Imax Earnings Top Wall Street Estimates Due to ‘Avengers: Endgame,’ China Locations
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Giant screen producer-exhibitor Imax has reported second quarter earnings and revenues that topped Wall Street expectations, citing strong performances from “Avengers: Endgame” and its Chinese sites.
The company, in an announcement Tuesday after the market closed, said it topped consensus estimates on revenues by 6.6% with $104.8 million and on adjusted earnings per share by 6.7% with 32 cents a share. Shares of Imax were up 44 cents to $21.76 in after-hours trading.
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Imax also said it is on track to deliver its best year ever at the global box office, affirming previous full-year guidance of low-double digit percentage growth over 2018’s $1.03 billion. Global box office in the second quarter grew to $364.9 million, up 6.5% and driven by the strong performance of “Avengers: Endgame” and overall strength in China.
The company also said Imax China has vastly outperformed the rest of the Chinese film industry year-to-date, with 28.9% box office growth in the second quarter — marking the company’s eighth consecutive quarter of year-over-year box office growth in China. Max noted that “Ne Zha,” Imax’s first-ever Chinese animation title, premiered with the best opening weekend ever for any Imax animation release in China.
The company said its commercial theater network grew 10% to 1,445 systems, including agreements with CGV for 40 new theaters in China, and with Cineworld for 15 sites with Laser upgrades in Regal theaters across the U.S.
A total of 19 films (15 new and four carryovers) were exhibited in the quarter, compared to 14 films (10 new and four carryovers) in the second quarter of 2018. CEO Richard Gelfond issued a bullish outlook for the rest of the year.
“Imax is on track to deliver its best year ever at the box office, with the success of ‘Spider-Man: Far From Home,’ ‘The Lion King,’ and our record-breaking, first local language animated release in China this past weekend, ‘Ne Zha,’ leading a strong second half film slate and building on our solid first-half,” he said. “Our continued success is driven by the privileged position we hold in the entertainment ecosystem, where our end-to-end technology empowers world-class creators to bring cultural events and communal experiences to life on a global scale.”
Operating expenses for 2019 are expected to be in line with the $110.7 million recorded last year. Total theater installations are expected in the range of 185 to 190, consisting of new theater installs of 140 to 145 systems and upgrades of approximately 45 systems.
Gelfond also disclosed during Tuesday’s conference call with analysts that the company is attempting to increase the use of Imax cameras on feature films. He said Christopher Nolan is using Imax cameras to shoot “Tenet,” his upcoming action thriller with John David Washington and Robert Pattinson starring.
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