The Marcus(US:MCS)2025-05-06 16:02Financial Data and Key Metrics Changes - Consolidated revenues for the first quarter were $148.8 million, an increase of $10.2 million or 7.4% compared to the prior year quarter, with revenue growth in both divisions [9] - Operating loss for the quarter was $20.4 million, a decline of $3.7 million compared to the prior year quarter [9] - Consolidated adjusted EBITDA for the first quarter was a loss of $0.3 million, a decrease of $2.6 million over the first quarter of fiscal 2024 [10][21] - Cash flow from operations was a use of cash of $35.3 million in the first quarter, compared to $15.1 million in the prior year quarter [21] - Total capital expenditures during the first quarter were $23 million, compared to $15.4 million in the first quarter of fiscal 2024 [22] Business Line Data and Key Metrics Changes Theater Division - Total revenue for the first quarter was $87.4 million, an increase of 7.5% compared to the prior year first quarter [11] - Comparable theater admission revenue increased by 1.3% and comparable theater attendance increased by 6.9% compared to the prior year [11] - Theater division adjusted EBITDA was $3.7 million, compared to $6.2 million in the prior year quarter [17] Hotels and Resorts Division - Revenues were $61.3 million for the first quarter, an increase of 7.2% compared to the prior year [17] - RevPAR for comparable owned hotels grew by 1.1% during the first quarter, with an overall occupancy rate decrease of 3.4 percentage points [18] - Hotels adjusted EBITDA increased by $1 million in the first quarter compared to the prior year quarter [20] Market Data and Key Metrics Changes - Comparable competitive hotels in the markets experienced RevPAR growth of 6.7% for the first quarter, indicating that the company's hotels underperformed the competitive set by 5.6 percentage points [19] - Group room revenue bookings for fiscal 2025 are running slightly ahead of the previous year, with group room pace for 2026 up 20% compared to the previous year [38] Company Strategy and Development Direction - The company plans to maintain a focus on long-term value creation while managing short-term dynamics, with expectations for growth in both theater and hotel divisions [25][34] - The company is investing in enhancing customer experience through new ScreenX auditoriums and additional concession stands at Dine-in Movie Tavern locations [30][31] - The Hilton Milwaukee renovation is expected to enhance competitiveness and capture group business once completed [39] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the summer movie season and the overall outlook for the year, despite challenges faced in the first quarter [26][34] - The company noted that economic uncertainty has increased, but its diversified business model provides a counterbalance [26] - Management highlighted the importance of attendance and customer experience in driving long-term growth [66] Other Important Information - The company repurchased approximately 424,000 shares of common stock for $7.1 million in cash during the quarter [23] - The balance sheet remains strong, ending the first quarter with $12 million in cash and over $192 million in total liquidity [23] Q&A Session Summary Question: Impact of concessions per patron - Management indicated that the change in food and beverage per caps was primarily due to pricing, with no significant change in incidence or basket size [44] Question: Ability to take price increases - Management expressed confidence in their ability to manage pricing, noting that customers have been willing to accept price increases in recent years [45] Question: Impact of Hilton Milwaukee renovation on pricing - Management views the renovation as an opportunity to hold or potentially increase prices, especially with the upcoming convention center demand [46][48] Question: Impact of Marcus Movie Club on ticket pricing - Initial results from the Marcus Movie Club have been positive, but its impact on ticket pricing is still minimal [54][55] Question: Group pace and market dynamics - Group room revenue bookings are performing well, particularly in recently renovated properties, with varying dynamics across different markets [57][58] Question: Strength of upcoming movie slate - Management highlighted the quality and variety of upcoming films as a positive indicator for continued momentum in attendance [61][63]