Core Viewpoint - McChip Resources Inc has decided to distribute cash and assets to shareholders and subsequently explore strategic alternatives to maximize shareholder value [1] Group 1: Financial Position and Distributions - The company has liquidated most of its assets, holding approximately $11,200,000 in cash and certain shares in other public companies [2] - The company plans to distribute all or a portion of its cash and securities holdings to shareholders after settling outstanding liabilities and estimated professional fees of approximately $700,000 [2] - A special meeting of shareholders is scheduled for October 1, 2025, to vote on a special resolution to distribute up to $5,200,000 through a reduction in stated capital [4] Group 2: Shareholder Meeting and Approval Process - Shareholders are expected to receive approximately C$0.91066 per Common Share as part of the Return of Capital, subject to the Board's discretion to adjust the amount [4] - Approval of the Reduction in Stated Capital requires at least two-thirds of the votes cast at the special meeting [5] - The Board unanimously recommends that shareholders vote in favor of the Reduction in Stated Capital, which is subject to necessary shareholder and regulatory approvals [5][6]

Core Insights - Marcus reported fiscal Q2 2025 earnings per share (GAAP) of $0.23, exceeding estimates by 16.4%, with revenue increasing 17.0% year over year to $206.0 million, surpassing forecasts [1][2] - The Marcus Theatres segment experienced a significant revenue increase of 29.8%, driven by blockbuster films and strategic renovations, while the Hotels & Resorts segment saw flat revenue due to ongoing renovations [1][7] Financial Performance - Q2 Fiscal 2025 metrics include GAAP EPS of $0.23, revenue of $206.0 million, and adjusted EBITDA of $32.3 million, reflecting a 46.8% year-over-year increase [2] - Revenue from the Marcus Theatres segment reached $131.7 million, up from $101.5 million a year earlier, while the Hotels & Resorts segment reported revenue of $74.3 million, a slight decline of 0.3% [2] Operational Highlights - The Marcus Theatres segment saw a 26.7% increase in attendance and a 2.0% rise in average ticket prices, contributing to a record Memorial Day weekend [5] - Strategic renovations at various cinema locations improved customer experience and operational efficiency, including enhanced digital ordering tools and upgraded facilities [6] Hotels & Resorts Segment - The Hotels & Resorts segment faced challenges with renovations at the Hilton Milwaukee, leading to a decline in operating income to $4.2 million from $6.1 million in Q2 FY2024 [7] - Revenue per available room (RevPAR) decreased by 2.9%, but all renovated rooms reopened by the end of June 2025, positioning the segment for improved performance in the upcoming travel season [7][10] Strategic Focus - Marcus emphasizes investments in customer experience, digital technology, and facility upgrades to attract a diverse customer base and enhance competitive positioning [3][4] - Management is optimistic about the second half of fiscal 2025, citing a strong film lineup and completed hotel renovations as key growth drivers [10]

PART I – FINANCIAL INFORMATION [Item 1. Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements for the quarterly period ended June 30, 2025, highlighting key changes in assets, liabilities, revenue, and net earnings [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) The balance sheet as of June 30, 2025, shows a decrease in total assets and shareholders' equity, with an increase in long-term debt Key Balance Sheet Items (in thousands) | Account | June 30, 2025 | December 26, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $14,901 | $40,841 | | Total current assets | $61,009 | $92,150 | | Net property and equipment | $694,239 | $685,734 | | **Total Assets** | **$1,016,307** | **$1,044,528** | | Total current liabilities | $156,529 | $176,681 | | Long-term debt | $170,116 | $149,007 | | **Total Liabilities** | **$567,889** | **$579,662** | | **Total Shareholders' Equity** | **$448,418** | **$464,866** | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) The company reported a significant increase in Q2 2025 revenues and a shift from net loss to net earnings, with improved six-month results Key Operating Results (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $206,043 | $176,032 | $354,809 | $314,579 | | Operating Income (Loss) | $13,007 | $2,237 | $(7,405) | $(14,428) | | Net Earnings (Loss) | $7,321 | $(20,221) | $(9,495) | $(32,087) | | Diluted EPS (Common Stock) | $0.23 | $(0.64) | $(0.31) | $(1.03) | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities shifted to a use of $3.7 million in H1 2025, with a net decrease in total cash and equivalents Six-Month Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 27, 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $(3,689) | $20,877 | | Net cash used in investing activities | $(31,545) | $(40,640) | | Net cash provided by (used in) financing activities | $7,354 | $(2,290) | | **Net decrease in cash, cash equivalents and restricted cash** | **$(27,880)** | **$(22,053)** | [Condensed Notes to Consolidated Financial Statements](index=11&type=section&id=Condensed%20Notes%20to%20Consolidated%20Financial%20Statements) The notes detail the basis of presentation, including a fiscal year-end change, disaggregated revenue, debt, and segment operations - Effective December 27, 2024, the company changed its fiscal year-end from the last Thursday in December to December 31 of each year[17](index=17&type=chunk) Total Revenues by Segment - Six Months Ended June 30, 2025 (in thousands) | Segment | Total Revenues | | :--- | :--- | | Theatres | $219,007 | | Hotels/Resorts | $135,604 | | Corporate | $198 | | **Total** | **$354,809** | - As of June 30, 2025, the company had **$179.9 million** in total debt (net of issuance costs), an increase from **$159.1 million** at year-end 2024, primarily due to **$21 million** in borrowings on its revolving credit facility[45](index=45&type=chunk)[46](index=46&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the significant improvement in Q2 and H1 2025 financial results, driven by the Theatre division, and reviews liquidity [Overall Results of Operations](index=25&type=section&id=Overall%20Results%20of%20Operations) Consolidated revenues increased significantly in Q2 and H1 2025, leading to improved operating income and a shift to net earnings in Q2 Overall Financial Performance (in millions) | Metric | Q2 2025 | Q2 2024 | Variance (%) | H1 2025 | H1 2024 | Variance (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenues | $206.0 | $176.0 | 17.0% | $354.8 | $314.6 | 12.8% | | Operating Income (Loss) | $13.0 | $2.2 | 481.4% | $(7.4) | $(14.4) | 48.7% | | Net Earnings (Loss) | $7.3 | $(20.2) | 136.2% | $(9.5) | $(32.1) | 70.4% | - The first half of fiscal 2025 included four additional operating days compared to the prior year period, which favorably impacted revenues by approximately **$9.2 million**[77](index=77&type=chunk) - The significant improvement in net earnings was aided by the absence of a **$13.9 million** debt conversion expense that was incurred in Q2 2024[84](index=84&type=chunk)[85](index=85&type=chunk) [Theatres Segment Analysis](index=26&type=section&id=Theatres%20Segment%20Analysis) The Theatre division experienced significant revenue and operating income growth in Q2 and H1 2025, driven by increased attendance Theatres Segment Performance (in millions) | Metric | Q2 2025 | Q2 2024 | Variance (%) | H1 2025 | H1 2024 | Variance (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenues | $131.7 | $101.5 | 29.8% | $219.0 | $182.7 | 19.9% | | Operating Income (Loss) | $15.7 | $2.8 | 464.5% | $9.4 | $(3.0) | 418.4% | - Comparable theatre attendance increased **26.7%** in Q2 2025, attributed to a stronger film slate with 32 wide-release films compared to 28 in Q2 2024[90](index=90&type=chunk) - The company's admission revenue growth for comparable theatres (**29.3%** in Q2) underperformed the U.S. box office increase (**36.5%**), which management attributes to strategic pricing and value promotions[88](index=88&type=chunk) Key Theatre Operating Metrics (Q2 2025 vs Q2 2024) | Metric | Change | | :--- | :--- | | Average Ticket Price | +2.0% | | Average Concession Revenues per Person | +3.1% | [Hotels and Resorts Segment Analysis](index=28&type=section&id=Hotels%20and%20Resorts%20Segment%20Analysis) The Hotels and Resorts division saw a slight Q2 revenue decrease and operating income decline, with RevPAR negatively impacted by renovations Hotels and Resorts Segment Performance (in millions) | Metric | Q2 2025 | Q2 2024 | Variance (%) | H1 2025 | H1 2024 | Variance (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenues | $74.3 | $74.5 | (0.3)% | $135.6 | $131.7 | 3.0% | | Operating Income (Loss) | $4.2 | $6.1 | (31.4)% | $(1.9) | $1.0 | (293.7)% | Key Hotel Operating Statistics (Comparable Properties, Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Occupancy Pct. | 67.3% | 72.7% | (5.4) pts | | ADR | $196.35 | $187.03 | +5.0% | | RevPAR | $132.07 | $136.03 | (2.9)% | - The renovation at the Hilton Milwaukee negatively impacted the division's RevPAR growth by an estimated **3.7 percentage points** during Q2 2025[106](index=106&type=chunk) - Group room revenue bookings for the remainder of fiscal 2025 are in-line with the prior year, while bookings for fiscal 2026 are running nearly **20%** ahead of the same time last year[109](index=109&type=chunk) [Adjusted EBITDA Analysis](index=31&type=section&id=Adjusted%20EBITDA%20Analysis) Total Adjusted EBITDA increased significantly in Q2 2025, primarily driven by strong performance in the Theatres division Adjusted EBITDA by Segment (in millions) | Segment | Q2 2025 | Q2 2024 | Variance (%) | H1 2025 | H1 2024 | Variance (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Theatres | $26.5 | $15.1 | 76.2% | $30.2 | $21.2 | 42.5% | | Hotels and resorts | $11.2 | $11.4 | (1.8)% | $12.2 | $11.4 | 7.2% | | Corporate items | $(5.5) | $(4.5) | (21.4)% | $(10.5) | $(8.4) | (24.8)% | | **Total Adjusted EBITDA** | **$32.3** | **$22.0** | **46.9%** | **$32.0** | **$24.3** | **32.0%** | Reconciliation of Net Earnings (Loss) to Adjusted EBITDA (in millions) | Line Item | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Net earnings (loss) | $7.3 | $(20.2) | $(9.5) | $(32.1) | | Depreciation and amortization | $17.6 | $16.7 | $35.4 | $32.7 | | Interest expense | $3.0 | $2.6 | $5.8 | $5.1 | | Income tax expense (benefit) | $2.7 | $5.7 | $(4.6) | $(1.7) | | Debt conversion expense | — | $13.9 | — | $13.9 | | Other adjustments | $1.7 | $3.3 | $1.9 | $6.4 | | **Total Adjusted EBITDA** | **$32.3** | **$22.0** | **$32.0** | **$24.3** | [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with available credit and a 1.61x net leverage ratio, despite cash used in operations - As of June 30, 2025, the company had a cash balance of **$14.9 million** and **$199.2 million** of availability under its **$225 million** revolving credit facility[121](index=121&type=chunk) Net Leverage Calculation (in millions) | Metric | June 30, 2025 | | :--- | :--- | | Long-term debt | $179.9 | | Finance lease obligations | $12.4 | | Less: Cash and cash equivalents | $(14.9) | | **Net Debt** | **$177.3** | | LTM Adjusted EBITDA | $110.2 | | **Net Leverage Ratio** | **1.61x** | - During the first half of fiscal 2025, the company repurchased **0.4 million** shares of its common stock for **$7.1 million** and paid dividends of **$4.3 million**[131](index=131&type=chunk)[132](index=132&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in market risk exposures have occurred since the previous fiscal year-end of December 26, 2024 - No material changes in market risk exposures were experienced since December 26, 2024[138](index=138&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no significant changes to internal control over financial reporting - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures are effective[139](index=139&type=chunk) - There were no significant changes in internal control over financial reporting during the quarter[140](index=140&type=chunk) PART II – OTHER INFORMATION [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors were reported, except for new risks related to tariffs and revised motion picture dependency - A new risk factor was added regarding the potential for tariffs to increase the cost of commodities and film production[141](index=141&type=chunk) - The risk factor concerning the dependency on the quantity and audience appeal of motion pictures was revised, noting the negative impact of production disruptions like the WGA and SAG-AFTRA strikes[142](index=142&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No common stock was repurchased in Q2 2025, with approximately 1.3 million shares remaining available under authorization Share Repurchases (Q2 2025) | Period | Total Number of Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 1 - June 30 | 0 | $0.00 | - As of June 30, 2025, **1,262,090 shares** remained available for repurchase under the company's authorized plans[143](index=143&type=chunk) [Item 4. Mine Safety Disclosures](index=38&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is reported as not applicable to the company's operations - Not applicable[146](index=146&type=chunk) [Item 5. Other Information](index=38&type=section&id=Item%205.%20Other%20Information) No director or Section 16 officer adopted or terminated trading arrangements during Q2 2025 - No director or Section 16 officer adopted or terminated a Rule 10b5-1 trading arrangement during the quarter[147](index=147&type=chunk) [Item 6. Exhibits](index=38&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including incentive plans and required certifications - Exhibits filed include CEO/CFO certifications (31.1, 31.2, 32) and the company's 2025 Omnibus Incentive Plan (10.1)[148](index=148&type=chunk)

The Marcus (MCS) Q2 2025 Earnings Call August 01, 2025 11:00 AM ET Company ParticipantsChad Paris - CFO & TreasurerGregory S. Marcus - Founder, President, CEO, Chairman & DirectorEric Wold - Executive Director, Equity ResearchDrew Crum - Managing DirectorPatrick Sholl - Vice PresidentOperatorGood morning, everyone, and welcome to Marcus Corporation's Second Quarter Earnings Conference Call. My name is Bailey, and I will be your operator for today. At this time, all participants are in listen only mode. We w ...

Financial Data and Key Metrics Changes - Consolidated revenues for Q2 2025 were $206 million, up 17% compared to the prior year quarter, with operating income increasing to $13 million, a rise of $10.8 million year-over-year [6] - Consolidated adjusted EBITDA for Q2 was $32.3 million, reflecting a nearly 47% increase over the previous year [6] - Net earnings for the quarter were $7.3 million, or $0.23 per share, compared to a net loss of $5.2 million, or $0.17 per share, in the prior year [6] Business Line Data and Key Metrics Changes Theater Division - Total revenue for the theater division in Q2 2025 was $131.7 million, a nearly 30% increase compared to the prior year [7] - Comparable theater admission revenue increased by 29.3%, and attendance rose by 26.7% year-over-year [8] - Adjusted EBITDA for the theater division was $26.5 million, a 76% increase from the prior year [12] Hotels and Resorts Division - Total revenues before cost reimbursements were $64.6 million, a 1.2% increase compared to the prior year [13] - RevPAR for comparable owned hotels decreased by 2.9%, with an average occupancy rate of 67.3% [13][14] - Adjusted EBITDA for the hotels division decreased by $200,000 compared to the prior year, impacted by changes in revenue mix [17] Market Data and Key Metrics Changes - U.S. box office receipts increased by 36.5% during Q2 2025 compared to the same period last year, indicating that the company's admissions revenue performance trailed the industry by approximately seven percentage points [9] - Comparable competitive hotels in the market experienced RevPAR growth of 2.9%, indicating that the company's hotels underperformed the competitive set by 5.8 percentage points [15] Company Strategy and Development Direction - The company is focused on driving long-term attendance and total revenue, with strategies to optimize pricing and promotional programs to encourage repeat moviegoing [24] - The company plans to continue capital expenditures for fiscal 2025 between $70 million and $85 million, with a significant portion allocated to renovations [18][32] - The company is looking for opportunities to deploy capital for growth while maintaining a strong balance sheet for potential investments [32] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong film slate and consumer demand, highlighting the resilience of the theatrical experience [19] - The hotel segment is expected to see improved performance as renovations are completed, with a stable outlook despite economic uncertainties [31] - Management noted that while there are challenges in the market, the company is prepared to react quickly to any signs of economic softening [31] Other Important Information - The company completed major renovations at the Hilton Milwaukee, with all guest rooms returned to service as of June [28] - The company is implementing pricing surcharges on select high-demand films, which are expected to benefit admission per cap growth going forward [10][42] Q&A Session Summary Question: Can you separate the group pace between the Milwaukee area and outside of Milwaukee? - Management indicated that group pace gains are partly due to renovated meeting spaces and that they are winning in the market for group events, but specific splits were not provided [36][38] Question: What size of surcharge is being implemented for blockbuster films? - Management mentioned that the Everyday Matinee program is moving from $7 to $7.50, with certain films priced at $8.50, indicating a cautious approach to pricing while focusing on driving attendance [41][42] Question: What are the preliminary thoughts for the domestic box office going into the second half? - Management acknowledged the challenges of tough comparisons but expressed optimism about upcoming films and the potential for a strong finish to the year [48][51] Question: How do you see the hotel segment performing in Q3? - Management highlighted strong performance in banquet and catering, stable group bookings, and the expectation of improved operational performance as the impact of renovations diminishes [52][54] Question: What is the outlook for capital expenditures moving forward? - Management indicated a significant step down in capital expenditures is expected as the heavy reinvestment cycle concludes, with ongoing smaller projects across the portfolio [62]

Company Performance - Marcus reported quarterly earnings of $0.23 per share, exceeding the Zacks Consensus Estimate of $0.19 per share, compared to a loss of $0.17 per share a year ago, representing an earnings surprise of +21.05% [1] - The company posted revenues of $206.04 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.63%, and showing an increase from year-ago revenues of $176.03 million [2] - Over the last four quarters, Marcus has surpassed consensus EPS estimates three times and topped consensus revenue estimates four times [2] Stock Performance and Outlook - Marcus shares have declined approximately 23.9% since the beginning of the year, while the S&P 500 has gained 7.8% [3] - The current consensus EPS estimate for the upcoming quarter is $0.58 on revenues of $222.5 million, and for the current fiscal year, it is $0.40 on revenues of $776.99 million [7] - The estimate revisions trend for Marcus was unfavorable prior to the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] Industry Context - The Leisure and Recreation Services industry, to which Marcus belongs, is currently ranked in the bottom 28% of over 250 Zacks industries, suggesting potential challenges for stocks in this sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment and stock performance [5]

Overall Financial Performance [Second Quarter Fiscal 2025 Highlights](index=1&type=section&id=Second%20Quarter%20Fiscal%202025%20Highlights) The company reported significant year-over-year growth in Q2 2025, with revenues up 17.0% to $206.0 million, shifting from a net loss to a net profit of $7.3 million, and Adjusted EBITDA growing by 46.9% primarily due to strong Marcus Theatres performance Q2 Fiscal 2025 Key Financial Metrics | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $206.0 million | $176.0 million | +17.0% | | Operating Income | $13.0 million | $2.2 million | +491.8% | | Net Earnings (Loss) | $7.3 million | ($20.2 million) | N/A | | Net Earnings (Loss) per Diluted Share | $0.23 | ($0.64) | N/A | | Adjusted EBITDA | $32.3 million | $22.0 million | +46.9% | - The net loss for Q2 2024 included a negative impact of **$15.0 million** (**$0.47 per share**) from convertible senior notes repurchases, with the net loss being **$5.2 million** excluding this impact[7](index=7&type=chunk) [First Half Fiscal 2025 Highlights](index=1&type=section&id=First%20Half%20Fiscal%202025%20Highlights) For the first half of fiscal 2025, revenues increased by 12.8% to $354.8 million, with the company significantly narrowing its operating loss to $7.4 million and its net loss to $9.5 million, while Adjusted EBITDA increased by 32.0% to $32.0 million First Half Fiscal 2025 Key Financial Metrics | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $354.8 million | $314.6 million | +12.8% | | Operating Loss | ($7.4 million) | ($14.4 million) | +48.6% | | Net Loss | ($9.5 million) | ($32.1 million) | +70.4% | | Net Loss per Diluted Share | ($0.31) | ($1.03) | +69.9% | | Adjusted EBITDA | $32.0 million | $24.3 million | +32.0% | Business Segment Performance [Marcus Theatres®](index=2&type=section&id=Marcus%20Theatres%C2%AE) The Marcus Theatres division was the primary driver of growth in Q2 2025, with revenues increasing 29.8% to $131.7 million and operating income surging to $15.7 million, fueled by a 26.7% increase in same-store attendance, higher ticket prices, and increased concession spending per person, all benefiting from a stronger film slate Marcus Theatres Q2 2025 Performance | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $131.7 million | $101.5 million | +29.8% | | Operating Income | $15.7 million | $2.8 million | +460.7% | | Adjusted EBITDA | $26.5 million | $15.1 million | +76.2% | - Same-store attendance increased by **26.7%**, average ticket prices rose by **2.0%**, and average concession revenues per person grew by **3.1%** compared to the prior year quarter[9](index=9&type=chunk) - Top performing films in Q2 included *A Minecraft Movie*, *Lilo & Stitch*, and *Thunderbolts*, with the company anticipating continued momentum from a strong film slate for the remainder of the year[9](index=9&type=chunk)[10](index=10&type=chunk) - The company completed renovations at theatres in New York and Pennsylvania, with another completed in July in Kentucky, to enhance lobbies, concessions, and bar areas[11](index=11&type=chunk) [Marcus Hotels & Resorts®](index=2&type=section&id=Marcus%20Hotels%20%26%20Resorts%C2%AE) The Marcus Hotels & Resorts division reported stable revenues of $64.6 million before cost reimbursements, a slight 1.2% increase, but operating income decreased to $4.2 million primarily due to a $1.7 million increase in depreciation from recent renovations, with the Hilton Milwaukee renovation negatively impacting performance and causing a 2.9% decrease in RevPAR at company-owned hotels Marcus Hotels & Resorts Q2 2025 Performance | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues (before cost reimbursements) | $64.6 million | $63.8 million | +1.2% | | Operating Income | $4.2 million | $6.1 million | -31.1% | | Adjusted EBITDA | $11.2 million | $11.4 million | -1.8% | - Revenue per available room (RevPAR) at company-owned hotels decreased by **2.9%** due to room displacement from the Hilton Milwaukee renovation[14](index=14&type=chunk) - Despite some industry-wide softening in leisure travel, group demand at Marcus Hotels & Resorts remains strong, and the Hilton Milwaukee guest room renovation was completed at the end of June 2025[14](index=14&type=chunk)[15](index=15&type=chunk) Financial Statements [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) The consolidated income statement shows a significant turnaround in Q2 2025, with net earnings of $7.3 million compared to a $20.2 million net loss in Q2 2024, and for the first half, the net loss narrowed to $9.5 million from $32.1 million year-over-year, driven by strong revenue growth, particularly in theatre admissions and concessions which rose 28.3% and 29.7% respectively in the quarter Consolidated Statements of Operations Highlights (in thousands) | Line Item | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $206,043 | $176,032 | $354,809 | $314,579 | | Operating Income (Loss) | $13,007 | $2,237 | ($7,405) | ($14,428) | | Net Earnings (Loss) | $7,321 | ($20,221) | ($9,495) | ($32,087) | | Net Earnings (Loss) per Share - Diluted | $0.23 | ($0.64) | ($0.31) | ($1.03) | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, the company's balance sheet shows total assets of $1.016 billion and total shareholders' equity of $448.4 million, with cash and cash equivalents decreasing from $40.8 million to $14.9 million and long-term debt increasing from $149.0 million to $170.1 million compared to the end of fiscal 2024 Key Balance Sheet Items (in thousands) | Account | June 30, 2025 | Dec 26, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $14,901 | $40,841 | | Total Assets | $1,016,307 | $1,044,528 | | Long-term debt | $170,116 | $149,007 | | Total Liabilities | $567,889 | $579,662 | | Total Shareholders' Equity | $448,418 | $464,866 | [Supplemental Data (Cash Flow)](index=8&type=section&id=Supplemental%20Data%20%28Cash%20Flow%29) For the first six months of 2025, net cash used in operating activities was $3.7 million, a significant decrease from the $20.9 million provided in the same period of 2024, while capital expenditures for the first half totaled $39.9 million, an increase from $35.3 million in the prior year period Cash Flow Summary (in thousands) | Line Item | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Net cash from operating activities | $31,640 | $35,975 | ($3,689) | $20,877 | | Net cash used in investing activities | ($8,766) | ($19,882) | ($31,545) | ($40,640) | | Net cash from (used in) financing activities | ($21,898) | $1,139 | $7,354 | ($2,290) | | Capital expenditures | ($16,910) | ($19,843) | ($39,915) | ($35,283) | Non-GAAP Financial Measures & Reconciliations [Reconciliation of Net Earnings (Loss) to Adjusted EBITDA](index=9&type=section&id=Reconciliation%20of%20Net%20Earnings%20%28Loss%29%20to%20Adjusted%20EBITDA) This section reconciles the GAAP measure of Net Earnings (Loss) to the non-GAAP measure of Adjusted EBITDA, showing that for Q2 2025, Net Earnings of $7.3 million reconciled to an Adjusted EBITDA of $32.3 million, and for H1 2025, a Net Loss of $9.5 million reconciled to an Adjusted EBITDA of $32.0 million Reconciliation to Adjusted EBITDA (in thousands) | Line Item | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Earnings (Loss) | $7,321 | ($20,221) | ($9,495) | ($32,087) | | Depreciation and amortization | $17,603 | $16,699 | $35,441 | $32,714 | | Interest expense | $2,981 | $2,564 | $5,803 | $5,098 | | Income tax expense (benefit) | $2,746 | $5,719 | ($4,612) | ($1,650) | | Debt conversion expense | — | $13,908 | — | $13,908 | | Adjusted EBITDA | $32,267 | $21,960 | $32,008 | $24,251 | [Reconciliation of Operating Income (Loss) to Adjusted EBITDA by Reportable Segment](index=9&type=section&id=Reconciliation%20of%20Operating%20Income%20%28Loss%29%20to%20Adjusted%20EBITDA%20by%20Reportable%20Segment) This table provides a segment-level reconciliation from Operating Income (Loss) to Adjusted EBITDA, indicating that in Q2 2025, the Theatres segment's Adjusted EBITDA was $26.5 million, a significant increase from $15.1 million in the prior year, while the Hotels & Resorts segment's Adjusted EBITDA remained stable at $11.2 million Segment Adjusted EBITDA (in thousands) | Segment | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Theatres | $26,546 | $15,069 | $30,240 | $21,225 | | Hotels & Resorts | $11,226 | $11,426 | $12,237 | $11,415 | | Corporate Items | ($5,505) | ($4,535) | ($10,469) | ($8,389) | | **Total** | **$32,267** | **$21,960** | **$32,008** | **$24,251** | Other Information [Fiscal Year Change](index=3&type=section&id=Fiscal%20Year%20Change) The company has changed its fiscal year-end from the last Thursday of each year to December 31, effective December 27, 2024, meaning future quarterly results will be reported for three-month periods ending on March 31, June 30, September 30, and December 31 - Effective December 27, 2024, the company's fiscal year will end on December 31, aligning quarterly results with standard calendar quarters[16](index=16&type=chunk) [Conference Call and Webcast](index=3&type=section&id=Conference%20Call%20and%20Webcast) Management will host a conference call on Friday, August 1, 2025, at 10:00 a.m. Central Time to discuss the quarterly results, with dial-in and webcast details provided in the press release for interested parties - A conference call to discuss Q2 2025 results is scheduled for August 1, 2025, at 10:00 a.m. Central / 11:00 a.m. Eastern time[17](index=17&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section contains the standard safe harbor statement, cautioning that forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially, listing several potential risk factors including the availability and appeal of motion pictures, theatre industry dynamics, economic conditions, and competition - The company identifies key risks that could impact future performance, including: - Availability and audience appeal of motion pictures[22](index=22&type=chunk) - Effects of adverse economic conditions[22](index=22&type=chunk) - Competitive conditions in its markets[22](index=22&type=chunk) - Ability to achieve benefits from strategic initiatives[23](index=23&type=chunk) - Changes in the cost of labor and supplies[23](index=23&type:chunk)

Core Viewpoint - Marcus (MCS) is anticipated to report a year-over-year increase in earnings driven by higher revenues, with the actual results being a significant factor influencing its near-term stock price [1][2]. Earnings Expectations - The upcoming earnings report is expected to be released on August 1, with a consensus EPS estimate of $0.19 per share, reflecting a year-over-year increase of +211.8% [3]. - Revenues are projected to reach $204.75 million, which is a 16.3% increase from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has been revised down by 6.23% over the last 30 days, indicating a reassessment by analysts [4]. - The Most Accurate Estimate for Marcus aligns with the Zacks Consensus Estimate, resulting in an Earnings ESP of 0% [12]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that a positive or negative reading indicates the likely deviation of actual earnings from the consensus estimate, with a positive ESP being a strong predictor of an earnings beat [9][10]. - However, Marcus currently holds a Zacks Rank of 4, which complicates the prediction of an earnings beat [12]. Historical Performance - In the last reported quarter, Marcus was expected to post a loss of $0.52 per share but actually reported a loss of -$0.54, resulting in a surprise of -3.85% [13]. - Over the past four quarters, the company has beaten consensus EPS estimates twice [14]. Conclusion - While Marcus does not appear to be a compelling candidate for an earnings beat, investors should consider other factors before making investment decisions [17].

Industry Overview - The Leisure and Recreation Services industry is experiencing growth due to optimized business processes, consistent partnerships, and digital initiatives [1] - Strong demand for concerts, easing trade tensions, and robust bookings for cruise operators are supporting the industry [1][2] Cruise Industry - The cruise industry is benefiting from strong demand and increasing booking volumes, with solid pricing and onboard spending contributing positively [3] - Carnival Corporation & plc (CCL) is raising its full-year 2025 guidance due to sustained demand strength and operational efficiency [5][6] - CCL has an expected revenue growth rate of 5.4% and earnings growth rate of 38% for the current year [6] Theme Park Industry - The theme park industry is also seeing robust demand, with operators benefiting from improved visitation [3] Company Highlights - **Carnival Corporation & plc (CCL)**: Zacks Rank 2, benefiting from increased booking volumes and onboard revenues, with a P/E ratio of 15.1X compared to the industry average of 21.7X [5][7] - **Manchester United plc (MANU)**: Zacks Rank 1, expected revenue growth of 9.6% and earnings growth of 56.6% for the current year, with a potential upside of 50.1% from current brokerage targets [10][12][13] - **The Marcus Corporation (MCS)**: Zacks Rank 2, engaged in lodging and entertainment, with expected revenue growth of 5.2% and earnings growth of over 100% for the current year [14][15] - **Madison Square Garden Sports Corp. (MSGS)**: Zacks Rank 2, expected revenue growth of 6.5% and earnings growth of over 100% for the current year, with a potential price target increase of 24.8% [18][20] - **Pursuit Attractions and Hospitality Inc. (PRSU)**: Zacks Rank 1, expected revenue growth of 6.2% and earnings growth of 11% for the next year, with a potential price target increase of 44.4% [22][23][24]

Group 1 - The Marcus Corporation (MCS) is experiencing significant activity in the options market, particularly with the Nov 21, 2025 $2.50 Put showing high implied volatility, indicating potential for a major price movement [1] - Implied volatility reflects market expectations for future stock movement, suggesting that investors anticipate a significant event that could lead to a rally or sell-off [2] - The Marcus is currently rated as Zacks Rank 2 (Buy) in the Leisure and Recreation Services industry, which is in the top 30% of the Zacks Industry Rank, with recent earnings estimates for the current quarter increasing from 5 cents per share to 16 cents [3] Group 2 - The high implied volatility for The Marcus could indicate a developing trading opportunity, as options traders often seek to sell premium on such options to capture decay, hoping the stock does not move as much as expected by expiration [4]