Cinemark Reaches 950,000 Movie Club Members as Fourth-Quarter Earnings Rise

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Cinemark CEO Mark Zoradi

CEO Mark Zoradi during an analyst call talked next-generation laser projection, the 2019 industry box office and continuing growth for its movie subscription service.

Cinema giant Cinemark Holdings on Friday reported higher fourth-quarter earnings that missed Wall Street estimates.

Cinemark said fourth-quarter attendance reached 63.8 million patrons, down from 67.4 million in the year-ago period, its average ticket price rose 3.2 percent to $6.81 and concession revenue per patron rose 4.6 percent to $4.31. Key box office performers of the fourth quarter included Frozen 2 and Joker.

The company also increased its dividend by 6 percent to $1.44 per year.

Cinemark posted quarterly earnings of $26.3 million, or 22 cents per share, compared with $19.4 million in the year-ago period, or 17 cents a share. Adjusted earnings before interest, taxes, depreciation and amortization, another profitability metric, fell to $178.3 million from $198.1 million in the year-ago period.

Cinemark's fourth-quarter revenue dropped 1 percent to $788.8 million from $798.6 million. Admissions revenue fell 2 percent to $434.3 million, with concession revenue dropping 1 percent to $275.0 million.

Cinemark CEO Mark Zoradi during an analyst call reported the chain's movie subscription and loyalty program service Movie Club had 950,000 members, having added 100,000 new members over the latest quarter. "As we continue to attract more guests into Movie Club, and better understand and engage with our members, we're achieving our program goals of enhancing the guest experience, increasing moviegoing frequency and driving more loyalty to Cinemark," he argued.

Zoradi also discussed the 2019 North American box office where combined industry ticket sales reached $11.4 billion, down 4 percent from 2018's historic $11.88 billion, according to Comscore. "While many in the industry, myself included, believed that 2019 had the potential to deliver another record year, we find it hard to be too disappointed with $11.4 billion in box office," he said.

And Zoradi touted Cinemark tapping Cinionic with an exclusive deal to upgrade the chain's circuit with Barco Series 4 laser projectors over 10 years. The Cinemark boss said laser projection will enhance the moviegoing experience for patrons while reducing overall operating costs for the chain.

Zoradi also reiterated his long-term optimism over the exhibition business, whatever the changes movie chains face from new technologies and new video viewing habits in the home from Netflix and other new digital alternatives. "In the last five years, it's cinema that's helped to enhance the out-of-home moviegoing experience by deploying upgraded guest experiences.... The moviegoing consumer has remained the most important component in this mix," Zoradi said.

Feb. 21 8:30 a.m.: Updated with comments by Cinemark CEO Mark Zoradi made during an analyst call.