Canada's Cineplex Sees Second Quarter Earnings Fall on Weaker Film Slate
The Canadian exhibition giant was side-swiped by box officer under-performers like the Tom Cruise-starrer "Edge of Tomorrow" and "Fast and Furious 7" shifting to a 2015 release.
TORONTO – Canadian exhibition giant Cineplex on Wednesday reported reduced second-quarter earnings due to a weaker film slate, even as overall revenue rose in part on new theater acquisitions.
Cineplex said profits fell nearly 19 percent to $23.2 million, compared to year-earlier earnings of $28.5 million, on total revenues up 7.2 percent to $323.5 million.
Last year's record second quarter was powered by Hollywood box-office performers like Iron Man 3, Star Trek: Into Darkness, Man of Steel and Fast and Furious 6.
The Canadian exhibitor, by contrast, had a weaker film slate during the latest quarter, with box office from outliers like Captain America: The Winter Soldier and X-Men: Days of Future Past undercut by under-performers like A Million Ways to Die in the West and the Tom Cruise-starrer Edge of Tomorrow.
Cineplex has also seen its recent box office undercut by Universal shifting Fast and Furious 7 from a summer 2014 to an April 2015 release after the death of Paul Walker in November 2013 owing to a fatal car crash.
The first six installments of the Fast and Furious franchise all screened in Cineplex theaters during the second quarter.
"The deferral of this release hurt the quarter," said Cineplex CEO Ellis Jacob during a conference call on Wednesday, before noting the 2014 Q2 box office could have surpassed last year's had Fast and Furious 7 not shifted gears into 2015.
But while counting on Hollywood movies as a draw, even as they vary in performance quarter to quarter, Jacob later told The Hollywood Reporter that the company continues to diversify into digital commerce, media, food, gaming, loyalty and other new businesses to generate new revenue streams for more consistent earnings.