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Reading NZ gets box office boost from Christchurch complex, eyes future gains in Wellington

Friday 7th June 2013

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Reading New Zealand, the local unit of the California-based cinema complex owner, got an earnings boost from re-opening its quake-damaged Christchurch centre last year, lifting its box-office takings.

The local holding company increased sales by 11 percent to $23.5 million in calendar 2012, according to statements lodged with the Companies Office. The boost in revenue from its cinema business came from 236,000 more movie admissions compared with 2011 after it re-opened the Christchurch multiplex.

The company's annual $18.2 million from the rendering of services amounts to about 11 percent of gross national box office takings of $173.1 million, according to Motion Picture Distributers' Association figures.

Reading's principal operation is managing the large retail spaces around its cinemas, though about 8 percent of its earnings come from investing in real estate. The New Zealand unit reported flat rental revenue of $6.8 million in the year.

The local company made a wider net loss of $4.9 million in the year from a loss of $4.6 million in 2011. Backing out interest, depreciation, amortisation and tax, Reading NZ boosted implied operating earnings 42 percent to $6.4 million.

Since the balance date, Reading's local unit has attracted more cinema goers in the first quarter, with 50,000 more admissions in the three months ended March 31 from a year earlier.

Last month, Reading signed Woolworths as an anchor tenant for its Wellington flagship in a 20-year lease for a Countdown supermarket. The cinema complex operator anticipates annual rent of $1.7 million from the deal. The supermarket is expected to open in two years.

In 2011, Reading beefed up its New Zealand presence by aggregating back-office accounting functions in Wellington. The group hired 17 local accountants to replace finance staff in the US and Australia.

Parent company Reading International's Nasdaq-listed stock rose 2.5 percent to US$6.14 yesterday.

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