INVESTOR PRESENTATIONThird Quarter 2016
THIS PRESENTATION INCLUDES "FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED. ALL STATEMENTS INCLUDED HEREIN, OTHER THAN STATEMENTS OF HISTORICAL FACT, MAY CONSTITUTE FORWARD-LOOKING STATEMENTS. ALTHOUGH THE
COMPANY BELIEVES THAT THE EXPECTATIONS REFLECTED IN SUCH FORWARD-LOOKING STATEMENTS ARE REASONABLE, IT CAN GIVE NO ASSURANCE THAT SUCH EXPECTATIONS WILL PROVE TO BE
CORRECT. IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE COMPANY'S EXPECTATIONS ARE DISCLOSED IN THE RISK FACTORS CONTAINED IN THE
COMPANY'S 2015 ANNUAL REPORT ON FORM 10-K FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE “SEC”) ON FEBRUARY 29, 2016. ALL FORWARD-LOOKING STATEMENTS ARE EXPRESSLY
QUALIFIED IN THEIR ENTIRETY BY SUCH FACTORS.
THIS PRESENTATION CONTAINS REFERENCES TO NON-GAAP FINANCIAL MEASURES INCLUDING ADJUSTED EBITDA (NET INCOME ATTRIBUTABLE TO CONTROLLING INTEREST ADJUSTED FOR INTEREST
EXPENSE, NET, PROVISION FOR INCOME TAXES, DEPRECIATION AND AMORTIZATION, NET LOSS ON DISPOSAL AND IMPAIRMENT OF OPERATING ASSETS AND OTHER, SHARE-BASED COMPENSATION
EXPENSE, LOSS ON EXTINGUISHMENT OF DEBT, EARNINGS RECOGNIZED FROM NCM, CASH DISTRIBUTIONS FROM NCM, CASH DISTRIBUTIONS FROM OTHER NON-CONSOLIDATED ENTITIES,
NONCONTROLLING INTEREST, NET OF TAX AND EQUITY IN INCOME OF NON-CONSOLIDATED ENTITIES AND OTHER, NET). A RECONCILIATION OF CURRENT YEAR NON-GAAP FINANCIAL MEASURES IS
AVAILABLE ON THE COMPANY’S WEB SITE AT WWW.REGMOVIES.COM.
WE BELIEVE EBITDA, ADJUSTED EBITDA AND FREE CASH FLOW PROVIDE USEFUL MEASURES OF CASH FLOWS FROM OPERATIONS FOR OUR INVESTORS BECAUSE EBITDA, ADJUSTED EBITDA AND FREE
CASH FLOW ARE INDUSTRY COMPARATIVE MEASURES OF CASH FLOWS GENERATED BY OUR OPERATIONS AND BECAUSE THEY ARE FINANCIAL MEASURES USED BY MANAGEMENT TO ASSESS THE
LIQUIDITY AND PERFORMANCE OF OUR COMPANY. EBITDA, ADJUSTED EBITDA AND FREE CASH FLOW ARE NOT MEASUREMENTS OF LIQUIDITY OR PERFORMANCE UNDER U.S. GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES AND SHOULD NOT BE CONSIDERED IN ISOLATION OR CONSTRUED AS A SUBSTITUTE FOR OTHER OPERATIONS DATA OR CASH FLOW DATA PREPARED IN ACCORDANCE WITH
U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES FOR PURPOSES OF ANALYZING OUR LIQUIDITY OR PERFORMANCE. IN ADDITION, NOT ALL FUNDS DEPICTED BY EBITDA, ADJUSTED EBITDA AND
FREE CASH FLOW ARE AVAILABLE FOR MANAGEMENT'S DISCRETIONARY USE. FOR EXAMPLE, A PORTION OF SUCH FUNDS ARE SUBJECT TO CONTRACTUAL RESTRICTIONS AND FUNCTIONAL
REQUIREMENTS TO PAY DEBT SERVICE, FUND NECESSARY CAPITAL EXPENDITURES AND MEET OTHER COMMITMENTS FROM TIME TO TIME AS DESCRIBED IN MORE DETAIL IN THE COMPANY’S 2015
ANNUAL REPORT ON FORM 10-K FILED WITH THE SEC ON FEBRUARY 29, 2016. EBITDA, ADJUSTED EBITDA AND FREE CASH FLOW, AS CALCULATED, MAY NOT BE COMPARABLE TO SIMILARLY TITLED
MEASURES REPORTED BY OTHER COMPANIES.
COMPANY OVERVIEW
o NYSE ticker – RGC
o Market capitalization* – $3.4 billion
o Annual dividend – $0.88 per share
o Credit rating – B1/B+
o Employees – over 25,000
o CEO – Amy Miles
o CFO – David Ownby
o Senior executive average tenure – 19 years
o Company headquarters – Knoxville, TN
*As of 9/30/16
About Us
7,310 Screens565 Theaters
Over 216MAnnual
Attendees
~20% ofNorth American
Box Office
4
Regal is a Leader in the U.S. Exhibition Industry
Geographic Diversification
o States: 42 + D.C & 3 U.S. territories
o Markets: 46 out of Top 50
Modern Asset Base
o 12.9 screens per theatre avg.
o Sony 4K Digital Projection
o ~58% feature premium amenities
5
Investment Thesis
Regal is a LEADER in a Stable, Mature Industry
o Long term box office
trend line shows
annual growth of
~4%
o Record industry box
office in 3 out of the
last 4 years
o As one of the largest
exhibitors, we
benefit from size
and scale
Regal generates significant
FREE CASH FLOW
o Average annual free
cash flow of approx.
~$250M for the last
five years
o Free cash flow well
ahead of our
competitors
o Able to generate free
cash flow in good
and bad box office
periods
We use our cash in ways that BENEFIT
SHAREHOLDERS
o Grow the asset base
by building and
acquiring theaters
o Find innovative,
return-focused ways
to better utilize
existing assets
o Provide a
meaningful return of
capital to
shareholders
6
BUSINESS MODEL & STRATEGY
Our Industry Provides Stable Long-Term Growth
$0.0
$2.0
$4.0
$6.0
$8.0
$10.0
$12.0
~4% Box Office CAGR (1985 - 2015)
Cable
VCRInternet
DVDNetflix | RedboxNote: Red bar indicates a recession year.
Industry Box Office exceeded $10B each of the last 7 years
8
Most Affordable Out of Home Entertainment Option
$85.83
$62.18 $53.98 $52.36
$28.94
$8.43
NFL NHL NBA Theme Parks MLB Cinema
Average Ticket Price
All major sports
Theme parks
Cinema
More people went to the movies in 2015 than all theme parks, MLB, NFL, NBA & NHL
combined.Source: 2015 MPAA data
Family of four can go to the movies for under $40
9
$918M of Return Focused Investments since 2012
Added ~90 large format IMAX and RPX
screens
Luxury reclining seats
available in over 1,200 auditoriums
Enhanced food menu
and/or alcohol program at 264
locations
Acquired ~875 screens at post
synergy multiples under 5x cash flow
Constructed 25 theatres in the US
10
Luxury Reclining Seats
• 106 sites and 1,210 screens operating with reclining seats currently
• ~30% of the circuit with reclining seats by year end 2017
Efficient capital spend, moderate investment with
high return
Before and after: 847 screens converted prior to Q3 2016
o Attendance growth of 32% per screen
o Average ticket price growth of 7.5% in Q3
o Incremental Adjusted EBITDA of almost
$23 million in Q3
11
Enhanced Food and Beverage Offerings
12
• Expanded food in 202 locations• ~240 locations by year end 2016
• Alcohol in 135 locations• ~175 locations by year end 2016
• Generated over $35M in revenue in last 12 months
Incremental to EBITDA margin, low investment with
moderate return
Large Format Screens and VIP Concepts
13
Large Format• 89 IMAX screens• 93 RPX screens
VIP Concepts• Luxury sections inside traditional theatres
• VIP area with bar and lounge• Auditorium service prior to showtime• Reserved seating
FINANCIAL REVIEW
5 Year Financial Overview
Revenue
Net Income
Adj EBITDA % Rev
Cash provided by operating Activities
Capital expenditures net
Free Cash Flow% Rev
2015
$ 3,038.1
157.7
597.719.7%
346.9
104.8
242.18.0%
2014
$ 2,990.1
105.6
575.719.3%
349.1
155.1
194.06.5%
2013
$ 3,127.3
153.4
607.719.4%
434.4
173.7
260.78.3%
2012
$ 2,675.9
36.8
482.118.0%
353.1
66.7
286.410.7%
$ 2,820.0
142.3
578.120.5%
346.6
83.4
263.29.3%
2011
15
Reconciliation of Net Income to EBITDA
2015
$ 157.7
141.3
107.0
200.2
$ 606.2
2014
$ 105.6
126.5
73.4
207.2
$ 512.7
2013
$ 153.4
129.6
100.1
216.8
$ 599.9
2012
$ 36.8
149.7
15.4
197.6
$ 399.5
$ 142.3
135.0
89.5
183.1
$ 549.9
2011
16
Net Income
Interest Expense, net
Provision for income taxes
Depreciation and amortization
EBITDA
Reconciliation of EBITDA to Cash Provided by Operating Activities
EBITDA
Interest expense, net
Provision for income taxes
Deferred income taxes
Changes in operating assets & liabilities
Gain on sale of NCM, Inc
Loss on extinguishment of debt
Landlord contributions
Impairment of investment in RealD, Inc
Other items, net
Cash provided by operating activities
2015
$ 606.2
(141.3)
(107.0)
(11.8)
(5.0)
(30.9)
30.7
3.5
-
2.5
$ 346.9
2014
$ 512.7
(126.5)
(73.4)
6.6
(42.9)
-
62.4
8.8
-
1.4
$ 349.1
2013
$ 599.9
(129.6)
(100.1)
(10.9)
35.5
-
5.7
32.2
-
1.7
$ 434.4
2012
$ 399.5
(149.7)
(15.4)
41.3
(15.9)
-
21.9
-
13.9
57.5
$ 353.1
$ 549.9
(135.0)
(89.5)
52.4
(68.3)
-
-
-
-
37.1
$ 346.6
2011
17
Reconciliation of EBITDA to ADJUSTED EBITDA
EBITDA
Net loss on disposal & impairment
Share based compensation
Gain on sale of NCM, Inc.
Impairment of investment in RealD, Inc.
Loss on extinguishment of debt
Earnings recognized from NCM
Cash distributions from NCM
Cash distributions from other non-consolidated entities
Noncontrolling interest, net of tax and equity in income of non-consolidated entities and other, net
Adjusted EBITDA
2015
$ 606.2
8.4
9.3
(30.9)
-
30.7
(37.5)
40.0
-
(28.5)
$ 597.7
2014
$ 512.7
7.3
9.4
-
-
62.4
(32.1)
39.1
6.3
(29.4)
$ 575.7
2013
$ 599.9
19.7
8.3
-
-
5.7
(31.0)
40.0
3.6
(38.5)
$ 607.7
2012
$ 399.5
20.8
7.9
-
13.9
21.9
(37.9)
40.3
-
15.7
$ 482.1
$ 549.9
16.2
10.3
-
-
-
(34.8)
38.5
-
(2.0)
$ 578.1
2011
18
Size and Scale Advantage
Consistently low operating costs driven by SCALE and operational EFFICIENCY
12.0%
13.0%
14.0%
15.0%
12.7%
13.4%
13.7%13.5% 13.6%
14.0%
Cost of Concession
50.0%
52.5%
55.0%
53.6%
52.4% 52.3%52.0%
51.8%
52.5%
Film Rent & Ad Costs
19
Liquidity and Debt
Our DIVERSIFIED debt structure maximizes flexibility and limits refinance risk
$0
$250
$500
$750
$1,000
$775 $954
$250 $250
5.75% Sr. Notes Due 2025
5.75% Sr. Notes Due 2023
Sr. Credit Facility
5.75% Sr. Notes Due 2022
Net Debt / LTM Adj EBITDA 3.4x
20
$- $1.00 $2.00 $3.00 $4.00 $5.00 $6.00
Special
Regular
Shareholder Value
Total Return Since IPO1:
Total Return last 3 Years2:
Annualized Return2:
435.5%
36.4%
10.9%
Dividends Since IPO:
Dividends Last 3 Years:
Current Dividend Yield:
$28.24
$3.63
4.0%
Note1: Total return assumes gross dividends reinvested in RGC from 05/10/02 to 09/30/16
Note2: Total return assumes gross dividends reinvested in RGC from 09/30/13 to 09/30/1621
LOOKING AHEAD
23
Q4 Film Product Outlook
November 2016 December 2016
2017 Film Product Outlook
24
Film Release Date
Fifty Shades Darker 2/10/2017
The Lego Batman Movie 2/10/2017
Beauty and The Beast 3/17/2017
Furious 8 4/14/2017
Guardians of The Galaxy 2 5/5/2017
Pirates of the Caribbean: Dead Men Tell No Tales 5/26/2017
Wonder Woman 6/2/2017
Cars 3 6/16/2017
Despicable Me 3 6/30/2017
Thor: Ragnarok 11/3/2017
Justice League 11/17/2017
Star Wars: Episode VIII 12/15/2017
Kevin Mead
Vice President of Investor Relations & Planning
investor.REGmovies.com
(865) 925-9685