Theatre food service:

• Reported all-time quarterly record theatre food service revenues of $132.4-million, an increase of $39.8-million, or 43.1 per cent, compared with the prior year, primarily due to a 41.6-per-cent increase in theatre attendance.
• Reported third-quarter CPP of $8.44, an increase of nine cents, or 1.1 per cent, compared with the prior year, primarily due to an increase in average spend.

Alternative programming and distribution:

• As part of the theatrical distribution partnership with Lionsgate, Cineplex's distribution business (Cineplex Pictures) distributed The Expendables 4 and Saw X during the third quarter.
• Recognized the third-highest presales of all time for Taylor Swift | The Eras Tour, with over 240,000 tickets sold up to Sept. 30, 2023.
• Cineplex represented 77 per cent and 69 per cent, respectively, of the total North American box office market share for successful international films Carry on Jatta 3 (Punjabi) and Mastaney (Punjabi).
• Event Cinema presented an assortment of big-screen programs, including the live-concert presentation of Metallica's M72 World Tour Live from Texas, Andre Rieu's 2023 Maastricht Concert: Love is All Around, as well as the anime hit The First Slam Dunk and the moving and dramatic stage adaptation of The Hiding Place.

Digital commerce:

• Total registered users for Cineplex Store increased 4.1 per cent compared with the prior year, reaching approximately 2.4 million registered users.
• Curated a Cineplex Store collection in honour of National Day for Truth and Reconciliation to highlight diverse indigenous experiences, cultures and artistic expressions.

Media:

• Reported third-quarter media revenues of $29-million, an increase of $3.7-million, or 14.8 per cent, compared with the prior year.

Cinema media:

• Reported third-quarter cinema media revenues of $19.5-million, an increase of $4.4-million, or 28.9 per cent, over the prior year.

Digital place-based media:

• Reported third-quarter revenues of $9.5-million, a decrease of $600,000, or 6.3 per cent, over the prior year.

Amusement solutions (P1AG) and location-based entertainment:

• Reported third-quarter record revenues of $75.2-million, an increase of $5.6-million, or 8.0 per cent, compared with the prior year.

Player One amusement group:

• Reported third-quarter record revenues of $49-million, an increase of $3.5-million, or 7.7 per cent, compared with the prior year. Reported third quarter adjusted EBITDAaL of $8.5-million, a decrease of $600,000, or 6.1 per cent, compared with the prior year.

Location-based entertainment:

• Reported third-quarter record revenues of $34.2-million, an increase of $3.2-million, or 10.2 per cent, compared with the prior year.
• Reported a third-quarter record adjusted store-level EBITDAaL of $9.9-million, an increase of $300,000, or 2.8 per cent, compared with the prior year.

Loyalty:

• Membership in the Scene+ loyalty program increased to over 14 million members as at Sept. 30, 2023.

Corporate:

• Commemorated National Day for Truth and Reconciliation on Sept. 30, 2023, by raising awareness and honouring indigenous communities through preshow content and donations to Tipi of Hope.

You are cordially invited to participate in a conference call with the management of Cineplex to review the company's third quarter. Mr. Jacob and Gord Nelson, chief financial officer, will host the call.

Cineplex Q3 2023 earnings conference call/webcast

Date:  Thursday, Nov. 9, 2023

Time:  10 a.m. ET

An archive of the webcast will be available at the company's website after the webcast for a limited time.

Analysts who cover the company should use the dial-in option to participate in the live question period: 1-226-828-7575 (local) or 1-833-950-0062 (Canada toll-free), access code 501465.

All attendees should join the event five to 10 minutes prior to the scheduled start time. Media are welcome to join the call in listen-only mode.

About Cineplex Inc.

Cineplex is a top-tier Canadian brand that operates in the film entertainment and content, amusement and leisure, and media sectors. Cineplex offers a unique escape from the everyday to millions of guests through its circuit of over 170 movie theatres and location-based entertainment venues. In addition to being Canada's largest and most-innovative film exhibitor, the company operates Canada's favourite destination for eats and entertainment (The Rec Room), complexes specially designed for teens and families (Playdium), and a newly launched entertainment concept that brings movies, amusement gaming, dining and live performances together under one roof (Cineplex Junxion). It also operates successful businesses in digital commerce, alternative programming (Cineplex Events), motion picture distribution (Cineplex Pictures), cinema media (Cineplex Media), digital place-based media (Cineplex Digital Media) and amusement solutions (Player One Amusement Group). Providing even more value for its guests, Cineplex is a partner in Scene+, Canada's largest entertainment and lifestyle loyalty program.

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