Reading's NZ cinemas get boost from reopened Christchurch complex, flags Taupo sale
By Paul McBeth
Aug 13 (BusinessDesk) - Reading International, the Nasdaq-listed cinema chain, reported a boost in patrons to its New Zealand theatres in the June quarter after reopening its Christchurch Palms complex following last year's earthquake.
An extra 68,000 admissions in the chain's New Zealand theatres lifted sales by US$484,000 in the three months ended June 30, the Los Angeles-based company said in a statement. The increased New Zealand sales partly offset declines in its US and Australian chains, and was "primarily as a result of the reopening of our Palms cinema in early January," it said.
Sales for the global group fell 6 percent to US$63.1 million in the quarter, with net income slumping to US$239,000 from US$17.4 million a year earlier when it recognised a one-time tax benefit in its Australian business.
Reading's first-half revenue rose 3.6 percent to US$125.8 million, falling into the red with a loss of US$3,000 compared to a profit of US$15 million a year earlier.
Since the period's balance date, Reading said it entered into an agreement to sell its Sails Motor Lodge property in Taupo last month for $4.9 million, subject to several conditions being satisfied. As at June 30 the property had a book value of $2.6 million. Reading began actively marketing it for sale in December.
Last year Reading beefed up its New Zealand presence by aggregating back-office accounting functions in its Wellington complex. The group hired 17 local accountants to replace finance staff in the US and Australia.
Local holding company Reading New Zealand reported a smaller loss of $4.6 million in calendar 2011 from $7.5 million a year earlier, according to its latest financial statements lodged with the Companies Office. That came as its revenue fell by a fifth to $28 million on smaller takings from its cinema business, and it took a $5.1 million charge on the fair value of its investment property.
Reading’s principal operation is managing large retail spaces centred around cinemas, though about 8 percent of its earnings come from investing in real estate.
The stock slipped 0.2 percent to US$5.07 on the Nasdaq on Friday, and has climbed 20 percent this year.