HIGHLIGHTS ----------
- Company completes 66 signings in the first quarter, including 35-theatre lease deal with RACIMEC International Group and 31-theatre joint venture deal with Regal Cinemas.
- Company on track to launch highly-anticipated digital projection system in June.
- Recent financing agreements leave Company well positioned for digital joint venture rollout.
- Addition of DreamWorks Animation's Madagascar 2 to 2008 film slate further endorsement of digital transition.
TORONTO, May 12 /PRNewswire-FirstCall/ - IMAX Corporation (NASDAQ: IMAX;TSX: IMX) today reported that it recorded a net loss per diluted share of($0.25) for the first quarter of fiscal 2008, compared to a net loss perdiluted share of ($0.12) for the first quarter of fiscal 2007. At the sametime, the Company announced that its pending digital roll-out was on scheduleand that it had added DreamWorks Animation's Magadascar 2 to the 2008 filmslate.
IMAX Co-Chief Executive Officers Richard L. Gelfond and Bradley J.Wechsler stated, 'As anticipated, our first quarter results reflect thetransitional nature of 2008 from a financial perspective as we continueimplementing our key joint venture revenue sharing and digital initiatives.From a strategic standpoint, however, we are very encouraged by ouraccomplishments to date and believe that the Company is well positioned tobenefit both financially and operationally from the steps we are taking. Wecontinue to expect improved results in the fourth quarter of 2008 andprofitability in 2009.'
The Company signed agreements for 66 IMAX(R) theatre systems in the firstquarter of fiscal 2008, compared to 13 in the first quarter of 2007. To date,IMAX has signed joint revenue sharing agreements with prominent exhibitors for146 theatres. To assist in funding its digital joint venture roll-out, theCompany entered into two significant financing transactions last week, onewith Wachovia Capital Finance Corporation to increase future availability andmodify other terms under the Company's existing credit facility, and one withthe Douglas family, IMAX's largest shareholder, for the sale of 2,726,447million common shares in a private placement at market prices, for anaggregate purchase price of $18.0 million.
'Our transition from a film to a digital platform is on track, and we arefast approaching the launch of our highly anticipated digital product.Importantly, we believe we are well positioned to fund our digital and jointventure roll-outs thanks to our two recently-announced financing agreements,which we expect will ultimately leave us with approximately $55-60 million infunding. The implementation of our joint venture agreements shouldsignificantly transform IMAX, and we are pleased to have the resources to rollout our 100-theatre JV deal with AMC Entertainment, Inc., our 31-system JVdeal with Regal Cinemas, Inc., and to pursue other joint venture revenuesharing opportunities in the future. We are encouraged by the level ofinterest we continue to see in IMAX, and believe this will ultimatelytranslate into strong network growth and recurring revenues,' said Messrs.Gelfond and Wechsler.
On the film side, on May 9 the Company released Warner Bros.' Speed Racer:The IMAX Experience. This family adventure from The Wachowski Brothers, thecreators of 'The Matrix' trilogy, is based on the hit animated series createdby Tatsuo Yoshida and grossed $1.9 million on 84 screens over its openingweekend.
Regarding film performance in the first quarter of fiscal 2008, theCompany noted that the seasonally weak quarter faced an especially difficultyear-over-year comparison given the strong IMAX DMR(R) release of 300: TheIMAX Experience in the first quarter of last year. The Spiderwick Chronicles:The IMAX Experience opened on February 15 and grossed $6.8 million in IMAXtheatres. Shine A Light, the Rolling Stones concert film directed by AcademyAward(R)-winning filmmaker Martin Scorsese, opened April 4 and the IMAXrelease has grossed approximately $3.9 million to date.
'While we were disappointed that Spiderwick and Shine a Light did notperform as well as we had hoped, we remain very optimistic about the films onour slate for the balance of the year and beyond,' stated Messrs. Gelfond andWechsler. 'We have already announced three films for 2009 and 2010 as part ofour deal with DreamWorks Animation, and have several great prospects to fillout future film slates.'
Speed Racer will be followed on June 8 by the release of the DreamWorksAnimation film Kung Fu Panda: The IMAX Experience. The next installment in theBatman series, The Dark Knight: An IMAX Experience, will follow in July. TheCompany will again partner with DreamWorks Animation to release Madagascar 2:The IMAX Experience for a two-week run beginning November 7. Finally, HarryPotter and the Half Blood Prince: An IMAX 3D Experience is scheduled forNovember.
November's two-week Madagascar 2 run is a further endorsement of theCompany's pending transition to digital technology. Digital's virtualelimination of film prints, allowing studios to recoup a higher return ontheir pictures over shorter periods of time, was a significant factor in thedeal with DreamWorks. The Company expects 35 digital theatres to be up andrunning in time to exhibit this film.
For the three months ended March 31, 2008, the Company's total revenueswere $23.5 million, as compared to $26.8 million reported for the prior yearperiod. Systems revenue was $12.5 million versus $13.1 million in the prioryear period.
