Cineplex Inc. Consolidated Statements of Changes in Equity (expressed in thousands of Canadian dollars) For the years ended December 31, 2012 and 2011 ------------------------------------------------------------------------ ------------------------------------------------------------------------ Unit Share Contributed capital capital surplus Balance - January 1, 2012 $ - $ 764,801 $ - Net income - - - Other comprehensive income - - - ----------------------------------- Total comprehensive income Share option liabilities reclassified - - 6,850 Dividends declared - - - Long-term incentive plan obligation - (4,818) - Long-term incentive plan shares - 6,471 - Share option expense - - 2,071 Issuance of shares on exercise of options - 5,873 (5,372) Issuance of shares on conversion of debentures - 75,844 219 Shares repurchased and cancelled - (936) - ----------------------------------- Balance - December 31, 2012 $ - $ 847,235 $ 3,768 ----------------------------------- -----------------------------------Cineplex Inc.Consolidated Statements of Changes in Equity(expressed in thousands of Canadian dollars)For the years ended December 31, 2012 and 2011------------------------------------------------------------------------------------------------------------------------------------------------------ Accumulated other comprehensive loss Deficit TotalBalance - January 1, 2012 $ (2,723) $ (140,469) $ 621,609Net income - 120,484 120,484Other comprehensive income 1,581 (140) 1,441 ---------------------------------------Total comprehensive income 1,581 120,344 121,925Share option liabilities reclassified - - 6,850Dividends declared - (81,572) (81,572)Long-term incentive plan obligation - - (4,818)Long-term incentive plan shares - - 6,471Share option expense - - 2,071Issuance of shares on exercise of options - - 501Issuance of shares on conversion of debentures - - 76,063Shares repurchased and cancelled - (850) (1,786) ---------------------------------------Balance - December 31, 2012 $ (1,142) $ (102,547) $ 747,314 --------------------------------------- --------------------------------------- Unit Share Contributed capital capital surplusBalance - January 1, 2011 $ 710,121 $ - $ 1,407Net income - - -Other comprehensive income - - - ----------------------------------------Total comprehensive incomeEffect of corporate conversion (710,121) 744,760 (1,407)Dividends declared - - -Long-term incentive plan obligation - (1,599) -Long-term incentive plan shares - 1,888 -Issuance of shares on conversion of debentures - 21,515 -Shares repurchased and cancelled - (1,763) - ----------------------------------------Balance - December 31, 2011 $ - $ 764,801 $ - ---------------------------------------- ---------------------------------------- Accumulated other comprehensive loss Deficit TotalBalance - January 1, 2011 $ (3,534) $ (113,120) $ 594,874Net income - 49,260 49,260Other comprehensive income 811 (602) 209 ---------------------------------------Total comprehensive income 811 48,658 49,469Effect of corporate conversion - - 33,232Dividends declared - (74,344) (74,344)Long-term incentive plan obligation - - (1,599)Long-term incentive plan shares - - 1,888Issuance of shares on conversion of debentures - - 21,515Shares repurchased and cancelled - (1,663) (3,426) ---------------------------------------Balance - December 31, 2011 $ (2,723) $ (140,469) $ 621,609 --------------------------------------- ---------------------------------------Cineplex Inc.Consolidated Statements of Cash Flows(expressed in thousands of Canadian dollars) Three months ended Year ended December December 31, 31, ------------------------------------------- 2012 2011 2012 2011Cash provided by (used in)Operating activitiesNet income $ 32,704 $ 10,931 $ 120,484 $ 49,260Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 16,934 16,812 62,058 68,115 Amortization of tenant inducements, rent averaging liabilities and fair value lease contract liabilities (1,432) (1,011) (5,033) (3,955) Accretion of debt issuance costs and other non-cash interest 143 139 562 840 (Gain) loss on disposal of assets (3,138) 731 (2,352) 735 (Gain) on acquisition of business (930) - (24,752) - Deferred income taxes 1,399 (193) 1,189 11,801 Interest rate swap agreements - non-cash interest (295) 3,072 1,485 4,215 Non-cash share-based compensation 433 37 2,108 330 Accretion of convertible debentures 24 290 323 1,368 Net change in interests in joint ventures 1,160 984 5,987 (1,876)Tenant inducements 1,643 1,565 7,615 7,150Changes in operating assets and liabilities 64,498 59,395 9,653 38,294 -------------------------------------------Net cash provided by operating activities 113,143 92,752 179,327 176,277 -------------------------------------------Investing activitiesProceeds from sale of assets 2,550 136 3,683 1,958Purchases of property, equipment and leaseholds (22,446) (19,821) (71,923) (60,624)Acquisition and formation of businesses, net of cash acquired - 51 (2,811) (3,229)Additional equity funding of CDCP (3,940) 22 (4,188) (356) -------------------------------------------Net cash used in investing activities (23,836) (19,612) (75,239) (62,251) -------------------------------------------Financing activitiesDividends paid (20,955) (18,858) (80,794) (68,059)Repayments under credit facility, net (20,000) (65,000) (20,000) (65,000)Payments under finance leases (531) (576) (2,104) (2,242)Proceeds from issuance of shares - - 501 -Acquisition of long-term incentive plan shares - - - (9,793)Deferred financing fees - 58 - (1,857)Shares repurchased and cancelled - (3,051) (1,786) (3,426)Repayment of convertible debentures at maturity (1,123) - (1,123) - -------------------------------------------Net cash used in financing activities (42,609) (87,427) (105,306) (150,377) -------------------------------------------Increase (decrease) in cash and cash equivalents during the period 46,698 (14,287) (1,218) (36,351)Cash and cash equivalents - Beginning of period 1,076 63,279 48,992 85,343 -------------------------------------------Cash and cash equivalents - End of period $ 47,774 $ 48,992 $ 47,774 $ 48,992 ------------------------------------------- -------------------------------------------Supplemental informationCash paid for interest $ 2,866 $ 4,322 $ 10,293 $ 18,084Cash paid for income taxes $ 5,281 $ 30 $ 35,268 $ 95Cineplex Inc.Consolidated Supplemental Information(Unaudited)(expressed in thousands of Canadian dollars)Reconciliation to Adjusted EBITDA---------------------------------------------------------------------------- Three months ended Year ended December December 31, 31, 2012 2011 2012 2011 -------------------------------------------Net income $ 32,704 $ 10,931 $ 120,484 $ 49,260Depreciation and amortization 16,934 16,812 62,058 68,115Interest expense 2,090 6,968 12,585 24,854Interest income (58) (94) (205) (898)Current income tax expense 8,795 5,482 31,436 17,493Deferred income tax expense (recovery) 1,399 (193) 1,189 11,801 -------------------------------------------EBITDA $ 61,864 $ 39,906 $ 227,547 $ 170,625(Gain) loss on disposal of assets (3,138) 731 (2,352) 735(Gain) on acquisition of business (930) - (24,752) -CDCP equity (income) loss (i) (834) (560) (2,222) 1,658Depreciation and amortization - joint ventures (ii) 474 25 1,927 156Future income taxes - joint ventures (ii) 53 - 289 -Current income taxes - joint ventures (ii) 18 - 47 - -------------------------------------------Adjusted EBITDA $ 57,507 $ 40,102 $ 200,484 $ 173,174----------------------------------------------------------------------------(i) CDCP equity (income) loss not included in adjusted EBITDA as CDCP is a limited-life financing vehicle that is funded by virtual print fees collected from distributors.(ii) Includes the joint ventures with the exception of CDCP (see (i) above).Components of Other Costs----------------------------------------------------------------------------Other costs Fourth Quarter Year to Date 2012 2011 Change 2012 2011 Change----------------------------------------------------------------------------Theatre occupancy expenses $ 45,498 $ 39,842 14.2% $ 174,259 $ 163,696 6.5%Other operating expenses 74,056 64,095 15.5% 258,973 246,289 5.2%General and administrative expenses 15,200 12,981 17.1% 57,137 56,440 1.2% -------------------------------------------------------Total other costs $ 134,754 $ 116,918 15.3% $ 490,369 $ 466,425 5.1%----------------------------------------------------------------------------
Cineplex Inc.Consolidated Supplemental Information(Unaudited)(expressed in thousands of Canadian dollars, except number of shares and per share data)Adjusted Free Cash Flow---------------------------------------------------------------------------- Three months ended December 31, Year ended December 31, 2012 2011 2012 2011 ----------------------------------------------------Cash provided by operating activities $ 113,143 $ 92,752 $ 179,327 $ 176,277Less: Total capital expenditures net of proceeds on sale of assets (19,896) (19,685) (68,240) (58,666) ----------------------------------------------------Standardized free cash flow/Standardized distributable cash 93,247 73,067 111,087 117,611Add/(Less):Changes in operating assets and liabilities (i) (64,498) (59,395) (9,653) (38,294)Changes in operating assets and liabilities of joint ventures (i) (574) 377 (4,612) 2,145Tenant inducements (ii) (1,643) (1,565) (7,615) (7,150)Principal component of finance lease obligations (531) (576) (2,104) (2,242)Growth capital expenditures and other (iii) 8,654 10,838 41,640 40,769Share of (loss) income of joint ventures, net of non-cash depreciation (iv) (893) (1,896) (1,381) 1,545Cash invested in CDCP (iv) (190) 22 (438) (356) ----------------------------------------------------Adjusted free cash flow $ 33,572 $ 20,872 $ 126,924 $ 114,028 ---------------------------------------------------- ----------------------------------------------------Average number of Shares outstanding 62,137,513 58,461,523 61,065,540 58,009,953Adjusted free cash flow per Share $ 0.5403 $ 0.3570 $ 2.0785 $ 1.9657----------------------------------------------------------------------------(i) Changes in operating assets and liabilities are not considered a source or use of adjusted free cash flow.(ii) Tenant inducements received are for the purpose of funding new theatre capital expenditures and are not considered a source of adjusted free cash flow.(iii) Growth capital expenditures and other represent expenditures on Board approved projects as well as any expenditures for digital equipment that was contributed to CDCP, exclude maintenance capital expenditures, and are net of proceeds on asset sales. Cineplex's revolving facility is available to fund Board approved projects.(iv) Excludes the share of income or loss of CDCP, as CDCP is a limited-life financing vehicle funded by virtual print fees collected from distributors. Cash invested into CDCP, as well as cash distributions received from CDCP, are considered to be uses and sources of adjusted free cash flow.
Contacts:
Cineplex Inc.
Gord Nelson
Chief Financial Officer
(416) 323-6602
Cineplex Inc.
Pat Marshall
Vice President Communications and Investor Relations
(416) 323-6648
