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]

Core Insights - The Marcus Corporation (NYSE: MCS) is attracting interest from value investors due to its structure as a holding company with two distinct businesses and a diverse portfolio [1] Group 1 - The company operates in two separate business segments, which may provide a diversified revenue stream [1]

Core Viewpoint - Marcus (MCS) shows potential for significant upside, with a mean price target of $24.67 indicating a 44.7% increase from the current price of $17.05 [1] Price Targets and Analyst Estimates - The mean estimate consists of three short-term price targets with a standard deviation of $0.58, suggesting a consensus among analysts [2] - The lowest estimate of $24 indicates a 40.8% increase, while the highest estimate suggests a 46.6% increase to $25 [2] - Analysts' price targets can often mislead investors, as empirical research shows they rarely indicate actual price movements [7][10] Earnings Estimates and Analyst Agreement - Strong agreement among analysts regarding MCS's earnings prospects supports the expectation of an upside [4][11] - The Zacks Consensus Estimate for the current year has increased by 19.7% over the past month, with no negative revisions [12] - MCS holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [13]

Company Overview - Marcus (MCS) currently has a Momentum Style Score of B, indicating potential for strong performance based on recent trends [3] - The company operates in the leisure and recreation services industry, which includes movie theaters, hotels, and resorts [4] Performance Metrics - MCS shares have increased by 8.32% over the past week, while the Zacks Leisure and Recreation Services industry has remained flat during the same period [6] - Over the past month, MCS shares have risen by 8.9%, outperforming the industry's 2.99% [6] - In the last quarter, MCS shares have gained 9.65%, and over the past year, they have surged by 69.91%, compared to the S&P 500's increases of 2.37% and 14.4%, respectively [7] Trading Volume - The average 20-day trading volume for MCS is 181,234 shares, which serves as a bullish indicator when combined with rising stock prices [8] Earnings Outlook - Recent earnings estimate revisions for MCS show one upward revision for the full year, increasing the consensus estimate from $0.31 to $0.40 over the past 60 days [10] - For the next fiscal year, there has been one upward revision with no downward revisions noted [10] Conclusion - Considering the positive performance metrics and earnings outlook, MCS is rated as a 2 (Buy) stock with a Momentum Score of B, making it a strong candidate for near-term investment [12]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investors often face challenges in determining the right entry point for fast-moving stocks, which can lead to limited upside or downside risks [2] - Investing in bargain stocks that have recently shown price momentum can be a safer strategy [3] Group 2: Case Study - Marcus (MCS) - Marcus (MCS) has shown a four-week price change of 8.9%, indicating growing investor interest [4] - Over the past 12 weeks, MCS stock gained 9.7%, with a beta of 1.28, suggesting it moves 28% higher than the market [5] - MCS has a Momentum Score of B, indicating a favorable time to invest [6] Group 3: Earnings Estimates and Valuation - MCS has a Zacks Rank 2 (Buy) due to upward trends in earnings estimate revisions, which attract more investors [7] - The stock is trading at a Price-to-Sales ratio of 0.74, suggesting it is undervalued at 74 cents for each dollar of sales [7] Group 4: Additional Opportunities - Besides MCS, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen [8] - Zacks offers over 45 Premium Screens to help identify potential winning stock picks based on various investing styles [9]

Group 1 - Shares of Marcus (MCS) have increased by 5.5% over the past four weeks, closing at $16.87, with a mean price target of $24.67 indicating a potential upside of 46.2% [1] - The mean estimate includes three short-term price targets with a standard deviation of $0.58, where the lowest estimate suggests a 42.3% increase and the highest a 48.2% increase [2] - Analysts show strong agreement in revising earnings estimates higher, with the Zacks Consensus Estimate increasing by 19.7% over the last 30 days [11][12] Group 2 - The Zacks Rank for MCS is 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [13] - A tight clustering of price targets, indicated by a low standard deviation, suggests a high degree of agreement among analysts regarding the stock's price movement [9] - While price targets can be misleading, the direction they imply may serve as a useful guide for potential price movements [10][11]

[PART I – FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) Part I presents the company's consolidated financial statements, management's discussion, market risk, and controls [Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) The consolidated financial statements present The Marcus Corporation's Q1 2025 financial position, operations, and cash flows [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Balance sheets show total assets decreased to **$1.018 billion**, driven by lower cash, with equity declining due to net loss Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 26, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $11,865 | $40,841 | | Net property and equipment | $693,120 | $685,734 | | Total current assets | $59,768 | $92,150 | | **Total Assets** | **$1,017,957** | **$1,044,528** | | **Liabilities & Equity** | | | | Total current liabilities | $142,812 | $176,681 | | Long-term debt | $189,062 | $149,007 | | Total liabilities | $576,166 | $579,662 | | Total shareholders' equity | $441,791 | $464,866 | | **Total Liabilities & Equity** | **$1,017,957** | **$1,044,528** | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) The statements of operations show Q1 2025 revenues increased to **$148.8 million**, but operating and net losses widened due to higher costs Q1 Statement of Operations (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total revenues | $148,766 | $138,547 | | Operating loss | $(20,412) | $(16,665) | | Net loss | $(16,816) | $(11,866) | | Net loss per share - diluted (Common) | $(0.54) | $(0.38) | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Cash flow statements indicate a significant increase in cash used in operations to **$35.3 million**, leading to a net cash decrease Q1 Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(35,329) | $(15,098) | | Net cash used in investing activities | $(22,779) | $(20,758) | | Net cash provided by (used in) financing activities | $29,252 | $(3,429) | | **Net decrease in cash** | **$(28,856)** | **$(39,285)** | [Condensed Notes to Consolidated Financial Statements](index=10&type=section&id=Condensed%20Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, fiscal year change, debt increase, segment performance, and a new hotel joint venture - The company changed its fiscal year from a 52/53-week system ending on the last Thursday of December to a calendar year ending on **December 31**, effective **December 27, 2024**[15](index=15&type=chunk) - In March 2024, the company invested **$5.62 million** for an initial **33.3%** equity interest in a joint venture to acquire the Loews Minneapolis Hotel, now rebranded as The Lofton Hotel. The interest was later reduced to **24.7%** after selling a portion to a minority investor[57](index=57&type=chunk) Q1 2025 Segment Performance (in thousands) | Segment | Total Revenues | Operating Loss | | :--- | :--- | :--- | | Theatres | $87,357 | $(6,281) | | Hotels/Resorts | $61,322 | $(6,044) | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 results, including revenue growth, widened operating loss due to increased costs, and liquidity, with negative Adjusted EBITDA [Overall Results](index=22&type=section&id=Overall%20Results) Overall Q1 2025 revenues increased by **7.4%** to **$148.8 million**, but operating and net losses widened due to higher costs Q1 Overall Results Summary (in millions) | Metric | F2025 | F2024 | Variance Amt. | Variance Pct. | | :--- | :--- | :--- | :--- | :--- | | Revenues | $148.8 | $138.5 | $10.2 | 7.4% | | Operating loss | $(20.4) | $(16.7) | $(3.7) | (22.5)% | | Net loss | $(16.8) | $(11.9) | $(5.0) | (41.7)% | - The first quarter of fiscal 2025 included **four additional operating days** compared to the prior year, which favorably impacted revenues by approximately **$9.2 million**[70](index=70&type=chunk)[72](index=72&type=chunk) [Theatres](index=24&type=section&id=Theatres) Theatre division revenues rose **7.5%** to **$87.4 million**, but operating loss increased due to higher costs and lower average ticket price - Comparable theatre admission revenues increased **1.3%**, underperforming the U.S. box office increase of **3.1%** by **1.8 percentage points**, attributed to strategic pricing decisions[79](index=79&type=chunk) - Average ticket price decreased by **5.1%** in Q1 2025, negatively impacted by promotional pricing and an unfavorable ticket mix with more family films[84](index=84&type=chunk) - Average concession revenues per person increased by **2.9%** in Q1 2025, driven by market pricing adjustments and changes to the Value Tuesday promotion[85](index=85&type=chunk) [Hotels and Resorts](index=26&type=section&id=Hotels%20and%20Resorts) Hotels and Resorts revenues grew **7.2%** to **$61.3 million**, but operating loss widened due to increased depreciation, despite RevPAR growth Q1 Hotels and Resorts Operating Statistics (Comparable Properties) | Metric | F2025 | F2024 | Variance | | :--- | :--- | :--- | :--- | | Occupancy pct. | 50.3% | 53.7% | (3.4) pts | | ADR | $162.09 | $150.11 | +8.0% | | RevPAR | $81.45 | $80.57 | +1.1% | - The operating loss increase was significantly impacted by a **$1.9 million** rise in depreciation expense from hotel renovations completed in fiscal 2024[88](index=88&type=chunk) - Group room revenue bookings for the remainder of fiscal 2025 are running over **11%** ahead of the same time last year (excluding the RNC), and fiscal 2026 bookings are over **20%** ahead[95](index=95&type=chunk) [Adjusted EBITDA](index=27&type=section&id=Adjusted%20EBITDA) Total Adjusted EBITDA for Q1 2025 was a loss of **$0.3 million**, a decline from prior year, with varied segment performance Adjusted EBITDA Reconciliation (in millions) | Line Item | F2025 | F2024 | | :--- | :--- | :--- | | Net loss | $(16.8) | $(11.9) | | Depreciation and amortization | 17.8 | 16.0 | | Share-based compensation | 3.5 | 2.5 | | Interest expense | 2.8 | 2.5 | | Income tax benefit | (7.4) | (7.4) | | Other adjustments | (0.8) | 1.1 | | **Total Adjusted EBITDA** | **$(0.3)** | **$2.3** | Adjusted EBITDA by Segment (in millions) | Segment | F2025 | F2024 | | :--- | :--- | :--- | | Theatres | $3.7 | $6.2 | | Hotels and resorts | $1.0 | $— | | Corporate items | $(5.0) | $(3.9) | | **Total Adjusted EBITDA** | **$(0.3)** | **$2.3** | [LIQUIDITY AND CAPITAL RESOURCES](index=30&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) The company maintains strong liquidity with **$180.2 million** available credit, despite increased cash used in operations and capital expenditures - As of **March 31, 2025**, the company had a cash balance of **$11.9 million** and **$180.2 million** of availability under its **$225 million** revolving credit facility[104](index=104&type=chunk) - Capital expenditures in Q1 2025 totaled **$23.0 million**, including **$15.9 million** for the hotels division (primarily for Hilton Milwaukee renovations) and **$4.4 million** for the theatre division[108](index=108&type=chunk)[109](index=109&type=chunk) - During Q1 2025, the company repurchased **0.4 million shares** of common stock for **$7.1 million**[113](index=113&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in market risk exposures were experienced since **December 26, 2024** - No material changes in market risk exposures were experienced since **December 26, 2024**[116](index=116&type=chunk) [Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures are **effective**, with no significant changes in internal control over financial reporting - The principal executive officer and principal financial officer concluded that disclosure controls and procedures are **effective**[117](index=117&type=chunk) - No significant changes in internal control over financial reporting were identified during the quarter[118](index=118&type=chunk) [PART II – OTHER INFORMATION](index=33&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) Part II provides updates on risk factors, equity security sales, and other required disclosures [Risk Factors](index=33&type=section&id=Item%201A.%20Risk%20Factors) Updated risk factors highlight potential negative financial impact from tariffs and dependency on film quantity and audience appeal - A new risk factor was added regarding tariffs, which could increase costs for commodities or film production, potentially harming financial results if costs cannot be offset[119](index=119&type=chunk) - A revised risk factor highlights the adverse financial impact from a lack of quantity and audience appeal of films, exacerbated by production disruptions from events like pandemics or labor strikes[120](index=120&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=33&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased **452,592 shares** of common stock at **$16.87 per share**, with **1.26 million shares** remaining authorized Q1 2025 Share Repurchase Summary | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | Dec 26 - Jan 31 | — | $— | | Feb 1 - Feb 28 | 10,989 | $20.81 | | Mar 1 - Mar 31 | 441,603 | $16.77 | | **Total** | **452,592** | **$16.87** | - As of **March 31, 2025**, **1,262,090 shares** remain authorized for repurchase[122](index=122&type=chunk) [Other Information](index=34&type=section&id=Item%205.%20Other%20Information) No director or Section 16 officer adopted or terminated a Rule 10b5-1 trading arrangement in **Q1 2025** - No director or Section 16 officer adopted or terminated a Rule 10b5-1 trading arrangement in **Q1 2025**[125](index=125&type=chunk) [Exhibits](index=34&type=section&id=Item%206.%20Exhibits) The report lists several exhibits filed with the Form 10-Q, including incentive plan agreements and required certifications - Exhibits filed include incentive plan agreements and required CEO/CFO certifications (Sections 302 and 906)[126](index=126&type=chunk)