Summary of Reading International, Inc. Q2 2026 Earnings Call

1Key Financial Results and Metrics

Consolidated Revenue: Increased by $6.5 million to $66.9 million year-over-year, marking the highest revenue for Q2 since 2018.

Net Income: Q2 net income attributable to Reading increased by 185% to $2.3 million, compared to a loss of $2.7 million in Q2 2025. For the first half of 2026, net loss decreased to $5.9 million from $7.4 million in the prior year.

Earnings Per Share (EPS): Basic EPS rose to $0.10 from a loss of $0.12 in Q2 2025; basic loss per share for the first half decreased to $0.26 from $0.33.

Adjusted EBITDA: Increased by 79% to $11.3 million for Q2, with a year-to-date increase to $10.4 million.

Operating Income: Q2 operating income improved to $7.5 million, up 159% from the previous year.

2Strategic Updates and Business Highlights

Cinema Segment Performance: The cinema division experienced a strong quarter, with Australian cinema revenue increasing by 31%. The film slate included successful titles like "Michael" and "Super Mario Galaxy."

Real Estate Revenue: Increased by 4% to $4.9 million, driven by improved performance in U.S. live theaters.

Strategic Initiatives: Focus on enhancing food and beverage (F&B) offerings and loyalty programs, with significant increases in membership and spending per person.

Debt Management: The company is actively working to reduce its overall debt, including plans to sell the Cinema 1,2,3 property to pay down loans.

3Forward Guidance and Outlook

Positive Momentum: Anticipation of continued strong box office performance in Q3 and Q4 2026, supported by upcoming blockbuster releases.

Debt Reduction Strategy: Plans to utilize proceeds from asset sales to further reduce debt and invest in cinema upgrades.

Market Positioning: The company believes 2026 could be the best post-pandemic year for box office revenues.

4Bad News, Challenges, or Points of Concern

Operational Costs: Increased labor and operating expenses are a concern, especially in markets like Hawaii, where labor costs have risen significantly.

Cinema Closures: The closure of two San Diego cinemas impacted U.S. revenue, and the company has reduced its cinema count by nine locations since the pandemic.

Refinancing Challenges: Delays in refinancing certain loans due to changing lender priorities, though extensions have been granted.

5Notable Q&A Insights

Refinancing Status: The CFO indicated ongoing negotiations with a replacement lender for a loan, with expectations for a new arrangement in the coming months.

Use of NOLs: The company has a potential net operating loss (NOL) of approximately $40 million, which could offset capital gains taxes from asset sales.

Asset Sales: The sale of Cinema 1,2,3 is progressing, with a preferred buyer identified, and the company is optimistic about closing the deal in Q4 2026.

Viaduct Litigation: Ongoing legal proceedings related to the Reading Viaduct are expected to continue through 2026, with no recent offers from the city for settlement. This summary encapsulates the key financial metrics, strategic initiatives, outlook, challenges, and insights from the Q&A session, providing a comprehensive overview of Reading International's performance and future direction.