On August 1, 2024, Marcus Corp (MCS, Financial) released its 8-K filing reporting the financial results for the second quarter of fiscal 2024, which ended on June 27, 2024. Marcus Corp is engaged in two business segments: Theatres and Hotels and Resorts. The Theatre segment operates multiscreen motion picture theatres across several states, while the Hotels and Resorts segment owns and operates full-service hotels and resorts in various locations.
Second Quarter Fiscal 2024 Highlights
Marcus Corp reported total revenues of $176.0 million for the second quarter of fiscal 2024, a 15.0% decrease from $207.0 million in the same period last year. The company posted an operating income of $2.2 million, down from $20.8 million in the prior year quarter. The net loss for the quarter was $20.2 million, compared to a net income of $13.5 million in Q2 fiscal 2023. The net loss per diluted common share was $0.64, a significant decline from the net earnings per diluted common share of $0.35 in the same period last year.
Performance and Challenges
The performance of Marcus Corp was notably impacted by the lingering effects of the Hollywood strikes in 2023, which affected the Theatre segment's results in April and May. However, there was a positive shift in June with stronger momentum. The Hotels and Resorts segment continued its strong performance, driven by improving group demand and the onset of the summer travel season.
Financial Achievements
Despite the challenges, Marcus Hotels & Resorts reported a 5.6% increase in total revenues before cost reimbursements, reaching $63.8 million in Q2 fiscal 2024. The division's revenue per available room (RevPAR) increased by 6.5%, outperforming the industry and its competitive sets. The Theatre segment, however, saw a decline in total revenue to $101.5 million from $136.9 million in the prior year quarter, primarily due to decreased attendance and weaker film performances in the early part of the quarter.
Income Statement and Key Metrics
| Metric | Q2 FY2024 | Q2 FY2023 |
|---|---|---|
| Total Revenues | $176.0 million | $207.0 million |
| Operating Income | $2.2 million | $20.8 million |
| Net Earnings (Loss) | $(20.2) million | $13.5 million |
| Net Earnings (Loss) per Diluted Share | $(0.64) | $0.35 |
| Adjusted EBITDA | $22.0 million | $38.7 million |
Analysis of Performance
The significant decline in revenue and earnings can be attributed to the adverse effects of the Hollywood strikes and the $15.0 million debt conversion expense. The Theatre segment's performance was particularly affected, although there was a notable recovery in June with the release of blockbuster films such as "Inside Out 2" and "Deadpool & Wolverine." The Hotels and Resorts segment showed resilience with strong group bookings and increased occupancy rates.
Marcus Corp's financial position remains robust with $208.0 million in cash and revolving credit availability at the end of Q2 fiscal 2024. The company also completed significant debt repurchases and refinancing transactions, which extended debt maturities and simplified the capital structure.
For more detailed insights and the complete financial statements, please refer to the official 8-K filing.
Explore the complete 8-K earnings release (here) from Marcus Corp for further details.
