Regal Entertainment Group Reports Results for Fiscal Second Quarter 2014 and Declares Quarterly Dividend Business Wire KNOXVILLE, Tenn. -- July 24, 2014 Regal Entertainment Group (NYSE: RGC), a leading motion picture exhibitor owning and operating the largest theatre circuit in the United States, today announced fiscal second quarter 2014 results. Total revenues for the second quarter ended June 26, 2014 were $770.3 million compared to total revenues of $842.3 million for the second quarter ended June 27, 2013. Net income attributable to controlling interest in the second quarter of 2014 was $33.8 million, which included a $6.6 million after-tax loss on extinguishment of debt, compared to $36.1 million in the second quarter of 2013, which included a $19.4 million after-tax loss on extinguishment of debt. Diluted earnings per share was $0.22 for the second quarter of 2014 compared to $0.23 for the second quarter of 2013. Adjusted diluted earnings per share^(1) was $0.27 for the second quarter of 2014 compared to $0.36 for the second quarter of 2013. Adjusted EBITDA^(3) was $146.6 million for the second quarter of 2014 and $178.2 million for the second quarter of 2013. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release. Regal’s Board of Directors also today declared a cash dividend of $0.22 per Class A and Class B common share, payable on September 15, 2014, to stockholders of record on September 5, 2014. The Company intends to pay a regular quarterly dividend for the foreseeable future at the discretion of the Board of Directors depending on available cash, anticipated cash needs, overall financial condition, loan agreement restrictions, future prospects for earnings and cash flows as well as other relevant factors. “In a challenging summer box office environment, the growth in our average concession sales per patron and our focus on controlling variable costs helped drive Adjusted EBITDA margin of over 19%,” stated Amy Miles, CEO of Regal Entertainment Group. “With year-to-date industry box office results on par with last year’s record setting pace and an exciting film slate in the back half of the year, we are optimistic regarding the potential for further box office success in 2014.” Forward-looking Statements: This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements included herein, other than statements of historical fact, may constitute forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the risk factors contained in the Company's 2013 Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 24, 2014. All forward-looking statements are expressly qualified in their entirety by such factors. Conference Call: Regal Entertainment Group management will conduct a conference call to discuss second quarter 2014 results on July 24, 2014 at 4:30 p.m. (Eastern Time). Interested parties can listen to the call live on the Internet through the Investor Relations section of the Company's website: www.REGmovies.com or by dialing 877-407-0778 (Domestic) and 201-689-8565 (International). Please dial in to the call at least 5-10 minutes prior to the start of the call or go to the website at least 15 minutes prior to the call to download and install any necessary audio software. When prompted, ask for the Regal Entertainment Group conference call. A replay of the call will be available beginning approximately two hours following the call. Those interested in listening to the replay of the conference call should dial 877-660-6853 (Domestic) or 201-612-7415 (International) and enter conference call ID #13574239. About Regal Entertainment Group: Regal Entertainment Group (NYSE: RGC) operates the largest and most geographically diverse theatre circuit in the United States, consisting of 7,349 screens in 574 theatres in 42 states along with the District of Columbia, American Samoa, Guam and Saipan as of June 26, 2014. The Company operates theatres in 46 of the top 50 U.S. designated market areas. We believe that the size, reach and quality of the Company’s theatre circuit not only provide its patrons with a convenient and enjoyable movie-going experience, but is also an exceptional platform to realize economies of scale in theatre operations. Additional information is available on the Company's website at www.REGmovies.com. Regal Entertainment Group Consolidated Statements of Income Information For the Fiscal Quarters and Two Quarters Ended 6/26/14 and 6/27/13 (in millions, except per share data) (unaudited) Quarter Ended Two Quarters Ended June 26, June 27, June 26, June 27, 2014 2013 2014 2013 Revenues Admissions $ 517.0 $ 571.0 $ 1,006.6 $ 1,007.6 Concessions 212.3 227.7 413.0 399.5 Other operating 41.0 43.6 77.6 78.0 revenues Total revenues 770.3 842.3 1,497.2 1,485.1 Operating expenses Film rental and 273.5 309.9 528.5 525.8 advertising costs Cost of 28.3 31.5 54.6 55.4 concessions Rent expense 106.3 104.6 210.9 204.2 Other operating 203.1 205.4 404.2 389.0 expenses General and administrative expenses (including share-based compensation of $2.3 and $2.5 for the quarters ended June 26, 18.3 19.6 36.9 37.6 2014 and June 27, 2013, respectively, and $4.2 and $4.8 for the two quarters ended June 26, 2014 and June 27, 2013, respectively) Depreciation and 51.0 51.0 102.4 98.2 amortization Net loss on disposal and 4.0 3.2 3.6 0.6 impairment of operating assets Income from 85.8 117.1 156.1 174.3 operations Interest expense, 30.4 36.6 64.7 71.5 net Loss on extinguishment of 10.5 30.7 62.4 30.7 debt Earnings recognized from (3.5 ) (4.4 ) (16.8 ) (14.2 ) NCM Other, net (7.8 ) (8.7 ) (11.0 ) (14.2 ) Income before 56.2 62.9 56.8 100.5 income taxes Provision for 22.4 26.8 24.3 42.0 income taxes Net income 33.8 36.1 32.5 58.5 Noncontrolling interest, net of ― ― 0.1 0.1 tax Net income attributable to $ 33.8 $ 36.1 $ 32.6 $ 58.6 controlling interest Diluted earnings $ 0.22 $ 0.23 $ 0.21 $ 0.38 per share Adjusted diluted earnings per $ 0.27 $ 0.36 $ 0.47 $ 0.49 share^(1) Weighted average number of diluted 156.2 155.6 156.2 155.6 shares outstanding^(2) Consolidated Summary Balance Sheet Information (dollars in millions) (unaudited) As of As of June 26, 2014 December 26, 2013 Cash and cash equivalents $ 355.3 $ 280.9 Total assets 2,675.7 2,704.7 Total debt 2,362.7 2,310.7 Total stockholders’ deficit of (748.3 ) (713.4 ) Regal Entertainment Group Operating Data (unaudited) Quarter Ended Two Quarters Ended June 26, June 27, June 26, June 27, 2014 2013 2014 2013 Theatres at period end 574 577 574 577 Screens at period end 7,349 7,343 7,349 7,343 Average screens per 12.8 12.7 12.8 12.7 theatre Attendance (in thousands) 56,085 62,281 111,221 111,926 Average ticket price $ 9.22 $ 9.17 $ 9.05 $ 9.00 Average concessions per $ 3.79 $ 3.66 $ 3.71 $ 3.57 patron Reconciliation of EBITDA to Net Cash Provided by Operating Activities (dollars in millions) (unaudited) Quarter Ended Two Quarters Ended June 26, June 27, June 26, June 2014 2013 2014 27, 2013 EBITDA $ 137.6 $ 150.5 $ 224.0 $ 270.3 Interest (30.4 ) (36.6 ) (64.7 ) (71.5 ) expense, net Provision for (22.4 ) (26.8 ) (24.3 ) (42.0 ) income taxes Deferred income (0.6 ) 4.0 (0.5 ) 2.5 taxes Changes in operating assets (6.9 ) 25.2 10.8 68.7 and liabilities Loss on extinguishment 10.5 30.7 62.4 30.7 of debt Other items, net (2.9 ) (1.3 ) 5.2 (2.1 ) Net cash provided by $ 84.9 $ 145.7 $ 212.9 $ 256.6 operating activities Reconciliation of EBITDA to Adjusted EBITDA (dollars in millions) (unaudited) Quarter Ended Two Quarters Ended June 26, June 27, June 26, June 2014 2013 2014 27, 2013 EBITDA $ 137.6 $ 150.5 $ 224.0 $ 270.3 Net loss on disposal and 4.0 3.2 3.6 0.6 impairment of operating assets Share-based compensation 2.3 2.5 4.2 4.8 expense Loss on extinguishment 10.5 30.7 62.4 30.7 of debt Noncontrolling interest, net of (7.8 ) (8.7 ) (11.1 ) (14.3 ) tax and other, net Adjusted $ 146.6 $ 178.2 $ 283.1 $ 292.1 EBITDA^(3) Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (dollars in millions) (unaudited) Quarter Ended Two Quarters Ended June 26, June 27, June 26, June 27, 2014 2013 2014 2013 Net cash provided by $ 84.9 $ 145.7 $ 212.9 $ 256.6 operating activities Capital expenditures (28.4 ) (24.7 ) (57.5 ) (48.6 ) Proceeds from asset ― 0.6 1.7 4.1 sales Free cash flow^(3) $ 56.5 $ 121.6 $ 157.1 $ 212.1 Reconciliation of Net Income Attributable to Controlling Interest to Adjusted Diluted Earnings Per Share (dollars in millions, except per share data) (unaudited) Quarter Ended Two Quarters Ended June 26, June June June 2014 27, 26, 27, 2013 2014 2013 Net income attributable $ 33.8 $ 36.1 $ 32.6 $ 58.6 to controlling interest Loss on extinguishment of debt, net of related 6.6 19.4 39.2 19.4 tax effects Gain on sale of available for sale (0.8 ) (1.6 ) (1.2 ) (1.6 ) securities, net of related tax effects Net loss on disposal and impairment of 2.4 1.9 2.2 0.4 operating assets, net of related tax effects Net income attributable to controlling interest, excluding loss on extinguishment of debt, net of related tax effects, gain on sale of available for $ 42.0 $ 55.8 $ 72.8 $ 76.8 sale securities, net of related tax effects, and net loss on disposal and impairment of operating assets, net of related tax effects Weighted average number of diluted shares 156.2 155.6 156.2 155.6 outstanding^(2) Adjusted diluted $ 0.27 $ 0.36 $ 0.47 $ 0.49 earnings per share^(1) Diluted earnings per $ 0.22 $ 0.23 $ 0.21 $ 0.38 share ______________________ We have included adjusted diluted earnings per share, which is diluted earnings per share excluding loss on extinguishment of debt, net of related tax effects, gain on sale of available for (1) sale securities, net of related tax effects, and net loss on disposal and impairment of operating assets, net of related tax effects, because we believe it provides investors with a useful industry comparative and is a financial measure used by management to assess the performance of our Company. Represents reported weighted average number of diluted shares (2) outstanding for purposes of computing diluted earnings per share and adjusted diluted earnings per share for the quarters and two quarters ended June 26, 2014 and June 27, 2013. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization expense, net loss on disposal and impairment of operating assets, share-based compensation expense, loss on extinguishment of debt and noncontrolling interest, net of tax and other, net) was approximately $146.6 million for the quarter ended June 26, 2014. We believe EBITDA, Adjusted EBITDA and Free Cash Flow provide useful measures of cash flows from operations for our investors because EBITDA, Adjusted EBITDA and Free Cash Flow are industry comparative measures of cash flows generated by our operations and because they are financial measures used by management to assess the liquidity of our Company. EBITDA, Adjusted EBITDA and Free Cash Flow are not measurements of liquidity under U.S. generally accepted accounting principles and (3) should not be considered in isolation or construed as a substitute for other operations data or cash flow data prepared in accordance with U.S. generally accepted accounting principles for purposes of analyzing our liquidity. In addition, not all funds depicted by EBITDA, Adjusted EBITDA and Free Cash Flow are available for management's discretionary use. For example, a portion of such funds are subject to contractual restrictions and functional requirements to pay debt service, fund necessary capital expenditures and meet other commitments from time to time as described in more detail in the Company’s 2013 Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 24, 2014. EBITDA, Adjusted EBITDA and Free Cash Flow, as calculated, may not be comparable to similarly titled measures reported by other companies. Contact: Financial Contact: Kevin Mead Regal Entertainment Group Vice President Investor Relations and Planning Kevin.Mead@regalcinemas.com 865-925-9685 or Media Contact: Ken Thewes Regal Entertainment Group Senior Vice President and Chief Marketing Officer 865-925-9539
Regal Entertainment Group Reports Results for Fiscal Second Quarter 2014 and Declares Quarterly Dividend
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