Reading International Inc · NASDAQ:RDI
Reading International — Shareholder Meeting (May 2019)
57 slides from Reading International's shareholder meeting presentation, May 7, 2019
Slide 1: 2019 Annual Stockholders Meeting
2019 Annual Stockholders Meeting May 7, 2019 Reading International 1
Slide 2: Reading International Disclaimers
Reading International Disclaimers Our comments today may contain forward-looking statements and management may make additional forward-looking statements in response to your questions. Such written and oral disclosures are made pursuant to the Safe Harbor provision of the Private Securities Litigati
Slide 3: Financial Reconciliations
Financial Reconciliations We use EBITDA in the evaluation of our Company’s performance since we believe that EBITDA provides a useful measure of financial performance and value. We believe this principally for the following reasons: We believe that EBITDA is an accepted industry-wide comparative mea
Slide 4: Our Mission: Cinema & Real Estate
Our Mission Cinema & Real Estate THROUGH CURATION AND CUSTOMIZATION, OUR MISSION IS TO CREATE ENGAGING EXPERIENCES THAT ENRICH AND GROW OUR COMMUNITIES. 4
Slide 5: Cinema Portfolio
Cinema Portfolio 60 Theaters 484 screens in US, AU & NZ 4 Brands Reading Cinemas (US, AU & NZ) Consolidated Theatres (Hawaii) Angelika Film Centers (US) City Cinemas (NYC) Geographic Footprint United States: 27 theaters in 6 states & DC 10th largest US exhibitor Australia: 22 theaters in 6 states 4
Slide 6: Well Positioned to Create Long-Term Stockholder Value
WELL POSITIONS TO CREATE LONG-TERM STOCKHOLDER VALUE Complementary Cinema & Real Estate portfolios offer compelling strategic and financial benefits. Cinemas provide steady cash flow to support real estate development focused on driving long-term stockholder value. Continue to grow that cash flow by
Slide 7: Cinema & Real Estate Synergistic Diversification Underpins Our Strategy
CINEMA & REAL ESTATE SYNERGISTIC DIVERSIFICATION UNDERPINS OUR STRATEGY Global Property Revenues 8% Global Cinema Revenues 92% Two Synergistic Businesses United States Revenues 52% Australia Revues 37% New Zealand Revenues 11% Operating in Three Strong Economies Revenues Year 2018. The above chart i
Slide 8: Total Stockholder Return – RDI Class A
TOTAL STOCKHOLDER RETURN – RDI CLASS A TSR% Reading International Russell 2000 Nasdaq Capital Market Composite S&P 500 164% Growth 6/21/2012 12/31/2018 8
Slide 9: Core Values & Guiding Principles
Core Values & Guiding Principals Inspired By Our Founder ENTREPRENEURIAL approach to our business EDUCATED analysis underpins our strategies ENGAGING our guests is paramount to our success EXECUTION is a focus of our three-year strategy EXTENDED VIEW means pursuing a long-term value strategy EMPATHE
Slide 10: 2018 Record Operational Year Financial Highlights
2018 Record Operational Year Financial Highlights 11% Revenue Growth 16% Operating Income Growth 10
Slide 11: Executing on Global Cinema Strategy
Executing on Global Cinema Strategy Since 2016, Invested Substantially In Our Global Cinemas Built 2 New Cinemas Made Significant Investment in Existing Portfolio As of December 31, 2018, 39% of all US Screens feature Luxury Recliner Seating 21% of all AU/NZ Screens feature Luxury Recliner Seating 2
Slide 12: Executing on Global Real Estate Strategy
Executing on Global Real Estate Strategy Completed expansion of Newmarket Village in Brisbane in Q1 2018, which added 52,668 leaseable SF inclusive of a new 8 screen Reading Cinema and 10,355 SF of third party space Acquired the strategically located Telstra property that directly abuts Redyard in A
Slide 13: Global Cinema Division
GLOBAL CINEMA DIVISION 13
Slide 14: Foundation for Global Cinema Strategy
FOUNDATION FOR GLOBAL CINEMA STRATEGY SOLID THEATRICAL STUDIO SLATE BOX OFFICE STRENGTH 2018 – Another Record Box Office Year While Streaming Services continue to grow, 2018 Theatrical Box Office was nevertheless a record Major Studio slate started slow, but expected to be strong in Q2-Q4 2019 2020-
Slide 15: Specialty Film Continues to Support Angelika
Specialty Film Continues to Support Angelika Box Office Strong 2019 Slate US Cinemas – Angelika Brand Relies on Documentaries, Independent & Foreign Language Films Fox Searchlight survives Disney/Fox merger Sony Pictures Classics and Focus Features continu e to be supported by studio parent A24, Neo
Slide 16: Execution Drove Reading's 2018 Strong Industry Performance
The Execution Of Our Capital Investment And Operating Strategies Drove Reading’s 2018 Strong Industry Performance United States 25% 20% 15% 10% 5% 0% -5% -10% 2014 2015 2016 2017 2018 Market Reading Australia 25% 20% 15% 10% 5% 0% -5% -10% 2014 2015 2016 2017 2018 Market Reading New Zealand 25% 20%
Slide 17: Global Cinema Strategy
Reading Cinemas Consolidated Theaters Angelika Film Center & Café City Cinemas Global Cinema Strategy Re-invest in existing portfolio Pursue Company growth through new developments and financially sound acquisitions Improve Theater Level Cash Flow 17
Slide 18: Investing in Our Cinema Portfolio
Investing in Our Cinema Portfolio United States 2019 expected to be invested $13.50M 2020 & 2021 expected to be invested $61.95M Australia 2019 expected to be invested A$17.69M 2020 & 2021 expected to be invested A%46.00M New Zealand 2019 expected to be invested NZ$2.03M 2020 & 2021 expected to be i
Slide 19: Create Engaging Cinema Experiences
CREATE ENGAGING CINEMA EXPERIENCES Comfort and Design Offer luxury recliner seating Create uniquely designed venues Premium Technology Feature state-of-the-art presentation Crafted Food and Beverage Craft food & beverage options to match our markets Digital Marketing Digital marketing dries revenues
Slide 20: Recliner Seating Continues to Drive Attendance & Ticket Price
Recliner Seating Continues to Drive Attendance & Ticket Price PERCENTAGE OF US SCREENS WITH LUXURY RECLINERS TODAY 39% By end of 2019 42% By end of 2020 59% By end of 2021 81% Percentage of AU/NZ Screes with Luxury Reclines Today 21% By end of 2019 27% By end of 2020 32% By end of 2021 40% 20
Slide 21: Premium Presentation Continues to Drive Attendance & Ticket Price
PREMIUM PRESENTATION CONTINUES TO DRIVE ATTENDANCE & TICKET PRICE PERCENTAGE OF US CINEMAS WITH AT LEAST ONE PREMIUM SCREEN Today 27% By end of 2019 31% By end of 2020 42% By end of 2021 46% PERCENTAGE OF AU/NZ CINEMAS WITH AT LEAST ONE PREMIUM SCREEN Today 41% By end of 2019 55% By end of 2020 64%
Slide 22: Crafted Food and Beverage Improves Cash Flow
CRAFTED FOOD AND BEVERAGE IMPROVES CASH FLOW Expand Sale and Service of Beer, Wine And/ Or Spirits US Cinemas Today, 12 cinemas serve liquor (or 46% of all US Cinemas) By end of 2021, target to add 10 more cinemas to serve liquor AU/NZ Cinemas Today, 16 cinemas serve liquor (or 53% of all AU/NZ Cine
Slide 23: US Cinemas Per Cap Continue Improving
US Cinemas Per Cap Continue Improving US Cinema SF&BPERCAPITA 2008 $3.16 2009 $3.28 2010$3.31 2011 $3.38 2012 $3.55 2013 $3.69 2014 $3.78 2015 $4.08 2016 $4.49 2017 $4.78 2018 $4.99 2018 Laser focus on Food Quality & Consistency lead to the Angelika Film Center Carmel Mountain hamburger being voted
Slide 24: Dine-In Services Drives Revenue
DINE-IN SERVICES DRIVES REVENUE US CINEMAS Today, only one US Cinema features SPOTLIGHT service (waiters serve elevated food & liquor in intimately sized auditoriums) Throughout 2019-2021, evaluate other US cinemas/new builds for SPOTLIGHT opportunities AU/NZ CINEMAS Today, 9 cinemas (or 30% of all
Slide 25: Innovative Pricing Continues to Drive Attendance
INNOVATIVE PRICING CONTINUES TO DRIVE ATTENDANCE In AU/NZ, a compelling value-based ticket pricing structure, with a simple, clear marketing plan, continues to be the foundation for circuit distinction and strength Continue monitoring cinema competition for Value Pricing matching Value Price is spec
Slide 26: Digital Marketing Drives Increased Revenues
DIGITAL MARKETING DRIVES INCREASED REVENUES Online Convenience Fee Revenue F&B Revenue Other Revenue Organic Audience Growth 26
Slide 27: Online Ticket Sales Improves Total Cinema Revenues
ONLINE TICKET SALES IMPROVES TOTAL CINEMA REVENUES 2018 – Increased Global Net Convenience Fee Revenue by 48% TO $4.45M Implement Reserved Seating in all US Cinemas by the end of 2019 and in AU/NZ in 2020 In 2018, improved functionality of US Cinemas App Launch Reading Cinemas App (IOS & Andriod) in
Slide 28: Digital Marketing Drives Other Revenues
DIGITAL MARKETING DRIVES OTHER REVEUES Online Gift Card Sales (Email & Mail) Launch AU/NZ E-Cards in 2019 Launch some form of F&B online sales by Q1 2020 Ensure that entire F&B menu available for online purchase by 2021 With global cinema attendance over 21M and an expanding global digital infrastru
Slide 29: Curate Film & Event Programming Tailored to Our Audiences
CURATE FILM & EVENT PROGRAMMING TAILORED TO OUR AUDIENCES Continue to generate incremental revenues through the curation of signature programming Alternative Content emphasis Japanese anime, foreign language films, music movies, cultural events Exclusively programmed repertory series, coupled with e
Slide 30: Disciplined Approach to New Opportunities – Australia
CONTINUED DISCIPLINED APPROACH TO PURSUING NEW OPPORTUNITIES – AUSTRALIA FOUR NEW READING CINEMAS ARE UNDER CONTRACT IN AUSTRALIA Burwood Brickworks developed by Frasers – Expected to open late 2019 Our first AU cinema with recliners in all 6 screens Melbourne’s first premium TITAN LUXE with DOLBY A
Slide 31: Global Real Estate Division
GLOBAL REAL ESTATE DIVISION 31
Slide 32: US Live Theatres
US LIVE THEATRES Three Leading Off Broadway Theatres In US Orpheum Theatre – New York City – one stage with 347 seats Minetta Lane Theatre – New York City - one stage with 399 seats Royal George Theatre – Chicago – four stages ranging from 60 to 450 seats, plus ancillary retail, office space and par
Slide 33: Minetta Lane Theatre New York City
MINETTA LANE THEATRE NEW YORK CITY Recently, extended license agreement with Audible, an Amazon company, the leading provider of Audiobooks. The new term will provide a home for Audible and steady cash flow for our Company through March 2021 Audible will continue to produce one and two voice plays b
Slide 34: Global Real Estate Strategy
GLOBAL REAL ESTATE STRATEGY Unlock embedded value in our existing real estate portfolio Reposition and incrementally build and develop a strong, diversified real estate portfolio Focus on curation, community and customization in each of our real estate and cinema businesses to create more value for
Slide 35: US Real Estate by the Numbers
US REAL ESTATE BY THE NUMBERS 73,106 SF of net leasable area (inclusive of anticipated BOMA adjustments) comprised of retail & office – 44 Union Square 75% interest in a 21,000 SF NYC cinema building and development potential of 80,000 SF, plus potential for additional 16,000 SF of air rights – Cine
Slide 36: Union Square Construction Nears Completion
44 UNION SQUARE CONSTRUCTION OF THIS ICONIC NYC PROPERTY NEARS COMPLETION 2019 Complete Base Building ConstructionQ2 2019 – Assuming lease is signed, we can begin turning over space to Tenant for their fitout Q2 2019 – Substantial completion of Glass Dome Steel gridframe substantially completed May
Slide 37: Union Square Leasing Underway
44 UNION SQUARE LEASING OF THIS ICONIC NYC PROPERTY UNDERWAY 2019 cont’d Approx. 90% of net leasable area Executed Letter of Intent with credit tenant Currently in lease negotiation Remaining 7,200 SF on ground floor will be retail 2020-2021 Expected completion of “rent concession” period Replace co
Slide 38: Cinemas 123 "Go It Alone" Strategy
CINEMAS 123 “GO IT ALONE” STRATEGY – 2021 IRREPLACEBLA PROPERTY ACROSS FROM BLOOMINGDALES IN NYC Complete evaluation of major foundational issues Subway Excavation and ability to create below grade floors Pursue and potentially buy inclusionary air rights to maximize development potential With inclu
Slide 39: Reading Viaduct & Adjacent Properties, Philadelphia
READING VIADUCT & ADJACENT PROPERTIES PHILADELPHIA, PA Our Reading Viaduct is 3,200 feet in length and at least 70 feet wide. We also own several small parcels (which all have air rights) adjacent to the Viaduct June 2018 - Center City District completed Phase One of the Philadelphia's new elevated
Slide 40: Coachella and California Properties
COACHELLA 50% MANAGING MEMBER INTEREST IN 202 ACRES OF UNDEVELOPED LAND Located immediately south of Interstate 10 and east of Highway 86 in Coachella Valley Current zoning for 50 acres of high density mixed-use and 150 acres of single family residences As we maintain the 202 acres, we monitor the m
Slide 41: AU/NZ Real Estate by the Numbers
AU/NZ REAL ESTATE BY THE NUMBERS 06 Multi-tenanted properties AU/NZ (358,858 SF) 97 Existing third party tenants (331,076 SF) 12 Current vacant third party tenant spaces (29,612 SF) 49 Third party leases, 127,326 SF, coming due in 2019-2021 211,511 SF of vacant land to develop on/adjacent to existin
Slide 42: Building Long-Term Stockholder Value Through Curation and Customization
THROUGH CURATION, COMMUNITY CONNECTION, CUSTOMIZATION AND COMPREHENSIVE PLANNING, WE WILL BUILD LONG-TERM STOCKHOLDER VALUE BY MAXIMIZING THE EMBEDDED VALUE IN OUR EXISTING PORTFOLIO LONG TERM VALUE FOR STOCKHOLERS PORTFOLIO Curate complementary tenant mix resonating with the local community Reposit
Slide 43: Newmarket Village
newmarket village CONTINUE TO IMRPOVE NEWMARKET VILLAGE (NMV) 2017-Q1 2019 Increased NMV capital value by: Created new entertainment precinct - 8 screen state-of-the-art Reading Cinemas with TITAN LUXE and 10,172 SF F&B precinct Expanded NMV’s net leasable area by 57% (including Reading Cinema) Toda
Slide 44: Auburn Redyard 2017-2018
Auburn Redyard 2017-2018 Since 2017, added six new incremental tenancies and upgraded the center Including Telstra property, an incremental 31,549 SF of net leaseable area added since Jan. 2017. 53% incremental increase in third-party net leasable area Acquired building occupied by ASX listed Telstr
Slide 45: Auburn Redyard 2020-2021 Future Value Opportunities
Auburn Redyard 2020-2021 Future Value Opportunities Complete Redyard Master Plan, taking into account the opportunity and potential Eastern Pad (129,167 SF), Western Pad (21,528 SF) and integration of the Telstra building 45
Slide 46: Cannon Park
CANNON PARK Refining Plans for Cannon Park 2018-Q1 2019 Value engineered Master Plan scope to reduce costs and enhance efficiency Expand Reading Cinemas - add new TITAN LUXE with DOLBY ATMOS, convert existing TITAN XC auditorium to PREMIUM with recliners, and expand lobby to add lounge area to serve
Slide 47: Courtenay Central: Wellington Is a Thriving Capital City
Courtenay Central Wellington Is A Thriving Capital City & New Zealand’s Ultimate Creative Urban Destination Wellington City Council’s Convention & Exhibition Centre being built across the street from Courtenay NZ$179M project Consent Application filed ~300,000 visitors expected annually No parking p
Slide 48: Courtenay Central Is Our Main Focus Today
Courtenay Central Courtenay Central is our Main Focus Today In January 2019, a decision was made to close most of the building due to seismic concerns Our Company is now laser focused on re- inventing the Courtenay Central space Our development principles Seismic Safety Value Engineering Creativity,
Slide 49: Courtenay Central: Breathe New Life Into Legacy Space
Courtenay Central Breathe New Life Into Our Legacy Courtenay Space We’ll re-imagine this space as a dynamic community hub housing the Courtenay Food Hall, other shops and a best-in-class Reading Cinemas. Reading Cinemas – “Top-to-Bottom” Renovation Convert all auditoriums to recliner seating Create
Slide 50: Manukau/Wiri New Zealand
MANUKAU/WIRI NEW ZEALAND 70.4 ACRES OF UNDEVELOPED LAND IN ONE OF NZ’S STRONGESTED INDUSTRIAL MARKETS 2018 November 2018 - Southern Gateway Consortium (“SGC”) lodged Resource Consent application to complete Stage 1 key infrastructure works required by Auckland City Council before development 2019 Co
Slide 51: Financial Review
Financial Revenue Presented by Gilbert Avanes Interim Chief Financial Officer & Treasurer 51
Slide 52: Summary Financial Data
SUMMARY FINANCIAL DATA Statement of Operations ($ in thousands, except per share data) Year ended December 31, 2018 2017 Revenues $309,385 $279,879 Operating Income 24,078 20,706 Interest Expense, net 6,837 6,194 Income Taxes 3,420 3,380 Net Income Attributable to Common Shareholders 14,366 31,101 B
Slide 53: Summary Balance Sheet
SUMMARY BALANCE SHEET ($ in thousands) 12/31/2018 12/31/2017 12/31/2016 Cash and Cash Equivalents $13,127 $13,338 $19,017 Receivables 8,045 13,050 8,772 Other Current Assets 9,086 6,757 44,852 Total Current Assets 30,258 33,475 72,641 Operating Property, Net 257,667 264,724 211,886 Investment and De
Slide 54: Reading International Debt
READING INTERNATIONAL DEBT DEBT SUMMARY ($ in thousands) Corporate and/or Property Debt Expiration Year Contractual Capacity Capacity Used Unused Capacity As of December 31, 2018 Trust Preferred Securities C 2027 $27,913 $27,913 $ - U.S Corporate Office P 2027 9,495 9,495 – Union Square Construction
Slide 55: 2001-2018 Yearly Financial Trend
2001-2018 Yearly Financial Trend in US$ Revenue & Adj. EBITA (000’s) $(50,000) $ $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 2015 to 2018 Growth Revenue $51.5M or 20% Assets $66.8M or 18% Debt (Adj for Union Square) $8.9M or 9% Adj EBITDA $10.5M or 26% Assets & Debt (000’s) $ $50,0
Slide 56: Status of Reading International as an Independent Company
STATUS OF READING INTERNATIONAL, INC. AS AN INDEPENDENT COMPAY In March, the Board reviewed and approved our three-year strategy and resolved that it has no current intention to engage in a sales process. The Board believes that Reading’s prospects for creating long term value offer the best course
Slide 57: Thank You
Reading International Thank You
Reading International — Shareholder Meeting (May 2019) on 6ix