Carmike Cinemas Reports First Quarter Revenue of $130.1 Million

  Carmike Cinemas Reports First Quarter Revenue of $130.1 Million

      Concessions/Other Revenue Per Patron Rises 6.9% to a Record $4.18

Business Wire

COLUMBUS, Ga. -- May 6, 2013

Carmike Cinemas, Inc. (NASDAQ: CKEC):

Webcast/Conference Call TODAY, Monday, May 6 at 5:00 p.m. ET
              
WEBCAST LINK:   www.carmikeinvestors.com (archived for 30 days)
                
CALL DIAL-IN:   800/732-8470 or 212/231-2900 (international callers)
                
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                13)

Carmike Cinemas, Inc. (NASDAQ: CKEC), a leading entertainment, digital cinema
and 3-D motion picture exhibitor, today reported results for the three month
period ended March 31, 2013, as summarized below.

Summary Financial Data

(unaudited)
                                                Three Months Ended Mar. 31
(in millions)                                    2013           2012
Total revenue                                    $   130.1       $    130.0
Operating income                                     3.3              14.5
Interest expense                                     12.3             8.3
Theatre level cash flow, excluding                   22.9             29.0
acquisition-related expenses (1)(2)
Net income (loss)                                    (5.8   )         3.2
Adjusted net income (loss), excluding                (3.6   )         4.3
acquisition-related expenses(1)(2)
Adjusted EBITDA, excluding acquisition-related       17.4             24.0
expenses(1)(2)
                                                                 
(in millions)                                    Mar. 31, 2013   Dec. 31, 2012
Total debt^(1)                                   $   433.9       $    434.7
Net debt^(1)                                     $   370.2       $    366.2

      Theatre level cash flow, adjusted net income (loss), adjusted EBITDA,
      total debt and net debt are supplemental non-GAAP financial measures.
      Reconciliations of theatre level cash flow and adjusted EBITDA to net
(1)  income (loss) and adjusted net income (loss) to net income (loss) for
      the three months ended March 31, 2013 and 2012, as well as a schedule of
      total debt and net debt as of March 31, 2013 and December 31, 2012, are
      included in the supplementary tables accompanying this news
      announcement.
      Theatre level cash flow, adjusted net income (loss) and adjusted EBITDA
(2)   exclude merger and acquisition-related expenses, primarily related to
      the Rave transaction, during the three months ended March 31, 2013.

Carmike Cinemas’ President and Chief Executive Officer David Passman stated,
“We are pleased that Carmike’s top-line revenue in the first quarter of 2013
held steady compared to the record-setting first quarter of 2012, as our
results were fueled by organic and acquisitive growth as well as a continued
appetite for concessions by our valued patrons. Last year’s first quarter box
office benefitted from a strong and well-balanced film slate, creating a
challenging year-over-year comparison for the industry, especially for
Carmike, as our 2012 Q1 admissions receipts and attendance metrics
significantly outperformed the industry by 1,260 and 550 basis points,
respectively, and we also achieved record-setting adjusted EBITDA and net
income. Even with these challenging comparisons, Carmike’s 2013 first quarter
admissions per-screen over-indexed by more than 200 basis points, versus the
industry.

“Notwithstanding the slow first quarter for the industry, we are optimistic
about the balance of 2013. The second quarter is off to a strong start with
the successful nationwide premiere of Iron Man 3 this past weekend and we
expect the positive momentum to continue throughout the summer as the upcoming
release calendar features a strong movie slate with several highly anticipated
titles.

“Carmike’s first quarter concessions and other per patron revenue rose nearly
7% to an all-time record of $4.18, marking the 13^th consecutive quarter of
year-over-year per patron spending increases. The strong per patron revenue
reflects the ongoing success of Carmike’s concessions strategies. We focus on
increasing this high-margin revenue stream by deploying our most innovative
and successful concessions programs and valuable promotions while
experimenting with other creative offerings.

“We opened two new theatres during the first quarter and have 11 more
locations currently under construction or in the planning or advanced
negotiating stages. We continue to search for acquisitive and organic growth
opportunities as we march toward our goal of expanding Carmike’s footprint to
300 locations and 3,000 screens. We are confident that the remainder of 2013
presents Carmike with prospects for growth and we remain committed to
identifying and acting on opportunities to create increased value for our
stakeholders.

“As a final point, while the film slate will vary from quarter-to-quarter, our
expanded scale and Company-wide emphasis on customer service excellence
combined with our fortified circuit of high-quality theatres remain important
factors in our ability to generate favorable operating results over the
long-term. With a much stronger financial and operating base to support our
expansion plans, we are optimistic about Carmike’s opportunities through the
remainder of 2013 and beyond.”

Theatre Performance Statistics

(unaudited)
                                                Three Months Ended Mar. 31
                                                 2013          2012
Average theatres                                    246            236
Average screens                                     2,480          2,259
Average attendance per screen^(1)                   4,687          5,394
Average admissions per patron^(1)                $  7.02        $  6.84
Average concessions/other sales per patron^(1)   $  4.18        $  3.91
Total attendance (in thousands)^(1)                 11,620         12,183
Total operating revenues (in thousands)          $  130,093     $  129,966

(1)  Includes activity from theatres designated as discontinued operations
      and reported as such in the consolidated statements of operations.

Carmike Cinemas’ Chief Financial Officer Richard B. Hare stated, “We were
pleased to see increases in per patron admissions and concessions revenue in
the first quarter, with both metrics rising to record levels. Carmike’s
average Q1 admissions per patron increased 2.6% to $7.02 while average
concession and other revenue per patron rose 6.9% to $4.18. In aggregate, per
patron spending was $11.20, compared to $10.75 in the 2012 first quarter.

“As a percentage of concessions and other revenues, concessions costs for the
quarter were 12.3%, a slight increase of 50 basis points over the first
quarter of 2012. The increase is due primarily to an increase in the cost of
concession supplies and increased discounts and other promotional activities.
Notably however, even in the midst of decreased attendance the gross margin
dollars in concessions and other increased over 200 basis points for the
comparable quarter.

“Other theatre operating expenses increased 11.2% to $58.0 million for the
three months ended March 31, 2013, compared to $52.1 million for the same
period in 2012, largely a reflection of the increased locations for the Rave
theatres acquired in Q4 2012. Selling, general and administrative expenses
were $6.0 million for the three months ended March 31, 2013 compared to $5.0
million for the same period in 2012, primarily due to costs associated with
acquisition activities and deferred compensation expense.

“In addition to the challenging industry environment, Carmike’s net income and
EPS for the first quarter of 2013 were impacted by lease termination charges
of approximately $3.1 million. The expenses are attributable to the closure of
an underperforming theatre prior to the expiration of the lease term and the
early termination of a lease agreement.

“As expected, quarterly interest expense rose to $12.3 million, due to a
combination of our assumption of financing obligations associated with the
Rave acquisition, and a higher interest rate on our $210 million of seven-year
senior secured notes that were issued in April 2012. Going forward, we
anticipate that quarterly interest expense will approximate the Q1 2013
levels.

“Adjusted EBITDA in Q1 2013 was $17.4 million and theatre level cash flow was
$22.9 million. While a majority of our costs are largely fixed, we continue to
exercise expense management disciplines throughout the organization to
maximize the performance of our operations and create efficiencies where
possible.”

Supplemental Financial Measures

Theatre level cash flow, EBITDA, adjusted EBITDA, adjusted net income (loss),
total debt and net debt are supplemental non-GAAP financial measures used by
Carmike to evaluate its operating performance. Carmike defines theatre level
cash flow as adjusted EBITDA, as defined below, plus general and
administrative expenses. Carmike believes that theatre level cash flow is an
important supplemental measure of operating performance for a motion picture
exhibitor’s operations because it provides a measure of the core operations,
rather than factoring in items such as general and administrative expenses and
depreciation and amortization, among others. In addition, Carmike believes
that theatre level cash flow, as defined, is a widely accepted measure of
comparative operating performance in the motion picture exhibition industry.
Adjusted net income (loss) is defined as net (loss) income plus impairment of
long-lived assets, loss on sale of property and equipment, lease termination
charges and merger and acquisition-related expenses, net of tax. Carmike
believes adjusted net income (loss) is an important supplemental measure of
operating performance for a motion picture exhibitor because it provides a
measure of core operations. Total debt is defined as the sum of current
maturities of capital leases and long-term financing obligations, long-term
debt (less current maturities) and capital leases and long-term financing
obligations (less current maturities). Net debt is defined as total debt less
cash and cash equivalents. EBITDA is defined as net (loss) income plus income
tax (benefit) expense, interest expense and depreciation and amortization.
Adjusted EBITDA is defined as EBITDA plus loss from unconsolidated affiliates,
loss from discontinued operations, lease termination charges, merger and
acquisition-related expenses, loss on sale of property and equipment, and
impairment of long-lived assets. Carmike believes that EBITDA and adjusted
EBITDA are important supplemental measures of operating performance for a
motion picture exhibitor’s operations because they provide measures of core
operations.

About Carmike Cinemas (www.carmike.com)

Carmike Cinemas, Inc. is a U.S. leader in digital cinema and 3-D cinema
deployments and one of the nation’s largest motion picture exhibitors. As of
March 31, 2013, Carmike had 244 theatres with 2,464 screens in 35 states.
Carmike’s digital cinema footprint reached 2,369 screens, including 232
theatres with 869 screens that are also equipped for 3-D. The circuit also
includes 18 “Big D” large format digital experience auditoriums, featuring
state-of-the-art equipment and luxurious seating and 7 IMAX^® auditoriums. As
“America’s Hometown Theatre Chain,” Carmike’s primary focus for its locations
is small to mid-sized communities.

Disclosure Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of
the federal securities laws. Statements that are not historical facts,
including statements about our beliefs, expectations and future performance,
are forward-looking statements. Forward-looking statements include statements
preceded by, followed by or that include the words, “believes,” “expects,”
“anticipates,” “plans,” “estimates,” “seeks” or similar expressions. Examples
of forward-looking statements in this press release include the Company’s
expectations regarding box office performance, circuit expansion, second
quarter performance, the upcoming film slate, future interest expense,
additional acquisition opportunities, and additional operating gains.
Forward-looking statements are only predictions and are not guarantees of
performance. These statements are based on beliefs and assumptions of
management, which in turn are based on currently available information. The
forward-looking statements also involve risks and uncertainties, which could
cause actual results to differ materially from those contained in any
forward-looking statement. Many of these factors are beyond our ability to
control or predict. Important factors that could cause actual results to
differ materially from those contained in any forward-looking statement
include, but are not limited to: our ability to achieve expected results from
our strategic acquisitions, general economic conditions in our regional and
national markets; our ability to comply with covenants contained in our senior
secured credit agreement and the indenture governing our 7.375% Senior Secured
Notes due 2019; our ability to operate at expected levels of cash flow;
financial market conditions including, but not limited to, changes in interest
rates and the availability and cost of capital; our ability to meet our
contractual obligations, including all outstanding financing commitments; the
availability of suitable motion pictures for exhibition in our markets;
competition in our markets; competition with other forms of entertainment; and
other factors, including the risk factors disclosed in our Annual Report on
Form 10-K for the year ended December31, 2012, under the caption “Risk
Factors.” We believe these forward-looking statements are reasonable; however,
undue reliance should not be placed on any forward-looking statements, which
are based on current expectations. Further, forward-looking statements speak
only as of the date they are made, and we undertake no obligation to update
publicly any of them in light of new information or future events.

CARMIKE CINEMAS, INC. and SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)
                                                                
                                                     Three Months Ended
                                                     March 31,
                                                     2013          2012
Revenues:                                            (Unaudited)   (Unaudited)
Admissions                                           $ 81,522      $ 82,690
Concessions and other                                 48,571      47,276  
                                                                   
Total operating revenues                               130,093       129,966
                                                                   
Operating costs and expenses:
Film exhibition costs                                  43,264        43,243
Concession costs                                       5,969         5,566
Other theatre operating costs                          57,959        52,132
General and administrative expenses                    6,015         5,000
Lease termination charges                              3,063         —
Depreciation and amortization                          10,234        7,767
Loss on sale of property and equipment                 80            248
Impairment of long-lived assets                       204         1,486   
                                                                   
Total operating costs and expenses                    126,788     115,442 
                                                                   
Operating income                                       3,305         14,524
Interest expense                                      12,298      8,263   
                                                                   
(Loss) income before income tax and loss from
unconsolidated                                         (8,993  )     6,261
affiliates
Income tax (benefit) expense                           (4,297  )     2,407
Loss from unconsolidated affiliates                   (1,015  )    (543    )
                                                                   
Income (loss) from continuing operations               (5,711  )     3,311
Loss from discontinued operations                     (72     )    (79     )
                                                                   
Net (loss) income                                    $ (5,783  )   $ 3,232   
                                                                   
Weighted average shares outstanding:
Basic                                                  17,547        12,824
Diluted                                                17,547        12,942
                                                                   
Net (loss) income per common share (Basic and
Diluted):
(Loss) income from continuing operations             $ (0.33   )   $ 0.26
Income (loss) from discontinued operations, net of    —           (0.01   )
tax
                                                                   
Net (loss) income per common share                   $ (0.33   )   $ 0.25    

CARMIKE CINEMAS, INC. and SUBSIDIARIES
SUPPLEMENTARY NON-GAAP RECONCILIATIONS
THEATRE LEVEL CASH FLOW AND ADJUSTED EBITDA
(Unaudited) ($ in thousands)
                                                              
                                                 Three Months Ended
                                                 March 31,
                                                 2013            2012
Net (loss) income                                $  (5,783   )   $  3,232
Income tax (benefit) expense                        (4,297   )      2,407
Interest expense                                    12,298          8,263
Depreciation and amortization                      10,234        7,767    
EBITDA                                           $  12,452       $  21,669
Loss from unconsolidated affiliates                 1,015           543
Loss from discontinued operations                   72              79
Loss on sale of property and equipment              80              248
Impairment of long-lived assets                     204             1,486
Lease termination charges                           3,063           —
Merger and acquisition-related expenses            531           —        
Adjusted EBITDA                                  $  17,417      $  24,025   
General and administrative expenses^(1)            5,484         5,000    
Theatre level cash flow                          $  22,901      $  29,025   
                                                                 
(1) Excludes merger and acquisition-related expenses for the three months
ended March 31, 2013.
                                                                 
TOTAL DEBT AND NET DEBT (Unaudited)
($ in thousands)

                                                 Mar. 31, 2013   Dec. 31, 2012
Current maturities of capital leases and
long-term financing                              $  4,547        $  4,422
obligations
Long-term debt, less current maturities             209,565         209,548
Capital leases and long-term financing
obligations, less current                          219,746       220,725  
maturities
Total debt                                       $  433,858      $  434,695
Less cash and cash equivalents                     (63,642  )     (68,531  )
Net debt                                         $  370,216      $  366,164
                                                                 
ADJUSTED NET INCOME (Unaudited)
($ in thousands)
                                                                 
                                                 Three Months
                                                 Ended March 31,
                                                    2013            2012
Net income (loss)                                $  (5,783   )   $  3,232
Impairment of long-lived assets                     204             1,486
Loss on sale of property and equipment              80              248
Lease termination charges                           3,063           —
Merger and acquisition-related expenses             531             —
Tax effect of adjustments to net income            (1,664   )     (685     )
(loss)^(1)
Adjusted net (loss) income                       $  (3,569   )   $  4,281    
Weighted average shares outstanding (basic)         17,547          12,824
Weighted average shares outstanding (diluted)       17,547          12,942
Adjusted net income (loss) per share (basic)     $  (0.20    )   $  0.33
Adjusted net income (loss) per share (diluted)   $  (0.20    )   $  0.33

      Adjustments to net income (loss) for the three months ended March 31,
(1)  2013 and 2012 are shown net of tax effect of 42.9% and 39.5%,
      respectively, which represents the estimated combined federal and state
      tax rates.

Contact:

JCIR – Investor Relations/Corporate Communications
Robert Rinderman or Jennifer Neuman
212-835-8500
ckec@jcir.com
or
Carmike Cinemas, Inc.
Richard B. Hare
Chief Financial Officer
706-576-341