Carmike Cinemas, Inc. (NASDAQ: CKEC), a leading 3D motion picture exhibitor, today reported results for the fourth quarter and year ended December 31, 2008.
"We finished 2008 with a solid fourth quarter, highlighted by a 10 percent increase in theatre level cash flow, compared to the year-ago quarter," stated Carmike Cinemas Chairman David Passman. "Although the domestic economy continues to be challenged, Carmike and the exhibition industry as a whole have demonstrated our resilience.
Our adjusted net income improved by $6.4 million in the fourth quarter of 2008 as compared to the same period in 2007. Our adjusted net income for the three months ended December 31, 2008 was $1.7 million, excluding $36.3 million of impairment charges. Our adjusted net loss for the three months ended December 31, 2007 was $4.9 million, excluding impairment charges of $63.6 million. The impairments are non-cash charges to earnings and did not affect the Company's liquidity or cash flows from operating activities.
"We are pleased with the positive response throughout our circuit to 3D films. Over the past few years Carmike has converted 2,157 of our screens to digital cinema and built a leadership position in 3D installations. As a result, Carmike now has the largest installed base of 3D screens of any domestic exhibitor. We believe we are well positioned to benefit from a growing pipeline of high profile 3D content planned for 2009 and beyond."
Carmike's Chief Financial Officer Richard Hare stated, "Our per patron revenue rose year-over-year during the fourth quarter due to price increases implemented during the year and 3D premium pricing. In aggregate, theatre patrons spent an average of $9.72 per visit during the fourth quarter, up over five percent versus the prior year period. Our average per patron combined revenue for the full year rose to $9.56, with average admissions rising 7.3 percent to $6.32, and average concessions/other finishing the twelve-month period at $3.24, a 5.9 percent year-over-year increase. The per patron metric increases we achieved during the fourth quarter offset a modest 1.2 percent decline in average per screen attendance, with revenues rising 1.5 percent to $117.4 million, versus $115.7 million in the 2007 fourth quarter.
"On the expense side, we once again achieved a significant reduction in total general and administrative expenses, which fell 9.6 percent in the 2008 fourth quarter. For the full year, G&A declined 10.8 percent, compared to prior year levels. Our expense savings combined with a 14.8 percent drop in our annual interest expense, enabled us to reduce bank debt over 9 percent and make a voluntary $10 million bank debt pre-payment in December. We finished the year with $273.5 million in outstanding bank debt, and no borrowings on our $50 million revolving credit facility. We were in compliance with our debt covenant financial ratios at December 31, 2008 and importantly, during the fourth quarter of 2008, both of our debt covenant financial ratios improved compared to third quarter 2008 levels."