Q: Could i have your thoughts on this company in particular the debt, are they making any headway in lowering their debt,also i just noticed their June numbers were back to 2019 pre pandemic level.Is their any hope for this or is loan servicing just too big an obstacle its too bad really considering the moat they have and the astronomical margins they must have on concessions.....Thanks
5i Research Answer:
Debt is about the same ($1.9B) as it was pre-pandemic, and expected revenue this year ($1.6B) is also similar. Interest costs are $137M (last 12 months) and these will likely rise a bit with higher rates. 12-month cash flow was $116M and therein lies the problem. Interest costs, currently, are more than cash flow. The debt mostly is due in the next five years. With attendance back, and a decent film slate, bankruptcy is becoming less of a concern, but it is still hard to paint a really positive picture here because of the leverage.