--- title: IMAX Corporation Reports Fourth-Quarter And Full-Year 2015 Financial Results publisher: "IMAX" description: "- 2015 IMAX Global Box Office reaches $1 billion , a 31% increase over 2014, and significantly surpasses worldwide industry box office growth of approximately 10% - 2015 Adjusted EBITDA grew 30% year-over-year to $140.8 million , resulting in adjusted EBITDA margins of  40.5%, up from 38.3% in the" canonical: "https://www.imax.com/pr/imax-corporation-reports-fourth-quarter-and-full-year-2015" date: 2016-02-24 last_updated: 2016-02-24 --- IMAX Corporation Reports Fourth-Quarter And Full-Year 2015 Financial Results ============================================================================ Wed, Feb 24, 2016 \- 2015 IMAX Global Box Office reaches $1 billion, a 31% increase over 2014, and significantly surpasses worldwide industry box office growth of approximately 10% \- 2015 Adjusted EBITDA grew 30% year-over-year to $140.8 million, resulting in adjusted EBITDA margins of  40.5%, up from 38.3% in the year-ago period \- 2015 adjusted EPS of $1.02grew 36%, driven by strong box office growth and network installations that were partially offset by FX and investments in new ventures \- IMAXsaw sizeable installations growth in 2015 – with 136 new installations up from 113 in 2014 \- IMAXraises installation guidance for 2016 from 115-120 range to 135-140 range, consistent with elevated levels seen in 2015 \- IMAX successfully listed shares of IMAX China(HKSE: 1970) on the Hong Kong Stock Exchangeat HKD$31 on Oct. 8, 2015, and has seen its share price increase 45% through Feb. 24, 2016 NEW YORK, Feb. 24, 2016/PRNewswire/ -- **IMAX Corporation**(NYSE: IMAX) today reported results for the fourth quarter and full year 2015, including its highest-ever quarter in revenue and among the highest-ever quarters for adjusted EBITDA and adjusted net earnings per diluted share ("EPS") in the Company's history. ![IMAX Logo. ](http://photos.prnewswire.com/prnvar/20111107/MM01969LOGO "IMAX Logo. ") "2015 was undoubtedly a historic year for IMAX– we delivered a record $1 billionin global box office, added 136 theatres to our network to bring our global total to over 1000 screens, launched our highly anticipated laser projection system, and of course, successfully listed our Chinabusiness on the Hong Kong Stock Exchange," said IMAXCEO Richard L. Gelfond. "IMAXis clearly benefiting from a global trend in the film industry to make more big-budget blockbuster movies.  And with so many major movie franchises releasing important sequels in 2016 and 2017, we believe we're extremely well positioned for success in the years ahead." **Fourth-Quarter 2015 Results ** The Company reported revenues of $119.3 million, up 16.5% from the year-ago period.  Adjusted EBITDA, as calculated in accordance with the Company's credit facility, grew 5.8% to $48.1 million.  Adjusted net income after non-controlling interest of $27.3 milliongrew 12.6%.  Adjusted diluted earnings per share of $0.39also grew 14.7%.  Reported net income after non-controlling interest was $22.5 million, or $0.32per diluted share. For reconciliations of adjusted net income to reported net income and for the definition of adjusted EBITDA and free cash flow, please see the tables at the end of this press release. The Company also reported a fourth-quarter global per-screen average of $318,600, up 9% over the year-ago period. * Revenue * Sales and Sales-Type Leases (STLs) revenue of $33.0 million, compared to $33.2 millionin the fourth quarter of 2014, primarily reflects the installation of 24 full, new theatre systems under sales and sales-type lease arrangements, compared to 26 installations last year.  In addition there were two system upgrades in existing locations, compared to two upgrades in the year ago period. * Revenue from joint revenue-sharing arrangements was $31.9 millionin the quarter, compared to $23.0 millionin the prior-year period.  During the quarter, the Company installed 32 new theatres under joint revenue-sharing arrangements, compared to 29 in the year ago period.  The Company had 529 theatres operating under joint revenue-sharing arrangements as of Dec. 31, 2015, as compared to 451 theatres one year prior. * Production and IMAX DMR® (Digital Re-Mastering) revenues were $31.9 millionin the fourth quarter of 2015, compared to $25.6 millionin the fourth quarter of 2014.  Gross box office from DMR titles was $288.4 millionin the fourth quarter of 2015, up 27.1% from $226.9 millionin the prior-year period.  The average global DMR box office per screen in the fourth quarter of 2015 was $318,600compared to $292,200in the prior-year period. * Network * Signings –52 theatre systems were signed in the fourth quarter of 2015, of which none were upgrades, bringing total signings for the year to 138, of which five were upgrades. Backlog level was replenished to 372 systems at year end. * Installations – 62 theatre systems were installed in the quarter, of which six were upgrades of existing theatre locations. **Full-Year 2015 Results ** Full-year 2015 revenues of $373.8 milliongrew 28.7%.  Adjusted EBITDA, as calculated in accordance with the Company's credit facility, rose 29.8% to $140.8 million.  Adjusted net income of $73.0 milliongrew 39.0% and adjusted net earnings per diluted share of $1.02grew 36.0%.  Reported net income attributable to common shareholders was $55.8 million, or $0.78per diluted share. The Company also reported a global 2015 per-screen average of $1,155,800, up 13.2% from the prior year. The full-year installation total grew to 154 theatre systems, of which 18 were upgrades, compared with 121 and eight, respectively, in the prior-year period.  The total IMAX® theatre network consisted of 1,061 systems as of Dec. 31, 2015, of which 943 were in commercial multiplexes.  IMAXsigned contracts for 138 theatres in 2015, across 24 countries, resulting in 372 theatre systems in backlog as of Dec. 31, 2015, compared to 397 theatre systems in backlog as of Dec. 31, 2014.  The Company's top three markets for signings were China, the United Statesand Japan. For a breakdown of theatre system signings, installations, network and backlog by type, please see the end of this press release. "As we look to 2016, we are very encouraged by what we see in the marketplace regarding our network expansion opportunities not only in China, but in other strategically important markets such as Japan, the Middle Eastand continental Europe," said Mr. Gelfond.  "With more than 1,000 theatres in our global network, $1 billionin box office running through our screens, and more than $300 millionin cash and virtually no debt, we believe we have significant opportunities to take our Company to the next level." **Conference Call **The Company will host a conference call on Feb. 24at 4:30pm ETto discuss its fourth-quarter and full-year 2015 results. To access the call via telephone, interested parties in the US and Canadashould dial (800) 505-9568 approximately 5 to 10 minutes before the call begins.  International callers should dial (416) 204-9271. The conference ID for the call is 4081404**.**A replay of the call will be available via webcast on the 'Investor Relations' section of [www.imax.com](http://www.imax.com/)or via telephone by dialing (888) 203-1112 (US and Canada), or (647) 436-0148 (international). The Conference ID for the telephone replay is 4081404**.** **About IMAX Corporation **IMAX, an innovator in entertainment technology, combines proprietary software, architecture and equipment to create experiences that take you beyond the edge of your seat to a world you've never imagined. Top filmmakers and studios are utilizing IMAXtheatres to connect with audiences in extraordinary ways, and, as such, IMAX'snetwork is among the most important and successful theatrical distribution platforms for major event films around the globe. IMAXis headquartered in New York, Torontoand Los Angeles, with offices in London, Tokyo, Shanghaiand Beijing.  As of Dec. 31, 2015, there were 1,061 IMAXtheatres (943 commercial multiplexes, 19 commercial destinations and 99 institutions) in 67 countries. On Oct. 8, 2015, shares of IMAX China, a subsidiary of IMAX Corp., began trading on the Hong Kong Stock Exchangeunder the stock code "HK.1970." IMAX®, IMAX® 3D, IMAX DMR®, Experience It In IMAX®, An IMAX 3D Experience®, The IMAX Experience®, IMAX Is Believing® and IMAXnXos® are trademarks of IMAX Corporation. More information about the Company can be found at [www.imax.com](http://www.imax.com). You may also connect with IMAXon Facebook([www.facebook.com/imax](http://www.facebook.com/imax)), Twitter ([www.twitter.com/imax](http://www.twitter.com/imax)) and YouTube([www.youtube.com/imaxmovies](http://www.youtube.com/imaxmovies)). _This press release contains forward looking statements that are based on IMAXmanagement's assumptions and existing information and involve certain risks and uncertainties which could cause actual results to differ materially from future results expressed or implied by such forward looking statements. Important factors that could affect these statements include, but are not limited to, references to future capital expenditures (including the amount and nature thereof), business and technology strategies and measures to implement strategies, competitive strengths, goals, expansion and growth of business, operations and technology, plans and references to the future success of IMAX Corporationtogether with its wholly-owned subsidiaries (the "Company") and expectations regarding the Company's future operating, financial and technological results. These forward-looking statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances. However, whether actual results and developments will conform with the expectations and predictions of the Company is subject to a number of risks and uncertainties, including, but not limited to_ _, the signing of theatre system agreements; conditions, changes and developments in the commercial exhibition industry; the performance of IMAX DMR films; the potential impact of increased competition in the markets within which the Company operates; competitive actions by other companies; the failure to respond to change and advancements in digital technology; risks associated with investments and operations in foreign jurisdictions and any future international expansion, including those related to economic, political and regulatory policies of local governments and laws and policies of the United Statesand Canada; risks related to the Company's growth and operations in China; the Company's largest customer accounting for a significant portion of the Company's revenue and backlog; risks related to new business initiatives; conditions in the in-home and out-of-home entertainment industries; the opportunities (or lack thereof) that may be presented to and pursued by the Company; risks related to cyber-security; risks related to the Company's inability to protect the Company's intellectual property; risks related to the Company's implementation of a new enterprise resource planning system; general economic, market or business conditions; the failure to convert theatre system backlog into revenue; changes in laws or regulations; and other factors, many of which are beyond the control of the Company__. These factors, other risks and uncertainties and financial details are discussed in IMAX'smost recent Annual Report on Form 10-K._ For additional information please contact: **_Investors:_** **IMAX Corporation, New York** **Jessica Kourakos** 212-821-0100 [jkourakos@imax.com](mailto:jkourakos@imax.com) **_Business Media:_** Sloane & Company, New York Whit Clay 212-446-1864 [wclay@sloanepr.com](mailto:wclay@sloanepr.com) **_Media:_** **IMAX Corporation, New York** **Ann Sommerlath** **212-821-0155** [asommerlath@imax.com](mailto:asommerlath@imax.com) **_Entertainment Media:_** Principal Communications Group, Los Angeles Melissa Zuckerman/Paul Pflug 323-658-1555 [melissa@pcommgroup.com](mailto:melissa@pcommgroup.com) [paul@pcommgroup.com](mailto:paul@pcommgroup.com) **Additional Information** **Signings and Installations** December 31, 2015 **Twelve Months** **Ended December 31,** **Theater Signings:** **2015** **2014** Full new sales and sales-type lease arrangements 55 (1) 81 (1) New joint revenue sharing arrangements 78 23 **Total new theaters** **133** **104** Upgrades of IMAX theater systems 5 (2)(3) 14 (2)(3) **Total Theater Signings** **138** **118** **Twelve Months** **Ended December 31,** **Theater Installations:** **2015** **2014** Full new sales and sales-type lease arrangements 56 46 New joint revenue sharing arrangements 80 67 **Total new theaters** **136** **113** Upgrades of IMAX theater systems 18 (4)(5) 8 (4) **Total Theater Installations** **154** **121** **As of December 31,** **Theater Backlog:** **2015** **2014** New sales and sales-type lease arrangements 145 153 New joint revenue sharing arrangements 212 217 **Total new theaters** **357** **370** Upgrades of IMAX theater systems 15 27 **Total Theaters in Backlog** **372** (6)(7) **397** (6)(8) **As of December 31,** **Theater Network:** **2015** **2014** Commercial Multiplex Theaters: Sales and sales-type lease arrangements 414 358 Joint revenue sharing arrangements 529 451 **Total Commercial Multiplex Theaters** **943** **809** Commercial Destination Theaters 19 19 Institutional Theaters 99 106 **Total IMAX Theater Network** **1,061** **934** \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (1) Includes four signings which replaced theatres under an existing arrangement in backlog (2014 – four signings). (2) Includes three signings for the installation of laser-based digital systems under sales and sales-type lease arrangements in existing theatre locations (2014 – five signings). (3) Includes two signings for the installation of an upgrade to a xenon-based digital system under sales and sales-type lease arrangements (2014 – three signings under sales and sales-type lease arrangements, three signings under short-term operating lease arrangements and three signings under joint revenue sharing arrangements). (4) Includes two installations of an upgrade to a xenon-based digital system, one of which is under a sales and sales-type lease arrangement and another under a short-term operating lease arrangement (2014 – three under sales and sales-type lease arrangements, two under short-term lease arrangement, one under an operating lease arrangement and two under joint revenue sharing arrangement). (5) Includes 16 installations of an upgrade to a laser-based digital system (10 under sales and sales-type lease arrangements, one under an operating lease arrangement and five under joint revenue sharing arrangements) (6) Includes 24 laser-based digital theatre system configurations (2014 – 71), including upgrades. The Company continues to develop and roll out its laser-based digital projection system. See "Research and Development" in this Part I for additional information. (7) Includes 15 upgrades to a digital theatre system, in existing IMAX theatre locations (2 xenon and 13 laser). (8) Includes 27 upgrades to a digital theatre system, in existing IMAX theatre locations (2 xenon and 25 laser, of which 4 are under joint revenue sharing arrangements). **Additional Information (continued)** **_2015 DMR Films:_**   In 2015, 44 films were converted through the IMAX DMR process and released to theatres in the IMAXnetwork by film studios as compared to 40 films in 2014. These films were: * _Taken 3_: _The_IMAX_Experience_(20th Century Fox, January 2015, select international markets); * _American Sniper: The_IMAX_Experience_(Warner Bros. Pictures, January 2015); * _Game of Thrones: The_IMAX_Experience_(Season 4, Episodes 9 and 10)(Warner Bros. Pictures, January 2015); * _Kingsman: The Secret Service: The_IMAX_Experience_(20th Century Fox, January 2015, international only); * _Jupiter Ascending: An_IMAX_3D__Experience_(Warner Bros. Pictures, February 2015); * _Fifty Shades of Grey: The_IMAX_Experience_(Universal Studios, February 2015, Domestic only); * _Wolf Totem: An_IMAX_3D__Experience_(China Film Group, February 2015, Chinaonly); * _Dragon Blade: An_IMAX_3D__Experience_(Shanghai Film Group, February 2015, Chinaonly); * _Focus: The_IMAX_Experience_(Warner Bros. Pictures, February 2015); * _Chappie: The_IMAX_Experience_(Sony Pictures Entertainment, March 2015); * _Cinderella: The_IMAX_Experience_(Walt Disney Studios, March 2015); * _The Divergent Series: Insurgent: An_IMAX_3D__Experience_(Summit Entertainment, March 2015); * _Furious 7: The_IMAX_Experience_(Universal Studios, April 2015); * _The Water Diviner: The_IMAX_Experience_(Warner Bros. Pictures, April 2015); * _Dragon Ball Z: Revival of 'F': An_IMAX_3D__Experience_(Toei Animation, April 2015, Japanonly); * _The Avengers: Age of Ultron: An_IMAX_3D__Experience_(Walt Disney Studios, May 2015); * _Tomorrowland: The_IMAX_Experience_(Walt Disney Studios, May 2015); * _San Andreas: An_IMAX_3D Experience_(Warner Bros. Pictures, May 2015); * _Mad Max: Fury Road: An_IMAX_3D Experience_(Warner Bros. Pictures, May 2015); * _Inside Out: An_IMAX_3D Experience_(Walt Disney Pictures, June 2015, select theatres); * _The Monk Comes Down the Mountain: An_IMAX_3D Experience_(Columbia Pictures, June 2015, Chinaonly); * _Jurassic World: An_IMAX_3D Experience_(Universal Studios, June 2015); * _Minions: An_IMAX_3D Experience_(Universal Pictures, July 2015, international only); * _Terminator Genisys: The_IMAX_Experience_(Paramount Pictures, July 2015); * _Monster Hunt: An_IMAX_3D Experience_(Edko Films, July 2015, Chinaonly); * _Ant Man: An_IMAX_3D Experience_(Walt Disney Pictures, July 2015); * _Pixels: An_IMAX_3D Experience_(Sony Pictures, July 2015); * _Mission: Impossible ― Rogue Nation: The_IMAX_Experience_ (Paramount Pictures, July 2015); * _Attack on Titan: Part 1: The_IMAX_Experience_(Toho Pictures, August 2015, Chinaonly); * _To the Fore: The_IMAX_Experience_(Emperor Motion Pictures, August 2015, Chinaonly); * _The Man from U.N.C.L.E: The_IMAX_Experience_(Warner Bros. Pictures, August 2015); * _Go Away Mr. Tumor: The_IMAX_Experience_(Wanda Media Co. Ltd., August 2015, Chinaonly); * _The Transporter Refueled: The_IMAX_Experience_(EuropaCorp, September 2015); * _Everest: An_IMAX_3D Experience_(Universal Studios, September 2015); * _Attack on Titan: Part 2: The_IMAX_Experience_(Toho Pictures, September 2015, Chinaonly); * _Lost in Hong Kong: The_IMAX_Experience_(PULIN Production, September 2015, Chinaonly); * _The Walk: The_IMAX_Experience_(Sony Pictures Entertainment, October 2015); * _Crimson Peak: The_IMAX_Experience_(Universal Studios, October 2015); * _The Martian: An_IMAX_3D Experience_(20th Century Fox, October 2015); * _Spectre: The_IMAX_Experience_ (Sony Pictures Entertainment, November 2015); * _The Hunger Games: Mockingjay Part 2: An_IMAX_3D Experience_(Lionsgate, November 2015); * _In the Heart of the Sea: An_IMAX_3D Experience_(Warner Bros. Pictures, December 2015); * _Star Wars: The Force Awakens: An_IMAX_3D Experience_(Walt Disney Studios, December 2015); and * _Mojin: The Lost Legend (aka "The Ghouls"): An_IMAX_3D Experience_(Wanda Media Co. Ltd., Chinaonly). **_2016 DMR Films:_**   To date, the Company has announced the following 26 DMR titles to be released in 2016 to the IMAXtheatre network. The Company remains in active negotiations with all of the major Hollywoodstudios for additional films to fill out its short and long-term film slate, and anticipates that a similar number of IMAX DMR titles will be released to the IMAXtheatre network in 2016 to the films that were released to the IMAXtheatre network in 2015. * _The Revenant: The_ IMAX_Experience_(20th Century Fox, January 2016); * _The Finest Hours: An_IMAX_3D Experience_(Walt Disney Studios, January 2016); * _Kung Fu Panda3: An_IMAX_3D Experience_(Oriental Dreamworks, January 2016, Chinaonly); * _The Monkey King 2: An_IMAX_3D Experience_(Filmko Entertainment, February 2016, Chinaonly); * _Crouching Tiger,  Hidden Dragon: Sword of Destiny: An_IMAX_3D Experience_(Netflix Distribution, LLC, February 2016); * _Deadpool: The_IMAX_Experience_(20th Century Fox, February 2016); * _Gods of Egypt: An_IMAX_3D Experience_(Lionsgate Entertainment, February 2016); * _Zootopia: An_IMAX_3D Experience_(Walt Disney Studios, February 2016); * _10 Cloverfield Lane: The_IMAX_Experience_(Paramount Pictures, March 2016); * _The Divergent Series: Allegiant: The_IMAX_Experience_(Lionsgate Entertainment, March 2016); * _Batman v Superman: Dawn of Justice: An_IMAX_3D Experience_(Warner Bros. Pictures, March 2016); * _The Crew: An_IMAX _3D Experience_(Russia\-1 Channel, April 2016); * _The Jungle Book: An_IMAX_3D Experience_(Walt Disney Studios, April 2016); * _Captain America: Civil War: An_IMAX_3D Experience_(Walt Disney Studios, May 2016); * _Alice in Wonderland: Through the Looking Glass: An_IMAX_3D Experience_(Walt Disney Studios, May 2016); * _Warcraft: An_IMAX_3D Experience_(Universal Studios, June 2016); * _Finding Dory: An_IMAX_3D Experience_(Walt Disney Studios, June 2016); * _Independence DayResurgence: An_IMAX_3D Experience_(20th Century Fox, June 2016); * _The Legend of Tarzan: An_IMAX_3D Experience_(Warner Bros. Pictures, July 2016); * _Star Trek Beyond: An_IMAX_3D Experience_(Paramount Pictures, July 2016); * _Suicide Squad: An_IMAX_3D Experience_(Warner Bros. Pictures, August 2016); * _Deepwater Horizon: The_ IMAX_Experience_(Lionsgate Entertainment, September 2016); * _The Duelist: The_IMAX_Experience_(Non-Stop Production LLC, October 2016, Russiaonly); * _Doctor Strange: An_ IMAX_3D Experience_(Walt Disney Studios, November 2016); * _Fantastic Beasts and Where to Find Them: An_IMAX_3D Experience_(Warner Bros. Pictures, November 2016); and * _Rogue One: A Star Wars Story: An_ IMAX_3D Experience_(Walt Disney Studios, December 2016). **IMAX CORPORATION** **CONSOLIDATED STATEMENTS OF OPERATIONS** **In accordance with United States Generally Accepted Accounting Principles** _(In thousands of U.S. dollars, except per share amounts)_ **Three Months** **Years Ended** **Ended December 31,** **Ended December 31,** **2015** **2014** **2015** **2014** **Revenues** Equipment and product sales $ 46,113 $ 41,084 $ 118,937 $ 78,705 Services 46,266 40,794 161,964 142,607 Rentals 24,645 18,427 83,651 60,705 Finance income 2,309 2,152 9,112 8,524 Other \- \- 141 \- **119,333** **102,457** **373,805** **290,541** **Costs and expenses applicable to revenues** Equipment and product sales 20,625 17,871 63,635 36,997 Services 20,654 15,910 70,855 62,228 Rentals 6,171 4,932 20,027 17,928 **47,450** **38,713** **154,517** **117,153** **Gross margin** **71,883** **63,744** **219,288** **173,388** Selling, general and administrative expenses 32,997 24,937 115,345 93,260 (including share-based compensation expense of $7.0 million and $21.9 million for the three months and year ended December 31, 2015, respectively (2014 - expense of $3.8 million and $15.1 million, respectively)) Research and development 3,119 4,628 12,730 16,096 Amortization of intangibles 558 465 1,860 1,724 Receivable provisions, net of recoveries 43 276 752 918 Asset impairments 160 314 405 314 Impairment of investments 75 2,556 425 3,206 **Income from operations** **34,931** **30,568** **87,771** **57,870** Interest income 241 216 968 405 Interest expense (491) (121) (1,661) (924) **Income from operations before income taxes** **34,681** **30,663** **87,078** **57,351** Provision for income taxes (7,644) (7,799) (20,052) (14,466) Loss from equity-accounted investments, net of tax (792) (350) (2,402) (1,071) **Income from continuing operations** **26,245** **22,514** **64,624** **41,814** Income from discontinued operations, net of tax \- \- \- 355 **Net income** **26,245** **22,514** **64,624** **42,169** Less: net income attributable to non-controlling interests (3,752) (1,522) (8,780) (2,433) **Net income attributable to common shareholders** **$** **22,493** **$** **20,992** **$** **55,844** **$** **39,736** **Net income per share attributable to common shareholders - Basic:** Net income per share from continuing operations $ 0.33 $ 0.30 $ 0.79 $ 0.57 Net income per share from discontinued operations \- \- \- 0.01 **$** **0.33** **$** **0.30** **$** **0.79** **$** **0.58** **Net income per share attributable to common shareholders - Diluted:** Net income per share from continuing operations $ 0.32 $ 0.30 $ 0.78 $ 0.56 Net income per share from discontinued operations \- \- \- \- **$** **0.32** **$** **0.30** **$** **0.78** **$** **0.56** Weighted average number of shares outstanding (000's): Basic 69,364 68,769 69,526 68,346 Fully Diluted 70,764 69,958 71,058 69,754 Additional Disclosure: Depreciation and amortization(1) $ 11,612 $ 9,819 $ 42,803 $ 33,756 (1) Includes $0.4 million and $1.0 million of amortization of deferred financing costs charged to interest expense for the three months and year ended December 31, 2015 (2014 - $0.1 million and $0.5 million, respectively). **IMAX CORPORATION** **CONSOLIDATED BALANCE SHEETS** **In accordance with United States Generally Accepted Accounting Principles** _(In thousands of U.S. dollars)_ **As at December 31,** **2015** **2014** **Assets** Cash and cash equivalents $ 317,449 $ 106,503 Accounts receivable, net of allowance for doubtful accounts of $1,146 (December 31, 2014 — $947) 97,981 76,051 Financing receivables 117,231 105,700 Inventories 38,753 17,063 Prepaid expenses 6,498 4,946 Film assets 14,571 15,163 Property, plant and equipment 218,267 183,424 Other assets 26,527 23,047 Deferred income taxes 25,766 23,058 Other intangible assets 28,950 27,551 Goodwill 39,027 39,027 **Total assets** **$** **931,020** **$** **621,533** **Liabilities** Bank indebtedness $ 29,667 $ 4,710 Accounts payable 23,455 26,145 Accrued and other liabilities 95,748 75,425 Deferred revenue 104,993 88,566 **Total liabilities** **253,863** **194,846** **Commitments and contingencies** **Non-controlling interests** **3,307** **43,912** **Shareholders' equity** Capital stock common shares — no par value. Authorized — unlimited number. Issued and outstanding — 69,673,244 (December 31, 2014 — 68,988,050) 448,310 344,862 Other equity 163,094 47,319 Accumulated earnings (deficit) 19,930 (6,259) Accumulated other comprehensive loss (7,443) (3,147) **Total shareholders' equity attributable to common shareholders** **623,891** **382,775** Non-controlling interests 49,959 **\-** **Total shareholders' equity** **673,850** **382,775** **Total liabilities and shareholders' equity** **$** **931,020** **$** **621,533** **IMAX CORPORATION** **CONSOLIDATED STATEMENTS OF CASH FLOWS** **In accordance with United States Generally Accepted Accounting Principles** _(In thousands of U.S. dollars)_ **Years Ended December 31,** **2015** **2014** **Cash provided by (used in):** **Operating Activities** Net income $ 64,624 $ 42,169 Income from discontinued operations, net of tax \- (355) Adjustments to reconcile net income to cash from operations: Depreciation and amortization 42,803 33,756 Write-downs, net of recoveries 3,725 5,294 Change in deferred income taxes (1,336) 627 Stock and other non-cash compensation 22,379 15,467 Unrealized foreign currency exchange loss 785 1,180 Loss from equity-accounted investments 3,838 1,774 Gain on non-cash contribution to equity-accounted investees (1,436) (703) Investment in film assets (15,119) (19,233) Changes in other non-cash operating assets and liabilities (36,578) 6,057 Net cash provided by operating activities from discontinued operations \- 572 **Net cash provided by operating activities** **83,685** **86,605** **Investing Activities** Purchase of property, plant and equipment (43,257) (40,104) Investment in joint revenue sharing equipment (28,474) (16,838) Investment in new business ventures (2,000) (2,500) Proceeds from sale of business venture \- 507 Acquisition of other intangible assets (5,065) (2,918) **Net cash used in investing activities** **(78,796)** **(61,853)** **Financing Activities** Increase in bank indebtedness 25,290 4,710 Repayment of bank indebtedness (333) \- Issuance of subsidiary shares to non-controlling interests - private offering 40,000 44,551 Share issuance costs from the issuance of subsidiary shares to non-controlling interests - private offering (2,000) (3,556) Issuance of subsidiary shares to non-controlling interests - public offering 178,226 \- Share issuance expenses – public offering (16,257) \- Exercise of stock options 35,609 10,834 Treasury stock repurchased for settlement of share based compensation (10,000) (790) Repurchase of common shares (34,276) (3,063) Dividends paid to non-controlling interests (9,511) \- Credit facility amendment fees paid (1,533) (427) **Net cash provided by financing activities** **205,215** **52,259** Effects of exchange rate changes on cash 842 (54) **Increase in cash and cash equivalents during year** **210,946** **76,957** **Cash and cash equivalents, beginning of year** **106,503** **29,546** **Cash and cash equivalents, end of year** $ **317,449** $ **106,503** **IMAX CORPORATION** **SELECTED FINANCIAL DATA** **In accordance with United States Generally Accepted Accounting Principles** _(in thousands of U.S. dollars)_ The Company has seven reportable segments identified by category of product sold or service provided: IMAX systems; theater system maintenance; joint revenue sharing arrangements; film production and IMAX DMR; film distribution; film post-production; and other. The IMAX systems segment includes the design, manufacture, sale or lease of IMAX theater projection system equipment. The theater system maintenance segment includes the maintenance of IMAX theater projection system equipment in the IMAX theater network. The joint revenue sharing arrangements segment includes the provision of IMAX theater projection system equipment to an exhibitor in exchange for a share of the box-office and concession revenues. The film production and IMAX DMR segment includes the production of films and the performance of film re-mastering services. The film distribution segment includes the distribution of films for which the Company has distribution rights. The film post-production segment provides film post-production and film print services. The other segment includes certain IMAX theaters that the Company owns and operates, camera rentals and other miscellaneous items. **Three Months** **Years Ended** **Ended December 31,** **Ended December 31,** **2015** **2014** **2015** **2014** **Revenue** **IMAX Theater Systems** IMAX Systems Sales and sales-type leases $ 33,011 $ 33,246 $ 86,935 $ 58,875 Ongoing rent, fees, and finance income 4,485 3,845 15,193 14,117 Other 6,259 3,747 17,579 12,154 43,755 40,838 119,707 85,146 Theater System Maintenance 9,599 8,658 36,944 34,042 Joint Revenue Sharing Arrangements 31,861 22,961 99,120 68,418 **Film** Production and IMAX DMR 31,945 25,587 107,089 83,172 Film distribution and post-production 2,173 4,413 10,945 19,763 34,118 30,000 118,034 102,935 **Total** $ 119,333 $ 102,457 $ 373,805 $ 290,541 **Gross margins** **IMAX Theater Systems** IMAX systems(1) Sales and sales-type leases $ 20,070 $ 20,322 $ 44,790 $ 34,483 Ongoing rent, fees, and finance income 4,267 3,646 14,378 13,445 Other 700 331 279 129 25,037 24,299 59,447 48,057 Theater System Maintenance 2,811 3,385 12,702 12,375 Joint Revenue Sharing Arrangements(1) 21,556 14,671 68,372 44,714 **Film** Production and IMAX DMR(1) 22,003 19,745 77,645 62,922 Film distribution and post-production(1) 476 1,644 1,122 5,320 22,479 21,389 78,767 68,242 **Total** $ 71,883 $ 63,744 $ 219,288 $ 173,388 \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (1) IMAX systems include marketing and commission costs of $1.2 million and $3.0 million for the three and twelve months ended December 31, 2015, respectively (2014 - $1.5 million and $2.7 million, respectively). Joint revenue sharing arrangements segment margins include advertising, marketing and commission costs of $1.6 million and $4.3 million for the three and twelve months ended December 31, 2015, respectively (2014 - $1.1 million and $3.2 million, respectively). Production and DMR segment margins include marketing costs of $5.0 million and $13.3 million for the three and twelve months ended December 31, 2015, respectively (2014 - $1.8 million and $7.1 million, respectively). Distribution segment margins include marketing costs recovery of less than $0.1 million and recovery of $0.1 million for the three and twelve months ended December 31, 2015, respectively (2014 - $0.1 million recovery and $0.6 million expense, respectively). **IMAX CORPORATION** **OTHER INFORMATION** _(in thousands of U.S. dollars)_ **_Non-GAAP Financial Measures:_** In this release, the Company presents adjusted net income, adjusted net income per diluted share, adjusted net income attributable to common shareholders and adjusted net income attributable to common shareholders per diluted share as supplemental measures of performance of the Company, which are not recognized under U.S. GAAP. The Company presents adjusted net income and adjusted net income per diluted share because it believes that they are important supplemental measures of its comparable controllable operating performance and it wants to ensure that its investors fully understand the impact of its stock-based compensation (net of any related tax impact) on net income. In addition, the Company presents adjusted net income attributable to common shareholders and adjusted net income attributable to common shareholders per diluted share because it believes that they are important supplemental measures of its comparable financial results and could potentially distort the analysis of trends in business performance and it wants to ensure that its investors fully understand the impact of net income attributable to non-controlling interests and its stock-based compensation (net of any related tax impact) in determining net income attributable to common shareholders. Management uses these measures to review operating performance on a comparable basis from period to period. However, these non-GAAP measures may not be comparable to similarly titled amounts reported by other companies. Adjusted net income, adjusted net income per diluted share, adjusted net income attributable to common shareholders and adjusted net income attributable to common shareholders per diluted share should be considered in addition to, and not as a substitute for, net income and net income attributable to common shareholders and other measures of financial performance reported in accordance with U.S. GAAP. The Credit Facility provides that the Company will be required at all times to satisfy a Minimum Liquidity Test (as defined in the Credit Agreement) of at least $50.0 million. The Company will also be required to maintain minimum EBITDA (as defined in the credit agreement) of $100.0 million. The Company must also maintain a Maximum Total Leverage Ratio (as defined in the credit agreement) of 2.25:1.0, which requirement decreases to (i) 2.0:1.0 on December 31, 2016; and (ii) 1.75:1.0 on December 31, 2017. The Company was in compliance with all of these requirements at December 31, 2015. The Maximum Total Leverage Ratio was 0.21:1 as at December 31, 2015, where Total Debt (as defined in the credit agreement) is the sum of all obligations evidenced by notes, bonds, debentures or similar instruments and was $29.7 million. EBITDA is calculated as follows: **Quarter Ended** **Year Ended** **Year Ended** **December 31, 2015** **December 31, 2015**(1) **December 31, 2014** Net income $ 26,245 $ 64,624 $ 42,169 Add (subtract): Loss from equity accounted investments 792 2,402 1,071 Provision for income taxes 7,644 20,052 14,683 Interest expense, net of interest income 250 693 519 Depreciation and amortization, including film asset amortization 11,259 41,787 33,230 Write-downs, net of recoveries including asset impairments and receivable provisions 797 3,725 5,294 Stock and other non-cash compensation 7,175 22,379 15,467 EBITDA attributable to non-controlling interests(2) (6,015) (14,885) (3,937) $ 48,147 $ 140,777 $ 108,496 Revenues attributed to IMAX common shareholders $ 106,981 $ 347,862 $ 283,001 Adjusted EBITDA margin 45.0% 40.5% 38.3% \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (1) Ratio of funded debt calculated using twelve months ended EBITDA. (2) The EBITDA calculation specified for purpose of the minimum EBITDA covenant excludes the reduction in EBITDA from the Company's non-controlling interests. **IMAX CORPORATION** **OTHER INFORMATION** _(in thousands of U.S. dollars)_ **_Adjusted Net Income and Adjusted Diluted Per Share Calculations – Quarter Ended December 31,_** **_2015_****_vs._** **_2014_****_:_** The Company reported net income of $26.2 million or $0.38 per basic share and $0.37 per diluted share for the quarter ended December 31, 2015 as compared to net income of $22.5 million or $0.32 per basic and diluted share for the quarter ended December 31, 2014. Net income for the quarter ended December 31, 2015 includes a $6.9 million charge or $0.10 per diluted share (2014 — $3.8 million or $0.05 per diluted share) for stock-based compensation. Adjusted net income, which consists of net income excluding the impact of stock-based compensation and the related tax impact, was $31.7 million or $0.45 per diluted share for the quarter ended December 31, 2015 as compared to adjusted net income of $25.8 million or $0.36 per diluted share for the quarter ended December 31, 2014. Adjusted net income attributable to common shareholders, which consists of net income attributable to common shareholders excluding the impact of stock-based compensation and the related tax impact, was $27.3 million or $0.39 per diluted share for the quarter ended December 31, 2015 as compared to adjusted net income attributable to common shareholders of $24.2 million or $0.34 per diluted share for the quarter ended December 31, 2014. A reconciliation of net income and net income attributable to common shareholders, the most directly comparable U.S. GAAP measure, to adjusted net income, adjusted net income per diluted share, adjusted net income attributable to common shareholders and adjusted net income attributable to common shareholders per diluted share is presented in the table below: **Quarter Ended December 31,** **2015** **2014** **Net Income** **Diluted EPS** **Net Income** **Diluted EPS** Reported net income $ 26,245 $ 0.37 (1) $ 22,514 $ 0.32 (1) Adjustments: Stock-based compensation 6,949 0.10 3,800 0.05 Tax impact on items listed above (1,453) (0.02) (563) (0.01) Adjusted net income 31,741 0.45 (1) 25,751 0.36 (1) Net income attributable to non-controlling interests (3,752) (0.05) (1,522) (0.02) Stock-based compensation (net of tax) attributable to non-controlling interests (703) (0.01) \- \- Adjusted net income attributable to common shareholders $ 27,286 $ 0.39 (1) $ 24,229 $ 0.34 (1) Weighted average diluted shares outstanding 70,764 69,958 \_\_\_\_\_\_\_\_\_\_\_\_\_ (1) Includes impact of less than $0.1 million (2014 - $0.1 million) of accretion charges associated with redeemable Class C shares of IMAX China. **_Adjusted Net Income and Adjusted Diluted Per Share Calculations – Year Ended December 31,_** **_2015_****_vs._** **_2014_****_:_** The Company reported net income of $64.6 million or $0.92 per basic share and $0.90 per diluted share for the year ended December 31, 2015 as compared to net income of $42.2 million or $0.61 per basic share and $0.59 per diluted share for the year ended December 31, 2014. Net income for the year ended December 31, 2015 includes a $21.9 million charge or $0.31 per diluted share (2014 — $15.1 million or $0.22 per diluted share) for stock-based compensation. Adjusted net income, which consists of net income excluding the impact of stock-based compensation and the related tax impact, was $82.4 million or $1.15 per diluted share for the year ended December 31, 2015 as compared to adjusted net income of $54.9 million or $0.78 per diluted share for the year ended December 31, 2014. Adjusted net income attributable to common shareholders, which consists of net income attributable to common shareholders excluding the impact of stock-based compensation and the related tax impact, was $73.0 million or $1.02 per diluted share for the year ended December 31, 2015 as compared to adjusted net income attributable to common shareholders of $52.5 million or $0.75 per diluted share for the year ended December 31, 2014. A reconciliation of net income and net income attributable to common shareholders, the most directly comparable U.S. GAAP measure, to adjusted net income, adjusted net income per diluted share, adjusted net income attributable to common shareholders and adjusted net income attributable to common shareholders per diluted share is presented in the table below: **Year Ended December 31,** **2015** **2014** **Net Income** **Diluted EPS** **Net Income** **Diluted EPS** Reported net income $ 64,624 $ 0.90 (1) $ 42,169 $ 0.59 (1) Adjustments: Stock-based compensation 21,880 0.31 15,128 0.22 Tax impact on items listed above (4,056) (0.06) (2,370) (0.03) Adjusted net income 82,448 1.15 (1) 54,927 0.78 (1) Net income attributable to non-controlling interests (8,780) (0.12) (2,433) (0.03) Stock-based compensation (net of tax) attributable to non-controlling interests (703) (0.01) \- \- Adjusted net income attributable to common shareholders $ 72,965 $ 1.02 (1) $ 52,494 $ 0.75 (1) Weighted average diluted shares outstanding 71,058 69,754 \_\_\_\_\_\_\_\_\_\_\_\_\_ (1) Includes impact of $0.8 million (2014 - $0.4 million) of accretion charges associated with redeemable Class C shares of IMAX China. **_Free Cash Flow:_** Free cash flow is defined as cash provided by operating activities minus cash used in investing activities (from the consolidated statements of cash flows). Cash provided by operating activities consist of net income, plus depreciation and amortization, plus the change in deferred income taxes, plus other non-cash items, plus changes in working capital, less investment in film assets, plus other changes in operating assets and liabilities. Cash used in investing activities includes capital expenditures, acquisitions and other cash used in investing activities. Management views free cash flow, a non-GAAP measure, as a measure of the Company's after-tax cash flow available to reduce debt, add to cash balances, and fund other financing activities. A reconciliation of cash provided by operating activities to free cash flow is presented in the table below: **For the** **For the** **3 months ended** **12 months ended** **December 31, 2015** **December 31, 2015** **_(In thousands of U.S. Dollars)_** Net cash provided by operating activities $ 41,885 $ 83,685 Net cash used in investing activities (13,762) (78,796) Free cash flow $ 28,123 $ 4,889 Logo - [http://photos.prnewswire.com/prnh/20111107/MM01969LOGO](http://photos.prnewswire.com/prnh/20111107/MM01969LOGO) To view the original version on PR Newswire, visit:[http://www.prnewswire.com/news-releases/imax-corporation-reports-fourth-quarter-and-full-year-2015-financial-results-300225647.html](http://www.prnewswire.com/news-releases/imax-corporation-reports-fourth-quarter-and-full-year-2015-financial-results-300225647.html) SOURCE IMAX Corporation