The Marcus(US:MCS)2025-02-27 23:22Debt and Interest Rates - As of December 26, 2024, the company had zero variable interest rate debt outstanding, with a fixed interest rate debt totaling $160.4 million at a weighted-average interest rate of 5.93%[263][264] - The fixed interest rate debt includes senior notes with interest rates ranging from 4.02% to 7.02%, maturing between fiscal 2025 and 2034, and other debt instruments maturing in fiscal 2025[264] - The total fixed interest rate debt matures as follows: $10.4 million in fiscal 2025, $62 million in fiscal 2027, and $52.6 million thereafter, totaling $160.4 million[265] - The company has no outstanding interest rate swap agreements as of December 26, 2024, and manages exposure to interest rate changes through monitoring financing alternatives[265] - The company is exposed to market risk related to changes in interest rates and manages this risk by monitoring available financing alternatives[262] - Long-term debt as of December 26, 2024, was $149.01 million, a decrease from $159.55 million as of December 28, 2023[368] Financial Performance - Total revenues for the year ended December 26, 2024, were $735.56 million, a slight increase of 0.2% from $729.58 million in 2023[300] - Theatre admissions revenue decreased to $214.42 million in 2024 from $229.19 million in 2023, representing a decline of 6.4%[300] - Net earnings attributable to The Marcus Corporation for 2024 were a loss of $7.79 million, compared to a profit of $14.79 million in 2023[302] - Operating income for 2024 was $16.17 million, down from $33.93 million in 2023, reflecting a decrease of 52.3%[300] - Total costs and expenses increased to $719.39 million in 2024, up from $695.65 million in 2023, marking a rise of 3.4%[300] - The company reported a basic net loss per share of $0.25 for 2024, compared to earnings of $0.48 per share in 2023[300] - Comprehensive loss for the year was $6.63 million, compared to comprehensive income of $15.15 million in 2023[302] - The company experienced a pension gain of $1.20 million in 2024, compared to a gain of $0.49 million in 2023[302] Asset and Equity Changes - Total current assets decreased from $101.716 million as of December 28, 2023, to $92.150 million as of December 26, 2024, representing a decline of approximately 9.5%[297] - Cash and cash equivalents decreased from $55.589 million in 2023 to $40.841 million in 2024, a reduction of about 26.6%[297] - Total assets decreased from $1,065.103 million in 2023 to $1,044.528 million in 2024, a decline of approximately 1.9%[297] - Shareholders' equity attributable to The Marcus Corporation increased slightly from $472.675 million in 2023 to $474.241 million in 2024[297] - The Company’s retained earnings decreased from $281.599 million in 2023 to $265.028 million in 2024, a decline of about 5.9%[297] - The Company’s total liabilities decreased from $593.931 million in 2023 to $579.662 million in 2024, a decline of about 2.4%[297] Impairment and Valuation - During fiscal 2024, the company recorded before-tax impairment charges totaling $6.8 million related to four operating theatres and one permanently closed theatre[269] - Valuation allowances against deferred tax assets were $3.6 million as of December 26, 2024, down from $11.3 million as of December 28, 2023[270] - The company performed its annual goodwill impairment test as of September 27, 2024, and determined that no impairment was indicated as the fair value of the theatre reporting unit exceeded its carrying value[270] - The Company performed its annual goodwill impairment test as of September 27, 2024, and determined that the fair value of its goodwill was greater than its carrying value, indicating no impairment for both fiscal 2024 and fiscal 2023[331] - Impairment charges recorded during the year were $6,823,000, compared to $1,061,000 in the prior year, indicating increased asset impairment concerns[308] Cash Flow and Investments - Total adjustments to reconcile net loss to net cash provided by operating activities amounted to $111,727,000, an increase from $87,835,000 in the prior year[308] - Net cash provided by operating activities was $103,940,000, slightly up from $102,629,000 in the previous year[308] - Capital expenditures for the year were $79,210,000, significantly higher than $38,774,000 in the prior year[308] - Net cash used in investing activities totaled $81,898,000, compared to $36,749,000 in the previous year[308] - Proceeds from borrowings on revolving credit facility were $119,000,000, with an equal repayment of the same amount[308] - The company reported a net increase in cash, cash equivalents, and restricted cash of $15,259,000, a decrease from an increase of $35,332,000 in the previous year[308] - The company had cash, cash equivalents, and restricted cash of $44,579,000 at the end of the year, down from $59,838,000 at the beginning of the year[308] Segment Reporting and Revenue Recognition - The company adopted ASU No. 2023-07 for segment reporting, which requires incremental segment information disclosure on an annual and interim basis, effective for the first quarter of fiscal 2025[272] - Revenue from contracts with customers is recognized when the Company satisfies its performance obligations by transferring promised services to the customer[349] - Hotel/Resorts segment revenue increased to $287.51 million in fiscal 2024 from $270.84 million in fiscal 2023, reflecting a growth of 6.15%[351] - Other revenues, which include management fees and family entertainment center revenues, totaled $97.23 million in fiscal 2024, up from $85.42 million in fiscal 2023, marking a growth of 13.67%[351] - The company recognized $22.49 million in revenue from deferred revenues during fiscal 2024, compared to $18.59 million in fiscal 2023[359] - The company had deferred revenue of $36.35 million as of December 26, 2024, down from $38.03 million as of December 28, 2023[359] Shareholder and Stock Compensation - The Company has authorized the repurchase of up to 11,687,500 shares of Common Stock, with 1,714,682 shares available for repurchase as of December 26, 2024[394][395] - The Company has amended its Dividend Reinvestment Plan, authorizing the issuance of up to 250,000 shares of Common Stock, with 245,330 shares available under this authorization[396] - Total pre-tax share-based compensation expense was $8,206 in fiscal 2024, compared to $6,394 in fiscal 2023 and $8,170 in fiscal 2022[398] - The intrinsic value of options outstanding at December 26, 2024, was $6,804, while the intrinsic value of options exercisable was $3,155[401] - As of December 26, 2024, total remaining unearned compensation cost related to stock options was $1,582, which will be amortized over a remaining weighted-average life of 1.8 years[401] - The Company granted 476 shares of restricted stock in fiscal 2024, with a weighted average fair value of $15.18[403] - Total remaining unearned compensation cost related to restricted stock was $4,565, to be amortized over a weighted-average remaining service period of 2.9 years[403] - The Company granted 143 performance stock units (PSUs) in fiscal 2024, with a weighted average fair value of $14.84[407] - Total remaining unearned compensation cost related to PSUs was $1,375, which will be amortized over a weighted-average remaining service period of 2.0 years[407] Pension and Benefit Obligations - The Company recorded a net unrecognized actuarial loss for pension obligation of $(181) thousand as of December 26, 2024, down from $(1,336) thousand as of December 28, 2023[344] - The benefit obligation at the end of fiscal 2024 was $34,983, down from $36,349 at the end of fiscal 2023[412] - The accumulated benefit obligation was $34,480 as of December 26, 2024, compared to $34,788 as of December 28, 2023[414] - The pre-tax change in the benefit obligation recognized in other comprehensive loss for the year ended December 26, 2024, was a total of $(1,563) thousand, compared to $(592) thousand for the year ended December 28, 2023[415] - The weighted-average discount rate used to determine benefit obligations increased from 5.00% in 2023 to 5.45% in 2024, while the rate of compensation increase remained constant at 4.00%[415] - Expected benefit payments for fiscal year 2025 are projected to be $2,377 thousand, with total expected payments from 2025 to 2029 amounting to $12,024 thousand[416] Taxation - The net deferred tax liability decreased from $(32,235) thousand as of December 28, 2023, to $(28,663) thousand as of December 26, 2024[417] - The effective income tax rate for fiscal 2024 was 23.7%, a decrease from 31.7% in fiscal 2023, influenced by a $7,755 thousand decrease in the valuation allowance for state net operating loss carryforwards[418] - The company reported net income taxes paid of $1,428 thousand in fiscal 2024, down from $1,776 thousand in fiscal 2023[420] Commitments and Joint Ventures - The company has commitments for construction at various properties totaling approximately $31,569 thousand as of December 26, 2024[423] - The company formed a joint venture in March 2024 to acquire the Loews Minneapolis Hotel, investing $5,620 thousand for a 33.3% equity interest[425] - The company held investments with aggregate carrying values of $5,166 thousand in joint ventures as of December 26, 2024, up from $1,718 thousand in 2023[424] - The company operates two hotels under the Hilton trademark and two under the Marriott trademark, with obligations to pay fees based on defined gross sales[423]