Imax Corp. Achieves Record Growth And Expands Strategic Partnerships
$IMAX
Imax Corp. (NYSE:IMAX) has reported a significant year-over-year growth in its Q4 2024 earnings. The company’s adjusted EBITDA soared by 48% to $37 million and its adjusted earnings per share increased by 59% to $0.27. This financial uptick was supported by a full-year revenue of $352 million and an improved operating cash flow, which saw a 21% increase from the previous year, totaling $71 million.
The fourth quarter alone generated $93 million in revenue, marking an 8% increase compared to the same period last year. Notably, the technology products and services sector contributed $64 million while content solutions saw a more substantial rise of 34%, bringing in $26 million. The company’s gross margin for the quarter stood at 52%, with selling, general and administrative expenses decreasing by $2 million year-over-year to $27 million. By the end of 2024, Imax Corp. maintained a cash position of $101 million, although it reported a debt of $269 million. The capital expenditures for the year were significant, at $41 million and the company also repurchased $18 million worth of shares.
In 2024, Imax Corp. installed 146 new systems, with over half under joint revenue sharing arrangements.The fourth-quarter box office results did not meet expectations due to weaker performance during the Christmas holiday period and a less favorable currency exchange environment as the US dollar strengthened. On the strategic front, Imax Corp. has fortified its global presence by securing partnerships with major exhibitors such as Wanda and AMC and entering new agreements across North America. A landmark deal with Netflix to release exclusive IMAX content sets a precedent for future collaborations, potentially reshaping how audiences engage with streaming content in cinematic formats.
Looking ahead to 2025, Imax Corp. has set targets, forecasting box office revenues to surpass $1.2 billion and planning to install between 145 to 160 new systems. The company aims to maintain or increase its adjusted EBITDA margin to a minimum of 40%. These positive developments, Imax Corp. faced challenges in 2024, particularly in the China market, which experienced a downturn affecting overall financial performance.
CEO Richard Gelfond provided insights into the company’s strategic direction. He emphasized the importance of maintaining high underwriting standards and focusing on Tier 1 and Tier 2 cities for new installations in China, acknowledging the strong market performance and potential for increased demand. The partnership with Netflix, particularly for the Narnia series, was highlighted as a complex but fruitful endeavor, indicating potential for similar deals in the future.Gelfond also noted the favorable movie mix and pent-up demand that drove the strong performance in China, with significant contributions from blockbuster titles like Avatar 3 and Mission Impossible.
These factors are expected to sustain growth throughout the year, bolstered by a transparent and robust slate of upcoming releases. As Imax Corp. navigates through fluctuating market conditions and strategic challenges, its focus on innovation, strategic partnerships and market expansion continues to position it as a key player in the global entertainment landscape. The company’s ability to adapt and thrive amid adversity highlights its resilience and commitment to delivering cinematic experiences worldwide.
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