The Marcus Corporation (NYSE: MCS) today reported results for
the third quarter of fiscal 2020 ended September 24, 2020 and
reaffirmed its strong balance sheet and liquidity position.
Balance Sheet and
Liquidity
Maintaining a strong balance sheet has been a core philosophy
throughout the 85-year history of The Marcus Corporation. As a
result, the company believes it entered the global COVID-19 crisis
from a position of strength. Despite theatres being closed during
most of the third quarter of fiscal 2020 and the majority of hotels
opened but operating at significantly reduced occupancies, the
company’s net-debt-to-capitalization ratio (debt, net of cash) was
35% as of September 24, 2020.
On April 29, 2020, The Marcus Corporation entered into an
amendment to its credit agreement, which included a new $90.8
million term loan. On September 22, 2020, the company extended the
maturity date of the term loan and received an additional $78.6
million of net proceeds from the issuance of Convertible Senior
Notes due 2025 (net of estimated fees and expenses related to the
offering and the cost of capped call transactions that
significantly reduce potential future dilution). As a result, the
company has extended its debt maturities and enhanced its
liquidity, which as of September 24, 2020 included $218.2 million
in cash and revolving credit availability. Subsequent to the end of
the third quarter, the company also received income tax refunds for
prior years and has continued to seek additional state and federal
governmental support where available in order to further reinforce
its liquidity position.
“These are challenging times, yet we expect both of our
businesses will begin returning to more normal conditions once the
pandemic is under control. The actions we have taken and continue
to take to further fortify our balance sheet and reinforce our
liquidity provide us with the financial flexibility to sustain
operations throughout fiscal 2021, even if our properties continue
to generate significantly reduced revenues or have to reclose due
to the effects of the COVID-19 pandemic,” said Gregory S. Marcus,
president and chief executive officer of The Marcus Corporation.
“It is also important to note our significant real estate
ownership. In addition to our owned hotels, we own the underlying
real estate for the majority of our theatres. We believe this
remains a significant advantage for us relative to our peers as it
keeps our monthly fixed lease payments low and provides significant
underlying credit support for our balance sheet. We also own
surplus real estate that may be monetized in future periods if
opportunities arise.”
Third Quarter Fiscal 2020
Highlights
- Total revenues for the third quarter of fiscal 2020 were
$33,591,000, compared to total revenues of $211,462,000 for the
third quarter of fiscal 2019.
- Operating loss was $47,987,000 for the third quarter of fiscal
2020, compared to operating income of $22,387,000 for the prior
year quarter.
- Net loss attributable to The Marcus Corporation was $39,440,000
for the third quarter of fiscal 2020, compared to net earnings
attributable to The Marcus Corporation of $14,289,000 for the same
period in fiscal 2019.
- Net loss per diluted common share attributable to The Marcus
Corporation was $1.30 for the third quarter of fiscal 2020,
compared to net earnings per diluted common share attributable to
The Marcus Corporation of $0.46 for the third quarter of fiscal
2019.
- Adjusted net loss attributable to The Marcus Corporation was
$36,992,000 for the third quarter of fiscal 2020, compared to
Adjusted net earnings attributable to The Marcus Corporation of
$15,531,000 for the third quarter of fiscal 2019.
- Adjusted net loss per diluted common share attributable to The
Marcus Corporation was $1.22 for the third quarter of fiscal 2020,
compared to Adjusted net earnings per diluted common share
attributable to The Marcus Corporation of $0.50 for the prior year
quarter.
- Adjusted EBITDA was a loss of $25,808,000 for the third quarter
of fiscal 2020, compared to Adjusted EBITDA of $44,161,000 for the
comparable prior year period.
- Adjusted net earnings (loss) attributable to The Marcus
Corporation, Adjusted net earnings (loss) per diluted common share
attributable to The Marcus Corporation and Adjusted EBITDA reflect
adjustments made by the company to eliminate the impact of a
nonrecurring income tax adjustment and certain nonrecurring
property closure expenses, reopening expenses and impairment
charges during the third quarter of fiscal 2020, as well as certain
nonrecurring acquisition and preopening expenses related to the
Movie Tavern acquisition and certain nonrecurring preopening
expenses and initial startup losses related to the conversion of
the former InterContinental Milwaukee hotel into Saint Kate® – The
Arts Hotel, during the third quarter of fiscal 2019.
First Three Quarters Fiscal 2020
Highlights
- Total revenues for the first three quarters of fiscal 2020 were
$200,984,000, compared to total revenues of $614,001,000 for the
first three quarters of fiscal 2019.
- Operating loss was $123,249,000 for the first three quarters of
fiscal 2020, compared to operating income of $54,812,000 for the
first three quarters of fiscal 2019.
- Net loss attributable to The Marcus Corporation was $85,821,000
for the first three quarters of fiscal 2020, compared to net
earnings attributable to The Marcus Corporation of $34,215,000 for
the first three quarters of fiscal 2019.
- Net loss per diluted common share attributable to The Marcus
Corporation was $2.84 for the first three quarters of fiscal 2020,
compared to net earnings per diluted common share attributable to
The Marcus Corporation of $1.10 for the first three quarters of
fiscal 2019.
- Adjusted net loss attributable to The Marcus Corporation was
$88,688,000 for the first three quarters of fiscal 2020, compared
to Adjusted net earnings attributable to The Marcus Corporation of
$39,809,000 for the first three quarters of fiscal 2019.
- Adjusted net loss per diluted common share attributable to The
Marcus Corporation was $2.93 for the first three quarters of fiscal
2020, compared to Adjusted net earnings per diluted common share
attributable to The Marcus Corporation of $1.28 for the first three
quarters of fiscal 2019.
- Adjusted EBITDA was a loss of $43,804,000 for the first three
quarters of fiscal 2020, compared to Adjusted EBITDA of
$118,460,000 for the first three quarters of fiscal 2019.
- Adjusted net earnings (loss) attributable to The Marcus
Corporation, Adjusted net earnings (loss) per diluted common share
attributable to The Marcus Corporation and Adjusted EBITDA reflect
adjustments made by the company to eliminate the impact of a
favorable income tax adjustment and certain nonrecurring property
closure expenses, reopening expenses and impairment charges during
the first three quarters of fiscal 2020, as well as certain
nonrecurring acquisition and preopening expenses related to the
Movie Tavern acquisition and certain nonrecurring preopening
expenses and initial startup losses related to the conversion of
the former InterContinental Milwaukee hotel into Saint Kate® – The
Arts Hotel, during the first three quarters of fiscal 2019.
“While the COVID-19 pandemic is truly unprecedented, we believe
we remain well-positioned to continue weathering this crisis,” said
Marcus. “Over the years, our growth and success has been built on
our founding principles of maintaining a strong financial position,
owning and maintaining our real estate assets, focusing on quality
and value, and managing for the long term. Those principles have
served us well during times of growth and prosperity and continue
to serve us during times of challenge. I remain grateful to our
talented and committed team who continue to lead through these
times with grace, grit and an unwavering commitment to each other,
our guests and the communities we serve.”
Marcus Theatres®
Marcus Theatres initially reopened 80% of theatres as of August
28, 2020 in time for the release of the quarter’s highest grossing
films: “Tenet,” “The New Mutants,” and “Unhinged.” Marcus Theatres
surveyed its first loyalty members back and more than 96% indicated
it was a comfortable and safe experience. Moviegoers continued to
enjoy food and beverage experiences, as average concession revenues
per person increased compared to the third quarter of fiscal
2019.
As the film product release schedule continued to change, Marcus
Theatres temporarily closed 17 previously reopened theatres in
early October due to the lack of new film releases. The company
subsequently reopened four theatres with 66% of the total circuit
open as of the date of this release, with the remainder ready to
reopen as soon as market conditions allow.
“The major film studios have been cautiously awaiting the
reopening of major movie markets before releasing new movies,” said
Rolando Rodriguez, chairman, president and chief executive officer
of Marcus Theatres. “We are encouraged by the recent news that
theatres can reopen in portions of New York State, a significant
market for the film industry and home to our Movie Tavern Syracuse
Cinema. We are also encouraged by the increases in our theatre
attendance during the past two weeks as we have been able to offer
guests a greater number and variety of films. Our hope is that
these are steps in the right direction as we head into the
traditionally popular holiday season.”
As of the date of this release, several films are scheduled to
be released during the remaining months of the year that have the
potential to generate box office interest, including “The Croods
2,” “Free Guy,” “Death on the Nile,” “Wonder Woman 1984,” and “News
of the World.”
“Thanks to our comprehensive safety protocols and advanced
technology, moviegoers are already enjoying the big screen with
confidence,” said Rodriguez. “As more films are released, we look
forward to welcoming more guests back to seeing movies the way they
are meant to be seen.”
Marcus® Hotels &
Resorts
During the quarter, Marcus Hotels & Resorts reopened three
additional company-owned hotels. Saint Kate - The Arts Hotel will
reopen on November 5, 2020, at which point all eight of the
company-owned hotels will have reopened. Nine out of 10 managed
hotels and other properties have also reopened, along with the
majority of the company’s restaurants and bars.
Current demand continues to be largely driven by the
“drive-to-leisure” market. While group pace for fiscal 2021 is
behind the comparable period last year, a large portion of that
decline can be attributed to one-time event bookings in
anticipation of Milwaukee hosting the Democratic National
Convention in 2020. Many cancelled group bookings due to COVID-19
are rebooking for future dates, including the rescheduled Ryder Cup
in September 2021. While banquet and catering revenue pace for
fiscal 2021 is also behind the comparable period last year, wedding
bookings are increasing.
“Our properties are uniquely positioned in their respective
markets to continue capturing demand as travel recovers and groups
begin to plan for future events,” said Michael Evans, president of
Marcus Hotels & Resorts. “We are enjoying welcoming our guests
back to our hotels, resorts and restaurants and remain committed as
ever to making our guests’ ordinary days extraordinary.”
Four of the company’s owned or managed hotels were recently
recognized by the coveted Condé Nast 2020 Readers Choice Awards.
Saint Kate – The Arts Hotel in Milwaukee was voted the #6 Top Hotel
in the Midwest, while The Pfister Hotel in Milwaukee was voted the
#8 Top Hotel in the Midwest. The Grand Geneva Resort & Spa in
Lake Geneva, Wis. was voted the #20 Top Resort in the Midwest and
West, and The Garland was voted the #14 Top Hotel in Los
Angeles.
Conference Call and
Webcast
The Marcus Corporation management will hold a conference call
today, Tuesday, November 3, 2020, at 10:00 a.m. Central/11:00 a.m.
Eastern time. Interested parties may listen to the call live on the
internet through the investor relations section of the company’s
website: www.marcuscorp.com or by dialing 1-574-990-3059 and
entering the passcode 5593304.
A telephone replay of the conference call will be available
through Tuesday, November 10, 2020, by dialing 1-855-859-2056 and
entering passcode 5593304. The webcast will be archived on the
company’s website until its next earnings release.
Non-GAAP Financial
Measures
Adjusted net earnings (loss) attributable to The Marcus
Corporation, Adjusted net earnings (loss) per diluted common share
attributable to The Marcus Corporation and Adjusted EBITDA have
been presented in this press release as supplemental measures of
financial performance that are not required by, or presented in
accordance with, GAAP. The company defines Adjusted net earnings
(loss) attributable to The Marcus Corporation as net earnings
(loss) attributable to The Marcus Corporation adjusted to eliminate
the impact of certain items that the company does not consider
indicative of its core operating performance and the tax effect
related to those items. The company defines Adjusted net earnings
(loss) per diluted common share attributable to The Marcus
Corporation as Adjusted net earnings (loss) attributable to The
Marcus Corporation divided by diluted weighted average shares
outstanding. The company defines Adjusted EBITDA as net earnings
(loss) attributable to The Marcus Corporation before investment
income or loss, interest expense, other expense, gain or loss on
disposition of property, equipment and other assets, equity
earnings or losses from unconsolidated joint ventures, net earnings
or losses attributable to noncontrolling interests, income taxes
and depreciation and amortization, adjusted to eliminate the impact
of certain items that the company does not consider indicative of
its core operating performance. Reconciliations of these measures
to the equivalent measures under GAAP are set forth in the attached
tables.
Adjusted net earnings (loss) attributable to The Marcus
Corporation, Adjusted net earnings (loss) per diluted common share
attributable to The Marcus Corporation and Adjusted EBITDA are key
measures used by management and the company’s board of directors to
assess the company’s financial performance and enterprise value.
The company believes that Adjusted net earnings (loss) attributable
to The Marcus Corporation, Adjusted net earnings (loss) per diluted
common share attributable to The Marcus Corporation and Adjusted
EBITDA are useful measures, as they eliminate certain expenses that
are not indicative of the company’s core operating performance and
facilitate a comparison of the company’s core operating performance
on a consistent basis from period to period. The company also uses
Adjusted EBITDA as a basis to determine certain annual cash bonuses
and long-term incentive awards, to supplement GAAP measures of
performance to evaluate the effectiveness of its business
strategies, to make budgeting decisions, and to compare its
performance against that of other peer companies using similar
measures. Adjusted net earnings, Adjusted diluted earnings per
share and Adjusted EBITDA are also used by analysts, investors and
other interested parties as performance measures to evaluate
industry competitors.
Adjusted net earnings (loss) attributable to The Marcus
Corporation, Adjusted net earnings (loss) per diluted common share
attributable to The Marcus Corporation and Adjusted EBITDA are
non-GAAP measures of the company’s financial performance and should
not be considered as alternatives to net earnings (loss) or diluted
earnings (loss) per share as a measure of financial performance, or
any other performance measure derived in accordance with GAAP and
they should not be construed as an inference that the company’s
future results will be unaffected by unusual or non-recurring
items. Additionally, Adjusted net earnings (loss) attributable to
The Marcus Corporation and Adjusted EBITDA are not intended to be
measures of liquidity or free cash flow for management’s
discretionary use. In addition, these non-GAAP measures exclude
certain non-recurring and other charges. Each of these non-GAAP
measures has its limitations as an analytical tool, and you should
not consider them in isolation or as a substitute for analysis of
the company’s results as reported under GAAP. In evaluating
Adjusted net earnings (loss) attributable to The Marcus
Corporation, Adjusted net earnings (loss) per diluted common share
attributable to The Marcus Corporation and Adjusted EBITDA, you
should be aware that in the future the company will incur expenses
that are the same as or similar to some of the items eliminated in
the adjustments made to determine Adjusted net earnings (loss)
attributable to The Marcus Corporation, Adjusted net earnings
(loss) per diluted common share attributable to The Marcus
Corporation and Adjusted EBITDA, such as acquisition expenses,
preopening expenses, accelerated depreciation, impairment charges
and other adjustments. The company’s presentation of Adjusted net
earnings (loss) attributable to The Marcus Corporation, Adjusted
net earnings (loss) per diluted common share attributable to The
Marcus Corporation and Adjusted EBITDA should not be construed to
imply that the company’s future results will be unaffected by any
such adjustments. Definitions and calculations of Adjusted net
earnings (loss), Adjusted diluted earnings (loss) per share and
Adjusted EBITDA differ among companies in our industries, and
therefore Adjusted net earnings (loss), Adjusted diluted earnings
(loss) per share and Adjusted EBITDA disclosed by the company may
not be comparable to the measures disclosed by other companies.
About The Marcus
Corporation
Headquartered in Milwaukee, The Marcus Corporation is a leader
in the lodging and entertainment industries, with significant
company-owned real estate assets. The Marcus Corporation’s theatre
division, Marcus Theatres®, is the fourth largest theatre circuit
in the U.S. and currently owns or operates 1,110 screens at 91
locations in 17 states under the Marcus Theatres, Movie Tavern® by
Marcus and BistroPlex® brands. The company’s lodging division,
Marcus® Hotels & Resorts, owns and/or manages 18 hotels,
resorts and other properties in eight states. For more information,
please visit the company’s website at www.marcuscorp.com.
Certain matters discussed in this press release are
“forward-looking statements” intended to qualify for the safe
harbors from liability established by the Private Securities
Litigation Reform Act of 1995. These forward-looking statements may
generally be identified as such because the context of such
statements include words such as we “believe,” “anticipate,”
“expect” or words of similar import. Similarly, statements that
describe our future plans, objectives or goals are also
forward-looking statements. Such forward-looking statements are
subject to certain risks and uncertainties which may cause results
to differ materially from those expected, including, but not
limited to, the following: (1) the adverse effects of the COVID-19
pandemic on our theatre and hotels and resorts businesses, results
of operations, liquidity, cash flows, financial condition, access
to credit markets and ability to service our existing and future
indebtedness; (2) the duration of the COVID-19 pandemic and related
government restrictions and social distancing requirements and the
level of customer demand following the relaxation of such
requirements; (3) the availability, in terms of both quantity and
audience appeal, of motion pictures for our theatre division
(particularly following the COVID-19 pandemic, during which the
production of new movie content has essentially ceased and release
dates for motion pictures have been postponed), as well as other
industry dynamics such as the maintenance of a suitable window
between the date such motion pictures are released in theatres and
the date they are released to other distribution channels; (4) the
effects of adverse economic conditions in our markets, including
but not limited to, those caused by the COVID-19 pandemic; (5) the
effects of adverse economic conditions, including but not limited
to, those caused by the COVID-19 pandemic, on our ability to obtain
financing on reasonable and acceptable terms, if at all; (6) the
effects on our occupancy and room rates caused by the COVID-19
pandemic and the effects on our occupancy and room rates of the
relative industry supply of available rooms at comparable lodging
facilities in our markets once hotels and resorts have more fully
reopened; (7) the effects of competitive conditions in our markets;
(8) our ability to achieve expected benefits and performance from
our strategic initiatives and acquisitions; (9) the effects of
increasing depreciation expenses, reduced operating profits during
major property renovations, impairment losses, and preopening and
start-up costs due to the capital intensive nature of our business;
(10) the effects of weather conditions, particularly during the
winter in the Midwest and in our other markets; (11) our ability to
identify properties to acquire, develop and/or manage and the
continuing availability of funds for such development; (12) the
adverse impact on business and consumer spending on travel, leisure
and entertainment resulting from terrorist attacks in the United
States, other incidents of violence in public venues such as hotels
and movie theatres or epidemics (such as the COVID-19 pandemic);
(13) a disruption in our business and reputational and economic
risks associated with civil securities claims brought by
shareholders; (14) our ability to timely and successfully integrate
the Movie Tavern operations into our own circuit; and (15) our
ability to achieve the additional revenues and operating income
that we anticipate from our additional week of operations in fiscal
2020. These statements are not guarantees of future performance and
are subject to risks, uncertainties and other factors, including
developments related to the COVID-19 pandemic, some of which are
beyond our control and difficult to predict and could cause actual
results to differ materially from those expressed or forecasted in
the forward-looking statements. Our forward-looking statements are
based upon our assumptions, which are based upon currently
available information, including assumptions about our ability to
manage difficulties associated with or related to the COVID-19
pandemic; the assumption that our theatre closures, hotel closures
and restaurant closures are not expected to be permanent or to
re-occur; the continued availability of our workforce; and the
temporary and long-term effects of the COVID-19 pandemic on our
business. Shareholders, potential investors and other readers are
urged to consider these factors carefully in evaluating the
forward-looking statements and are cautioned not to place undue
reliance on such forward-looking statements. The forward-looking
statements made herein are made only as of the date of this press
release and we undertake no obligation to publicly update such
forward-looking statements to reflect subsequent events or
circumstances.
THE MARCUS CORPORATION Consolidated Statements of
Earnings (Loss) (Unaudited) (in thousands, except per
share data)
13 Weeks Ended 39 Weeks Ended
Sept. 24, Sept. 26, Sept. 24, Sept. 26,
2020
2019
2020
2019
Revenues: Theatre admissions
$
3,118
$
69,753
$
58,667
$
211,777
Rooms
9,772
34,185
27,618
81,317
Theatre concessions
3,243
57,051
50,277
172,126
Food and beverage
5,420
20,170
19,620
54,568
Other revenues
8,813
22,872
30,886
66,234
30,366
204,031
187,068
586,022
Cost reimbursements
3,225
7,431
13,916
27,979
Total revenues
33,591
211,462
200,984
614,001
Costs and expenses: Theatre operations
14,150
66,971
76,806
199,542
Rooms
4,611
10,829
16,132
30,173
Theatre concessions
2,592
21,471
25,634
63,789
Food and beverage
5,109
15,842
20,725
44,353
Advertising and marketing
1,981
6,653
8,446
17,664
Administrative
11,645
18,053
40,555
54,862
Depreciation and amortization
18,690
19,226
56,568
53,484
Rent
6,594
6,806
19,876
19,087
Property taxes
5,950
5,666
18,004
16,527
Other operating expenses
6,266
10,127
18,094
31,729
Impairment charges
765
-
9,477
-
Reimbursed costs
3,225
7,431
13,916
27,979
Total costs and expenses
81,578
189,075
324,233
559,189
Operating income (loss)
(47,987
)
22,387
(123,249
)
54,812
Other income (expense): Investment income
66
187
207
835
Interest expense
(4,132
)
(2,807
)
(10,177
)
(8,959
)
Other expense
(590
)
(481
)
(1,771
)
(1,441
)
Loss on disposition of property, equipment and other assets
(251
)
(129
)
(299
)
(269
)
Equity losses from unconsolidated joint ventures
(1,054
)
(84
)
(1,539
)
(252
)
(5,961
)
(3,314
)
(13,579
)
(10,086
)
Earnings (loss) before income taxes
(53,948
)
19,073
(136,828
)
44,726
Income taxes (benefit)
(14,508
)
4,843
(50,984
)
10,465
Net earnings (loss)
(39,440
)
14,230
(85,844
)
34,261
Net (earnings) loss attributable to noncontrolling interests
-
(59
)
(23
)
46
Net earnings (loss) attributable to The Marcus Corporation
$
(39,440
)
$
14,289
$
(85,821
)
$
34,215
Net earnings (loss) per common share attributable to
The Marcus Corporation - diluted
$
(1.30
)
$
0.46
$
(2.84
)
$
1.10
THE MARCUS CORPORATION Condensed Consolidated
Balance Sheets (In thousands) (Unaudited) (Audited)
September 24, December 26,
2020
2019
Assets: Cash and cash equivalents
$
8,244
$
20,862
Restricted cash
8,509
4,756
Accounts receivable
6,907
29,465
Refundable income taxes
54,434
5,916
Assets held for sale
2,119
-
Other current assets
11,477
18,265
Property and equipment, net
877,702
923,254
Operating lease right-of-use assets
236,632
243,855
Other assets
110,398
112,813
Total Assets
$
1,316,422
$
1,359,186
Liabilities and Shareholders' Equity: Accounts
payable
$
15,824
$
49,370
Taxes other than income taxes
16,638
20,613
Other current liabilities
61,638
79,189
Short-term borrowings
89,932
-
Current portion of finance lease obligations
2,908
2,571
Current portion of operating lease obligations
20,646
13,335
Current maturities of long-term debt
12,927
9,910
Finance lease obligations
20,256
20,802
Operating lease obligations
231,552
232,111
Long-term debt
199,357
206,432
Deferred income taxes
46,838
48,262
Deferred compensation and other
58,938
55,133
Equity
538,968
621,458
Total Liabilities and Shareholders' Equity
$
1,316,422
$
1,359,186
THE MARCUS CORPORATION Business Segment
Information (Unaudited) (In thousands) Theatres
Hotels/Resorts CorporateItems Total
13 Weeks Ended September 24,
2020 Revenues
$
7,354
$
26,178
$
59
$
33,591
Operating income (loss)
(37,174
)
(6,925
)
(3,888
)
(47,987
)
Depreciation and amortization
13,353
5,210
127
18,690
13 Weeks Ended September 26, 2019 Revenues
$
136,802
$
74,572
$
88
$
211,462
Operating income (loss)
16,843
10,580
(5,036
)
22,387
Depreciation and amortization
13,438
5,451
337
19,226
39 Weeks Ended September 24, 2020 Revenues
$
118,414
$
82,253
$
317
$
200,984
Operating income (loss)
(78,788
)
(32,459
)
(12,002
)
(123,249
)
Depreciation and amortization
40,245
15,955
368
56,568
39 Weeks Ended September 26, 2019 Revenues
$
414,074
$
199,604
$
323
$
614,001
Operating income (loss)
57,656
11,443
(14,287
)
54,812
Depreciation and amortization
37,918
15,050
516
53,484
Corporate items include amounts not allocable to the business
segments. Corporate revenues consist principally of rent and the
corporate operating loss includes general corporate expenses.
Corporate information technology costs and accounting shared
services costs are allocated to the business segments based upon
several factors, including actual usage and segment revenues.
THE MARCUS CORPORATION Reconciliation of Adjusted
net earnings (loss) and Adjusted net earnings (loss) per diluted
common share (Unaudited) (In thousands, except per share
data)
13 Weeks Ended
39 Weeks Ended Sept. 24,
Sept. 26, Sept. 24, Sept. 26,
2020
2019
2020
2019
Net earnings (loss) attributable to The Marcus Corporation
$
(39,440
)
$
14,289
$
(85,821
)
$
34,215
Add (deduct): Adjustment to income taxes (a)
168
(17,420
)
Acquisition/preopening expenses - theatres (b)
-
60
-
2,036
Preopening expenses - hotels (c)
-
1,620
-
5,534
Property closure/reopening expenses - theatres (d)
1,173
4,630
Property closure/reopening expenses - hotels (e)
443
5,484
Impairment charges (f)
765
-
9,477
-
Joint venture impairment charge (g)
811
811
Tax impact of adjustments to net earnings (h)
(912
)
(438
)
(5,849
)
(1,976
)
Adjusted net earnings (loss) attributable to The Marcus Corporation
$
(36,992
)
$
15,531
$
(88,688
)
$
39,809
Net earnings (loss) per diluted common share attributable to
The Marcus Corporation
$
(1.30
)
$
0.46
$
(2.84
)
$
1.10
Adjusted net earnings (loss) per diluted common share attributable
to The Marcus Corporation
$
(1.22
)
$
0.50
$
(2.93
)
$
1.28
(a) Reflects a nonrecurring adjustment to income taxes related to
net operating loss carrybacks to a higher federal income tax rate
year, made as a result of the CARES Act. (b) Acquisition and
preopening costs incurred related to the Movie Tavern acquisition.
(c) Preopening costs and initial startup losses incurred related to
the conversion of the InterContinental Milwaukee into Saint Kate® -
The Arts Hotel. (d) Reflects nonrecurring costs (primarily payroll)
related to the required closure of all of the company's movie
theatres due to the COVID-19 pandemic, plus subsequent nonrecurring
costs related to reopening theatres. (e) Reflects nonrecurring
costs (primarily payroll) related to the closure of the company's
hotels and resorts due to reduced occupancy as a result of the
COVID-19 pandemic, plus subsequent nonrecurring costs related to
reopening hotels. (f) Impairment charges related to intangible
assets (trade name) and several theatre locations. (g) Impairment
charge related to an investment in a joint venture (h) Represents
the tax effect related to adjustments (b), (c), (d), (e), (f), and
(g) to net earnings, calculated using statutory tax rates of 28.7%
for the fiscal 2020 periods and 26.1% for the fiscal 2019 periods.
Reconciliation of Net earnings (loss) to Adjusted EBITDA
(Unaudited) (In thousands)
13 Weeks
Ended 39 Weeks Ended
Sept. 24, Sept. 26, Sept. 24, Sept. 26,
2020
2019
2020
2019
Net earnings (loss) attributable to The Marcus Corporation
$
(39,440
)
$
14,289
$
(85,821
)
$
34,215
Add (deduct): Investment income
(66
)
(187
)
(207
)
(835
)
Interest expense
4,132
2,807
10,177
8,959
Other expense
590
481
1,771
1,441
Loss on disposition of property, equipment and other assets
251
129
299
269
Equity losses from unconsolidated joint ventures
1,054
84
1,539
252
Net earnings (loss) attributable to noncontrolling interests
-
(59
)
(23
)
46
Income tax expense (benefit)
(14,508
)
4,843
(50,984
)
10,465
Depreciation and amortization
18,690
19,226
56,568
53,484
Share-based compensation expenses (a)
1,108
868
3,286
2,594
Acquisition/preopening expenses - theatres (b)
-
60
-
2,036
Preopening expenses - hotels (c)
-
1,620
-
5,534
Property closure/reopening expenses - theatres (d)
1,173
4,630
Property closure/reopening expenses - hotels (e)
443
5,484
Impairment charges (f)
765
-
9,477
-
Adjusted EBITDA
$
(25,808
)
$
44,161
$
(43,804
)
$
118,460
(a) Non-cash charges related to share-based compensation
programs. (b) Acquisition and preopening costs incurred related to
the Movie Tavern acquisition. (c) Preopening costs and initial
startup losses incurred related to the conversion of the
InterContinental Milwaukee into Saint Kate - The Arts Hotel. (d)
Reflects nonrecurring costs (primarily payroll) related to the
required closure of all of the company's movie theatres due to the
COVID-19 pandemic, plus subsequent nonrecurring costs related to
reopening theatres. (e) Reflects nonrecurring costs (primarily
payroll) related to the closure of the company's hotels and resorts
due to reduced occupancy as a result of the COVID-19 pandemic, plus
subsequent nonrecurring costs related to reopening hotels. (f)
Impairment charges related to intangible assets (trade name) and
several theatre locations.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201103005137/en/
For additional information, contact: Douglas A. Neis (414)
905-1100
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