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IMAX Corp (IMAX) Q1 Earnings Break Even, Revenues Miss Mark

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IMAX Corporation (IMAX - Free Report) , based in Mississauga, Canada, reported mixed results in the first quarter of 2017. The company reported break-even earnings per share in the first quarter, which compared favorably to the Zacks Consensus Estimate of a loss of 1 cents.  IMAX’s earnings per share in the first quarter of 2016 stood at 14 cents.

Total revenue in the first quarter of 2017 was $68.7 million, down 25.48% year over year. The figure also missed the Zacks Consensus Estimate of $71.1 million. Adjusted EBITDA margin in the reported quarter was 29.5%.

Category wise, equipment and product revenues were $11.5 million, down 51.4%. Services revenues totaled $38.8 million, down 12.26%. Rentals revenues totaled $15.8 million, down 27.19%, while Financial income was $2.4 million, up marginally.

Segmental Results

IMAX Theater Business generated revenues of $23.2 million down 33.8% year over year. Within this segment, IMAX system sales and sales-type leases were $6.9 million, down 61.43%. Ongoing fees and finance income was $2.5 million, down 3.4%. Meanwhile, Joint revenue sharing arrangements-fixed fees was $0.5 million, down 77.3%. Theater system maintenance was $11 million, up 12.41%, while Other Theatre revenues fell 13% to $2.2 million.

Network Business generated revenues of $39.3 million, down 24.8% year over year. Within this segment, IMAX DMR was $23.4 million, down 21.5%. Joint revenue sharing arrangements-contingent rent was $15.2 million, reflecting a decline of 28.5% and IMAX systems-contingent rent deteriorated 42% to $0.7 million.

Other segments generated revenues of $4.8 million, down 1.62% year over year. Within this segment, Film distribution and post-production was $3.6 million, up 29.4%, and Other revenues were down 37% to $1.2 million. IMAX exited the first quarter with cash and cash equivalents of $190.5 million, compared with $204.7 million at the end of 2016.

Network Growth Statistics

The company installed 15 theaters (including 1 upgrade) as against 19 (including 9 upgrades) in the first quarter of 2016. The company signed 39 theatre agreements in the first quarter of 2017 compared with 36 in the year-earlier quarter. As of Mar 31, 2017, total theater count in backlog was 524 compared with 388 as of Mar 31, 2016.

Imax Corporation Price, Consensus and EPS Surprise


Imax Corporation Price, Consensus and EPS Surprise | Imax Corporation Quote

Zacks Rank & Key Picks

IMAX currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the broader consumer discretionary sector are AMC Entertainment Holdings (AMC - Free Report) , Acme United Corporation and Adidas AG (ADDYY - Free Report) . AMC Entertainment and Adidas sport a Zacks Rank #1 (Strong Buy), while Acme United carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of AMC Entertainment and Acme United gained over 2% and 6%, respectively, over the last one month, while Adidas shares gained above 17% over a period of three months.

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