Cineplex Inc.

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Cineplex fourth quarter year-end 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question, you will need to press star 11 on your telephone keypad. As a reminder, this conference call is being recorded. I would now like to turn the conference over to Mr. Rehan Azmat. Sir, please begin.

Good morning, everyone. I would like to welcome you to Cineplex's fourth quarter 2025 earnings release conference call. I'm Ray Hines-Mutz, Vice President, Investor Relations, Corporate Development, and Financial Planning and Analysis at Cineplex. Joining me today are Alex Jacob, our President and Chief Executive Officer, and Gordon Ellison, our Chief Financial Officer. I'll remind you that certain statements made today are forward-looking and subject to various risks and uncertainties. Such forward-looking statements are based on management's beliefs and assumptions regarding Information regarding factors that cause results to vary can be found in the company's most recently filed annual information form and management discussion and analysis. Following today's remarks, we will close the call of our customary question and answer period. I will now turn the call over to Alex Jacob.

Thank you, Rehan, and good morning, everyone. I'm pleased to present our fourth quarter and full year 2025 results with you today. We'll start with a look at the fourth quarter, which featured a broad and compelling film slate that appealed to audiences across a wide range of genres. The quarter's performance was led by James Cameron's third installment in the Avatar franchise, Avatar Fire and Ash, which delivered a strong performance and over-indexed that cineplex, powered by audience demand for our premium experiences. Following close behind was family title Zootopia 2, which provided incredible results and has become the highest grossing Disney animation release of all time globally. The musical Wicked for Good enchanted audiences and contributed meaningfully to the quarter's performance. In addition, Five Nights at Freddy's 2 delivered the largest December opening ever for a horror film. Together, these results reinforce a familiar truth. When compelling content is available, guests choose to experience it at our theaters. While the quarter included several standout films and strong performances in our premium formats, Q4 results were down compared to last year, driven primarily by the weakest October since 2020. After the slow start to the quarter, the slate strengthened significantly through November and December, supported by the wide range of high-performing titles and leading to our strongest December since 2019. In fact, our fourth quarter box office performance exceeded the domestic market by 218 basis points, marking the third consecutive quarter where we outpaced the North American industry performance. Our premium formats remain one of Cineplex's competitive advantages, with guests overwhelmingly choosing to view films in one of the many enhanced formats we offer. In Q4, 43% of our box office came from premium experiences versus 41% in 2024. Our premium formats continue to play a major role in the performance of 2025's biggest title, with our top five firms averaging 62% of our box office from premium formats. The strong demand for premium experiences combined with strategic pricing and a continued focus on the guest experience contributed to new all-time records. In Q4, we delivered the highest quarterly box office per patron in our history at $13.87. and a Q4 record for concession for patron at $9.92. Our distribution business, Cineplex Pictures, also had a strong fourth quarter. The housemate opened in Q4 and has delivered impressive holding power into January, and Now You See Me, Now You Don't performed exceptionally well in Canada. Our distribution team continues to demonstrate that we can drive better results as a distributor because of our deep understanding of the Canadian movie goal, allowing us to effectively position and market titles to maximize their potential in this market. The success of our distribution business in the fourth quarter was also highlighted by Jujitsu Kaizen, The anime title performed well and is part of a broader resurgence in the genre. Earlier in 2025, Demon Slayer Infinity Castle became the highest grossing foreign language film of all time at the domestic box office. Its performance reinforced how anime temples can drive exceptional results when they tap into large passionate fan bases built over years of televised storytelling. This dynamic extends beyond anime with the Stranger Things series finale, which sold out at 97% of our locations . These events reinforce that audiences are choosing to come to our theaters for moments they could easily watch at home, drawn to shared and immersive cultural experiences that resonate more deeply in our cinema. The fourth quarter once again showcased the value of our data-driven audience targeting and localized marketing expertise. International content represented more than 11% of our Q4 box office, nearly double the North American average, further demonstrating our ability to identify titles that resonate with specific demographic groups. One of the standout performers this quarter was Dohan Dahar, which became the highest grossing Hindi language film in North America, where Cineplex delivered an impressive 31% market share and ranked among our top five films for the quarter. This underscores how alternative and international content remain key differentiators for Cineplex and positions as well for 2026, which includes a number of highly anticipated international releases, including Blades of the Guardians and Scare Love, both of which debut at the start of Lunar New Year, as well as the sequel to Duhandahar in March and Ramayana Part 1 later this year during the Indian Festival Diwali. Our programming strengths form an important competitive advantage, reflecting the power of our analytical capabilities and reinforcing the essential role this content plays in the future of theatrical. Turning to our media business, cinema media continued to perform well despite a softer advertising market. Q4 revenues increased 12.5% over the prior despite a decrease in attendance. As a result, our cinema media per patron reached a Q4 record of $3.33. Advertisers remain attracted to the high attention environment that only theatrical can offer. Our team continues to leverage data and analytics to optimize campaign performance and demonstrate clear value to our agency partners and clients. We successfully closed the sale of Cineplex Digital Media to Creative Reality Inc. on November 7, 2025. The transaction unlocks meaningful value for shareholders while strengthening our balance sheet. The initial cash proceeds of approximately $60 million provide flexibility for share buybacks, debt reduction, and general corporate purposes. Importantly, Cineplex Media will continue as CDN's exclusive advertising sales agent for its digital out-of-home networks across Canada, ensuring continuity for clients and maintaining a strong presence in this market. Turning to our location-based entertainment business, revenue increased 6.8% to 35.9 million in the fourth quarter, driven by the contribution of new locations opened in the prior year. This performance comes against the backdrop of broader industry trends, where many operators seen same-store revenue decline in the same range we are. Despite the softer top-line results, we continue to demonstrate strong operational discipline which helped us maintain flat same-store margins. This reflects the expertise of our teams and our ongoing efforts to optimize the operations of our location. During the quarter, we announced that construction of a new palladium is underway at Vaughan Mill, one of Canada's most visited shopping and entertainment destinations. This location will further strengthen our position in the GTA and expand our ability to offer guests a dynamic social entertainment experience anchored in gaming, attractions, and food and beverage. Our Cineplex Club Program remains a powerful driver of engagement and frequency. Membership has now surpassed 225,000 members, and we continue to see strong adoption of the annual plan which helps reduce churn and supports more consistent visitation throughout the year. Cine Club members visit more often, choose premium formats at a higher rate, and spend more on concessions. All signs the program is delivering meaningful value both for our guests and our business. Our new Monday surprise premieres have also been extremely well-received. offering moviegoers early access to select titles and creating a sense of exclusivity that strengthens loyalty and deepens engagement. Our broader loyalty ecosystem has also taken an important step forward with the expansion of ScenePlus to include Shell as a national partner. This addition enhances the everyday utility of ScenePlus by connecting entertainment, groceries, travel, dining, and now gas into a holistic value proposition. The ability for guests to earn and redeem points across such a wide range of touch points in their daily lives strengthens ScenePlus as one of Canada's leading loyalty programs. I'd like to provide a brief update on our appeal of the Competition Tribunal's decision regarding our online booking fee. The Federal Court of Appeal has upheld the Competition Tribunal's September 2024 decision relating to Cineplex's presentation of its online booking fee, including the $39 million administrative monetary penalty. We respectfully disagree with the Federal Court of Appeal's decision, and we continue to believe that our online booking fee has always been presented in a clear and prominent manner that fully complies with the spirit and letter of the law. We have reviewed the Federal Court of Appeals decision and will seek leave to appeal to the Supreme Court of Canada and seek the state of this penalty. As we look back on the full year, we started with a soft first quarter, but Q2 to Q4 benefited from a relatively consistent release schedule and a diverse slate of quality firms contributing to a solid and steady performance through the balance of the year. From April through December, we delivered box office revenues of 105% of the prior year and outperformed the domestic market over the same period, reflecting the unique strength of our programming strategy and the engagement we continue to see from Canadian moviegoers. Our investment in premium experiences continue to resonate with 44.8% of our box office from Q2 through Q4 generated from premium experiences, the highest proportion since the same timeframe in 2018. Audiences embraced a wide range of genres and formats. Superman and the Fantastic Four First Steps both became the highest-grossing films in their franchise. Live-action films, remakes of Lilo and Stitch and How to Train Your Dragon both outperformed their original film. A Minecraft movie delivered the biggest opening ever for a video game adaptation. Best Picture nominee F1 The Movie became Apple's highest-grossing film of all time, driven by exceptional performance in our premium format. Horror film The Conjuring Lost Rights became the highest-grossing in its franchise, An original title, Sinners and Weapons, will both stand out performances and exceeded expectations. Despite this breadth of success, no film surpassed $500 million at the domestic box office, the first time this has occurred since 2016. We do not expect this anomaly to occur again. What gives us more confidence is that the 2026 film slate is shaping up to be significantly stronger than 2025 with both mega blockbusters and depth. Audience engagement with trailers and teasers is suggesting that consumers are meaningfully more interested in 2026 titles than they were in 2025. The 2026 lineup features a remarkable collection of strong intellectual property with incredible brand recognition, including the Super Mario Galaxy movie, Toy Story 5, a live-action remake of Moana, Spider-Man Brand New Day, Doom Pops 3, and Avengers Doomsday. The slate also includes compelling original titles such as Pixar's Hoppers, Steven Spielberg's Disclosure Day, and Chris Nolan's epic The Odyssey. Cineplex Pictures will be distributing the highly anticipated Sir Michael, which is the most watched biopic trailer ever. It is also acting as distributor for the new installment from the Hunger Games franchise, Sunrise on the Ripping. These releases position 2026 as a year with significant strength and greater depth than 2025. With our focus on premium experiences, innovative programming, loyalty engagement, and an increasing diverse slate, Cineplex is well positioned to capture demand as it develops over the course of the year. Before I close, I'm pleased to announce the appointment of Sean McDuckin to our Board of Directors. As the former group head and CFO at Scotiabank, Sean brings intensive leadership experience in finance, governance, and executive management, and his strategic insight will be a huge asset. We look forward to the valuable perspective he will bring to the board. I would also like to extend our sincere thanks to Rob Bruce for his many years of dedicated service and meaningful contributions to Cineplex. His leadership, counsel, and support have played an important role in guiding the company, and we are deeply appreciative of his commitment throughout his tenure. I will now turn the call over to Gordon Ellison, our Chief Financial Officer, to walk you through the financials in more detail.