Cineplex Entertainment Circuit

Transcription

1 Welcome to the Cineplex Galaxy Income Fund 2006 Annual General Meeting 1

2 2 Welcome

3 Cineplex Entertainment Circuit Cineplex Odeon Theatres: 51 Screens: 491 Famous Players Theatres: 54 Screens: 573 Galaxy Cinemas Theatres: 24 Screens: 205 3

4 Famous Players Acquisition - Rationale The leading film exhibitor in Canada Accretive to distributable cash Complementary operations will lead to cost savings Opportunities to increase distributable cash through revenue growth Increase advertising market share and other income Addition of high quality theatres in metropolitan markets Superior combined management 4

5 Box Office Market Share Market Share of Canadian Box Office Revenues Cineplex Galaxy Combined After Divestiture Cineplex Galaxy 32.1% Other 6.9% 69% AMC 6.3% Empire 6.0% Landmark 3.1% Cineplex Entertainment Empire 13.6% 64.2% Empire 13.6% Other 9.8% AMC 6.3% Landmark 3.1% Guzzo 3.0% Guzzo 3.0% Famous Players 42.6% Source: A.C. Nielsen EDI data 5

6 Six Top-Tier Brands SilverCity Colossus Coliseum 22 theatres 3 theatres 4 theatres Famous Players Cineplex Odeon Galaxy 25 theatres 51 theatres 24 theatres 6

7 Industry overview 7

8 Consistent Long-Term Box Office Revenue Growth Canadian Box Office Revenue $1,000 $750 CAGR since 1965: 5.6% $500 $250 $ Canadian Recessionary Periods 8

9 Industry Box Office 2005 Q Canadian Industry* -8.6% 86% +2.0% Cineplex Entertainment -6.1% +2.3% (same store) * Source: Motion Picture Theatre Associations of Canada 9

10 Highest Grossing Films in 2005 Star Wars: Episode III Harry Potter and Goblet of Fire War of the Worlds Wedding Crashers Charlie and the Chocolate Factory $380 M $244 M $234 M $209 M $206 M 10

11 Upcoming Films for 2006 Mission Impossible May 2006 Poseidon May 2006 The Da Vinci Code May 2006 Over the Hedge May 2006 X-Men May

12 Upcoming Films for 2006 Cars June 2006 Click June 2006 Superman Returns June 2006 Pirates of the Caribbean 2 July

13 Upcoming Films for 2006 Casino Royale November 2006 The Santa Clause 3 November 2006 Happy Feet November 2006 Charlottes Web December

14 Company overview 14

15 Key Accomplishment Repatriation of IT Function from Loews (New York) Vista POS Digital Pre-Show Network Famous Players Acquisition New credit facility Equity offering RioCan REIT transaction Divestiture completion to Empire and Fortune 15

16 Key Accomplishment Aurora Barrhaven 16

17 Increasing Revenue per Guest Revenue per Guest $9.83 $0.54 $2.64 $10.27 $0.53 $2.77 $10.84 $0.67 $11.23 $0.74 $2.89 $3.04 $12.28 $12.33 $1.11 $0.80 $3.44 $3.72 $6.65 $6.97 $7.28 $7.45 $7.73 $ Q Box Office Concessions Other 17

18 Significant Other Revenue Contribution Other Revenues ($ millions) $62.5 $44.3 $13.4 $17.4 $20.9 $ Pro Forma LTM Mar excludes divestitures and includes FP for partial year Pro forma excludes divestitures 18

19 Synergies Three Core Synergies: 1. Reducing overhead costs and adopting best practices Consolidating two head offices Staff reductions Adopting best practices Enhanced revenues Operating savings 2. Media sales efficiencies and effectiveness Creation of Cineplex Media 3. Improved purchasing and merchandising opportunities Supplier contracts Merchandising strategies Concession management 19

20 Acquisition Synergies Annualized Synergies: ($ millions) Prospectus Q1 Current General and Administrative $15 $15 $15 Media Operations Total $20 $25 $30 20

21 Looking Into the Future Leverage Over 60 Million Guests Magazine In-Theatre Interactive Media-Web Loyalty Naming Rights 21

22 22 Marketing

23 Marketing Commercial 23

24 Growth 1. Other income initiatives Digital pre-show network Cineplex Media Alternative programming 2. Merchandising 3. Theatre openings 24

25 Cineplex Media Magazine publishing: Famous Magazine, Famous Kids, Famous Quebec In-theatre advertising: Magazine, onscreen, posters, monitors, buildings, naming rights 25

26 Cineplex Media Revenue by Component Digital Pre-Show 29% Magazine 12% Lobby / Monitors 5% Full Motion 47% Commissions 4% Website and Other 3% 26

27 Digital Pre-Show Network Rollout Plan Phase 1: April 1 Launch Toronto Extended Market Area - 21 Locations; 215 Screens Phase 2: Complete Nationwide - Additional 800+ Screens TOTAL 89 theatres & 1020 screens 27

28 28 Alternative Programming

29 Merchandising Concession Per Patron $3.04 $0.20 $3.44 $0.39 $3.72 $0.56 $2.86 $3.05 $ Q Core RBO 29

30 30 The Best Partners

31 Deal Overview 5-Year Term Effective, April 28, 2006 Significant financial impact Concession rebates Media revenue Other revenue Focus on marketing and innovation to increase purchase incidence 31

32 32 Marketing and Innovation

33 33 Milton, ON - June 2006

34 34 Brossard, QC - June 2006

35 35 Saskatoon, SK - July 2006

36 36 Brockville, ON - July 2006

37 37 North Oshawa, ON - November 2006

38 38 Collingwood, ON - December 2006

39 New Theatres for 2006/07 Brand Location Screens Opening Galaxy Milton 8 June Cineplex Odeon Brossard 16 June Galaxy Saskatoon 12 July Galaxy Brockville 6 July Cineplex Odeon Oshawa 10 November Galaxy Collingwood 7 December SilverCity Burloak Theatres 71 Screens 39

40 Financial highlights 40

41 Annual Total Revenue ($ millions) 1,275 1, $ $ $316.4 $330.0 $353.7 $490.3 $ Pro Forma LTM March 2005 Screen Count 2005 excludes divestitures and includes FP for partial year 41

42 Annual Attendance (millions) Pro Forma LTM March excludes divestitures and includes FP for partial year 42

43 Annual EBITDA ($ millions) $140.0 $120.0 EBITDA Margin 19.4% 20.4% 21.1% $101.4 $128.4 $ $ % 2% 16.7% $63.0 $68.5 $74.5 $ % 15.8% 13.7% 15.0% $60.0 $41.7 $40.0 $24.1 $20.0 $ % Pro forma LTM March 2005 Adjusted EBITDA Margins LTM March 2005: without synergies CGX 20.2% FP 9.0% Pro forma LTM March 2005 with synergies 2005 EBITDA excludes divestitures and non-recurring/transaction related items and includes FP for partial year 43

44 Total Revenue Q ($ millions) +3.2% 32% $157.6 $162.7 $70.0 Q Q Pro Forma Q

45 Q Attendance (millions) +0.9% Q Q Pro Forma Q

46 Q Adjusted EBITDA ($ millions) +282% $18.3 $10.8 $6.5 Q Q Pro Forma Q Margin 15.4% 4.1% 11.2% 46

47 Credit Facilities Development facility Available - $60 million Working capital facility Available - $50 million Term facility Drawn - $235 million 47

48 Unit Holder Return Unit price at 2004 AGM $13.82 Unit price May 8, 2006 $16.50 Unit price appreciation $2.68 Distributions paid $ Total Return 31.3% 48

49 Analyst Coverage Company Analyst Stock Rating BMO Nesbitt Burns Jeff Tkachuk Perform CIBC World Markets Petro Panarites Outperform Merrill Lynch Joel Sutherland Buy National Bank Financial Adam Shine Outperform Raymond James Andy Nasr Outperform RBC Capital Markets Walter Spracklin Outperform Scotia Capital Chris Blake Outperform TD Newcrest Adina Bloom Hold Wellington West Capital Markets Robert Winslow Buy Westwind Capital Partners Ben Mogil Buy 49

50 50 Questions