Company Performance - National CineMedia (NCMI) reported a quarterly loss of $0.24 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.20, and compared to a loss of $0.19 per share a year ago, indicating a decline in performance [1] - The company posted revenues of $34.9 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 1.16%, and showing a slight increase from year-ago revenues of $34.8 million [2] - Over the last four quarters, National CineMedia has surpassed consensus revenue estimates four times, but has only exceeded consensus EPS estimates once [2] Stock Performance and Outlook - National CineMedia shares have declined approximately 15.5% since the beginning of the year, while the S&P 500 has only declined by 3.9%, indicating underperformance relative to the broader market [3] - The current consensus EPS estimate for the upcoming quarter is -$0.03 on revenues of $66.45 million, and for the current fiscal year, it is also -$0.03 on revenues of $265.3 million [7] - The estimate revisions trend for National CineMedia is mixed, resulting in a Zacks Rank 3 (Hold), suggesting that the shares are expected to perform in line with the market in the near future [6] Industry Context - The Advertising and Marketing industry, to which National CineMedia belongs, is currently ranked in the top 25% of over 250 Zacks industries, indicating a favorable industry outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Data and Key Metrics Changes - NCM's total revenue for Q1 2025 was $34.9 million, a 7% decline from $37.4 million in the same period last year, primarily due to a 5% year-over-year reduction in attendance and advertiser uncertainty regarding tariffs [27][12][13] - Adjusted OIBDA was negative $9 million, in line with guidance, reflecting reduced theater attendance and investments in sales and operations [13][32] - The company had $63.1 million in cash and equivalents at the end of Q1 2025, with zero outstanding debt [33] Business Line Data and Key Metrics Changes - National advertising revenue decreased to $27.4 million from $29.5 million in Q1 2024, driven by lower attendance in March [28] - Local and regional advertising revenue totaled $4.9 million, down from $5.3 million in the same quarter last year, primarily due to lower attendance and economic uncertainty [29] Market Data and Key Metrics Changes - The box office generated approximately $1.4 billion in Q1 2025, an 11.6% decline compared to the same period last year, attributed to a weaker film slate and underperformance of high-profile titles [6][7] - NCM's year-to-date network attendance through April was up 6% compared to the same period last year, driven by strong performances from new releases [8] Company Strategy and Development Direction - NCM is focused on enhancing its platform through technology investments and talent acquisition, aiming to capitalize on opportunities in the premium video ad space [5][6] - The company has agreed to a five-year extension of its contract with AMC Theatres, aligning payment structures with performance metrics to enhance revenue generation [17][34] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about attendance recovery supported by a strong film slate in the second quarter and beyond, despite headwinds from government policy shifts affecting advertising [24][25] - The company anticipates Q2 revenue between $56 million and $61 million, reflecting ongoing impacts of tariff uncertainty [37] Other Important Information - NCM's scatter market participation increased to 42% in Q1 2025, up from 29% in the prior year, indicating a shift towards real-time advertising solutions [12][28] - The company launched new products, Bullseye and Blueprint, aimed at enhancing targeting capabilities and connecting brands with high-intent consumers [19][70] Q&A Session Summary Question: Has the strength of pacing weakened from Q4 to Q1? - Management noted that while the pipeline remains active, there has been some softening in pacing due to economic uncertainties affecting certain categories [44][46] Question: Will there be more flexibility in upfront commitments due to the current environment? - Management indicated that while upfront negotiations will allow for more flexibility, current cancellation policies are expected to remain in place for the upcoming quarters [49][50] Question: How is NCMX helping to compete with digital video platforms? - Management highlighted that NCMX's new tools allow for better targeting and quicker ad delivery, enhancing competitiveness against digital media companies [70][72] Question: What is the incremental revenue opportunity from the new AMC inventory? - Management expressed excitement about the new inventory from AMC, which is expected to have a material impact on revenue in the second half of the year [63][66]

Financial Data and Key Metrics Changes - NCM's total revenue for Q1 2025 was $34.9 million, a 7% decline from $37.4 million in the same period last year, primarily due to a 5% year-over-year reduction in attendance and advertiser uncertainty related to tariffs [26][12][13] - Adjusted OIBDA was negative $9 million, in line with guidance, compared to negative $5.7 million in the prior year [30][13] - Total unlevered free cash flow for the quarter was $5.5 million, impacted by prior year client advance payments [30] Business Line Data and Key Metrics Changes - National advertising revenue decreased to $27.4 million from $29.5 million in Q1 2024, driven by lower attendance [27] - Local and regional advertising revenue totaled $4.9 million, down from $5.3 million in the prior year, primarily due to lower attendance and economic uncertainty [28] - The scatter market accounted for 42% of first quarter national onscreen revenue, up from 29% in the prior year, reflecting a shift towards real-time advertising solutions [12][27] Market Data and Key Metrics Changes - The box office generated approximately $1.4 billion in Q1 2025, an 11.6% decline compared to the same period last year, attributed to a weaker film slate and underperformance of high-profile titles [6][7] - Year-to-date network attendance through April was up 6% compared to the same period last year, driven by strong performances from new releases [7] Company Strategy and Development Direction - NCM is focused on enhancing its platform through investments in technology and talent, aiming to capitalize on opportunities in the premium video ad space [5][6] - The company has extended its contract with AMC Theatres for five years, aligning payment structures with performance metrics to enhance revenue generation [16][34] - NCM is prioritizing the development of programmatic and self-serve advertising solutions to meet evolving market demands [20][21] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about attendance recovery supported by a strong film slate in the second quarter and beyond, despite headwinds from tariff-related uncertainties [23][36] - The company anticipates second quarter revenue between $56 million and $61 million, reflecting ongoing impacts of tariff uncertainty [36] - Management remains confident in the resilience of the theatrical exhibition industry, supported by a compelling film slate and renewed commitments from industry leaders [24][36] Other Important Information - NCM repurchased 2.3 million shares at an average price of $6.6, totaling approximately $14 million, as part of its share repurchase program [34][35] - A quarterly dividend of $0.03 per share was announced, amounting to $2.9 million, to be paid on May 29, 2025 [35] Q&A Session Summary Question: Has the strength of pacing seen in Q4 weakened? - Management noted that while the pipeline remains active, there are headwinds in certain categories, and pacing has softened slightly compared to Q4 [44] Question: Will there be more flexibility in upfront commitments due to the current environment? - Management indicated that while upfront negotiations will allow for more flexibility, current cancellation policies are expected to remain unchanged [48] Question: How is the ability to deliver ads quickly impacting monetization? - Management stated that quick ad delivery is beneficial for capitalizing on films that outperform expectations, enhancing inventory utilization [52] Question: Is there a difference in spending between brand-driven and performance ad purchases? - Management observed that brand-driven advertisers are pausing spending, while performance-based companies continue to invest due to quantifiable outcomes [54] Question: What is the incremental revenue opportunity from the new AMC inventory? - Management expressed excitement about the enhanced relationship with AMC, indicating that the new inventory will provide significant revenue opportunities [60] Question: How is NCMX helping to compete with digital video platforms? - Management highlighted that NCMX's new tools allow for better targeting and attribution, making NCM more competitive in the advertising space [66]

Revenue and Advertising - National CineMedia's revenue primarily comes from advertising sales in The Noovie® Show, which is shown in theaters across the U.S.[126] - National advertising revenue fell by $2.1 million, or 7.1%, from $29.5 million in Q1 2024 to $27.4 million in Q1 2025, primarily due to a 7.6% decrease in national advertising utilization[145]. - The weighted average remaining term of exclusive advertising agreements is 11.0 years as of March 27, 2025, extending to 12.6 years after the 2025 AMC Agreement[127]. Financial Performance - Total revenue decreased by $2.5 million, or 6.7%, from $37.4 million in Q1 2024 to $34.9 million in Q1 2025[144]. - Adjusted OIBDA was $(9.0) million in Q1 2025 compared to $(5.7) million in Q1 2024, reflecting a 57.9% increase in losses[144]. - Adjusted OIBDA margin decreased to (25.8%) in Q1 2025 from (15.2%) in Q1 2024[142]. - Net loss attributable to NCM, Inc. was $(30.7) million in Q1 2025, a decrease of 11.5% from $(34.7) million in Q1 2024[140]. - Net loss per diluted share improved to $(0.32) in Q1 2025 from $(0.36) in Q1 2024, reflecting an 11.1% decrease in losses per share[140]. Attendance and Operating Expenses - Total theater attendance decreased by 4.6% from 75.8 million in Q1 2024 to 72.3 million in Q1 2025[144]. - Total operating expenses decreased by $1.3 million, or 2.2%, from $60.1 million in Q1 2024 to $58.8 million in Q1 2025[147]. - Network operating costs decreased by $0.5 million, or 13.9%, from $3.6 million in Q1 2024 to $3.1 million in Q1 2025[148]. - Selling and marketing costs increased by $0.7 million, or 7.0%, from $10.0 million in Q1 2024 to $10.7 million in Q1 2025[150]. - Administrative and other costs decreased by $0.6 million, or 4.4%, from $13.5 million in Q1 2024 to $12.9 million in Q1 2025, primarily due to a $1.0 million decrease in personnel costs[151]. - Depreciation expense increased by $0.1 million, or 10.0%, from $1.0 million in Q1 2024 to $1.1 million in Q1 2025[152]. Cash Flow and Liquidity - Cash, cash equivalents, and marketable securities decreased from $75.2 million as of December 26, 2024, to $59.8 million as of March 27, 2025, a decline of $15.4 million[160]. - Operating cash flow decreased by $18.1 million, from $24.1 million in Q1 2024 to $6.0 million in Q1 2025, attributed to lower accounts receivable collections and changes in deferred revenue[161][164]. - As of March 27, 2025, total liquidity was $104.2 million, down from $119.6 million as of December 26, 2024[160]. - For the three months ended March 27, 2025, NCM LLC's available cash for distribution was approximately negative $13.4 million, primarily due to NCM, Inc. being the main holder of NCM LLC units[166]. - As of March 27, 2025, NCM LLC owed NCM, Inc. $14.8 million in deferred available cash distribution[166]. Debt and Credit Facilities - The 2025 Credit Facility provides a $45.0 million senior secured revolving credit facility, maturing on January 24, 2028, with a floating interest rate[133]. - The company entered into a $45.0 million senior secured revolving credit facility on January 24, 2025, maturing on January 24, 2028, with no borrowings made as of March 27, 2025[158]. - The company repaid the $10.0 million balance of the previous revolving credit facility and incurred a prepayment fee of 1% upon termination[159]. - The weighted average remaining maturity of the company's debt facility was 2.8 years as of March 27, 2025, with 100.0% of borrowings bearing interest at variable rates[161]. - The maximum capacity of the 2025 Credit Facility is $45.0 million, with a floating interest rate of term SOFR plus an applicable margin of 2.00%[170]. - A 100-basis point fluctuation in market interest rates would affect cash interest expense by approximately $0.5 million annually if the maximum capacity of the 2025 Credit Facility were drawn[170]. Corporate Actions and Agreements - The 2025 AMC Agreement extends the term of the exhibitor services agreement with AMC by five years, through February 13, 2042, and revises the payment structure based on attendance and revenue generated[131]. - The company repurchased 1,455,668 shares during the three months ended March 27, 2025, with a total of 4,804,257 shares repurchased since the program's inception[134]. - NCM LLC emerged from bankruptcy on August 7, 2023, recording a gain on bankruptcy of $916.4 million for the year ended December 26, 2024[137]. - The company recorded a gain on deconsolidation of $557.7 million during the second quarter of 2023 due to the Chapter 11 filing[135]. - The company has long-term agreements with network affiliates, with expiration dates ranging from July 2025 to July 2033[128].

Financial Performance - Total revenue for Q1 2025 decreased by 6.7% to $34.9 million compared to $37.4 million in Q1 2024[3] - Operating loss increased to $23.9 million, or negative $0.32 per diluted share, for Q1 2025, compared to a loss of $22.7 million, or negative $0.36 per diluted share, in Q1 2024[3] - Adjusted OIBDA for Q1 2025 was negative $9.0 million, worsening from negative $5.7 million in Q1 2024[3] - Total revenue for the quarter ended March 27, 2025, was $34.9 million, a decrease of 6.7% from $37.4 million in the same quarter of the previous year[22] - Adjusted OIBDA for the quarter was $(9.0) million, compared to $(5.7) million in the prior year, indicating a worsening of 57.9%[22] - The operating loss increased to $(23.9) million from $(22.7) million, a rise of 5.3% year-over-year[22] - Loss per share (diluted) was $(0.32), slightly improved from $(0.36) in the same quarter last year[22] - Adjusted loss per share (diluted) was $(0.24), compared to $(0.19) in the prior year, indicating a deterioration of 26.3%[22] Attendance and Screen Count - Total attendance for Q1 2025 was 72.3 million, down from 75.8 million in Q1 2024[19] - Total attendance decreased to 72.3 million from 75.8 million, representing a decline of 7.3%[22] - The number of total screens at the end of Q1 2025 was 17,875, a decrease from 18,297 screens in Q1 2024[19] Cash and Assets - Cash, cash equivalents, and marketable securities decreased to $63.1 million as of March 27, 2025, from $78.2 million at the end of 2024[17] - Total assets decreased to $503.8 million as of March 27, 2025, down from $568.6 million at the end of 2024[17] Advertising Revenue - Total advertising revenue (excluding beverage) was $32.3 million, down from $34.8 million, reflecting a decline of 7.2% year-over-year[22] - National advertising revenue per attendee was $0.379, down from $0.389, a decrease of 2.6%[22] - Local and regional advertising revenue per attendee was $0.068, down from $0.070, reflecting a decline of 2.9%[22] Future Expectations - For Q2 2025, the company expects total revenue between $56.0 million and $61.0 million, with Adjusted OIBDA ranging from $2.5 million to $7.5 million[5] Strategic Partnerships - A new long-term agreement with AMC Theatres extends the partnership through 2042, aligning payment structures with performance metrics[6] Dividend Declaration - The company declared a cash dividend of $0.03 per share, totaling approximately $2.8 million, to be paid on May 30, 2025[4]

Financial Data and Key Metrics Changes - National CineMedia, Inc. reported fourth-quarter revenue of $86.3 million, slightly exceeding the guidance of $82 million to $86 million, but down from $90.9 million in the prior year [22][33] - Adjusted OIBDA for the fourth quarter was $35 million, surpassing the guidance range of $28 to $30 million, compared to $39.8 million in the prior year [22][38] - Full-year 2024 revenue was $240.8 million, down from $259.8 million in 2023, with adjusted OIBDA of $45.7 million compared to $52.7 million in 2023 [24][39] Business Line Data and Key Metrics Changes - National advertising revenue for Q4 decreased to $69.2 million from $71.9 million in Q4 2023, while local and regional advertising revenue fell to $13.5 million from $16.2 million [33] - Attendance for the fourth quarter was 101 million, driven by new titles, while total attendance for 2024 was 390.7 million, reflecting an 11% decline year over year [24][40] Market Data and Key Metrics Changes - The total domestic box office for Q4 2024 reached approximately $2.4 billion, a 26% increase year over year, with the full-year box office totaling $8.6 billion [12][15] - The audience demographic remains strong, with Gen Z and Millennials accounting for 69% of total viewership in Q4 [17] Company Strategy and Development Direction - The company is focusing on innovation and growth, particularly in programmatic and self-serve advertising solutions, which are expected to drive revenue growth in the coming years [31][50] - National CineMedia, Inc. is strategically investing in expanding its sales team and enhancing marketing efforts to support future revenue generation [49][50] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second quarter of 2025, indicating strong sales pacing and a positive outlook for the remainder of the year despite expected near-term variability [29][48] - The company anticipates a slight decline in first-quarter revenue due to a weaker film slate and seasonal advertising slowdowns, but expects a strong recovery in attendance and advertising demand later in the year [30][48] Other Important Information - The company closed a new revolving facility with US Bank, reducing the cost of debt and annual interest expense, and has no outstanding long-term debt as of now [44][45] - National CineMedia, Inc. has repurchased 2.5 million shares for $13.4 million as part of its $100 million share repurchase program [45] Q&A Session Summary Question: Expectations on advertising headwinds and second half of the year - Management noted encouraging pacing for Q2 compared to last year, but could not provide specifics for the second half yet [55][56] Question: KPI-based ad sales and advertiser retention - Management indicated that half of the business is supported through NCMx, which is significant for advertiser retention and engagement [58] Question: Share of national advertisers still on the sidelines - Management acknowledged the need to calculate the percentage of pre-pandemic advertisers that have yet to return [63] Question: Expectations for attendance growth in 2025 and 2026 - Management stated that attendance is the primary driver of revenue growth, with forecasts for 2025 and 2026 aligning with industry expectations [66][67] Question: Advertiser sentiment compared to prior years - Management expressed that advertiser sentiment is currently positive, with no surprises expected from the industry [72] Question: Potential for higher upfront costs - Management believes they will perform better in the upfronts compared to last year, with a cleaner market environment [76][77] Question: Demand for premium screens and advertiser interest - Management confirmed high demand for premium screens, which is beneficial for attracting large advertisers [80] Question: Local and regional business growth - Management is optimistic about the local business comeback in 2025 and 2026, following reinvestment in the sales team [84]

Financial Data and Key Metrics Changes - For Q4 2024, National CineMedia, Inc. reported revenue of $86.3 million, slightly exceeding the guidance of $82 million to $86 million, but down from $90.9 million in Q4 2023 [22][33] - Adjusted OIBDA for Q4 2024 was $35 million, surpassing the guidance range of $28 to $30 million, compared to $39.8 million in the prior year [22][38] - Full-year 2024 revenue was $240.8 million, down from $259.8 million in 2023, with adjusted OIBDA of $45.7 million compared to $52.7 million in 2023 [24][39] Business Line Data and Key Metrics Changes - National advertising revenue for Q4 2024 decreased to $69.2 million from $71.9 million in Q4 2023, while local and regional advertising revenue fell to $13.5 million from $16.2 million [33] - The fourth quarter saw attendance of 101 million, driven by new titles, with full-year attendance at 390.7 million, reflecting a decline of 11% year over year [24][40] Market Data and Key Metrics Changes - The total domestic box office for Q4 2024 reached approximately $2.4 billion, a 26% increase year over year, with the full-year box office totaling $8.6 billion [12][15] - The audience demographic remains strong, with Gen Z and Millennials accounting for 69% of total viewership in Q4 2024 [17] Company Strategy and Development Direction - The company is focusing on advertising growth, leveraging its NCMx data intelligence platform to enhance audience engagement and drive measurable results for advertisers [28][29] - National CineMedia, Inc. plans to continue investing in client solutions, including programmatic and self-serve advertising, to drive revenue growth in the coming years [31][50] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the cinema industry's recovery, particularly in Q2 2025, despite expecting a softer performance in Q1 due to a weaker film slate and advertising market headwinds [30][48] - The company anticipates a strong film slate for 2025, with several high-profile releases expected to drive attendance and revenue growth [51] Other Important Information - The company closed a new revolving facility with US Bank, reducing its cost of debt and annual interest expense, and has no outstanding long-term debt as of now [44][45] - National CineMedia, Inc. has repurchased 2.5 million shares for $13.4 million as part of its $100 million share repurchase program [45] Q&A Session Summary Question: Expectations on advertising headwinds - Management indicated that the pacing for Q2 looks encouraging compared to last year, with optimism for the second half of the year [55][56] Question: KPI-based ad sales and advertiser retention - Management noted that half of the business is supported through NCMx, which is significant for advertiser retention and engagement [58] Question: Share of national advertisers still on the sidelines - Management acknowledged the need to calculate the percentage of pre-pandemic advertisers that have yet to return [63] Question: Attendance growth expectations for 2025 and 2026 - Management stated that attendance is the primary driver of revenue growth, with forecasts for 2025 and 2026 aligning with industry expectations [66][67] Question: Advertiser sentiment compared to prior years - Management reported positive sentiment among advertisers, with expectations for a better upfront season compared to the previous year [72][76] Question: Demand for premium screens and advertising - Management confirmed strong demand from advertisers for premium screens, which is expected to benefit the company [80] Question: Local and regional business growth - Management expressed optimism about the local and regional teams' potential for growth in 2025 and 2026, following reinvestment in sales resources [84]

Core Insights - National CineMedia (NCMI) reported revenue of $86.3 million for the quarter ended December 2024, a decrease of 5.1% year-over-year, but exceeded the Zacks Consensus Estimate by 0.12% [1] - Earnings per share (EPS) for the quarter was $0.26, up from $0.20 in the same quarter last year, representing a surprise of 30.00% over the consensus estimate of $0.20 [1] Revenue Breakdown - Local and regional advertising revenue was $13.50 million, matching the average estimate but down 16.7% year-over-year [4] - National advertising revenue reached $69.20 million, slightly above the average estimate of $68.80 million, but down 3.8% year-over-year [4] - Total advertising revenue (excluding beverage) was reported at $82.70 million, below the average estimate of $84.10 million, reflecting a decline of 6.1% year-over-year [4] - ESA advertising revenue from beverage concessionaire agreements was $3.60 million, below the average estimate of $3.95 million, but showed a significant increase of 28.6% year-over-year [4] Stock Performance - Over the past month, shares of National CineMedia have returned -8.7%, compared to a -3.5% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Core Viewpoint - National CineMedia (NCMI) reported quarterly earnings of $0.26 per share, exceeding the Zacks Consensus Estimate of $0.20 per share, and showing an increase from $0.20 per share a year ago, representing a 30% earnings surprise [1] Financial Performance - The company posted revenues of $86.3 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.12%, but down from $90.9 million year-over-year [2] - Over the last four quarters, National CineMedia has surpassed consensus revenue estimates four times [2] Stock Performance - National CineMedia shares have declined approximately 3.8% since the beginning of the year, compared to a decline of 0.7% for the S&P 500 [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.15 on revenues of $38.9 million, and for the current fiscal year, it is $0.21 on revenues of $275.1 million [7] - The estimate revisions trend for National CineMedia is mixed, which may change following the recent earnings report [6] Industry Context - The Advertising and Marketing industry, to which National CineMedia belongs, is currently ranked in the bottom 24% of over 250 Zacks industries, indicating potential challenges ahead [8]

Company Overview - National CineMedia (NCM) is the largest cinema advertising platform in the US, with over 18,000 screens in more than 1,400 theaters across 196 Designated Market Areas (DMAs) [22]. - NCM generates revenue primarily from advertising through The Noovie® Show and strategically-placed screens in theater lobbies, extending reach via NCM Boost across various digital and out-of-home venues [23]. Bankruptcy and Restructuring - NCM LLC emerged from Chapter 11 bankruptcy on August 7, 2023, after a restructuring plan was confirmed, allowing it to reconsolidate into NCM, Inc.'s financial statements [35]. - The company made a capital contribution of $15.0 million to NCM LLC as part of the restructuring support agreement [32]. - Following the emergence from bankruptcy, NCM, Inc. retained approximately 13.8% ownership of NCM LLC's equity [34]. - Regal terminated its exclusive advertising agreement with NCM LLC on July 14, 2023, and entered into a new advertising agreement, effectively ending its status as an ESA Party [39]. - Each holder of general unsecured claims received a pro rata share of $15.0 million, with $14.5 million contributed by NCM LLC and $0.5 million from NCM, Inc. [38]. - As of December 26, 2024, NCM LLC held a total of $3.0 million within escrow accounts for finalizing unsecured creditors' claims [37]. - The restructuring plan included the issuance of new common membership units to secured debt claim holders, allowing them to exchange units for shares of NCM, Inc.'s common stock [38]. - The company emerged from bankruptcy on August 7, 2023, which required significant management focus on negotiations rather than business operations [131]. - The ongoing litigation with AMC and Cinemark regarding the confirmation of the bankruptcy plan could impact future cooperation under the ESAs [130]. Financial Performance - The company executed a one-for-ten reverse stock split on August 3, 2023, reducing outstanding shares from 174,112,385 to 17,411,323, and later to 13,343,065 after share cancellations [40]. - A stock repurchase program was approved on March 18, 2024, allowing the company to repurchase up to $100 million of its common stock over three years, with 2,524,991 shares repurchased in the year ended December 26, 2024 [41]. - The company entered into a $45 million senior secured revolving credit facility on January 24, 2025, maturing on January 24, 2028, which is expected to reduce overall interest expenses [42]. - The company's revenue is seasonal, with the first quarter typically generating 15.5% of total revenue for FY 2024, compared to 35.8% in the fourth quarter [86]. - The company reported that 62.0% of its audience in 2023 was between the ages of 12-34, with a median age of 30, highlighting its appeal to younger demographics [95]. - The cinema advertising business derived 78.1% of its revenue from national clients and 16.2% from regional and local advertisers for the year ended December 26, 2024 [54]. - Exclusive contractual relationships accounted for approximately 19.0% and 28.4% of total revenue for the years ended December 26, 2024, and December 28, 2023, respectively [101]. - NCM LLC's Adjusted OIBDA margin was 20.3% for the year ended December 28, 2023, but decreased to (69.6)% in 2024 due to various operational impacts [102]. - The average annual attendance per screen in the network was 21,674 in 2024 [97]. - The company generates a significant portion of its revenue from a small number of large advertisers, with one agency accounting for over 14.7% of the gross outstanding receivable balance as of December 26, 2024 [165]. Advertising Strategies and Innovations - In 2024, the company launched several specialty content platforms targeting diverse audiences, including sustainability and sports, to attract higher disposable income demographics [47]. - The company launched programmatic and self-serve advertising marketplaces in 2024, allowing real-time data-driven trading and enabling local businesses to manage their own ad purchases [55]. - NCMx™, the company's data analytics platform, had over 824.4 million unique data records as of December 26, 2024, providing advertisers with extensive insights into moviegoer behavior [62]. - In 2024, the company launched NCM Boost, enhancing cinema advertising campaigns by extending reach beyond the big screen, allowing for precise targeting of moviegoers using first-, second-, and third-party data [63]. - The NCM Boomerang retargeting solution was introduced in 2024, enabling advertisers to reconnect with moviegoers three hours after their theater experience, maximizing campaign impact [64]. - The company's Digital Out-of-Home (DOOH) group sold media inventory on a national, regional, local, and programmatic level in 2024, expanding advertising reach beyond theaters [74]. - The Noovie Show's Post-Showtime Inventory is utilized by 65.0% of network affiliates, enhancing advertising opportunities [105]. - The company aims to expand its affiliate network and strengthen relationships with exhibitors to increase revenue and market reach [106]. Market Challenges and Risks - The company experienced significant impacts on theater attendance due to production delays from writers' and actors' strikes in 2023, which are expected to affect attendance throughout 2024 [120]. - Future pandemics or health-related incidents could lead to public safety restrictions that negatively impact attendance and advertising revenue [121]. - The company faces risks related to the enforceability of non-competition provisions in its ESAs, which could allow competitors to enter the market [133]. - Changes in consumer behavior, such as increased online ticket purchases, may reduce the number of patrons present to view advertising content [129]. - Regal announced plans to optimize the number of theaters it operates, which may reduce advertising impressions and revenue if theaters are closed or liquidated [138]. - The competitive advertising market includes significant competition from digital platforms, which may affect NCM's market position and revenue [153]. - Changes in the number and mix of films shown in theaters could lead to reduced advertising spending if the audience does not match advertisers' target demographics [155]. - Economic uncertainty and a decline in consumer spending in the U.S. may adversely impact demand for the company's services and delay payments from advertising clients [160]. Technology and Cybersecurity - The company implemented a new cinema advertising management system in early 2021, which replaced many internally developed systems and aims to optimize delivery, inventory management, and revenue recognition [157]. - The company maintains a cybersecurity management program, regularly updated to address identified risks and threats [198]. - The company has established a cybersecurity incident response plan to manage potential incidents, requiring notification to a response team for risk assessment and appropriate action [200]. - The Audit Committee oversees the company's cybersecurity program, receiving updates quarterly on risk management effectiveness and identified threats [202]. - The Chief Information Officer, with over 30 years of experience, leads the cybersecurity team and reports to the Audit Committee on incident prevention and mitigation efforts [203]. Corporate Governance and Shareholder Relations - The company is a holding entity with no independent operations, relying on distributions from NCM LLC to meet obligations [179]. - The declaration of future dividends will depend on NCM LLC's financial condition and results of operations [179]. - The company's bylaws contain anti-takeover provisions that may impede strategic transactions beneficial to stockholders [188]. - The management discussion includes forward-looking statements regarding financial conditions and results of operations for fiscal 2024 compared to fiscal 2023 [220].