Cinemark Earnings Analysis: Here’s How Key Drivers Settled Out

The following is an excerpt from a report compiled by Michael Pachter of Wedbush Securities.

Despite Cinemark’s (NYSE:CNK) slight revenue miss, adjusted EBITDA and a normalized EPS beat our estimate. Total revenue was $612 million, vs. our $622 million estimate and consensus of $617 million. U.S. revenue was $433 million, vs. our $430 million estimate. International revenue was $179 million, vs. our $192 million estimate. Adjusted EBITDA totaled $144 million, vs. our $136 million estimate.  Although GAAP EPS was $0.24 vs. our estimate and consensus of $0.38, the shortfall was primarily due to a higher tax rate which accounted for $0.11, and an additional $0.05 attributable to loss on early retirement of debt during the quarter. Backing out these items, EPS would have been $0.40, driven primarily by lower film rental cost.

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The domestic segment performed slightly better than our expectations, while international was strong, but below our high estimates. Admissions revenue per average screen in the domestic segment increased 14.8% year-over-year compared to our estimate of 15.0% and the industry of 16.0% during the quarter. International revenue grew 11% during the quarter, but below our expectations.

Q1 is tracking down 9% domestically. Q1:13 is up against a strong +22% comp that remains difficult throughout the quarter. We assume Q1 box office  will track negative high-single-digits, and Cinemark (NYSE:CNK) will have contribution from…