Slide 1: As at December 31, 2016
As at December 31, 2016 Contact/Inquiries: Pat Marshall, Vice President, Communications and Investor Relations T: 416.323.6648 • E: Pat.Marshall@cineplex.com
Slide 2: Cineplex Entertainment is the motion picture exhibition company in Canada
CINEPLEX ENTERTAINMENT AS AT DECEMBER 31, 2016 IS THE AND MOTION PICTURE Landmark, 9.9% EXHIBITION COMPANY IN CANADA Cineplex 78.5% Other, 9.7% Guzzo, 1.9% THEATRES SCREENS Source: Rentrak © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 2
Slide 3: Box Office Premium Offerings
$9.23 $9.15 $9.13 $8.97 $8.67 $8.74 $7.99 $8.05 $8.30 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Box Office Premium Offerings © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 3
Slide 4: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
© Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 4
Slide 5: Strategic priorities
• Continue to enhance and expand existing infrastructure and expand Cineplex’s presence as an entertainment destination for Canadians in-theatre, at-home and on-the-go • Capitalize on our core media strengths and infrastructure to provide continued growth of Cineplex’s media business, both inside an
Slide 6: Theatre Exhibition, Food Service, Alternative Programming, Digital Commerce
Theatre Exhibition • Theatre Food Service • Alternative Programming • Digital Commerce © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 6
Slide 7: Luxurious accounted for share of box office revenue
LUXURIOUS ACCOUNTED FOR OF BOX OFFICE REVENUE FOR THE YEAR ENDED DECEMBER 31, 2016 © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 7
Slide 8: Auditoriums
® • Wall to wall screens • Dolby ATMOS surround sound • Reserved seating • Extra-wide high back, rocker seats • Premium pricing • 85 auditoriums (as at December 31, 2016) AUDITORIUMS OF SCREENS OF BOX OFFICE © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 8
Slide 9: IMAX theatres
• All locations are digital and 3D capable • Premium pricing • Reserved seating • 23 IMAX Theatres (as at December 31, 2016) THEATRES CAPABLE © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 9
Slide 10: Motion-seat theatre locations
• Unique out-of-home experience • Seats move in synchronization with the action on screen • Premium pricing • Reserved seating • 77 locations (as at December 31, 2016) LOCATIONS © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 10
Slide 11: Adult-only licensed auditoriums
• Enhanced food and beverage menu • Adult-only licensed auditoriums • Reserved recliner seats • Service at your seat • Private licensed lounge and box office • Premium pricing • 17 locations and 63 screens (as at December 31, 2016) LUXURIOUS GREAT EXCEPTIONAL © Cineplex Entertainment. Not to be dist
Slide 12: Scotiabank Theatre Saskatoon and VIP Cineplex Cinemas
Scotiabank Theatre Cineplex Cinemas Cineplex Cinemas Saskatoon and VIP Marine Gateway and VIP Pickering and VIP (Saskatoon, SK) (Vancouver, BC) (Pickering, ON) Cineplex Cinemas Cineplex Cinemas Cineplex Cinemas Lansdowne and VIP North Barrie Seton and VIP (Ottawa, ON) (Barrie, ON) (Calgary, AB) Cine
Slide 13: Revenue 2016
• Focus on speed of service • Premium promotional programs • Digital menu boards REVENUE 2016 • Proprietary brands © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 13
Slide 14: Concession per patron history
$5.43 $5.65 $5.09 $4.82 $4.63 $4.41 $4.27 $3.96 $4.12 $3.84 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 14
Slide 15: As at December 31, 2016
AS AT DECEMBER 31, 2016 © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 15
Slide 16: Self-serve frozen yogurt
• Self-serve frozen yogurt • Will replace all Cineplex yogurt RBOs • 96 locations at December 31, 2016 AS AT DECEMBER 31, 2016 © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 16
Slide 17: Specialty gourmet popcorn
• Selection of specialty gourmet popcorn AS AT DECEMBER 31, 2016 © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 17
Slide 18: Alternative programming
• The Met: Live in HD • Family Favourites • Classic Film Series • In the Gallery Series • Flashback Film Festival • National Theatre Live • Sensory Friendly Screenings • World Wrestling Entertainment • Concerts, Broadway shows and special events • South Asian programming (Bollywood) • East Asian • H
Slide 19: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
© Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 19
Slide 20: Digital: Cineplex.com and mobile apps
• Provides entertainment content before the show • Mobile ticketing - no lines • 111 million site visits in 2016 • One of Canada’s most popular mobile brands • 510 million page views in 2016 • Downloaded 16.1 million times and recorded 873 million app sessions since launch • Online ticketing and sho
Slide 21: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
• • • • • © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 21
Slide 22: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
• • • • • © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 22
Slide 23: SCENE loyalty program members
• Canada’s top loyalty program for movie lovers 7.3 • Members are represented in 45% of 6.3 Canadian households 5.3 • One of top five loyalty programs in 4.3 Canada 3.3 • One in five Canadians are SCENE 2.7 2.1 members 1.4 0.6 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Number of Members (Mill
Slide 24: SCENE benefits
• Drives attendance frequency • Encourages concession spend • Better target offers to guests • Cineplex Store – Build awareness / promote trial • Great opportunity for film studios and promotional partners © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 24
Slide 25: Cinema Media, Digital Place-Based Media
Cinema Media • Digital Place-Based Media © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 25
Slide 26: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
© Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 26
Slide 27: Cinema Media Represents
Yukon • On-screen advertising – Show time, Pre-Show, and TimePlay • Cineplex Magazine and Le magazine Cineplex • Cineplex Magazine is the #2 most read magazine in Canada and #1 most read magazine in Canada for all demographics under B.C. 50 years old Alberta • Cineplex.com and Cineplex Mobile advert
Slide 28: Advertising awareness and correct brand association
86% 88% 70% 58% 58% 45% 39% 40% 14% Advertising Correct Brand Ad Entertainment Awareness Association TV (USA) Cinema Pre-Show Cinema Show time Sources: *TV Stats based on Nielsen Brand Effect (US) 2011-2015 (P13+); **Cinema Advertising Show Time Impact Study 2010-2013+2015 Strategic Marketing Counse
Slide 29: For Advertisers Nationwide
SCREENS THEATRES FOR ADVERTISERS NATIONWIDE NATIONWIDE (as at December 31, (as at December 31, 2016) 2016) © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 29
Slide 30: Advertising Experience
• Touch • Gesture • Image Capture • Content Manipulation AS AT DECEMBER 31, 2016 ADVERTISING EXPERIENCE • Social Media Connectivity • Data Capture © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 30
Slide 31: Bring Campaigns to Life
• 3 minute loop keeps content upbeat and timely • 84” fully HD digital backlits BRING CAMPAIGNS TO LIFE AS AT DECEMBER 31, 2016 • Roll-out now complete across circuit © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 31
Slide 32: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
© Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 32
Slide 33: Path to Purchase, Point of Purchase
Path to Purchase • Point of Purchase © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 33
Slide 34: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
• • • • © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 34
Slide 35: Path to Purchase
• Selected to install, maintain and operate • Expanded agreement to develop best-in- • Installed, maintain and operate digital digital display networks for nearly 175 class, in-mall digital ecosystem display network for nearly 230 digital digital displays in 21 Morguard-managed displays in 21 shoppi
Slide 36: Market-leading digital signage company
• Market-leading digital signage company • Designs, installs, manages and consults on some of the largest digital merchandising networks in • Largest digital networks in Canada North America • Proprietary technology © Cineplex Entertainment. Not to be distributed, reproduced or used without permissi
Slide 37: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
© Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 37
Slide 38: More than Tim Hortons locations across Canada
MORE THAN TIM HORTONS LOCATIONS ACROSS CANADA One of the largest digital signage networks in Canadian retail © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 38
Slide 39: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
© Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 39
Slide 40: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
© Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 40
Slide 41: Amusement Solutions, Location Based Entertainment, eSports
Amusement Solutions • Location Based Entertainment • eSports © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 41
Slide 42: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
• • • • • • • • © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 42
Slide 43: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
• • • • © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 43
Slide 44: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
• • • • © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 44
Slide 45: Collegiate StarLeague partnership with Riot Games
• • • Collegiate StarLeague (“CSL”), a subsidiary of WGN, announced a partnership with Riot Games to present the 2017 season of CSL’s League of Legends collegiate league, called ‘uLoL Campus Series’, which will see over 500 schools in North America competing to qualify for the regional and national
Slide 46: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
© Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 46
Slide 47: The Rec Room at South Edmonton Common
• The Rec Room at South Edmonton Common • 60,000 square feet • Incredible dining experiences with exciting live entertainment and amusement gaming experiences © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 47
Slide 48: Upcoming Rec Room locations
• Toronto Roundhouse (Q2, 2017) • West Edmonton Mall (Q3, 2017) • Deerfoot Crossing Calgary (Q4, 2017) • CF Masonville Place London (2018) • 10-15 locations • 40,000 – 60,000 sq. ft. © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 48
Slide 49: The first Rec Room location opened
The first location of The Rec Room at South Edmonton Common opened its doors on September 19, 2016. The Rec Room features a wide range of entertainment options: • A large attractions area with amusement games and interactive attractions alongside recreational activities like pool and ping pong • Mul
Slide 50: © Cineplex Entertainment. Not to be distributed, reproduced or used without permission.
© Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 50
Slide 51: Total revenue ($ millions)
$ MILLIONS $1,371 $1,235 $1,171 $1,092 $1,006 $998 $964 $850 $805 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 51
Slide 52: Adjusted EBITDA ($ millions)
$ MILLIONS $250 $200 $202 $201 $173 $168 $160 $137 $141 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 52
Slide 53: Box office revenue and attendance
$ MILLIONS $711 $665 $673 $638 $598 $581 $577 $511 77.0 $489 73.6 74.6 71.2 72.7 70.0 69.0 66.1 63.5 61.1 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Attendance (Millions) © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 53
Slide 54: Concession revenue and per patron
$ MILLIONS $418 $375 $350 $329 $5.65 $295 $292 $5.43 $288 $5.09 $252 $4.82 $235 $4.63 $4.41 $4.27 $4.12 $3.96 $3.84 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Concession Per Patron (CPP) © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 54
Slide 55: Media revenue
$ MILLIONS $154 $134 $110 $91 $84 $82 $67 $61 $56 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Media Revenue Digital Media Revenue © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 55
Slide 56: Amusement and other revenue
$ MILLIONS $88 $53 $46 $41 $38 $32 $26 $28 $25 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 *Includes consolidation of P1AG (formerly Cineplex Starburst Inc.) effective October 1, 2015 © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 56
Slide 57: Box Office Per Patron
$19.82 $16.77 $16.11 $15.11 $15.34 $14.59 $13.78 $13.17 $13.38 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Box Office Per Patron (BPP) Concessions Per Patron (CPP) Media Per Patron Other Per Patron © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 57
Slide 58: Financial results 2016 vs 2015
MILLIONS, EXCEPT ADJUSTED EBITDA MARGIN AND PER PATRON AMOUNTS 2016 2015 % $712.4 $711.1 0.2% $423.9 $418.4 1.3% $170.8 $153.6 11.2% $171.2 $87.7 95.1% $1,478.3 $1,370.9 7.8% $234.0 $249.8 -6.3% 15.8% 18.2% -2.4% 74.6 77.0 -3.2% $9.55 $9.23 3.5% $5.65 $5.43 4.1% *Includes consolidation of P1AG (form
Slide 59: Corporate Conversion Jan. 1, 2011
80% $1.54 $1.48 $1.41 69% 67% $1.33 65% 64% 64% $1.28 62% $1.24 $1.26 $1.26 59% $1.18 57% $1.15 56% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Corporate Conversion Jan. 1, 2011 © Cineplex Entertainment. Not to be distributed, reprodu
Slide 60: Credit facilities maturity and capacity
(MILLIONS) Maturity Capacity Drawn Reserved Remaining (as at December (as at December 31/16) 31/16) Term Facility Apr. 2021 $150 $150 — — Revolving Facility Apr. 2021 $400 $150 $6.3 $243.7 Total $550 $300 $6.3 $243.7 2.89 2.39 1.94 1.88 1.64 1.58 1.27 1.31 1.19 1.13 0.89 0.97 2005 2006 2007 2008 200
Slide 61: As of December 31, 2016
* As of December 31, 2016 $60 $50 $40 $30 $20 $10 $0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 © Cineplex Entertainment. Not to be distributed, reproduced or used without permission. 61
Slide 62: EBITDA and non-GAAP definitions
’ ’ EBITDA is calculated by adding back to net income, income tax expense, depreciation, amortization and interest expense net of interest income Adjusted EBITDA excludes change in fair value of financial instrument, gain on acquisition of the business, the loss on disposal of assets, the equity inc
Slide 63: Thank You!
Thank You!