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Giant-screen exhibitor Imax on Thursday swung into profit in the third-quarter of this year, due largely to a strong Hollywood film slate.
Imax reported earnings of $5.02 million attributable to shareholders, compared with a loss of $850,000 last year. The adjusted earnings per share came to 14 cents, compared with 8 cents per share in 2017, and beat an analyst forecast for per-share earnings of 11 cents for the latest quarter.
Quarterly revenue fell to $82.1 million, against $98.8 million a year earlier, and beat an analyst forecast for $81.2 million.
Gross box office from Imax digitally remastered movies was $206.5 million in the third quarter, down from a year-earlier $218 million, as the exhibitor released 29 films during the latest financial quarter, against 24 in the year-earlier period.
“Compelling blockbuster content from Hollywood and China, coupled with our ongoing focus on controlling costs helped drive our third consecutive quarter of operating margin expansion,” Imax CEO Richard Gelfond said in a statement.
The giant-screen exhibitor during its latest financial quarter screened The Meg, Mission Impossible — Fallout and the Chinese title Dying to Survive in its theaters.
Gelfond during an analyst call discussed Imax positioning itself to take advantage as streaming giants, starting with Netflix and Amazon, enter the blockbuster movie business, and traditional Hollywood studios develop their own streaming products.
“We have worked hard to position Imax squarely at the intersection of this convergence, with the unique opportunity to profit from it,” he said. Gelfond later told The Hollywood Reporter that he expected all streaming services to eventually get into the blockbuster movie business, even though until now Netflix and Amazon have mostly responded to demands from auteur directors to get their movies into theaters before their streaming runs.
“A lot of the big directors have said to the streaming services, ‘We’ll make a move for you if there’s a theatrical release, and more specifically if there’s an Imax release,'” Gelfond insisted. He added Imax will respect the traditional theatrical window, as it looked to subscription VOD services and Hollywood studios teeing up their movie releases with a prerelease on Imax screens.
“If you release the film in Imax, you get to 80 countries, you have a premiere, and if you have a one-week run, it will really prime the market for a streaming release,” Gelfond said.
The Imax topper also touched on his company’s plans in Saudi Arabia in the wake of the murder of Saudi journalist Jamal Khashoggi. “Under the current circumstances, we can’t comment right now,” Gelfond said.
Like several other major operators — including AMC, Cinepolis and Middle East giant Vox — Imax has opened a cinema in Saudi Arabia and unveiled plans to make large-format movies with local partners.
In China, where Imax box office increased during the latest quarter, the giant-screen pioneer has seen its proprietary cameras used by Chinese filmmakers on two upcoming releases: 800 and Chinatown Detective 3.
“With the cameras firmly planted in China, it makes it easier. You’re going to start to see it roll out,” Greg Foster, CEO of Imax Entertainment, told analysts during the morning call.
In its financial results, Imax pointed to 37 theater signings during the latest quarter, against a year-earlier 17.
Imax’s digital remastering revenues fell to $22.3 million, compared with $25.9 million in the prior year. And revenue from joint venture theaters came to $14.3 million, against a year-earlier $15.5 million.
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