On August 5, 2024, National CineMedia Inc (NCMI, Financial) released its 8-K filing for the fiscal second quarter ended June 27, 2024. National CineMedia Inc is a cinema advertising platform in the U.S., deriving revenue from the sale of advertising to national, regional, and local businesses through The Noovie Show, LEN screens in theater lobbies, and other forms of advertising and promotions.
Performance Overview
National CineMedia Inc reported total revenue of $54.7 million for Q2 2024, significantly exceeding the analyst estimate of $49.40 million. However, the company posted a net loss of $8.7 million, or negative $0.09 per diluted share, missing the estimated earnings per share (EPS) of -$0.08.
Despite the revenue beat, the company's operating loss increased to $9.3 million from $4.9 million in the same quarter last year. Adjusted OIBDA, a non-GAAP measure, decreased to $7.6 million from $12.5 million in Q2 2023.
Key Financial Metrics
For the six months ended June 27, 2024, total revenue increased 85.3% to $92.1 million compared to $49.7 million for the same period in 2023. However, the operating loss for the six months was $32.0 million, a slight improvement from the $35.5 million loss in the prior year. The net loss for the six months was $43.4 million, or negative $0.45 per diluted share, compared to net income of $499.8 million, or $28.32 per diluted share, for the same period in 2023.
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Total Revenue | $54.7 million | $14.8 million |
| Operating Loss | -$9.3 million | -$4.9 million |
| Net Loss | -$8.7 million | -$545.3 million |
| Adjusted OIBDA | $7.6 million | $12.5 million |
Challenges and Achievements
National CineMedia Inc faced several challenges, including increased operating losses and a significant net loss. The company's performance is crucial as it reflects the broader recovery of the cinema advertising industry post-pandemic. Despite these challenges, the company achieved notable milestones. Advertising revenue per attendee reached $0.56, surpassing 2019 levels, and national advertising revenue per attendee increased by 37% year-over-year.
"The second quarter of 2024 highlighted our continued strong performance across the key metrics of inventory utilization and monetization," said Tom Lesinski, CEO of NCM. "NCM’s industry-leading platform continues to outperform the box office recovery, as category-leading advertisers turn to NCM to reach young, diverse audiences at an unmatched scale."
Income Statement Highlights
National CineMedia Inc's income statement reveals a mixed performance. While revenue saw a substantial increase, operating expenses also rose significantly. Network operating costs increased to $3.7 million from $0.5 million, and selling and marketing costs rose to $9.6 million from $1.1 million. The company also faced higher amortization expenses, which increased to $9.5 million from $0.9 million in the previous year.
Balance Sheet and Cash Flow
As of June 27, 2024, National CineMedia Inc reported cash, cash equivalents, and restricted cash of $56.8 million, up from $37.6 million as of December 28, 2023. Receivables, net, decreased to $50.7 million from $96.6 million. The company's total assets stood at $527.2 million, with total equity of $387.9 million.
Outlook
Looking ahead, National CineMedia Inc expects total revenue for Q3 2024 to be in the range of $56.0 million to $58.0 million, compared to $69.6 million in Q3 2023. Adjusted OIBDA is expected to be between $6.0 million and $8.0 million, down from $11.3 million in the same quarter last year.
For more detailed information, readers can access the full 8-K filing.
Explore the complete 8-K earnings release (here) from National CineMedia Inc for further details.
