The Marcus Corporation Reports First Quarter Fiscal 2024 Results
“Marcus Hotels & Resorts led our results for the quarter as our group business continued to grow significantly. As we head into the summer travel and convention season in our markets, we are well positioned to capture both leisure and group business across our portfolio, particularly at our newly renovated properties,” said
First Quarter Fiscal 2024 Highlights
-
Total revenues for the first quarter of fiscal 2024 were
$138.5 million , a 9.0% decrease from total revenues of$152.3 million for the first quarter of fiscal 2023. -
Operating loss was
$16.7 million for the first quarter of fiscal 2024, compared to operating loss of$9.0 million for the prior year quarter. -
Net loss was
$11.9 million for the first quarter of fiscal 2024, compared to net loss of$9.5 million for the same period in fiscal 2023. -
Net loss per diluted common share was
$0.38 for the first quarter of fiscal 2024, compared to net loss per diluted common share of$0.31 for the first quarter of fiscal 2023. -
Adjusted EBITDA was
$2.3 million for the first quarter of fiscal 2024, compared to Adjusted EBITDA of$9.5 million for the prior year quarter.
Revenues before cost reimbursements increased 3.8% during the first quarter of fiscal 2024 compared to the first quarter of fiscal 2023. Revenue per available room, or RevPAR, increased 2.1% during the first quarter of fiscal 2024 compared to the prior year first quarter, resulting in
“While the first quarter is seasonally our slowest, I am pleased with the meaningful improvements in midweek group travel during the quarter,” said
Group business continued to increase during the first quarter of fiscal 2024, with an increase in mid-week groups driving occupancy growth 2.9 percentage points during the first quarter of fiscal 2024. Group booking pace for the remainder of fiscal 2024 is running ahead of comparable pace during the same period in fiscal 2023, even when excluding bookings related to the upcoming
During the first quarter of fiscal 2024,
In addition, extensive renovations continue at
As anticipated, the production delays caused by the WGA and
As a result,
“Despite the overall weaker film slate in the quarter, the success of several films reinforced that consumers remain hungry for a steady flow of new, diverse, theatrical entertainment,” said
While schedule changes may occur, new films expected to be released during the remainder of fiscal 2024 that have the potential to perform well include The Fall Guy, Kingdom of the Planet of the Apes, IF, Furiosa, Inside Out 2, A
Balance Sheet and Liquidity
The Marcus Corporation’s financial position remains strong with
Conference Call and Webcast
A telephone replay of the conference call will be available through
Non-GAAP Financial Measure
Adjusted EBITDA has been presented in this press release as a supplemental measure of financial performance that is not required by, or presented in accordance with, GAAP. The company defines Adjusted EBITDA as net earnings (loss) attributable to
Adjusted EBITDA is a key measure used by management and the company’s board of directors to assess the company’s financial performance and enterprise value. The company believes that Adjusted EBITDA is a useful measure, as it eliminates certain expenses and gains that are not indicative of the company’s core operating performance and facilitates a comparison of the company’s core operating performance on a consistent basis from period to period. The company also uses Adjusted EBITDA as a basis to determine certain annual cash bonuses and long-term incentive awards, to supplement GAAP measures of performance to evaluate the effectiveness of its business strategies, to make budgeting decisions, and to compare its performance against that of other peer companies using similar measures. Adjusted EBITDA is also used by analysts, investors and other interested parties as a performance measure to evaluate industry competitors.
Adjusted EBITDA is a non-GAAP measure of the company’s financial performance and should not be considered as an alternative to net earnings (loss) as a measure of financial performance, or any other performance measure derived in accordance with GAAP and it should not be construed as an inference that the company’s future results will be unaffected by unusual or non-recurring items. Additionally, Adjusted EBITDA is not intended to be a measure of liquidity or free cash flow for management’s discretionary use. In addition, this non-GAAP measure excludes certain non-recurring and other charges and has its limitations as an analytical tool. You should not consider Adjusted EBITDA in isolation or as a substitute for analysis of the company’s results as reported under GAAP. In evaluating Adjusted EBITDA, you should be aware that in the future the company will incur expenses that are the same as or similar to some of the items eliminated in the adjustments made to determine Adjusted EBITDA, such as acquisition expenses, preopening expenses, accelerated depreciation, impairment charges and other adjustments. The company’s presentation of Adjusted EBITDA should not be construed to imply that the company’s future results will be unaffected by any such adjustments. Definitions and calculations of Adjusted EBITDA differ among companies in our industries, and therefore Adjusted EBITDA disclosed by the company may not be comparable to the measures disclosed by other companies.
About
Headquartered in
Certain matters discussed in this press release are “forward-looking statements” intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements may generally be identified as such because the context of such statements include words such as we “believe,” “anticipate,” “expect” or words of similar import. Similarly, statements that describe our future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties which may cause results to differ materially from those expected, including, but not limited to, the following: (1) the adverse effects the COVID-19 pandemic, or future pandemics, may have on our theatre and hotels and resorts businesses, results of operations, liquidity, cash flows, financial condition, access to credit markets and ability to service our existing and future indebtedness; (2) the availability, in terms of both quantity and audience appeal, of motion pictures for our theatre division (including disruptions in the production of films due to events such as a strike by actors, writers or directors or future pandemics); (3) the effects of theatre industry dynamics such as the maintenance of a suitable window between the date such motion pictures are released in theatres and the date they are released to other distribution channels; (4) the effects of adverse economic conditions in our markets; (5) the effects of adverse economic conditions on our ability to obtain financing on reasonable and acceptable terms, if at all; (6) the effects on our occupancy and room rates caused by the relative industry supply of available rooms at comparable lodging facilities in our markets; (7) the effects of competitive conditions in our markets; (8) our ability to achieve expected benefits and performance from our strategic initiatives and acquisitions; (9) the effects of increasing depreciation expenses, reduced operating profits during major property renovations, impairment losses, and preopening and start-up costs due to the capital intensive nature of our business; (10) the effects of changes in the availability of and cost of labor and other supplies essential to the operation of our business; (11) the effects of weather conditions, particularly during the winter in the Midwest and in our other markets; (12) our ability to identify properties to acquire, develop and/or manage and the continuing availability of funds for such development; (13) the adverse impact on business and consumer spending on travel, leisure and entertainment resulting from terrorist attacks in
Consolidated Statements of Earnings (Loss) (Unaudited) (in thousands, except per share data) |
|||||||
|
13 Weeks Ended |
||||||
|
|
|
|
||||
Revenues: |
|
|
|
||||
Theatre admissions |
$ |
40,596 |
|
|
$ |
47,635 |
|
Rooms |
|
18,213 |
|
|
|
17,857 |
|
Theatre concessions |
|
34,695 |
|
|
|
42,375 |
|
Food and beverage |
|
16,163 |
|
|
|
15,193 |
|
Other revenues |
|
19,702 |
|
|
|
19,688 |
|
|
|
129,369 |
|
|
|
142,748 |
|
Cost reimbursements |
|
9,178 |
|
|
|
9,528 |
|
Total revenues |
|
138,547 |
|
|
|
152,276 |
|
|
|
|
|
||||
Costs and expenses: |
|
|
|
||||
Theatre operations |
|
44,985 |
|
|
|
51,069 |
|
Rooms |
|
9,411 |
|
|
|
9,278 |
|
Theatre concessions |
|
14,886 |
|
|
|
15,730 |
|
Food and beverage |
|
13,863 |
|
|
|
13,568 |
|
Advertising and marketing |
|
5,301 |
|
|
|
5,065 |
|
Administrative |
|
21,402 |
|
|
|
19,851 |
|
Depreciation and amortization |
|
16,015 |
|
|
|
15,876 |
|
Rent |
|
6,347 |
|
|
|
6,493 |
|
Property taxes |
|
3,931 |
|
|
|
4,757 |
|
Other operating expenses |
|
9,870 |
|
|
|
9,651 |
|
Loss on disposition of property, equipment and other assets |
|
23 |
|
|
|
398 |
|
Reimbursed costs |
|
9,178 |
|
|
|
9,528 |
|
Total costs and expenses |
|
155,212 |
|
|
|
161,264 |
|
|
|
|
|
||||
Operating loss |
|
(16,665 |
) |
|
|
(8,988 |
) |
|
|
|
|
||||
Other income (expense): |
|
|
|
||||
Investment income |
|
692 |
|
|
|
260 |
|
Interest expense |
|
(2,534 |
) |
|
|
(3,008 |
) |
Other income (expense) |
|
(341 |
) |
|
|
(401 |
) |
Equity losses from unconsolidated joint ventures |
|
(387 |
) |
|
|
(171 |
) |
|
|
(2,570 |
) |
|
|
(3,320 |
) |
|
|
|
|
||||
Loss before income taxes |
|
(19,235 |
) |
|
|
(12,308 |
) |
Income tax benefit |
|
(7,369 |
) |
|
|
(2,842 |
) |
Net Loss |
$ |
(11,866 |
) |
|
$ |
(9,466 |
) |
|
|
|
|
||||
Net loss per common share - diluted |
$ |
(0.38 |
) |
|
$ |
(0.31 |
) |
|
|
|
|
||||
Weighted average shares outstanding - diluted |
|
31,892 |
|
|
|
31,572 |
|
Condensed Consolidated Balance Sheets (Unaudited) (In thousands) |
|||||
|
|
|
|
||
|
|
|
|
||
Assets: |
|
|
|
||
|
|
|
|
||
Cash and cash equivalents |
$ |
17,258 |
|
$ |
55,589 |
Restricted cash |
|
3,295 |
|
|
4,249 |
Accounts receivable |
|
13,425 |
|
|
19,703 |
Assets held for sale |
|
2,980 |
|
|
— |
Other current assets |
|
24,589 |
|
|
22,175 |
Property and equipment, net |
|
678,198 |
|
|
682,262 |
Operating lease right-of-use assets |
|
173,068 |
|
|
179,788 |
Other assets |
|
105,322 |
|
|
101,337 |
|
|
|
|
||
Total Assets |
$ |
1,018,135 |
|
$ |
1,065,103 |
|
|
|
|
||
Liabilities and Shareholders' Equity: |
|
|
|
||
|
|
|
|
||
Accounts payable |
$ |
29,574 |
|
$ |
37,384 |
Taxes other than income taxes |
|
15,785 |
|
|
18,585 |
Other current liabilities |
|
69,603 |
|
|
80,283 |
Current portion of finance lease obligations |
|
2,602 |
|
|
2,579 |
Current portion of operating lease obligations |
|
14,061 |
|
|
15,290 |
Current maturities of long-term debt |
|
10,273 |
|
|
10,303 |
Finance lease obligations |
|
12,129 |
|
|
12,753 |
Operating lease obligations |
|
172,985 |
|
|
178,582 |
Long-term debt |
|
159,506 |
|
|
159,548 |
Deferred income taxes |
|
25,311 |
|
|
32,235 |
Other long-term obligations |
|
46,988 |
|
|
46,389 |
Equity |
|
459,318 |
|
|
471,172 |
|
|
|
|
||
Total Liabilities and Shareholders' Equity |
$ |
1,018,135 |
|
$ |
1,065,103 |
Business Segment Information (Unaudited) (In thousands) |
|||||||||||||||
|
Theatres |
|
Hotels/
|
|
Corporate
|
|
Total |
||||||||
13 Weeks Ended |
|
|
|
|
|
|
|
||||||||
Revenues |
$ |
81,270 |
|
|
$ |
57,197 |
|
$ |
80 |
|
|
$ |
138,547 |
|
|
Operating loss |
|
(5,739 |
) |
|
|
(5,162 |
) |
|
|
(5,764 |
) |
|
|
(16,665 |
) |
Depreciation and amortization |
|
11,033 |
|
|
4,864 |
|
|
|
118 |
|
|
|
16,015 |
|
|
Adjusted EBITDA |
|
6,156 |
|
|
|
(11 |
) |
|
|
(3,854 |
) |
|
|
2,291 |
|
|
|
|
|
|
|
|
|
||||||||
13 Weeks Ended |
|
|
|
|
|
|
|
||||||||
Revenues |
$ |
96,376 |
|
$ |
55,811 |
|
|
$ |
89 |
|
|
$ |
152,276 |
|
|
Operating income (loss) |
|
1,519 |
|
|
|
(5,032 |
) |
|
|
(5,475 |
) |
|
|
(8,988 |
) |
Depreciation and amortization |
|
11,488 |
|
|
|
4,301 |
|
|
|
87 |
|
|
|
15,876 |
|
Adjusted EBITDA |
|
13,803 |
|
|
|
(410 |
) |
|
|
(3,935 |
) |
|
|
9,458 |
|
Corporate items include amounts not allocable to the business segments. Corporate revenues consist principally of rent and the corporate operating loss includes general corporate expenses. Corporate information technology costs and accounting shared services costs are allocated to the business segments based upon several factors, including actual usage and segment revenues.
Supplemental Data (Unaudited) (In thousands) |
||||||||
|
|
13 Weeks Ended |
||||||
Consolidated |
|
|
|
|
||||
Net cash flow provided by (used in) operating activities |
|
$ |
(15,098 |
) |
|
$ |
(7,734 |
) |
Net cash flow provided by (used in) investing activities |
|
|
(20,758 |
) |
|
|
(9,531 |
) |
Net cash flow provided by (used in) financing activities |
|
|
(3,429 |
) |
|
|
5,575 |
|
Capital expenditures |
|
|
(15,440 |
) |
|
|
(8,921 |
) |
Reconciliation of Net Loss to Adjusted EBITDA (Unaudited) (In thousands) |
|||||||
|
13 Weeks Ended |
||||||
|
|
|
|
||||
Net loss |
$ |
(11,866 |
) |
|
$ |
(9,466 |
) |
Add (deduct): |
|
|
|
||||
Investment income |
|
(692 |
) |
|
|
(260 |
) |
Interest expense |
|
2,534 |
|
|
|
3,008 |
|
Other expense (income) |
|
341 |
|
|
|
401 |
|
Loss on disposition of property, equipment and other assets |
|
23 |
|
|
|
398 |
|
Equity losses from unconsolidated joint ventures |
|
387 |
|
|
|
171 |
|
Income tax benefit |
|
(7,369 |
) |
|
|
(2,842 |
) |
Depreciation and amortization |
|
16,015 |
|
|
|
15,876 |
|
Share-based compensation (a) |
|
2,514 |
|
|
|
2,172 |
|
Insured losses (b) |
|
404 |
|
|
|
— |
|
Adjusted EBITDA |
$ |
2,291 |
|
|
$ |
9,458 |
|
Reconciliation of Operating income (loss) to Adjusted EBITDA by Reportable Segment (Unaudited) (In thousands) |
|||||||||||||||
|
13 Weeks Ended |
||||||||||||||
|
Theatres |
|
Hotels &
|
|
Corp.
|
|
Total |
||||||||
Operating loss |
$ |
(5,739 |
) |
|
$ |
(5,162 |
) |
|
$ |
(5,764 |
) |
|
$ |
(16,665 |
) |
Depreciation and amortization |
|
11,033 |
|
|
|
4,864 |
|
|
|
118 |
|
|
|
16,015 |
|
Loss on disposition of property, equipment and other assets |
|
18 |
|
|
|
5 |
|
|
|
— |
|
|
|
23 |
|
Share-based compensation (a) |
|
440 |
|
|
|
282 |
|
|
|
1,792 |
|
|
|
2,514 |
|
Insured losses (b) |
|
404 |
|
|
|
— |
|
|
|
— |
|
|
|
404 |
|
Adjusted EBITDA |
$ |
6,156 |
|
|
$ |
(11 |
) |
|
$ |
(3,854 |
) |
|
$ |
2,291 |
|
|
13 Weeks Ended |
|||||||||||||
|
Theatres |
|
Hotels &
|
|
Corp.
|
|
Total |
|||||||
Operating income (loss) |
$ |
1,519 |
|
$ |
(5,032 |
) |
|
$ |
(5,475 |
) |
|
$ |
(8,988 |
) |
Depreciation and amortization |
|
11,488 |
|
|
4,301 |
|
|
|
87 |
|
|
|
15,876 |
|
Loss on disposition of property, equipment and other assets |
|
323 |
|
|
75 |
|
|
|
— |
|
|
|
398 |
|
Share-based compensation (a) |
|
473 |
|
|
246 |
|
|
|
1,453 |
|
|
|
2,172 |
|
Adjusted EBITDA |
$ |
13,803 |
|
$ |
(410 |
) |
|
$ |
(3,935 |
) |
|
$ |
9,458 |
|
|
|
|
|
|
|
|
|
(a) |
Non-cash expense related to share-based compensation programs. |
|
(b) |
Repair costs related to insured property damage at one theatre location that are non-operating in nature. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240501474382/en/
(414) 905-1100
investors@marcuscorp.com
Source: