Financial Performance - Revenue and adjusted net profit for 2021 reached $112.8 million and $41.7 million respectively, nearly returning to pre-pandemic levels[3]. - Operating cash flow for 2021 was $30 million, demonstrating strong financial performance despite ongoing pandemic challenges[3]. - In 2021, IMAX China recorded a total revenue of $112.8 million, representing a 116% year-over-year increase, and achieved an adjusted net profit of $42 million, compared to a net loss of $4.6 million in 2020[21]. - The gross profit for IMAX China reached $68.2 million in 2021, reflecting a 252.4% increase compared to $19.3 million in 2020, with a gross margin of 60.4%[42]. - The net profit for the year was $38.2 million, a significant turnaround from a net loss of $26.7 million in 2020, resulting in a net profit margin of 33.9%[42]. - Total box office revenue for IMAX China was $239.5 million in 2021, up 141.3% from $99.2 million in 2020, with an average box office per screen of $328[42]. - IMAX's technology network revenue increased by 159% to $39 million, with box office recovery reaching $239 million and a revenue share increase to 16.4%, up 110 basis points year-over-year[15]. - The company reported a net reversal of financial asset impairments of $4.0 million in 2021, compared to a loss of $10.9 million in 2020[82]. - The company recorded a cash and cash equivalents increase of $9.3 million in fiscal year 2021, compared to a decrease of $0.8 million in fiscal year 2020[127]. Market Expansion - IMAX China expanded its network to 783 screens, with an additional 215 screens under contract, approaching a milestone of 1,000 cinemas[3]. - The company installed 57 new and upgraded systems in 2021, compared to 42 installations in 2020, contributing to a total of 783 theaters in over 210 cities across Greater China[12]. - The number of IMAX theaters in Greater China increased from 745 on December 31, 2020, to 783 on December 31, 2021[60]. - The company anticipates that the total number of screens in China will exceed 100,000 by 2025, driven by urbanization and increasing purchasing power[63]. - The company has identified approximately 1,400 IMAX regions in Greater China, where typically only one IMAX theater will be installed per region[62]. - The company plans to expand its theater network in China by introducing IMAX laser technology and additional laser cinema systems to replace and upgrade existing IMAX xenon theaters[53]. Film Performance - Local language films generated box office revenue of $150 million, highlighted by record-breaking performances during the Chinese New Year and National Day[3]. - IMAX's contribution to the opening weekend box office of "The Battle at Lake Changjin" was nearly 6%, with the film grossing over RMB 5.7 billion, becoming the highest-grossing film in Chinese history[3]. - The box office for local language films reached $150 million, a 30% increase compared to 2019, with significant contributions from films like "Detective Chinatown 3" and "The Battle at Lake Changjin" which broke multiple records[7]. - IMAX films generated a total box office of $239 million in 2021, an increase of $140 million (141%) compared to 2020, including a record $136 million for Chinese films[55]. - The average box office share for local language films during opening weekends rose to approximately 4.6%, compared to 3.6% in 2019[7]. - IMAX's market share for Hollywood sequels continues to grow, with significant contributions from films like "No Time to Die" (15%), "F9" (9%), and "Godzilla vs. Kong" (12%)[4]. Dividend and Shareholder Returns - The company announced a proposed final dividend of approximately $9.2 million, increasing the payout ratio from 33% to 50%[4]. - The board proposed a final dividend of $0.027 per share for 2021, reflecting an increase in the payout ratio from 33% to 50% of net profit[21]. - The company declared a final dividend of USD 0.027 per share (approximately HKD 0.210) for the fiscal year 2021, pending shareholder approval[168]. Technology and Innovation - IMAX's unique end-to-end technology and strong brand association with blockbuster films position it as a preferred partner for local filmmakers in China[3]. - IMAX's laser network now covers 79 theaters, providing higher resolution and better image quality, which is expected to drive the next wave of upgrades in the Greater China commercial IMAX network[51]. - The company has shifted its focus to Chinese-language films due to delays in Hollywood releases, indicating a strategic pivot in response to market conditions[48]. - The IMAX technology network's revenue model includes three segments: IMAX DMR films, revenue-sharing arrangements, and sales and rental agreements, allowing for a diversified income stream[47]. Strategic Partnerships and Collaborations - The company has established partnerships with approximately 80 exhibitors, including major players like Wanda Film and Alibaba Pictures, enhancing its market presence[52]. - The revenue-sharing model allows exhibitors to expand their IMAX networks more rapidly by reducing upfront costs, aligning the interests of IMAX and its partners[47]. - The company continues to collaborate with local filmmakers to create IMAX-certified films, which has led to record box office results for Chinese-language films in the fiscal year 2021[49]. Management and Governance - Richard Gelfond has been the Chairman and Non-Executive Director since May 27, 2015, and has been a key shareholder and CEO of IMAX Corporation since 2009, providing strategic guidance[149]. - Chen Yuanpeng has been the CEO since December 9, 2019, focusing on expanding the company's leadership in the Greater China region[150]. - The company aims to enhance its market presence and operational strategies under the guidance of its executive team, including a focus on new product development and technology[152]. - The leadership team has a diverse background in the film and entertainment industry, contributing to strategic decision-making and operational management[153]. Risks and Challenges - The impact of the COVID-19 pandemic on IMAX's business and financial performance remains uncertain and dependent on various unpredictable factors, including the duration of the pandemic and government responses[54]. - The company faces risks from changes in laws and regulations, currency fluctuations, and economic downturns, which could impact future revenue and cash flow[67]. - The company does not currently hedge against currency fluctuations, which could adversely affect profitability if the USD/CNY exchange rate rises significantly[71]. Future Outlook - The company expects a favorable start to 2022 with unprecedented Hollywood films scheduled for release in China, including sequels to "Thor," "Doctor Strange," and "Jurassic World"[4]. - The company anticipates continued growth in the Chinese market, which is expected to be a major source of future revenue[46]. - The company plans to promote revenue-sharing arrangements to exhibitors with strong box office potential and successful track records[66].
IMAX CHINA(01970) - 2021 - 年度财报