NEW YORK, April 20, 2017/PRNewswire/ --

IMAX Logo. (PRNewsFoto/IMAX Corporation)

HIGHLIGHTS

Year-to-date backlog through April 20^thup 52% vs. prior year comparable period to a record 589 theaters
Year-to-date signings through April 20^thof 104 new systems vs. 37 new systems in the year-ago period, representing a 181% increase
Extended Disneyblockbuster slate deal through 2019 that includes live-action and animated tent-pole releases from Disney, Walt Disney Animation Studios, Pixar, Marvel and LucasFilm
Announced first-ever virtual reality Hollywoodcontent deal with Warner Bros. Home Entertainmentto develop three cutting-edge VR experiences based on highly anticipated films, including Justice Leagueand Aquaman
Agreed with exhibitor partners to open multiple additional pilot VR centres by the end of 2017 in locations including New York; Manchester, UK; Shanghai; and Japan
IMAXkicks off blockbuster season with Fate of the Furious, which delivered $30 millionopening weekend globally, including the biggest opening weekend ever in China
IMAXincreases full-year 2017 installation guidance to approximately 160 new theater systems from 150 – 155 theater systems

IMAX Corporation(NYSE: IMAX)today reported first-quarter 2017 revenue of $68.7 millionand net income attributable to common shareholders of $0.1 million, or $nil per diluted share. Adjusted net income attributable to common shareholders for the first quarter was $0.06per diluted share, inclusive of a $0.02per diluted share asset impairment charge related to a write-down on a documentary title within the film distribution business. For reconciliations of reported results to non-GAAP financial results, and for the definition and reconciliation of Adjusted EBITDA as calculated in accordance with the Company's credit facility, please see the end of this press release.

"Building on our record signings in 2016, our momentum in the first four months of 2017 has continued at an extremely strong pace. Not only have we witnessed record signings to date, we have also seen exceptional box office performance from titles such as TheFate of the Furious, which did $30 millionin its opening weekend in IMAXand broke numerous box office records including our biggest opening weekend ever in China," said IMAXCEO Richard L Gelfond. "We closed the first quarter with a 30-theatre deal with Bona and just recently announced a 40-theatre deal with Omnijoi and a 25-theatre deal with AMC-Odeon, bringing our year-to-date signings to a record 104 new theaters. Not only do these deals demonstrate our partners' continued optimism in the IMAXbusiness, they also underscore the global diversity of our future expansion. For instance, the Odeon deal has strategic significance to us on several fronts: it opens up markets in Western Europesuch as Germany, Italyand Spain and significantly increases the Company's exposure to Scandinavia, which historically has generated above-average box office per screen. These types of agreements are also important as they help facilitate increased awareness in underpenetrated markets, which ultimately drives exhibitor demand for additional IMAXtheaters."

First-Quarter 2017 Results

Network Update:

During the quarter, the Company installed 15 theaters, of which 14 were for new theatre locations and one was an upgrade. The total IMAXtheatre network consisted of 1,226 systems as of March 31, 2017, of which 1,121 were in commercial multiplexes. There were 524 theaters in backlog as of March 31, 2017, up 35% from the 388 in backlog as of Mar. 31, 2016. Year to date, as of April 20, 2017, there were 589 theaters in backlog, up 52% from the year-ago period.

Continuing the Company's record signings momentum from 2016, IMAXsigned contracts for 39 theaters in the first quarter of 2017, headlined by a 30-theatre agreement with Bona Film Group, a leading film distributor and vertically integrated film production company in China. Year to date, the Company has signed contracts for 104 new theatre systems. On April 11the Company announced a 25-theatre agreement with Odeon Cinemas Groupincluding its Nordic Cinema Group subsidiary, both wholly owned by AMC(NYSE:AMC), and the largest cinema operators in Europe. On April 18the Company also announced a 40-theatre agreement with Omnijoi Cinemas, the third-largest IMAXexhibitor partner in China, and the fifth-largest globally. For a breakdown of theatre system signings, installations, network and backlog by type for the first quarter of 2017, please see the end of this press release.

"In addition to significantly expanding our network and backlog, we are beginning to execute against several new promising business initiatives," CEO Richard L. Gelfondcontinued. "We launched our flagship IMAX VR Centre in Los Angeles, announced our first-ever Hollywood VR slate deal with Warner Bros., and kicked off production with Marvel and ABC Studios on Marvel's Inhumans, which will debut exclusively in IMAXtheaters in early September. We're encouraged by the progress we're seeing across these fronts and believe 2017 will serve as a key inflection point for IMAXas our business expands beyond box office."

Box Office Update:

Gross box office from IMAX DMR® titles was $212.1 millionin the first quarter of 2017, compared with $272.0 millionin the prior-year period. The average global DMR box office per-screen average in the first quarter of 2017 was $189,300, compared with $284,400in same period last year. The first-quarter 2016 film slate comparisons included Star Wars: The Force Awakenscarryover, Batman v Supermanand Deadpool. Other upcoming tent-pole film releases include Guardians of the Galaxy Vol. 2, Transformers: The Last Knight, Spider-Man: HomecomingandDunkirk.

First-Quarter Segment Results

Network Business

Network business revenue was $39.3 millionin the quarter, compared with $52.3 millionin the prior-year period.
IMAX DMR revenues were $23.4 millionin the first quarter of 2017, compared with $29.8 millionin the first quarter of 2016. Gross margin for the IMAX DMR segment was 74.6%, compared to 76.6% in the prior-year comparative period, primarily a result of lower box office performance and higher costs, including marketing, print and sound.
Revenue from joint revenue-sharing arrangements was $15.2 millionin the quarter, compared with $21.3 millionin the prior-year comparative period.
Gross margin for joint revenue-sharing arrangements was 67.3%, compared to 82.0% in the prior-year comparative period, reflecting lower box office performance.
During the quarter, the Company installed eight new theaters under full joint revenue-sharing arrangements, compared with one in the first quarter of 2016.

Theater Business

Theater business segment revenue was $23.2 millionin the quarter, compared with $35.1 millionin the prior-year comparative period.
Revenue from IMAXsystem sales and sales-type leases was $6.9 millionin the first quarter of 2017, compared with $18.0 millionin the first quarter of 2016. The Company recognized one upgrade under a sales arrangement in the most recent quarter, compared to nine in the same period last year. The Company also installed five full theatre systems under sales and sales-type lease arrangements in the first quarter of 2017 and 2016, respectively.
The Company's margins on full, new sales and sales-type leases were 66.0% compared with 68.2% in the year-ago period, primarily a result of lower margins from the installation of laser-based digital systems.
The Company also installed one hybrid joint revenue sharing agreement in the most recent quarter, compared with four in 2016.

Gross margin across all segments in the first quarter of 2017 was 52.1%, compared with 56.6% in the first quarter of 2016, mainly due to lower box office performance and the $3.4 millionwrite-down in our film distribution business. Excluding the write-down, consolidated gross margin would have been 57.1% in the first quarter. Operating expenses (which include SG&A and R&D, and exclude stock-based compensation) were $30.0 millionin the quarter, compared with $26.7 millionin the first quarter of 2016, and consistent with guidance disclosed on the Q4 2016 call.

Supplemental Materials

For more information about our results, please refer to the IMAX Investor Relations website located at www.imax.com/content/investor-relations

Investor Relations Website and Social Media

On a weekly basis, the Company posts quarter-to-date box office results on the IMAX Investor Relations website located at www.imax.com/content/investor-relations. The Company expects to provide such updates on Friday of each week, although the Company may change this timing without notice. Results will be displayed with a one week lag. In addition, the Company maintains a Twitter account: @IMAX_Investors. The Company intends to use Twitter to disclose the box office information, as well as other information that may be of interest to the Company's investor community.

The information posted on the Company's website and/or via its Twitter account may be deemed material to investors. Accordingly, investors, media and others interested in the Company should monitor the Company's website and its Twitter account in addition to the Company's press releases, SECfilings and public conference calls and webcasts.

Conference Call

The Company will host a conference call today at 8:30AM ETto discuss its first-quarter 2017 financial results. To access the call via telephone, interested parties in the US and Canadashould dial (800) 274-0251 approximately 5 to 10 minutes before the call begins. Other international callers should dial (416) 642-5209. The conference ID for the call is 7006877. A replay of the call will be available via webcast www.imax.com/content/investor-relationsor via telephone by dialing (888) 203-1112 (US and Canada), or (647) 436-0148 (international). The Conference ID for the telephone replay is 7006877.

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 IMAXtheaters 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 Mar 31, 2017, there were 1,226 IMAXtheaters (1,121 commercial multiplexes, 14 commercial destinations and 91 institutions) in 75 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."

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 consolidated 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, 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 signing of theater system agreements; conditions, changes and developments in the commercial exhibition industry; risks related to currency fluctuations; 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; 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 its 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 theater 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 and Quarterly Reports on Form 10-Q.

For additional information please contact:

Investors:

IMAX Corporation, New York

Jessica Kourakos

212-821-0100

jkourakos@imax.com

Michael Mougias

212-821-0187

mmougias@imax.com

Business Media:

Sloane & Company, New York

Whit Clay

212-446-1864

wclay@sloanepr.com

Media:

IMAX Corporation, New York

Ann Sommerlath

212-821-0155

asommerlath@imax.com

Entertainment Media:

Principal Communications Group, Los Angeles

Melissa Zuckerman/Paul Pflug

323-658-1555

melissa@pcommgroup.com

paul@pcommgroup.com

Additional Information

Signings and Installations
March 31, 2017
		Three Months Ended March 31,
	Theater Signings:	2017		2016
	Full new sales and sales-type lease arrangements	36		28
	New joint revenue sharing arrangements	2		7
	Total new theaters	38		35
	Upgrades of IMAX theater systems	1		1
	Total Theater Signings	39		36


		Three Months Ended March 31,
	Theater Installations:	2017		2016
	Full new sales and sales-type lease arrangements	5		5
	New joint revenue sharing arrangements	9		5
	Total new theaters	14		10
	Upgrades of IMAX theater systems	1	⁽¹⁾	9	⁽¹⁾⁽²⁾
	Total Theater Installations	15		19


		As of March 31,
	Theater Backlogs:	2017		2016
	New sales and sales-type lease arrangements	176		174
	New joint revenue sharing arrangements
	Hybrid arrangements	93		119
	Traditional arrangements	255		95
	Total new theaters	524	⁽³⁾	388	⁽⁴⁾


		As of March 31,
	Theater Network:	2017		2016
	Commercial Multiplex Theaters:
	Sales and sales-type lease arrangements	472		418
	Joint revenue sharing arrangements	649		534
	Total Commercial Multiplex Theaters	1,121		952

	Commercial Destination Theaters	14		17
	Institutional Theaters	91		97
	Total Theater Installations	1,226		1,066



(1)	Includes one installation of an upgrade to a laser-based digital system under sales arrangement (2016 – eight laser-based digital systems under sales and sales-type lease arrangements).
(2)	Includes one installation of an upgrade to a xenon-based digital system under sales arrangement.
(3)	Includes 21 laser-based digital theater system configurations, including three upgrades. The Company continues to develop and roll out its laser-based digital projection system.
(4)	Includes 21 laser-based digital theater system configurations, including six upgrades (one xenon configuration and five laser configurations).

IMAX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of U.S. dollars, except per share amounts)
*(Unaudited)*

		Three Months
		Ended March 31,
		2017		2016
Revenues
Equipment and product sales		$	11,544	$	23,740
Services			38,844		44,273
Rentals			15,857		21,779
Finance income			2,412		2,336
			68,657		92,128
Costs and expenses applicable to revenues
Equipment and product sales			7,464		17,791
Services			19,814		17,596
Rentals			5,608		4,565
			32,886		39,952
Gross margin			35,771		52,176
Selling, general and administrative expenses			30,941		28,919
	(including share-based compensation expense of $5.3 million for the three months ended March 31, 2017 (2016 — expense of $5.9 million))
Research and development			4,334		3,708
Amortization of intangibles			602		491
Receivable provisions, net of recoveries			185		126
(Loss) income from operations			(291)		18,932
Interest income			228		467
Interest expense			(455)		(398)
(Loss) income from operations before income taxes			(518)		19,001
Provision for income taxes			(114)		(4,608)
Loss from equity-accounted investments, net of tax			(255)		(441)
Net (loss) income			(887)		13,952
Less: net income attributable to non-controlling interests⁽¹⁾			962		(2,650)
Net income attributable to common shareholders		$	75	$	11,302

Net income per share attributable to common shareholders - basic & diluted:
Net income per share – basic		$	-	$	0.16
Net income per share – diluted		$	-	$	0.16

Weighted average number of shares outstanding (000's):
	Basic		66,363		69,379
	Fully Diluted		67,180		70,120

Additional Disclosure:
Depreciation and amortization⁽²⁾		$	12,088	$	10,438

(1)	For the three months ended March 31, 2017, includes an adjustment of $1.9 million related to the Documentary Film Fund's non-controlling shareholder's portion of the impairment
(2)	Includes $0.1 million of amortization of deferred financing costs charged to interest expense for the three months ended March 31, 2017 (2016 - $0.1 million)

IMAX CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars)
*(Unaudited)*



	March 31,		December 31,
	2017		2016

Assets
Cash and cash equivalents	$	190,481	$	204,759
Accounts receivable, net of allowance for doubtful accounts of $1,282 (December 31, 2016 — $1,250)		96,113		96,349
Financing receivables		120,490		122,125
Inventories		45,433		42,121
Prepaid expenses		8,047		6,626
Film assets		13,413		16,522
Property, plant and equipment		248,228		245,415
Other assets		19,660		33,195
Deferred income taxes		29,491		20,779
Other intangible assets		31,106		30,416
Goodwill		39,027		39,027
Total assets	$	841,489	$	857,334

Liabilities
Bank indebtedness	$	26,826	$	27,316
Accounts payable		13,935		19,990
Accrued and other liabilities		75,424		93,208
Deferred revenue		100,901		90,266
Total liabilities		217,086		230,780

Commitments and contingencies

Non-controlling interests		2,555		4,980

Shareholders' equity
Capital stock common shares — no par value. Authorized — unlimited number.
66,596,784 issued and 66,573,078 outstanding (December 31, 2016 — 66,224,467 issued and 66,159,902 outstanding)		455,838		439,213
Less: Treasury stock, 23,706 shares at cost (December 31, 2016 — 64,565)		(779)		(1,939)
Other equity		165,670		177,304
Accumulated deficit		(55,605)		(47,366)
Accumulated other comprehensive loss		(4,447)		(5,200)
Total shareholders' equity attributable to common shareholders		560,677		562,012
Non-controlling interests		61,171		59,562
Total shareholders' equity		621,848		621,574
Total liabilities and shareholders' equity	$	841,489	$	857,334

IMAX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of U.S. dollars)
*(Unaudited)*
	Three Months Ended March 31,
	2017		2016

Cash provided by (used in):
Operating Activities
Net (loss) income	$	(887)	$	13,952
Adjustments to reconcile net (loss) income to cash from operations:
Depreciation and amortization		12,088		10,438
Write-downs, net of recoveries		4,010		648
Change in deferred income taxes		(958)		(185)
Stock and other non-cash compensation		5,660		6,002
Unrealized foreign currency exchange gain		(171)		(557)
Loss from equity-accounted investments		156		818
Loss (gain) on non-cash contribution to equity-accounted investees		99		(377)
Investment in film assets		(3,334)		(3,919)
Changes in other non-cash operating assets and liabilities		(17,280)		(21,783)
Net cash (used in) provided by operating activities		(617)		5,037

Investing Activities
Purchase of property, plant and equipment		(4,068)		(4,585)
Investment in joint revenue sharing equipment		(7,547)		(3,988)
Investment in new business ventures		(1,000)		-
Acquisition of other intangible assets		(1,591)		(770)
Net cash used in investing activities		(14,206)		(9,343)

Financing Activities
Repayment of bank indebtedness		(500)		(500)
Settlement of restricted share units and options		(11,158)		(5,849)
Common shares issued - stock options exercised		13,082		740
Treasury stock purchased for future settlement of restricted share units		(779)		-
Taxes withheld and paid on employee stock awards vested		(146)		(73)
Repurchase of common shares		-		(44,618)
Taxes paid on secondary sale and repatriation dividend		-		(2,991)

Net cash provided by (used in) financing activities		499		(53,291)

Effects of exchange rate changes on cash		46		(100)

Decrease in cash and cash equivalents during period		(14,278)		(57,697)

Cash and cash equivalents, beginning of period		204,759		317,449

Cash and cash equivalents, end of period	$	190,481	$	259,752

IMAX CORPORATION SELECTED FINANCIAL DATA In accordance with United States Generally Accepted Accounting Principles (in thousands of U.S. dollars)

The Company has four primary groups identified by nature of product sold or service provided: (1) Network Business, representing variable revenue generated by box-office results and which includes the reportable segments of IMAX DMR and contingent rent from the JRSAs and IMAX systems segments; (2) Theater Business, representing revenue generated by the sale and installation of theater systems and maintenance services, primarily related to the IMAX Systems and Theater System Maintenance reportable segments, and also includes fixed hybrid revenues and upfront installation costs from the JRSA segment and after-market sales of projection system parts and 3D glasses from the other segment; (3) New Business, which includes content licensing and distribution fees associated with the Company's original content investments, virtual reality initiatives, IMAX Home Entertainment, and other business initiatives that are in the development and/or start-up phase, and (4) Other; which includes the film post-production and distribution segments and certain IMAX theaters that the Company owns and operates, camera rentals and other miscellaneous items from the other segment.

		Three Months
		Ended March 31,
			2017		2016
Revenue
Network Business
	IMAX DMR	$	23,408	$	29,805
	Joint revenue sharing arrangements – contingent rent		15,233		21,315
	IMAX systems - contingent rent		688		1,187
			39,329		52,307
Theater Business
	IMAX systems
	Sales and sales-type leases		6,942		17,999
	Ongoing fees and finance income		2,585		2,675
	Joint revenue sharing arrangements – fixed fees		470		2,070
	Theater system maintenance		11,045		9,826
	Other theater		2,165		2,487
			23,207		35,057

New Business			1,280		-

Other
	Film distribution and post-production		3,584		2,770
	Other		1,257		1,994
			4,841		4,764
Total		$	68,657	$	92,128

Gross margins
Network Business
	IMAX DMR⁽¹⁾	$	17,467	$	22,823
	Joint revenue sharing arrangements – contingent rent⁽¹⁾		10,250		17,487
	IMAX systems - contingent rent		688		1,187
			28,405		41,497
Theater Business
	IMAX systems
	Sales and sales-type leases⁽¹⁾		3,220		4,320
	Ongoing fees and finance income		2,521		2,328
	Joint revenue sharing arrangements – fixed fees⁽¹⁾		88		504
	Theater system maintenance		4,249		3,439
	Other theater		430		(32)
			10,508		10,559

New Business			(337)		(225)

Other
	Film distribution and post-production⁽¹⁾		(2,663)		570
	Other		(142)		(225)
			(2,805)		345
Total		$	35,771	$	52,176

(1)

IMAX DMR segment margins include marketing costs of $2.6 million for the three months ended March 31, 2017 (2016 - $2.3 million). Joint revenue sharing arrangements segment margins include advertising, marketing and commission costs of $0.4 million for the three months ended March 31, 2017 (2016 - $0.1 million). IMAX systems segment margins include marketing and commission costs of $0.4 million for the three months ended March 31, 2017 (2016 - $0.5 million). Film distribution and post production segment margins include a marketing recovery of $0.2 million for the three months ended March 31, 2017 (2016 – expense of $0.7 million) and an asset impairment charge of $3.4 million related to a write-down within the film distribution business.

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, EBITDA and adjusted EBITDA 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 Company is required to maintain a minimum level of "EBITDA", as such term is defined in the Company's credit agreement (and which is referred to herein as "Adjusted EBITDA", as the credit agreement includes additional adjustments beyond interest, taxes, depreciation and amortization). EBITDA and Adjusted EBITDA (each as defined below) should not be construed as substitutes for net income or as better measures of liquidity as determined in accordance with U.S. GAAP. The Company believes that EBITDA and Adjusted EBITDA are relevant and useful information widely used by analysts, investors and other interested parties in the Company's industry.

		For the			For the
		3 months ended			12 months ended
		March 31, 2017			March 31, 2017⁽¹⁾
*(In thousands of U.S. Dollars)*
Net (loss) income		$	(887)		$	26,256
Add (subtract):
	Provision for income taxes		114			12,608
	Interest expense, net of interest income		227			611
	Depreciation and amortization, including film asset amortization		11,957			47,613
	EBITDA	$	11,411		$	87,088
	Write-downs, net of recoveries including asset impairments and
	receivable provisions		4,010			9,302
	Loss from equity accounted investments		255			2,135
	Stock and other non-cash compensation		5,660			28,579
	Adjusted EBITDA before non-controlling interests		21,336			127,104
	Adjusted EBITDA attributable to non-controlling interests⁽²⁾		(2,845)			(18,211)
	Adjusted EBITDA attributable to common shareholders	$	18,491		$	108,893
	Adjusted revenues attributable to common shareholders⁽³⁾	$	62,749		$	318,355
	Adjusted EBITDA margin		29.5	%		34.2	%

(1)	Ratio of funded debt calculated using twelve months ended Adjusted EBITDA.
(2)	The Adjusted EBITDA calculation specified for purpose of the minimum Adjusted EBITDA covenant excludes the reduction in Adjusted EBITDA from the Company's non-controlling interests.

(3)

		3 months ended March 31, 2017				12 months ended March 31, 2017
	Total revenues			$	68,657			$	353,863
	Greater China revenues	$	18,590			$	112,183
	Non-controlling interest ownership percentage⁽⁴⁾		31.78%				31.65%
	Deduction for non-controlling interest share of revenues				(5,908)				(35,508)
	Adjusted revenues attributable to common shareholders			$	62,749			$	318,355

(4)	Weighted average ownership percentage for change in non-controlling interest share

IMAX CORPORATION OTHER INFORMATION (in thousands of U.S. dollars)

*Adjusted Net Income and Adjusted Diluted Per Share Calculations – Quarter Ended March 31, 2017 vs. 2016:*

The Company reported a net loss of $0.9 million, or a loss of $0.01 per basic and diluted share for the first quarter of 2017, as compared to net income of $14.0 million or $0.20 per basic share and diluted share for the first quarter of 2016. Net income for the first quarter of 2017 includes a $5.3 million charge or $0.08 per diluted share (2016 — $5.9 million or $0.09 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 $3.0 million or $0.05 per diluted share for the first quarter of 2017, as compared to adjusted net income of $18.0 million or $0.26 per diluted share for the first quarter of 2016. The Company reported net income attributable to common shareholders of $0.1 million, or $nil per basic and diluted share for the first quarter of 2017 (2016 — $11.3 million, or $0.16 per basic and diluted share). 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 $3.9 million or $0.06 per diluted share for the first quarter of 2017, as compared to adjusted net income attributable to common shareholders of $15.3 million or $0.22 per diluted share for the first quarter of 2016. 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:

*(In thousands of U.S. dollars, except per share amounts)*		Quarter Ended March 31,
		2017					2016
		Net Income		Diluted EPS			Net Income		Diluted EPS
Reported net (loss) income		$	(887)	$	(0.01)		$	13,952	$	0.20
Adjustments:
	Stock-based compensation		5,264		0.08			5,873		0.09
	Tax impact on items listed above		(1,341)		(0.02)			(1,800)		(0.03)
Adjusted net income			3,036		0.05			18,025		0.26
	Net loss (income) attributable to non-controlling interests		962		0.01			(2,650)		(0.04)
	Stock-based compensation (net of tax of less than
	$0.1 million and less than $0.1 million, respectively) attributable to non-controlling interests		(128)		-			(125)		-
Adjusted net income attributable to common shareholders		$	3,870	$	0.06		$	15,250	$	0.22

Weighted average diluted shares outstanding					67,180					70,120



*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. Free cash flow does not represent residual cash flow available for discretionary expenditures. A reconciliation of cash provided by operating activities to free cash flow is presented in the table below:

						For the
						Three months ended
						March 31, 2017
*(In thousands of U.S. Dollars)*
Net cash used in operating activities						$	(617)
Net cash used in investing activities							(14,206)
Net cash flow						$	(14,823)

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SOURCE IMAX Corporation