2005 Annual General Meeting 2005 Annual General Meeting 1 - - PowerPoint PPT Presentation

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2005 Annual General Meeting 2005 Annual General Meeting 1 Highlights and Achievements Highlights and Achievements Two Cinema Brands, One Company: Two Cinema Brands, One Company: Outstanding Results Outstanding Results Mission Statement

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2005 Annual General Meeting 2005 Annual General Meeting

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Highlights and Achievements Highlights and Achievements Two Cinema Brands, One Company: Two Cinema Brands, One Company: Outstanding Results Outstanding Results

Mission Statement Mission Statement

Passionately Delivering an Exceptional Entertainment Experience Passionately Delivering an Exceptional Entertainment Experience p

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Top Tier Theatre Exhibition Brands Top Tier Theatre Exhibition Brands

Locations: 63 Screens: 589 Locations: 20 Screens: 167

2003:

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Top Tier Theatre Exhibition Brands Top Tier Theatre Exhibition Brands

Locations: 64 Screens: 592 Locations: 22 Screens: 183

2004:

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Consistent Long-Term Box Office Revenue Growth Consistent Long-Term Box Office Revenue Growth

C di B Offi R C di B Offi R Canadian Box Office Revenues

1965 - 2004

Canadian Box Office Revenues

1965 - 2004

$ Millions $ Millions $750 $1,000

CAGR since 1965: 6.3% CAGR since 1965: 6.3%

$500 $750 $250 $0 1965 1970 1975 1980 1985 1990 1995 2000 6

Canadian Recessionary Periods Canadian Recessionary Periods

SLIDE 7

Highest Grossing Films in 2004 Highest Grossing Films in 2004

Spiderman 2 $373 million Spiderman 2 $373 million Shrek 2 $436+ million Shrek 2 $436+ million Passion of the Christ $370 million Passion of the Christ $370 million

Meet the Fockers $278 million Meet the Fockers $278 million The Incredibles $261 million The Incredibles $261 million Harry Potter $250 million Harry Potter $250 million

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Big Films for 2005 Big Films for 2005

Star Wars Episode III May 2005 Star Wars Episode III May 2005 Madagascar May 2005 Madagascar May 2005

Mr. And Mrs. Smith

June 2005

Mr. And Mrs. Smith

June 2005 Batman Begins June 2005 Batman Begins June 2005 Cinderella Man June 2005 Cinderella Man June 2005 War of the Worlds July 2005 War of the Worlds July 2005

The Wedding Crashers July 2005 The Wedding Crashers July 2005 Charlie and the Chocolate Factory July 2005 Charlie and the Chocolate Factory July 2005 Dukes of Hazzard August 2005 Dukes of Hazzard August 2005 Harry Potter and the Goblet of Fire November 2005 Harry Potter and the Goblet of Fire November 2005 The Lion, the Witch and the Wardrobe December 2005 The Lion, the Witch and the Wardrobe December 2005 King Kong December 2005 King Kong December 2005

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Strong Market Share Strong Market Share

M k Sh f C di B Offi R M k Sh f C di B Offi R Market Share of Canadian Box Office Revenues Market Share of Canadian Box Office Revenues 2003 2003 2004 2004

Other: 7 4% Other: 7 4%

Cineplex Galaxy: 30.1% Cineplex Galaxy: 30.1%

Other: 7 6% Other: 7 6%

Cineplex Galaxy: 31.3% Cineplex Galaxy: 31.3%

Other: 7.4% Other: 7.4% Guzzo: 3.3% Guzzo: 3.3% Landmark: 2.9% Landmark: 2.9% Empire: 4.6% Empire: 4.6% Other: 7.6% Other: 7.6% Guzzo: 3.3% Guzzo: 3.3% Landmark: 2.9% Landmark: 2.9% Empire: 5.7% Empire: 5.7%

y

AMC: 6.3% AMC: 6.3% AMC: 6.5% AMC: 6.5% Famous Players: 45.4% Famous Players: 45.4% Famous Players: 42.7% Famous Players: 42.7%

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Source: A.C. Neilsen EDI data Source: A.C. Neilsen EDI data

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Diverse Supply of Films - 2003 Diverse Supply of Films - 2003

Ci l G l Fil S l b Di ib Ci l G l Fil S l b Di ib Cineplex Galaxy Film Supply by Distributor Full Year 2003 Cineplex Galaxy Film Supply by Distributor Full Year 2003

Alliance Atlantis: 20% Alliance Atlantis: 20% Paramount: 6% Paramount: 6% DreamWorks: 3% DreamWorks: 3% MGM/UA: 3% MGM/UA: 3% Other: 9% Other: 9% Twentieth Century Fox: 9% Twentieth Century Fox: 9% Paramount: 6% Paramount: 6% y Sony: 15% Sony: 15% Warner Bros : 11% Warner Bros : 11% Universal: 13% Universal: 13% Warner Bros.: 11% Warner Bros.: 11% Buena Vista (Disney): 11% Buena Vista (Disney): 11%

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Universal: 13% Universal: 13% Buena Vista (Disney): 11% Buena Vista (Disney): 11%

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Diverse Supply of Films - 2004 Diverse Supply of Films - 2004

Ci l G l Fil S l b Di ib Ci l G l Fil S l b Di ib Cineplex Galaxy Film Supply by Distributor Full Year 2004 Cineplex Galaxy Film Supply by Distributor Full Year 2004

Alliance Atlantis: 14% Alliance Atlantis: 14% DreamWorks: 10% DreamWorks: 10% MGM/UA: 2% MGM/UA: 2% Other: 9% Other: 9% Paramount: 7% Paramount: 7% Sony: 14% Sony: 14% Twentieth Century Fox: 9% Twentieth Century Fox: 9% Sony: 14% Sony: 14% Universal: 10% Universal: 10% Warner Bros.: 15% Warner Bros.: 15%

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Buena Vista (Disney): 10% Buena Vista (Disney): 10%

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Revenue Retention Revenue Retention

6% 6%

Retention Factor Retention Factor

85% - 95% 85% - 95%

27% 27%

80% 80%

67% 67%

48% 48%

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Box Office Concession Other Revenue Box Office Concession Other Revenue

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Increasing Revenue Per Patron Increasing Revenue Per Patron

R P P R P P Revenue Per Patron Revenue Per Patron

$11 12 $11 12 $9.83 $9.83 $10.27 $10.27 $10.84 $10.84 $11.12 $11.12

$2 77 $2 77 $2 89 $2 89 $3.00 $3.00 $0.54 $0.54 $0.53 $0.53 $0.67 $0.67 $0.72 $0.72 $2.64 $2.64 $2.77 $2.77 $2.89 $2.89 $3.00 $3.00 $6.65 $6.97 $7.28 $7.40

2001 2002 2003 2004

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Box Office Concession Other Revenue Box Office Concession Other Revenue

Pro forma normalized values Pro forma normalized values

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Significant Other Revenue Contribution Significant Other Revenue Contribution

O h R ($ Milli ) O h R ($ Milli ) Other Revenues ($ Millions) Other Revenues ($ Millions)

$17 4 $17 4 $20.9 $20.9 $22.8 $22.8 $13.4 $13.4 $17.4 $17.4

2001 2002 2003 2004

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Advertising Games Other Advertising Games Other

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Building Frequency for all Demographics Building Frequency for all Demographics

I i M k i d P i I i M k i d P i Innovative Marketing and Promotions Innovative Marketing and Promotions

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New Projects New Projects

Project Project Screens Screens Projected Opening Projected Opening Brand Brand Opening Opening

Barrhaven 7 Fall 2005 Barrhaven 7 Fall 2005 Aurora 10 Fall 2005 Brossard 16 Spring 2006 Aurora 10 Fall 2005 Brossard 16 Spring 2006 Burloak 12 Fall 2006 Milton 8 Spring 2006 Burloak 12 Fall 2006 Milton 8 Spring 2006 Milton 8 Spring 2006 Brockville 6 Spring 2006 Milton 8 Spring 2006 Brockville 6 Spring 2006

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Corporate Initiatives - 2004 Corporate Initiatives - 2004

I t ti f t i I t ti f t i

Recap of 2004 Recap of 2004

Integration of two companies New Theatres / Expansions: Integration of two companies New Theatres / Expansions: p

– Guelph, Orillia, Pitt Meadows, Lethbridge

C i P p

– Guelph, Orillia, Pitt Meadows, Lethbridge

C i P Concession Programs Improved Margins Concession Programs Improved Margins p g p g

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Corporate Initiatives - 2004 Corporate Initiatives - 2004

I t ti f t i I t ti f t i

Recap of 2004 Recap of 2004

Integration of two companies New Theatres / Expansions: Integration of two companies New Theatres / Expansions: p

– Guelph, Orillia, Pitt Meadows, Lethbridge

C i P p

– Guelph, Orillia, Pitt Meadows, Lethbridge

C i P Concession Programs Improved Margins Concession Programs Improved Margins p g p g

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Analyst Coverage Analyst Coverage

Company Company Analyst Analyst Stock Rating Stock Rating

BMO Nesbit Burns Jeff Tkachuk Outperform National Bank Financial Joel Sutherland Outperform BMO Nesbit Burns Jeff Tkachuk Outperform National Bank Financial Joel Sutherland Outperform RBC Capital Markets Walter Spracklin Outperform S ti C it l Ch i Bl k S t P f RBC Capital Markets Walter Spracklin Outperform S ti C it l Ch i Bl k S t P f Scotia Capital Chris Blake Sector Perform TD Newcrest Adina Bloom Buy Scotia Capital Chris Blake Sector Perform TD Newcrest Adina Bloom Buy Westwind Partners Ben Mogil Buy Wellington West Capital Markets Robert Winslow Buy Westwind Partners Ben Mogil Buy Wellington West Capital Markets Robert Winslow Buy

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Wellington West Capital Markets Robert Winslow Buy Wellington West Capital Markets Robert Winslow Buy

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Unit Holder Return Unit Holder Return

Unit Price at AGM May 20 2004 $10 00 Unit Price at AGM May 20 2004 $10 00 Unit Price at AGM, May 20, 2004 $10.00 Unit Price May 17, 2005 $13.82 Unit Price at AGM, May 20, 2004 $10.00 Unit Price May 17, 2005 $13.82 Unit Price Appreciation $3.82 Unit Price Appreciation $3.82 Distributions Paid $1.15 Distributions Paid $1.15 Total Return 50.0% Total Return 50.0%

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Corporate Initiatives 2005 Corporate Initiatives 2005

New Theatres:

– Barrhaven, Aurora

New Theatres:

– Barrhaven, Aurora ,

Theatre Rebranding

– Medicine Hat Barrie and Grande Prairie ,

Theatre Rebranding

– Medicine Hat Barrie and Grande Prairie – Medicine Hat, Barrie and Grande Prairie

New POS System Implementation (VISTA) R i IT f L Ci l C d

– Medicine Hat, Barrie and Grande Prairie

New POS System Implementation (VISTA) R i IT f L Ci l C d Repatriate IT from Loews Cineplex to Canada Loyalty Program Repatriate IT from Loews Cineplex to Canada Loyalty Program Digital Advertising Pre-Show Network Digital Advertising Pre-Show Network

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Corporate Initiatives 2005 Corporate Initiatives 2005

New Theatres:

– Barrhaven, Aurora

New Theatres:

– Barrhaven, Aurora ,

Theatre Rebranding

– Medicine Hat Barrie and Grande Prairie ,

Theatre Rebranding

– Medicine Hat Barrie and Grande Prairie – Medicine Hat, Barrie and Grande Prairie

New POS System Implementation (VISTA) R i IT f L Ci l C d

– Medicine Hat, Barrie and Grande Prairie

New POS System Implementation (VISTA) R i IT f L Ci l C d Repatriate IT from Loews Cineplex to Canada Loyalty Program Repatriate IT from Loews Cineplex to Canada Loyalty Program Digital Advertising Pre-Show Network Digital Advertising Pre-Show Network

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Digital Advertising Pre-show - Overview Digital Advertising Pre-show - Overview

Movie Showtime 8 pm Movie Showtime 8 pm Commercials Commercials Commercials Commercials Special Feature/Content Special Feature/Content

20 minute digital show presented 20 minute digital show presented

Commercials Commercials Commercials Commercials Special Feature/Content Special Feature/Content Music Video Music Video

Replaces current static slide program Replaces current static slide program

20 minute digital show presented prior to advertised show time 20 minute digital show presented prior to advertised show time

Commercials/Slides Commercials/Slides C i l /Slid C i l /Slid Music Video Music Video

p p g Combination of entertainment, advertising and promotional messages High quality full screen full motion content p p g Combination of entertainment, advertising and promotional messages High quality full screen full motion content

Commercials/Slides Commercials/Slides Commercials/Slides Commercials/Slides

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High quality, full screen, full motion content High quality, full screen, full motion content

Commercials/Slides Commercials/Slides Promotions/Interactive Promotions/Interactive

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Digital Advertising Pre-show - Overview Digital Advertising Pre-show - Overview

F ll t k d t b d TV b d t d l F ll t k d t b d TV b d t d l

Kodak Digital Cinema System: Kodak Digital Cinema System:

Fully networked system based on TV broadcast model All content is delivered electronically via DSL Playback is automated from servers in each auditorium Fully networked system based on TV broadcast model All content is delivered electronically via DSL Playback is automated from servers in each auditorium All systems remotely monitored All systems remotely monitored High quality LCD projectors High quality LCD projectors

Christie Digital Projectors: Christie Digital Projectors:

High quality LCD projectors Native 16x9 format - full light output on the entire screen High quality LCD projectors Native 16x9 format - full light output on the entire screen

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Digital Advertising Pre-show - Benefits Digital Advertising Pre-show - Benefits Significantly better presentation than any other existing digital pre-show in Canada Significantly better presentation than any other existing digital pre-show in Canada g g p Improved customer experience - entertaining and interactive show g g p Improved customer experience - entertaining and interactive show Improved presentation quality Improved presentation quality

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Digital Advertising Pre-show - Benefits Digital Advertising Pre-show - Benefits More creativity and flexibility for advertisers More precise targeting of ads More creativity and flexibility for advertisers More precise targeting of ads More precise targeting of ads Shorter timelines and reduced production costs for advertisers More precise targeting of ads Shorter timelines and reduced production costs for advertisers costs for advertisers Expanded Customer base Net result = Increased advertising revenue costs for advertisers Expanded Customer base Net result = Increased advertising revenue Net result = Increased advertising revenue Net result = Increased advertising revenue

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Alt ti C t t P i Alt ti C t t P i

Alternative Programming Opportunities Alternative Programming Opportunities

Alternative Content Programming

– Sporting events – Concerts

Alternative Content Programming

– Sporting events – Concerts – Gaming – Special events

Expanded meeting rentals and corporate events

– Gaming – Special events

Expanded meeting rentals and corporate events Expanded meeting rentals and corporate events Educational programming Specialty film programming Expanded meeting rentals and corporate events Educational programming Specialty film programming p y p g g Interactive opportunities p y p g g Interactive opportunities

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Rollout Plan Rollout Plan

Phase 1:

April 1 Launch Toronto extended market area

Phase 1:

April 1 Launch Toronto extended market area

Phase 2:

November/December Launch Nationwide - Additional 400+ screens

Phase 2:

November/December Launch Nationwide - Additional 400+ screens

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Toronto extended market area

21 locations; 215 screens

Toronto extended market area

21 locations; 215 screens

Nationwide Additional 400+ screens Nationwide Additional 400+ screens

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Digital Advertising Pre-show - Summary Digital Advertising Pre-show - Summary

Th Ci l G l Di i l Th Ci l G l Di i l The Cineplex Galaxy Digital Pre-Show Cinema Network The Cineplex Galaxy Digital Pre-Show Cinema Network

provides us with the platform to build a unique cinema entertainment provides us with the platform to build a unique cinema entertainment a unique cinema entertainment experience and positions us as the market leader in digital cinema and a unique cinema entertainment experience and positions us as the market leader in digital cinema and market leader in digital cinema and content distribution market leader in digital cinema and content distribution

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Total Revenue - 2004 vs. 2003 Total Revenue - 2004 vs. 2003

$ Milli $ Milli $ Millions $ Millions

5 4% 5 4% $335.8 $353.7 5.4% 5.4% 2003 2004

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2003 2004

Screen Count: 755 775 Screen Count: 755 775

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Box Office - 2004 vs. 2003 Box Office - 2004 vs. 2003

$ Milli $ Milli $ Millions $ Millions

4 5% 4 5% $225.3 $235.4 4.5% 4.5% 2003 2004

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2003 2004

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Concession Revenues - 2004 vs. 2003 Concession Revenues - 2004 vs. 2003

$ Milli $ Milli $ Millions $ Millions

$89.6 $95.5 6.6% 6.6% 2003 2004

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2003 2004

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Other Revenues - 2004 vs. 2003 Other Revenues - 2004 vs. 2003

$ Milli $ Milli $ Millions $ Millions

9 2% 9 2% $20.9 $22.8 9.2% 9.2% 2003 2004

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2003 2004

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Adjusted EBITDA - 2004 vs. 2003 Adjusted EBITDA - 2004 vs. 2003

$ Milli $ Milli % M i % M i

$ Millions $ Millions

8.9% 8.9%

% Margin % Margin

$68.5 $74.5 21.1 20.4 19.4 12.2 16.7 2003 2004 2000 2001 2002 2003 2004

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Adjusted EBITDA Adjusted EBITDA EBITDA Margin EBITDA Margin

SLIDE 38

Total Revenue - Q1 2005 vs. Q1 2004 Total Revenue - Q1 2005 vs. Q1 2004 $ Milli $ Milli $ Millions $ Millions

1.0% 1.0% $79.0 $78.3 Q1 2004 Q1 2005

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Q1 2004 Q1 2005

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Box Office - Q1 2005 vs. Q1 2004 Box Office - Q1 2005 vs. Q1 2004

$ Milli $ Milli $ Millions $ Millions

4.5% 4.5% $53.8 $51.4 Q1 2004 Q1 2005

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Q1 2004 Q1 2005

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Concession Revenues - Q1 2005 vs. Q1 2004 Concession Revenues - Q1 2005 vs. Q1 2004

$ Milli $ Milli $ Millions $ Millions

2 4% 2 4% $21.1 $21.6 2.4% 2.4% Q1 2004 Q1 2005

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Q1 2004 Q1 2005

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Other Revenues - Q1 2004 vs. Q1 2003 Other Revenues - Q1 2004 vs. Q1 2003

$ Milli $ Milli $ Millions $ Millions

28 5% 28 5% $4.1 $5.2 28.5% 28.5% $ Q1 2003 Q1 2004

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Q1 2003 Q1 2004

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EBITDA - Q1 2005 vs. Q1 2004 EBITDA - Q1 2005 vs. Q1 2004

$ Milli $ Milli $ Millions $ Millions

20 5% 20 5% $15.1 $12.0 20.5% 20.5% Q1 2004 Q1 2005

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Q1 2004 Q1 2005

SLIDE 43

Distributable Cash 2004 Distributable Cash 2004

(in $ thousands except per unit amounts) (in $ thousands except per unit amounts) (in $ thousands except per unit amounts) (in $ thousands except per unit amounts)

Distributable Cash per Unit $1.23 Distributable Cash per Unit $1.23 Distributable Cash per Unit $1.23 Declared Distribution per Unit $1.15 Distributable Cash per Unit $1.23 Declared Distribution per Unit $1.15 Payout Ratio 94.0% Payout Ratio 94.0%

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SLIDE 44

Flexible Financing Structure Flexible Financing Structure

Development Facility Development Facility Development Facility

– Available - $40 million D t M h 31 2005 $16 5 illi

Development Facility

– Available - $40 million D t M h 31 2005 $16 5 illi – Drawn as at March 31, 2005 - $16.5 million

Cash at March 31, 2005 - $24.1 million

– Drawn as at March 31, 2005 - $16.5 million

Cash at March 31, 2005 - $24.1 million Working Capital Facility

– Available - $20 million

Working Capital Facility

– Available - $20 million Available $20 million – Drawn as at March 31, 2005 - Nil Available $20 million – Drawn as at March 31, 2005 - Nil

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SLIDE 45

2005 Annual General Meeting 2005 Annual General Meeting

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