investor presentation q3 2018
TRANSCRIPT
INVESTOR PRESENTATION Q3 2018
2
3
COMPANY OVERVIEW
• ~3.1% yield • ~90% institutional ownership
Annual Dividend History (4)
4
5-Year Total Return (1)
Return to Shareholders
1) TTM 9/30/20182) As reported in USD. The adoption of ASC Topic 606 impacted how we record certain revenues. See Note 3 to our financial statements as included in our Form 10Q filed Nov 2, 20183) CNK value increase due to stock price appreciation and dividends – does not assume dividend reinvestment4) As expected. Based on paid date
44%Total Shareholder
Return
Increased CNK value (3)
$1.6B
20.7%Adjusted EBITDA
growth (2)
Cash dividends paid
$633M$0.72
$0.84
$1.00 $1.08
$1.16
$1.28
Nov. 2007 -Nov. 2010
Dec. 2010 -July 2013
Aug. 2013 -Feb. 2016
Mar. 2016 -Feb. 2017
Mar. 2017 -Feb. 2018
Mar. 2018 -Current
Cinemark Domestic Theatres
1) Ranking based on box office revenues as of 12/31/17.5
41States
DMAs102
#1 or #2in ~75% of our top 25 markets
Cinemark International Theatres
6 Ranking based on box office revenues as of 12/31/17
15Countries
of the top 20 largest metropolitan areas in South America
14
25Years operating
experience
Market shareIn key
countries
~30%
Strong and expansive presence strategically important for film distribution and to potential Pan-Regional promotional partners
Brazil
Chile
Argentina
7
Broad and Leading Presence in the Americas
Approximate Market Share 1Strong Americas Presence
As of 9/30/18Years in Country Theatres Screens Rank (1)
USA 32 340 4,579 #3
Brazil 22 84 625 #1
Argentina 21 21 184 #1
Chile 25 19 133 #2
Colombia 19 35 193 #2
Peru 21 13 93 #2
Ecuador 21 7 45 #3
Central America 21 19 133
Bolivia 4 1 13
Curacao 3 1 6
Paraguay 2 1 10
541 6,014
1) FY 2017 based on box office
28%14%
9%6%6%
4%
33%CinemarkCinépolisKinoplexAraújoUciCinesystemOther
34%
15%10%10%
8%8% 15%
CinemarkVillage CinesLumiereNat'l AmusementsIndependentCinemacenterOther
37%43%
17%
3%
CinemarkHoyts ChileCineplanetOther
Significant Latin American Screen Growth Potential
Population (Millions) 3
Total Screens in
CountryCNK
Screens
124.6 6,023 0 4
17.8 391 126
31.0 632 93
44.3 911 184
47.7 1,055 193
207.3 3,187 608
2017 Population & Screen Data 1, 3
1) Screens source: Rentrak Data excludes Central American countries. CNK screens are as of 12/31/17.2) Sources: US & Canada (2016 MPAA). UK (2016 British Film Institute). 3) Population source: CIA World Factbook4) Sale of Mexico theatres closed 11/15/2013
8
Population per Screen
Screen Growth Potential
~2x incremental screens in underserved
countries to reach Mexico levels
8.0
15.9
20.3
45.7
53.9
51.6
52.0
67.6
U.S. (2)
U.K. (2)
Mexico
Chile
Peru
Argentina
Colombia
Brazil
Stable Long-Term Exhibition Industry Trends
Sources: North America: Rentrak, NATO9
North America Industry
Stable, long-term industry growth trends across technology innovations and economic cycles
3.2% Box Office CAGR (1987 – 2017)0.4% Admissions CAGR (1987 - 2017)2.8% Ticket Price CAGR (1987 – 2017)
VCR Internet DVD Streaming
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
$4.2B
Recession year
$11.1B
$596.7
$860.4
Consistent Industry Outperformance
34 out of 39 quarters of North American industry out-performance2012 – 2017 Admission Revenue Growth (1)
10
2012 2017Constant $
CNK WW Adjusted EBITDA Growth (1, 2)
Con
stan
t $
North American Industry
38.3%
23.4%
2.7%
U.S
.
Wor
ldw
ide
C$
Source: MPAA and Public Filings. 1) As of December 31, 2017. 14% WW growth in USD as reported. Constant currency is a non-GAAP measurement calculated using the average exchange rates for the
corresponding months for 2012. We translate results of our international operating segment from local currencies into U.S. dollars using currency rates for respective reporting periods. Significant changes in foreign exchange rates from one period to the next can result in meaningful variations in reported results. We provide constant currency amounts to compare performance without the impact of foreign currency fluctuations.
2) Adjusted EBITDA has been presented including all cash distributions from equity investees
Compelling 2018 Film Slate
11
Fifty Shades Freed
February 9
The Post
January 12 March 9
A Wrinkle in Time
March 16
Tomb Raider
1Q ‘18
March 30
Ready Player One
3D denoted in red
February 16
Black Panther
Avengers: Infinity War
April 27
Rampage
April 13 May 25
Solo: A Star Wars Story
June 15
The Incredibles 2
June 22
Jurassic World: Fallen Kingdom
May 18
Deadpool 2
2Q ‘18
Compelling 2018 Film Slate
12
Hotel Transylvania 3: Summer Vacation
July 13 August 15
Crazy Rich Asians
July 27
Mission: Impossible Fallout
September 7
The Nun
3Q ‘18
3D denoted in red
Dr. Seuss’ The Grinch
November 9
Venom
October 5 November 16
Fantastic Beasts: The Crimes of Grindelwald
November 23
Ralph Breaks the Internet
November 2
Bohemian Rhapsody
4Q ‘18
December 21
Aquaman
Ant-Man and The Wasp
July 6 August 10
The Meg
Compelling 2019 Film Slate
13
Glass
January 18
On the Basis of Sex
January 11 February 8
What Men Want
February 22
How to Train Your Dragon 3
1Q ‘19
March 8
Captain Marvel
3D denoted in red
February 8
The LEGO Movie 2
Avengers: Infinity War
May 3
Shazam!
April 5 May 24
Aladdin
June 7
Dark Phoenix
June 21
Toy Story 4
May 10
Detective Pikiachu
2Q ‘19
Compelling 2019 Film Slate
14
Annabelle
July 5 August 2
Hobbs & Shaw
July 19
The Lion King
September 6
IT Chapter 2
3Q ‘19
3D denoted in red
Sonic the Hedgehog
November 8
Joker
October 4 November 29
Frozen 2
December 20
Cats
October 18
You Are My Friend
4Q ‘19
December 20
Star Wars: Episode IX
Spider-Man: Far From Home
July 5 July 26
Once Upon a Time in Hollywood
a
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STRATEGIC INITIATIVES
Strategic Initiatives
16
Luxury Lounger
recliner seats
Enhanced food & beverage
tactics
XD private-label premium
large format
Loyalty programs & subscription
Primary Objectives:1) Extraordinary guest experience to drive attendance
2) Invest in & grow a “AAA” circuit
3) Deliver consistent industry-leading results
Luxury Lounger Recliner Seats
17
3Q 2018:
53%of U.S. circuit
Est. YE 2018:
~55%of U.S. circuit
Enhanced Food & Beverage Tactics
18
3Q 2018:
38%U.S. Circuit
Est. YE 2018:
~45%U.S. Circuit
Est. YE 2018:
~75%U.S. Circuit
Alcohol Expansion
Enhanced Food & Beverage
47Consecutive Quarters Domestic Concession
per Patron Growth
3Q 2018:
69%U.S. Circuit
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World’s #1 Private-Label Premium Large Format Brand
1) Data as of YTD 9/30/20182) 70% of US auditoriums3) Latin America certification in-process
4.2%Worldwide Screens
8.5% (1)
Worldwide Box Office
70%(2)
Feature Luxury Loungers
100%(3)
THX Certified
250Global XD Auditoriums
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Loyalty Programs
Free app-based loyalty
program
8.8M+ members worldwide
Redeem points for fun rewards and free concessions
Earn points by purchasing tickets, concessions, and using Cinemode
Enables advanced analytics for more robust consumer
insight
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Program Highlights:• One 2D ticket per month • $8.99 add-on tickets for member• Unused credits roll over • One companion ticket per transaction• 20% concessions discount • Upgrade to XD/3D/DBOX for upcharge• Waived online fees • Not a breakage model
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445KActive members =
1.3K members/theater
8MCumulative tickets sold via Movie Club
~ 8%of 3Q18 box office
3xMember visits relative
to non-members
98%Positive response rate
75%Movie credits
redeemed to-date
Progress since December 5th launch…
Information as of 11/1/2018
23
FINANCIALS
$'s in millions Sept. 30, 2018
Long-term Debt, including current maturities: Senior Secured Credit Facility 654.6$
4.875% Senior Notes due 2023 755.0$
5.125% Senior Notes due 2022 400.0$
Capital Lease Obligations 254.5$
Other 2.8$
Total Debt 2,066.9$
Cash and Cash Equivalents 366.8$
Net Debt 1,700.1$ TTM Adj. EBITDA (1) 771.0$
Net Debt / Adj. EBITDA 2.2x
Capital Structure
24 Note: The Company has an undrawn revolver of $100mm.1) TTM Adjusted EBITDA thru 9/30/2018. Adjusted EBITDA reconciliation available in 10Q,10K, in earnings release and at investors.cinemark.com
Significant cash reservesAbility to take advantage of growth opportunities as they arise
No near-term debt maturitiesCovenant-lite debt
Solid Recent Results
1) The adoption of ASC Topic 606 impacted how we record certain revenues. See Note 3 to our financial statements as included in our Form 10Q filed Nov 2, 2018
Adjusted EBITDA represents net income before income taxes, interest expense, interest income, foreign currency exchange gain (loss), interest expense – NCM, equity in income of affiliates, loss on debt amendments and refinancing, other cash distributions from equity investees, depreciation and amortization, impairment of long-lived assets, loss on disposal of assets and other, changes in deferred lease expense, amortization of long-term prepaid rents and share based awards compensation expense, as calculated below. Adjusted EBITDA is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to net income as an indicator of operating performance or as an alternative to cash flow provided by operating activities as a measure of liquidity (as determined in accordance with GAAP). Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. We have included Adjusted EBITDA because we believe it provides management and investors with additional information to measure our performance and liquidity, estimate our value and evaluate our ability to service debt. In addition, we use Adjusted EBITDA for incentive compensation purposes. See reconciliation of net income, the most directly comparable GAAP measure, to Adjusted EBITDA in the 10Q filed on Nov 2, 2018 or at investors.cinemark.com.
2) Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by Worldwide Revenues
25
$'s in millions 2018 2017 vs. Prior Year 2017 2016 vs. Prior
Year
Revenues U.S. 1,897.7$ 1,650.5$ 2,236.2$ 2,230.7$ International 535.5 602.1 769.5 701.6 Eliminations (10.0) (11.0) (14.1) (13.5)Worldwide Revenues 2,423.2$ 2,241.6$ 8.1% 2,991.6$ 2,918.8$ 2.5%
Adjusted EBITDA (1)
U.S. 476.9$ 402.9$ 558.2$ 548.4$ International 106.5 133.3 165.6 157.7Worldwide Adj. EBITDA 583.4$ 536.2$ 8.8% 723.8$ 706.1$ 2.5%
WW Adj. EBITDA Margin (2) 24.1% 23.9% 20 bps 24.2% 24.2% 0 bps
Nine Months Ended September 30, Year Ended December 31,
