Imax China Holding Inc · HKEX:1970

Imax China — Investor Presentation (November 2020)

27 slides from Imax China's investor presentation, November 2020

  1. Slide 1: IMAX China (1970 HK) Investor Presentation

    IMAX China (1970 HK) Investor Presentation Nov 2020 ® IMAX 1 Corp.

  2. Slide 2: Disclaimer

    Disclaimer This document is not intended to form or provide any basis of any decision in connection with IMAX China Holding, Inc. (the "Company") or any other entity in which it directly or indirectly holds any interest (together with the Company, hereinafter referred to as the "Group"). It does not

  3. Slide 3: Ecosystem, Business Model, Investment Thesis, Financials

    • Ecosystem • Business Model • Investment Thesis • Financials Investor Presentation IMAX® is a registered trademark of IMAX Corporation. 3

  4. Slide 4: Unique Position in the Greater China Entertainment Ecosystem

    Unique Position in the Greater China Entertainment Ecosystem Upstream Downstream ECOSYSTEM Filmmakers Studios Exhibitors Audience The IMAX IMAX IMAX Digital IMAX Theatre Media Experience TECHNOLOGY Camera Systems Technology Remastering Technology (DMR) “Films to the Fullest” Content Content Content

  5. Slide 5: Chinese Film Market Sees Room for Growth From Both Demand and Supply Perspective

    Chinese Film Market Sees Room for Growth From Both Demand and Supply Perspective Movie admission per capita No. of cinema screen per 100,000 population 80 14.0 2,000 5.00 70 70 12.3 12.0 1,800 1,716 1,727 4.50 1,620 60 60 1,600 4.00 10.0 3.78 51 1,360 1,340 1,374 1,400 1,270 1,320 1,314 1,304 3.50 5

  6. Slide 6: Business Model

    • Ecosystem • Business Model • Investment Thesis • Financials Investor Presentation IMAX® is a registered trademark of IMAX Corporation. 6

  7. Slide 7: Our Business Model - Diversifying Monetization

    Our Business Model - Diversifying Monetization IMAX China business models Network business • Film revenue (from studios) Box office-based • Revenue sharing fee (from JV + revenue Hybrid exhibitors) Theatre business • Maintenance revenue (from all Network-based exhibitors) revenue • Others including

  8. Slide 8: Our Network Effect Drives Higher Recurring Revenue Mix

    Our Network Effect Drives Higher Recurring Revenue Mix Increasing mix of recurring revenue Installation-based Network-based Box office-based 41.7% 39.2% 48.3% 49.8% 17.7% 18.2% 11.0% 13.3% 61% 40.6% 40.6% 42.6% 36.9% FY2016 FY2017 FY2018 FY2019 Note: Recurring revenue refers to box office and networ

  9. Slide 9: Investment Thesis

    • Ecosystem • Business Model • Investment Thesis • Financials Investor Presentation IMAX® is a registered trademark of IMAX Corporation. 9

  10. Slide 10: Why IMAX China is Well-Positioned as Theatres Reopen?

    Why IMAX China is Well-Positioned as Theatres Reopen? Poised for recovery Benefit from Structural Tailwinds Financial Strength ❑ Trusted brand to both audience and ❑ “Blockbusterization” effect ❑ Strong, debt-free balance sheet with net exhibitors cash balance of US$75mn as of Sept 30, ❑ Local conte

  11. Slide 11: China's Movie Industry, Particularly IMAX China Network, is Returning to Normalcy

    China’s Movie Industry, Particularly IMAX China Network, is Returning to Normalcy Despite Capacity Constraints (1) Attendance as % of normalized 2H 2019 level Gross box office as % of normalized 2H 2019 level 100% 94% 93% 90% 105% 95% 93% 80% 85% 70% 65% 64% 68% 67% 60% 65% 50% 40% 45% 30% 20% 25% 1

  12. Slide 12: IMAX China Sets Another National Holiday Record as Blockbusterization Continues

    IMAX China Sets Another National Holiday Record as Blockbusterization Continues to Play Out 2014-2020 IMAX China National Day Holiday Box Office & Market Share IMAX China box office market share 4.5% 4.0% 3.9% 4.0% 3.7% 3.5% 3.5% 3.0% 2.5% 2.0% 1.5% 1% 1% 1% 1% 1.0% 0.5% 0.0% 2017 2018 2019 2020 sin

  13. Slide 13: Strong Film Slate and Promising Pipeline of Potential Local Language Titles

    Strong Film Slate and Promising Pipeline of Potential Local Language Titles ‘The Eight Hundred’ (Aug 2020) ‘The Leap’ (Sept 2020) ‘Legend of Deification’ (Oct 2020) ‘My People My Homeland’ (Oct 2020) ‘The Sacrifice’ (Oct 2020) • First local title filmed with IMAX Cameras • Industry box office1: RMB8

  14. Slide 14: Blockbuster 2021 Around the Corner

    Blockbuster 2021 Around the Corner Bond: No BLACK FAST & GODZILLA VENOM WIDOW Let There Be Time to Die FURIOUS 9 VS. KONG Carnage SHANG-CHI Top Gun: and the MISSION THE Maverick Legend of DUNE IMPOSSIBLE: the Ten ETERNALS 7 Rings Blockbuster slate extends through 2021 Note: Titles have been confirme

  15. Slide 15: Industry Consolidation an Opportunity, Not a Risk

    Industry Consolidation an Opportunity, Not a Risk Theatre penetration in top 500 complexes in China Gross box office share in top 500 complexes in China 80% 16% 70% 68% 14% 14% 62% 14% 13% 60% 59% 12% 53% 12% 11% 50% 49% 10% 40% 8% 30% 6% 20% 20% 14% 4% 13% 3% 10% 10% 11% 10% 8% 8% 9% 2% 2% 2% 2% 6%

  16. Slide 16: Continued Network and Partnership Expansion

    Continued Network and Partnership Expansion IMAX theatre footprint Greater China backlog mix2 Backlog Full revenue sharing Hybrid revenue sharing Sales arrangement IMAX zones: 1,414 1 258 258 365 105 256 As of Sept 30, 2020 Note 1: As of Dec 31, 2019 Note 2: As of Sept 30, 2020 Source: Company Data

  17. Slide 17: Favorable Structural Tailwind…

    Favorable Structural Tailwind… Total box office of top-10 grossing movies Local content gravitating towards IMAX genres 35,000 50% 45% (in RMB millions) 45% 30,000 40% 40% 36% 25,000 35% 35% 31% 31% 31% 30% 20,000 25% 15,000 Ne Zha (July 2019) 28,605 20% The Wandering Earth (Feb 2019) 24,845 Highest

  18. Slide 18: …and Our Refined Programming Strategy

    …and Our Refined Programming Strategy “The Wandering Earth” – Feb 2019 • Milestone Chinese sci-fi movie with RMB4.66 billion GBO • First local title to break RMB300 million IMAX GBO in China – third highest-grossing movie in IMAX China history • Close to 10% indexing during Chinese New Year “The Wan

  19. Slide 19: Drives a consistently High Hit-Rate…

    Drives a consistently High Hit-Rate… Top 10 films, 2019 IMAX = 9 out of 10 Top 10 films, 2018 IMAX = 9 out of 10 Top 10 films, 2017 IMAX = 8 out of 10 Source: Company data Investor Presentation 19

  20. Slide 20: Rising Box Office Contribution From Local Language Titles

    Rising Box Office Contribution From Local Language Titles IMAX China box office distribution (Hollywood vs. Local) China box office distribution (Hollywood vs. Local) Hollywood box office Hollywood box office Local language box office Local language box office 40.0% 36.0% 42.0% 46.4% 70.0% 68.6% 77.

  21. Slide 21: …And Sustainable Market Share Gain

    …And Sustainable Market Share Gain IMAX China Screen Count Share IMAX China Box Office Market Share IMAX China Average Box Office Per Title* (in US$mn) 1% IMAX China screen penetration IMAX China Screen Count Share IMAX China IMAXBox Office China ShareCount Share Screen IMAX GBO IMAX % of Complex GB

  22. Slide 22: Financials

    • Ecosystem • Business Model • Investment Thesis • Financials Investor Presentation IMAX® is a registered trademark of IMAX Corporation. 22 22

  23. Slide 23: Strong Financial Position with Ample Liquidity and Balance Sheet Flexibility

    Strong Financial Position with Ample Liquidity and Balance Sheet Flexibility Strong fundamentals Cost control actions Financial Strength ❑ Healthy, debt-free balance sheet ❑ Three-day or four-day work week for ❑ US$75 million in cash as of Sept 30, majority of company during theatre 2020 ❑ No exposu

  24. Slide 24: Key Highlights (1H20 vs. 1H19)

    Key Highlights (1H20 vs. 1H19) Key Financial Highlights 1H2020 1H2019 YoY change % (in USD 000, unless otherwise stated) Greater China Box Office1 7,393 235,959 (96.9%) Theatre Network (in unit) 714 662 7.9% Total Revenue 6,662 59,256 (88.8%) - Network Business 1,120 33,730 (96.7%) Take-rate2 15.1%

  25. Slide 25: Key Highlights (FY19 vs. FY18)

    Key Highlights (FY19 vs. FY18) Key Financial Highlights FY2019 FY2018 YoY change % (in USD 000, unless otherwise stated) Greater China Box Office1 365,807 336,633 8.7% Mainland China Box Office1 (in RMB million) 2,367 2,070 14.4% Theatre Network (in unit) 717 639 12.2% Total Revenue 124,294 117,520

  26. Slide 26: Long-term Shareholder Value Creation

    Long-term Shareholder Value Creation Capital returned to shareholders Capital expenditure (in USD mn) (in USD mn) 33% 33% 30.0 21% 22% 20% 19% 33.3 25.0 17% 27.6 15% 14.1 20.0 12% 15.0 21.5 26.6 24.2 24.1 7% 10.0 19.1 19.2 2% 5.0 6.1 - -3% FY2018 FY2019 FY2016 FY2017 FY2018 FY2019 Adjusted earnings

  27. Slide 27: Investor Presentation

    Investor Presentation IMAX® is a registered trademark of IMAX Corporation. 27

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