HIGHLIGHTS
- Robust Q2 2016 signings of 95 IMAX® theatre systems, up 217% year-over-year
- IMAX increases 2016 installation guidance to 155 theatres, up from original 2016 guidance of 115 to 120 theatres, underscoring strong worldwide demand for IMAX theatres
- Record backlog of 442 systems represents 40% growth to existing network of 1,102 theatres

NEW YORK, July 20, 2016/PRNewswire/ -- IMAX Corporation(NYSE: IMAX)today reported second-quarter 2016 revenues of $91.7 millionand GAAP net income after non-controlling interest of $7.8 million, or $0.11per share. Adjusted net income after non-controlling interest was $12.1 million, or $0.18per diluted share. EBITDA as calculated in accordance with the Company's credit facility was $29.0 million. For reconciliations of adjusted net income to reported net income, adjusted earnings per share to reported earnings per share, and for the definition and reconciliation of EBITDA as calculated in accordance with the Company's credit facility, please see the tables at the end of this press release.

"Demand for IMAXtheatres has never been stronger and bodes well for our business as more signings lead to more installs, which then lead to more box office, and, ultimately, to greater revenue. Including the 95 theatres signed in the second quarter, we have signed nearly as many deals in the first half of 2016 as we did in all of 2015. This robust signings momentum has resulted in a record backlog, which includes a 40-theatre full revenue-share agreement with Guangzhou JinYi Media Corporation, a 25-theatre deal with AMC Theatres and additional multi-theatre agreements with several other key exhibition partners, and improves visibility into installations and ultimately revenue over the next several years. As a result, we are once again raising our installation guidance –this time to 155 theatres, up from our prior guidance range of 135 to 140 theatres and compared to our original 2016 install guidance range of 115 to 120 that was set late last year," said IMAXCEO Richard L. Gelfond.

Network Update:
During the quarter, the Company installed 40 theatres, of which 38 were for new theatre locations and two were upgrades. The Company also signed contracts for 95 theatres in the second quarter of 2016. The total IMAXtheatre network consisted of 1,102 systems as of June 30, 2016, of which 990 were in commercial multiplexes. There were 442 theatres in backlog as of June 30, 2016, up 14% from the 388 in backlog as of March 31, 2016. For a breakdown of theatre system signings, installations, network and backlog by type, please see the end of this press release.

Box Office Update:
Gross box office from IMAX DMR® titles was $260.8 millionin the second quarter of 2016, compared with $343.0 millionin the prior-year period, which was the highest-grossing box office quarter in Company history and included Furious 7,Jurassic World, and Avengers: Age of Ultronlast year. The average global DMR box office per-screen average in the second quarter of 2016 was $268,200.

"While IMAX faced a challenging comparison to last year's second-quarter box office – which was the highest-grossing box office quarter in Company history – considering the strong outperformance in box office we saw in the first quarter, we believe our portfolio of titles released across the full year will result in an annual box office that is relatively consistent with our historical PSA. Looking ahead, we expect our heightened network growth in 2016, which is heavily weighted towards our joint revenue-sharing model, will position us well to capitalize on a promising array of upcoming tentpole franchises and sequels this year and next, including Suicide Squad, Marvel's Dr. Strange, Fantastic Beasts and Where to Find Them, Rogue One: A Star Wars Story, Kong: Skull Island, Guardians of the Galaxy Vol. 2,Spider-Man Homecoming, and, of course, Star Wars: Episode VIII."

Second-Quarter Segment Results

Revenue from sales and sales-type leases was $18.7 millionin the second quarter of 2016, compared with $18.7 millionin the second quarter of 2015. The Company installed 13 full theatre systems under sales and sales-type lease arrangements in the most recent quarter, compared with the 15 full sales-type theatres the Company installed in the second quarter of 2015.
Revenue from joint revenue-sharing arrangements was $23.9 millionin the quarter, compared with $31.6 millionin the prior-year period. During the quarter, the Company installed 25 new theatres under joint revenue-sharing arrangements, compared with 20 in the second quarter of 2015. The Company had 559 theatres operating under joint revenue-sharing arrangements as of June 30, 2016, as compared to 477 joint revenue-sharing theatres one year prior.
Production and DMR revenues were $27.4 millionin the second quarter of 2016, compared with $36.6 millionin the second quarter of 2015. As mentioned above, gross box office from DMR titles was $260.8 millionin the second quarter of 2016, compared with $343.0 millionin the prior-year period, which was the highest grossing box office quarter in Company history and included Furious 7,Jurassic World, and Avengers: Age of Ultronlast year. The global DMR per screen average in the second quarter of 2016 was $268,200, compared with $414,600in same period last year.
Gross margin of 54.8%, compared with 64.4% last year, primarily resulting from lower box office, higher DMR cost and a larger mix of hybrid sales in the quarter.
Operating expenses (which include SG&A and R&D, and excludes stock-based compensation) were $27.7 millionin the quarter, compared with $26.3 millionin the second quarter of 2015.

Share Buybacks

The Company repurchased 1,344,094 shares in the second quarter of 2016, which does not include 68,430 shares purchased in connection with the Company's long-term incentive plan. The Company purchased the shares at an average price of $30.55, for a total value of $41.1 million.

Conference Call
The Company will host a conference call today at 4:30 PM ETto discuss its second-quarter 2016 financial 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. Other international callers should dial (416) 204-9271. The conference ID for the call is 1146762. A replay of the call will be available via webcast on the 'Investor Relations' section of www.imax.comor via telephone by dialing (888) 203-1112 (US and Canada), or (647) 436-0148 (international). The Conference ID for the telephone replay is 1146762.

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 Jun. 30, 2016, there were 1,102 IMAXtheatres (990 commercial multiplexes, 16 commercial destinations and 96 institutions) in 69 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. You may also connect with IMAXon Facebook(www.facebook.com/imax), Twitter (www.twitter.com/imax) and YouTube(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 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,the signing of theater 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 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.

Investors:		Media:
IMAX Corporation, New York		IMAX Corporation, New York
Jessica Kourakos		Ann Sommerlath
212-821-0100		212-821-0155
jkourakos@imax.com		asommerlath@imax.com


Michael Mougias		Entertainment Media:
mmougias@imax.com		Principal Communications Group, Los Angeles
		Melissa Zuckerman/Paul Pflug
		323-658-1555
Business Media:		melissa@pcommgroup.com
Sloane & Company, New York		paul@pcommgroup.com
Whit Clay
212-446-1864
wclay@sloanepr.com


Signings and Installations
June 30, 2016
			Three Months
			Ended June 30,
	Theater Signings:		2016		2015
		Full new sales and sales-type lease arrangements	19		19	(1)
		New joint revenue sharing arrangements	75		9
	Total new theaters		94		28

		Upgrades of IMAX theater systems	1		2
	Total Theater Signings		95		30

			Three Months
			Ended June 30,
	Theater Installations:		2016		2015
		Full new sales and sales-type lease arrangements	13	(2)	15	(2)
		New joint revenue sharing arrangements	25		20
	Total new theaters		38		35
		Upgrades of IMAX theater systems	2	(3)	-
	Total Theater Installations		40		35

			As of June 30,
	Theater Backlog:		2016		2015
		New sales and sales-type lease arrangements	178		181
		New joint revenue sharing arrangements	264		210
	Total new theaters		442	(4)(5)	391	(4)(6)


			As of June 30,
	Theater Network:		2016		2015
	Commercial Multiplex Theaters:
		Sales and sales-type lease arrangements	431		375
		Joint revenue sharing arrangements	559		477
	Total Commercial Multiplex Theaters		990		852

	Commercial Destination Theaters		16		20
	Institutional Theaters		96		104
	Total IMAX Theater Network		1,102		976

(1) Includes one signing which replaced a theatre system under an existing arrangement in backlog.
(2) Includes one used theater system (2015 – one theater system).
(3) Includes one installation of an upgrade to a laser-based digital system and one upgrade to a xenon-based digital system under sales and sales-type lease arrangements.
(4) Includes 19 laser-based digital theater system configurations (2015 – 73), including upgrades. The Company continues to develop and roll out its laser-based digital projection system.
(5) Includes seven upgrades to a digital theater system, in existing IMAXtheater locations (one xenon configuration and six laser configurations).
(6) Includes 24 upgrades to a digital theater system, in existing IMAXtheater locations (two xenon configurations and 22 laser configurations, of which five are under joint revenue sharing arrangements).

Additional Information (continued)

In addition to the 21 IMAX DMR films released to the IMAXtheater network during the first six months ended June 30, 2016, 21 additional IMAX DMR films have been announced so far to be released in the remaining six months of 2016:

Ice Age: Collision Course: An IMAX 3D Experience (20^thCentury Fox, July 2016);
The BFG: An IMAX 3D Experience (Walt Disney Studios, July 2016);
Jason Bourne: The IMAX Experience (Universal Studios, July 2016);
Godzilla: Resurgence: The IMAX Experience (Toho-Towa Company, Ltd., July 2016, Japanonly);
Cold War 2: An IMAX 3D Experience (Edko Films, July 2016, Chinaonly);
Ghostbusters: An IMAX 3D Experience (Sony Pictures, July 2016);
For A Few Bullets: The IMAX Experience (Wanda Media Co., July 2016, Chinaonly);
Star Trek Beyond: An IMAX 3D Experience (Paramount Pictures, July 2016);
Skiptrace: An IMAX 3D Experience (Talent Int., August 2016, Chinaonly);
Time Raiders: An IMAX 3D Experience (Le Vision Pictures, August 2016, Chinaonly);
Suicide Squad: An IMAX 3D Experience (Warner Bros. Pictures, August 2016);
Ben-Hur: An IMAX 3D Experience (Paramount Pictures, August 2016);
Sully: The IMAX Experience (Warner Bros. Pictures, September 2016);
The Magnificent Seven: The IMAX Experience (Sony Pictures, September 2016);
Deepwater Horizon: The IMAX Experience (Lionsgate Entertainment, September 2016);
Inferno: The IMAX Experience (Sony Pictures, October 2016);
Jack Reacher: Never Go Back: The IMAX Experience (Paramount Pictures, October 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).

In addition, the Company will be releasing an IMAXdocumentary film, Voyage of Time, on October 7, 2016.

To date, the Company has announced the following 13 titles to be released in 2017 to the IMAXtheater network:

Attraction: An IMAX 3D Experience (Art Pictures Studio, January 2017, Russiaonly);
God Particle: The IMAX Experience (Paramount Pictures, February 2017);
Untitled Wolverine Film: The IMAX Experience (20th Century Fox, March 2017);
Kong: Skull Island: An IMAX 3D Experience (Warner Bros. Pictures, March 2017);
Ghost in the Shell: An IMAX 3D Experience (Paramount Pictures, March 2017);
Guardians of the Galaxy Vol. 2: An IMAX 3D Experience (Walt Disney Studios, May 2017);
Pirates of the Caribbean: Dead Men Tell No Tales: An IMAX 3D Experience (Walt Disney Studios, May 2017);
Transformers: The Last Knight: An IMAX 3D Experience (Paramount Pictures, June 2017);
Spider-Man: Homecoming: An IMAX 3D Experience (Sony Pictures, July 2017);
Dunkirk: The IMAX Experience (Warner Bros. Pictures, July 2017);
Thor: Ragnarök: An IMAX 3D Experience (Walt Disney Studios, November 2017);
Justice League: An IMAX 3D Experience (Warner Bros. Pictures, November 2017); and
Star Wars: Episode VIII: An IMAX 3D Experience (Walt Disney Studios, December 2017);

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 films will be released to the IMAXnetwork in 2016 to the 44 films that were released to the IMAXnetwork in 2015.

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

		Three Months				Six Months
		Ended June 30,				Ended June 30,
		2016		2015		2016		2015
Revenues
Equipment and product sales		$	26,489	$	25,305	$	50,229	$	39,741
Services			41,385		50,958		85,658		82,674
Rentals			20,752		28,527		42,531		42,341
Finance income			2,367		2,229		4,703		4,474
Other			750		141		750		141
			91,743		107,160		183,871		169,371
Costs and expenses applicable to revenues
Equipment and product sales			15,594		13,521		33,385		21,061
Services			20,528		19,495		38,124		34,302
Rentals			5,298		5,109		9,863		8,992
Other			46		-		46		-
			41,466		38,125		81,418		64,355
Gross margin			50,277		69,035		102,453		105,016
Selling, general and administrative expenses			30,436		29,023		62,020		57,375
(including share-based compensation expense of $6.2 million and $14.7 million for the three and six months ended June 30, 2016, respectively (2015 - expense of $5.1 million and $10.7 million, respectively))
Research and development			3,435		2,347		7,143		6,889
Amortization of intangibles			515		443		1,006		873
Receivable provisions, net of recoveries			230		343		356		348
Impairment of investments			194		350		194		350
Income from operations			15,467		36,529		31,734		39,181
Interest income			380		259		847		505
Interest expense			(458)		(403)		(856)		(707)
Income from operations before income taxes			15,389		36,385		31,725		38,979
Provision for income taxes			(3,366)		(9,256)		(7,084)		(9,931)
Loss from equity-accounted investments, net of tax			(1,340)		(749)		(1,781)		(1,183)
Net income			10,683		26,380		22,860		27,865
Less: net income attributable to non-controlling interests			(2,892)		(2,030)		(5,542)		(3,124)
Net income attributable to common shareholders		$	7,791	$	24,350	$	17,318	$	24,741

Net income per share attributable to common shareholders - basic & diluted:
Net income per share - basic		$	0.11	$	0.34	$	0.25	$	0.35
Net income per share - diluted		$	0.11	$	0.34	$	0.25	$	0.34

Weighted average number of shares outstanding (000's):
	Basic		67,768		69,843		68,540		69,526
	Fully Diluted		68,455		71,688		69,222		71,349

Additional Disclosure:
Depreciation and amortization⁽¹⁾		$	11,626	$	11,091	$	22,064	$	20,724

(1) Includes $0.2 million and $0.3 million of amortization of deferred financing costs charged to interest expense for the three and six months ended June 30, 2016, respectively (2015 - $0.2 million and $0.4 million, respectively).

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


	As at		As at
	June 30		December 31
	2016		2015

Assets
Cash and cash equivalents	$	228,081	$	317,449
Accounts receivable, net of allowance for doubtful accounts of $1,319 (December 31, 2015 — $1,146)		94,687		97,981
Financing receivables		118,884		117,231
Inventories		44,776		38,753
Prepaid expenses		8,754		6,498
Film assets		16,859		14,571
Property, plant and equipment		234,480		218,267
Other assets		26,017		26,136
Deferred income taxes		25,893		26,666
Other intangible assets		29,279		28,950
Goodwill		39,027		39,027
Total assets	$	866,737	$	931,529

Liabilities
Bank indebtedness	$	28,296	$	29,276
Accounts payable		21,451		23,455
Accrued and other liabilities		83,539		95,748
Deferred revenue		106,967		104,993
Total liabilities		240,253		253,472

Commitments and contingencies

Non-controlling interests		3,221		3,307

Shareholders' equity
Capital stock common shares — no par value. Authorized — unlimited number.
67,112,751 — issued and 67,112,358 — outstanding (December 31, 2015 — 69,673,244 — issued and outstanding)		435,711		448,310
Less: Treasury stock held in trust, 393 shares at cost		(13)		-
Other equity		172,645		168,425
Accumulated (deficit) earnings		(34,923)		15,499
Accumulated other comprehensive loss		(4,471)		(7,443)
Total shareholders' equity attributable to common shareholders		568,949		624,791
Non-controlling interests		54,314		49,959
Total shareholders' equity		623,263		674,750
Total liabilities and shareholders' equity	$	866,737	$	931,529

IMAX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of U.S. dollars)
*(Unaudited)*
	Six Months Ended June 30,
	2016		2015

Cash provided by (used in):
Operating Activities
Net income	$	22,860	$	27,865
Adjustments to reconcile net income to cash from operations:
Depreciation and amortization		22,064		20,724
Write-downs, net of recoveries		1,249		1,457
Change in deferred income taxes		(29)		2,232
Stock and other non-cash compensation		15,014		10,861
Unrealized foreign currency exchange (gain) loss		(583)		851
Loss from equity-accounted investments		1,980		1,923
Gain on non-cash contribution to equity-accounted investees		(199)		(740)
Investment in film assets		(10,890)		(7,404)
Changes in other non-cash operating assets and liabilities		(15,399)		(39,271)
Net cash (used in) provided by operating activities		36,067		18,498

Investing Activities
Purchase of property, plant and equipment		(8,472)		(34,920)
Investment in joint revenue sharing equipment		(20,700)		(11,613)
Acquisition of other intangible assets		(1,691)		(2,972)
Net cash used in investing activities		(30,863)		(49,505)

Financing Activities
Increase in bank indebtedness		-		17,568
Repayment of bank indebtedness		(1,000)		-
Repurchase of common shares		(85,714)		-
Settlement of restricted share units and options		(8,369)		(4,988)
Common shares issued - stock options exercised		3,582		22,850
Taxes paid on secondary sale and repatriation dividend		(2,991)		-
Taxes withheld and paid on employee stock awards vested		(73)		-
Treasury stock purchased for future settlement of restricted share units		(13)		(1,214)
Credit facility amendment fees paid		-		(1,161)
Issuance of subsidiary shares to non-controlling interests - private offering		-		40,000
Share issuance costs from the issuance of subsidiary shares to non-controlling
interests - private offering		-		(2,000)
Net cash (used in) provided by financing activities		(94,578)		71,055

Effects of exchange rate changes on cash		6		(168)

(Decrease) increase in cash and cash equivalents during period		(89,368)		39,880

Cash and cash equivalents, beginning of period		317,449		106,503

Cash and cash equivalents, end of period	$	228,081	$	146,383

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: IMAXsystems; theater system maintenance; joint revenue sharing arrangements; film production and IMAX DMR; film distribution; film post-production; and other. The IMAXsystems segment includes the design, manufacture, sale or lease of IMAXtheater projection system equipment. The theater system maintenance segment includes the maintenance of IMAXtheater projection system equipment in the IMAXtheater network. The joint revenue sharing arrangements segment includes the provision of IMAXtheater 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 IMAXtheaters that the Company owns and operates, camera rentals and other miscellaneous items.

			Three Months				Six Months
			Ended June 30,				Ended June 30,
				2016		2015	2016		2015
Revenue
IMAX Theater Systems
	IMAX Systems
		Sales and sales-type leases	$	18,720	$	18,674	$	36,718	$	27,289
		Ongoing rent, fees, and finance income		4,241		3,691		8,103		7,190
		Other		5,009		4,674		9,490		8,099
				27,970		27,039		54,311		42,578

	Theater System Maintenance			9,912		9,158		19,738		18,008

	Joint Revenue Sharing Arrangements			23,856		31,594		47,242		47,462

Film
	Production and IMAX DMR			27,413		36,603		57,218		54,279
	Film distribution and post-production			2,592		2,766		5,362		7,044
				30,005		39,369		62,580		61,323
Total			$	91,743	$	107,160	$	183,871	$	169,371

Gross margins
IMAX Theater Systems
	IMAX systems⁽¹⁾
		Sales and sales-type leases	$	9,540	$	10,038	$	13,859	$	14,945
		Ongoing rent, fees, and finance income		4,135		3,499		7,650		6,777
		Other		162		(114)		(320)		(154)
				13,837		13,423		21,189		21,568

	Theater System Maintenance			3,370		3,089		6,809		6,370

	Joint Revenue Sharing Arrangements⁽¹⁾			15,744		24,069		33,736		34,686

Film
	Production and IMAX DMR⁽¹⁾			17,127		28,488		39,950		41,713
	Film distribution and post-production⁽¹⁾			199		(34)		769		679
				17,326		28,454		40,719		42,392
Total			$	50,277	$	69,035	$	102,453	$	105,016
__________________
(1)		IMAX systems include marketing and commission costs of $0.6 million and $1.1 million for the three and six months ended June 30, 2016, respectively (2015 - $0.6 million and $0.9 million, respectively). Joint revenue sharing arrangements segment margins include advertising, marketing and commission costs of $1.4 million and $1.5 million for the three and six months ended June 30, 2016, respectively (2015 - $1.3 million and $1.4 million, respectively). Production and DMR segment margins include marketing costs of $5.2 million and $7.5 million for the three and six months ended June 30, 2016, respectively (2015 - $3.6 million and $4.9 million, respectively). Distribution segment margins include marketing expense of $0.8 million and $1.5 million for the three and six months ended June 30, 2016, respectively (2015 - cost of less than $0.1 million and cost recovery of $0.1 million, 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 adjusted 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 June 30, 2016. The ratio of total debt to adjusted EBITDA was 0.21:1 as at June 30, 2016, 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 $28.7 million. Adjusted EBITDA is calculated as follows:

		For the		For the			For the
		3 months ended		12 months ended			3 months ended
		June 30, 2016		June 30, 2016		⁽¹⁾	June 30, 2015
*(In thousands of U.S. Dollars)*
Net income		$	10,683	$	59,619		$	26,380
Add (subtract):
	Loss from equity accounted investments		1,340		3,000			749
	Provision for income taxes		3,366		17,205			9,256
	Interest expense, net of interest income		78		500			144
	Depreciation and amortization, including film asset amortization		11,496		43,252			10,861
	Write-downs, net of recoveries including asset impairments and
	receivable provisions		601		3,517			1,329
	Stock and other non-cash compensation		6,347		26,532			5,195
	EBITDA before non-controlling interests		33,911		153,625			53,914
	EBITDA attributable to non-controlling interests⁽²⁾		(4,876)		(18,667)			(3,538)
	EBITDA attributable to common shareholders	$	29,035	$	134,958		$	50,376
__________________
(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 June 30,2016vs. 2015:

The Company reported net income of $10.7 millionor $0.16 per basic and diluted share for the second quarter of 2016 as compared to net income of $26.4 million or $0.37 per basic share and $0.36per diluted share for the second quarter of 2015. Net income for the second quarter of 2016 includes a $6.2 million charge or $0.09 per diluted share (2015 — $5.1 million or $0.07 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 $15.1 millionor $0.22per diluted share for the second quarter of 2016 as compared to adjusted net income of $30.7 millionor $0.42per diluted share for the quarter ended June 30, 2015. 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 $12.1 millionor $0.18per diluted share for the second quarter of 2016 as compared to adjusted net income attributable to common shareholders of $28.7 millionor $0.40per diluted share for the second quarter of 2015. 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 June 30,
		2016				2015
		Net Income		Diluted EPS		Net Income		Diluted EPS
Reported net income		$	10,683	$	0.16	$	26,380	$	0.36	⁽¹⁾
Adjustments:
	Stock-based compensation		6,205		0.09		5,103		0.07
	Tax impact on items listed above		(1,744)		(0.03)		(740)		(0.01)
Adjusted net income			15,144		0.22		30,743		0.42	⁽¹⁾
	Net income attributable to non-controlling interests		(2,892)		(0.04)		(2,030)		(0.02)
	Stock-based compensation (net of tax of less than $0.1
	million) attributable to non-controlling interests		(168)		-		-		-
Adjusted net income attributable to common shareholders		$	12,084	$	0.18	$	28,713	$	0.40	⁽¹⁾

Weighted average diluted shares outstanding					68,455				71,688

_____________
(1)	Includes impact of $0.3 million of accretion charges associated with redeemable Class C shares of IMAX China.

Adjusted Net Income and Adjusted Diluted Per Share Calculations – Period Ended June 30,2016vs. 2015

The Company reported net income of $22.9 millionor $0.33per basic and diluted share for the six months ended June 30, 2016, as compared to net income of $27.9 millionor $0.39per basic share and $0.38per diluted share for the six months ended June 30, 2015. Net income for the six months ended June 30, 2016includes a $14.7 millioncharge or $0.21per diluted share (2015 — $10.7 millionor $0.15per 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 $33.4 millionor $0.48per diluted share for the six months ended June 30, 2016, as compared to adjusted net income of $36.8 millionor $0.51per diluted share for the six months ended June 30, 2015. 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 $27.6 millionor $0.40per diluted share for the six months ended June 30, 2016, as compared to adjusted net income attributable to common shareholders of $33.7 millionor $0.47per diluted share for the six months ended June 30, 2015. 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:

		Six Months Ended June 30,
		2016				2015
		Net Income		Diluted EPS		Net Income		Diluted EPS
Reported net income		$	22,860	$	0.33	$	27,865	$	0.38	⁽¹⁾
Adjustments:
	Stock-based compensation		14,743		0.21		10,678		0.15
	Tax impact on items listed above		(4,184)		(0.06)		(1,702)		(0.02)
Adjusted net income			33,419		0.48		36,841		0.51	⁽¹⁾
	Net income attributable to non-controlling interests		(5,542)		(0.08)		(3,124)		(0.04)
	Stock-based compensation (net of tax of $0.1 million)
	attributable to non-controlling interests		(293)		-		-		-
Adjusted net income attributable to common shareholders		$	27,584	$	0.40	$	33,717	$	0.47	⁽¹⁾

Weighted average diluted shares outstanding					69,222				71,349

_____________
(1)	Includes impact of $0.5 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. 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		For the
		3 months ended		6 months ended
		June 30, 2016		June 30, 2016
*(In thousands of U.S. Dollars)*
Net cash provided by operating activities		$	31,103	$	36,067
Net cash used in investing activities			(21,520)		(30,863)
	Free cash flow	$	9,583	$	5,204

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SOURCE IMAX Corporation