This is the Earnings Call script for the Fourth Quarter 2024. Thank you for joining Reading International's Earnings Call to discuss our 2024 Fourth Quarter and Full Year Results. My name is Andrzej Matyczynski, and I am Reading's Executive Vice President of Global Operations. With me are Ellen Cotter, our President and Chief Executive Officer; and Gilbert Avanes, our Chief Executive Vice President, Chief Financial Officer and Treasurer. Before we begin the substance of the call, I will run through the usual caveats. In accordance with the safe harbor provision of the Private Securities Litigation Reform Act of 1995, certain matters that will be addressed in this earnings call may constitute forward-looking statements. Such statements are subject to risks, uncertainties, and other factors that may cause our actual performance to be materially different from the performance indicated or implied by such statements. Such risk factors are clearly set out in our SEC filings. We undertake no obligation to publicly update or revise any forward-looking statements. In addition, we will discuss non-GAAP financial measures on this call. Reconciliations and definitions of non-GAAP financial measures, which are segment operating income, EBITDA and adjusted EBITDA, are included in our recently issued 2024 fourth quarter corrected earnings release released on April 1 on our company's website. We have adjusted, where applicable, the EBITDA items we believe to be external to our business and not reflective of our cost of doing business or results of operations. Such costs could include legal expenses relating to extraordinary litigation and any other items that we can consider to be nonrecurring in accordance with the 2-year SEC requirement for determining whether an item is nonrecurring, infrequent or unusual in nature. We believe that the adjusted EBITDA is an important supplemental measure of our performance. In today's call, we also use an industry-accepted financial measure called theater level cash flow, TLCF, which is theater level revenue less direct theater level expenses. Average ticket price, ATP, which is calculated by dividing cinema box office revenue by the number of cinema admissions is also used as an accepted industry acronym. We will also use a measure referred to as Food and Beverage Spend Per Patron, F&B SPP, which is a key performance indicator for our cinemas. The F&B SPP is calculated by dividing a cinema's revenues generated by food and beverage sales by the number of admissions at that cinema. Please note that our comments are necessarily summary in nature, and anything we say is qualified by the more detailed disclosure set forth in our Form 10-K and other filings with the U.S. Securities and Exchange Commission. So, with that behind us, I'll turn it over to Ellen, who will review our 2024 fourth quarter and full-year results and discuss our business strategy going forward, followed by Gilbert, who will provide a more detailed financial review. Ellen?

Thanks, Andre, and welcome, everyone, to the call today, and thank you for listening in. Let's start with the fourth quarter 2024 results, which were encouraging and, we believe reinforce our confidence in Reading's long-term future. Thanks to both an amazing lineup of blockbuster movies like Wicked, Moana 2, Gladiator II, Sonic the Hedgehog 3 and Mufasa and our management team's collaborative efforts, each of Reading's key operational metrics, total revenues, operating income, and adjusted EBITDA all significantly improved compared to 2023's fourth quarter. At $58.6 million, our Q4 2024 global total revenue was 29% higher than Q4 '23 and the best fourth quarter since Q4 2019. Our Q4 '24 global operating income of $1.5 million increased $8.5 million or 122% from a global operating loss of $7 million in Q4 2023 and represented the first fourth quarter since Q4 2019 that we enjoyed positive operating income. At $6.8 million, our Q4 2024 adjusted EBITDA increased over 400% from a negative adjusted EBITDA of $2.2 million in Q4 2023 and represented the highest fourth quarter EBITDA since Q4 2019. Our Q4 2024 global cinema revenue of $54.6 million was 30% above Q4 '23 and represented just under 84% of pre-pandemic Q4 2019 levels. At $3.8 million, our Q4 2024 global cinema operating income was 191% ahead of Q4 '23 and represented the best fourth quarter global cinema operating income since Q4 2019. In highlighting the significant progress our company has made since the first year of the pandemic, our Q4 2020 operating loss was $11.7 million. And again, looking forward to Q4 '24, we had a positive $3.8 million operating income, a 132% increase. As many of you know, we operate in two industries: cinema and real estate in three countries: the U.S., Australia and New Zealand. Currently, over 93%…

Thank you, Ellen. Consolidated revenue for the quarter ended December 31, 2024, increased by $13.3 million to $58.6 million when compared to the fourth quarter of 2023 as a result of a stronger film slate and higher live theater and the U.S. property revenue in the fourth quarter of 2024. Consolidated revenue for the 12 months ended December 31, 2024, decreased by $12.2 million to $210.5 million when compared to the 12 months ended December 31, 2023. This decrease is primarily attributable to the lower attendance in the U.S. and New Zealand as a result of overall lower-performing titles for our theaters in 2024 compared to 2023, along with closing cinemas in these specific countries. Net loss attributable to Reading International Inc. for the quarter ended December 31, 2024, decreased by $10.1 million to a loss of $2.2 million compared to a loss of $12.4 million in Q4 2023. Q4 2024 basic loss per share decreased by $0.46 to a basic loss per share of $0.10 compared to a basic loss per share of $0.56 for Q4 2023. These results were primarily due to strengthened cinema performance in all 3 countries, strengthened U.S. and Australia property performance, decreased interest expense, reduced depreciation and amortization and increased other income. Net loss attributable to Reading International Inc. for 12 months ended December 31, 2024, increased by $4.6 million to a loss of $35.3 million from a loss of $30.7 million when compared to the 12 months ended December 31, 2023. Basic loss per share increased by $0.20 to a loss of $1.58 compared to a loss of $1.38 for the 12 months ended 2023. These results were primarily due to a decrease in cinema segment revenue due to a weaker movie slate as a result of lingering impact of 2023 Hollywood strike,…

Thanks, Gilbert. As usual, I'd like to thank our stockholders for forwarding questions to our Investor Relations e-mail. And in addition to addressing many of your questions in the prepared remarks from Ellen and Gilbert, we've selected a few additional questions to offer additional insights from management.

The first question, what are your capital allocation priorities for 2025? And how should we think about CapEx spending for this year and the next? Ellen?

In 2025, our highest priority is to reduce debt. However, we are working on plans right now to upgrade at least four theaters, one in Australia, two in the U.S. and one in New Zealand. The upgrades would include converting certain auditoriums to luxury recliner seating and adding premium screens. But ultimately, the final execution of these plans will be subject to the strength of the box office over the next 3 quarters in '25 and the execution of potential asset sales.

Thanks, Ellen. We also received some stockholder questions about the size of our global cinema portfolio. What are the recent underperforming theater closures about how much annually will these closed theaters save the company in aggregate? How many Reading cinema screens remain on difficult leases or are underperforming such that they are candidates for a 2025 closure? And what are the expected cost savings of these decisions? Ellen?

In 2025, in the U.S., we're closing one U.S.-based cinema that we're closing it this month in April. Based on the box office trends over the last few years and the occupancy levels that would be required by the landlord, we'd expect cash savings to be between $500,000 and $1 million per year. In New Zealand, we did close another theater, a small theater a few months ago. And again, if you look at the box office trends over the last few years and the occupancy levels, we expect to save about maybe $100,000 to $200,000 a year. Right now, we've got no immediate plans to close any other theaters in the U.S., Australia or New Zealand, but I'll note that we are in communications with our landlords. And if there was an opportunity to exit a lease without any sort of economic penalty for a theater that doesn't have a consistent cash flow history, we would likely pursue that opportunity to continue to streamline our circuit.

Thanks again, Ellen. While you're on a roll, can you handle this one? Is your Australian cinema development project in Noosa still on track for 2026? Any other projected developments? What are the screen count, timing and milestones providing more info on the prospective projects known to be going forward?

Yes. We're still working with the Stockwell development team on the Reading Cinema in Noosa, which is in Queensland, Australia. The project, which includes the cinema are in the town planning phases right now. And so today, we would expect the opening date to be pushed out a year or so, so likely a 2027 opening. And in Australia, while we're always monitoring the market for new cinema opportunities, whether it's an acquisition, a new build or a management deal, as of today, other than Noosa, we don't have any new deals to report to our stockholders.

Thanks, Ellen. And we'll finish up with this last question, which I filled regarding the comment that we failed to follow through and deliver on our promise of two non-deal roadshows and an additional microcap investor conference before the year-end of 2024. And we had earlier said it was working on and has done nothing to engage with a broader set of investors in all of 2024. Explain why not. Well, we'll take the mayor Culper and rather than dwelling on the past, we have begun discussions with one of our analysts with a view to bringing to fruition the promised 2 non-deal roadshows during 2025. Furthermore, we are finalizing our participation in a microcap virtual conference for mid-May of this year. And then following these efforts, we will reevaluate the way forward for our Investor Relations strategy. And that marks the conclusion of our call. We appreciate you listening to the call today. We thank you for your attention, and we wish everyone good health and a safe 2025. Thank you.