National CineMedia(US:NCMI)2025-05-06 20:19Revenue 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].