Cineplex Sees Earnings Fall on Brutal Winter, Weaker Film Slate
TORONTO – A brutal Canadian winter left exhibition giant Cineplex out in the cold with its first-quarter box office draw.
Toronto-based Cineplex on Thursday posted sharply lower first-quarter earnings due to extreme weather during the first part of the year and weaker film product.
The exhibitor saw earnings for the three months to March 31 slide 42.5 percent to CAN$5.1 million (US$4.7 million), against a profit of CAN$8.8 million in 2013.
Lower earnings came despite overall revenues rising 13 percent to CAN$280 million (US$257.3 million), with box office revenues increasing 7.6 percent to CAN$156.2 million (US$143.4 million).
The box office bump was due to the acquisition of 24 Empire Theaters and a digital media company in 2013.
At the same time, Cineplex had weaker box office draws for its Hollywood film slate during the latest quarter, a portfolio led by The LEGO Movie, Frozen and 300: Rise of an Empire.
Cineplex reported some films in the latest period did not perform as well in Canada as they did in the U.S. market.
The latest quarter was also undercut by extreme wintry conditions, especially in Atlantic Canada, causing theater closures, power outages and poor driving conditions that kept patrons from going to the local multiplex.
Cineplex also saw film costs rise 9.6 percent to CAN$80.4 million (U$74 million) due to the settlement rate on the top films being higher during the first quarter of 2014, compared to the same period a year earlier.