IMAX Corporation (IMAX) Earnings Call Transcript & Summary

Hello, and welcome to the Annual General Meeting of Shareholders of IMAX Corporation. Please note that today's meeting is being recorded. It is my pleasure to turn the meeting over to Rich Gelfond, Chief Executive Officer of IMAX Corporation. Mr. Gelfond, the floor is yours.

Thank you, operator. I would like to call this Annual General Meeting of Shareholders to order. I want to welcome all of you to this year's meeting, which is being conducted via live webcast and to thank you for joining us. Ken Weissman, Corporate Secretary, will act as Secretary of the meeting and Computershare Investor Services, Inc., through its representatives, will act as scrutineer. Other members of our Board of Directors and management are present on today's webcast as well. I will chair the formal part of the meeting today, and then I will have some comments on the business and operations of IMAX. I would now like to ask Ken to briefly go over some of the procedural and administrative matters.

Thanks, Rich. I have confirmed that we have not received any shareholder nominations or proposals for business at today's meeting. Questions can be submitted by any registered shareholder or duly appointed proxy holder by selecting the Q&A icon at the top of your screen. If you submit a question, please include your name and your affiliation and indicate if the question relates to a specific agenda item. We will address questions relating to specific business items when those items are brought before the meeting, and we will address other questions during the Q&A session at the end of the meeting. Before the formal part of the meeting begins, please keep in mind that comments and answers to your questions might include statements that are forward-looking and that they address future results or occurrences. Actual future results and occurrences may differ materially from these forward-looking statements. Please refer to our SEC and SEDAR filings for a discussion of some of the factors that could affect our future results and occurrences. I have received from Computershare a list of the holders of the corporation's common shares as of the close of business on April 14, 2025, the record date for this meeting. I have also received a statutory declaration as to the due mailing of the notice of meeting, the proxy circular and proxy statement, the former proxy and the annual report that contains the 2024 financial statements of the corporation. These documents will be available for review during the meeting by selecting the documents icon at the top of your screen. I have also received the scrutineer's report on attendance which indicates that sufficient shareholders are present to constitute a quorum pursuant to the corporation's bylaws.

Thanks, Ken. I direct that the statutory declaration and the list of shareholders be kept by the Secretary with the records of this meeting. Notice having been duly given and there being a quorum present, I declare this meeting to be properly constituted. The formal agenda for this meeting as set out in the notice is to receive the consolidated financial statements for the fiscal year ended December 31, 2024, together with the auditor's report; to elect directors; to appoint the auditors of the corporation and to authorize the directors to fix the auditor's remuneration and to conduct an advisory vote on the compensation of the corporation's named executive officers. Ken will now discuss the voting procedures.

Thanks, Rich. Voting today is limited to shareholders of record on April 14, 2025, the record date of this meeting as well as duly appointed proxy holders for such shareholders. Voting will be conducted by electronic ballot. We now ask that the balloting be open. If you are a shareholder and you have already voted your shares ahead of the meeting, you do not need to vote your shares again. But if you use the control number or invitation code to log into the meeting and you accepted the terms and conditions, you will be provided the opportunity to vote by online ballot. If you vote by online ballot during the meeting, your previously submitted proxies will be revoked. The polls are now open and all registered shareholders and duly appointed proxy holders who wish to vote can click on the Vote icon at the top of your screen. You will be able to see all motions being brought forth at the meeting, and you can select a relevant option next to each proposal. Voting will end after all items have been brought before the meeting. Rich, we are now ready to proceed with the formal business of the meeting.

Thanks, Ken. The first item of business is the election of 10 directors. The meeting is now open for nominations.

Mr. Chairman, my name is Robert Lister. I'm a Chief Legal Officer and Senior Executive Vice President of IMAX Corporation and a shareholder. I nominate Gail Berman, Eric A. Demirian, Kevin Douglas, Richard L. Gelfond, David W. Leebron, Michael MacMillan, Steve R. Pamon, Dana Settle, Darren D. Throop and Jennifer Wong as directors of IMAX Corporation, to hold office until the close of the Annual Meeting of Shareholders in the year 2026 until their successors are elected or appointed or until the date of their resignation or termination.

Thank you, Rob. A motion to close the nominations and for the election of those nominated is now in order.

Mr. Chairman, my name is Robert Lister. I move that nominations be closed, and that the persons nominated as director be elected directors of the corporation to hold office until the close of the Annual Meeting of Shareholders in the year 2026 until their successors are elected or appointed or until their resignation or termination.

Thank you, Rob. May we have a seconder, please?

Mr. Chairman, my name is Kenneth Weissman. I'm Deputy General Counsel and Corporate Secretary of IMAX Corporation and a shareholder. I second the motion.

Thank you, Ken. Jennifer Horsley, IMAX's Senior Vice President of FP&A and Investor Relations is receiving any questions that are submitted during the meeting. Jennifer, can you please advise if there are any questions regarding this business item?

I can confirm that we have not received any questions specific to this business item.

May we now have a motion reappointing the corporation's auditors, PricewaterhouseCoopers LLP and authorizing the directors to fix their remuneration.

Mr. Chairman, my name is Robert Lister. I move that PricewaterhouseCoopers LLP be and they are hereby appointed auditors of the corporation to hold office until the close of the next Annual Meeting of Shareholders at such remuneration as the directors may fix.

Thank you, Rob. May we have a seconder, please?

My name is Kenneth Weissman. I second the motion.

Thank you, Ken. Jennifer, can you please advise if we have received any questions regarding this business item?

I can confirm that we have not received any questions specific to this business item.

The next proposal, commonly known as say-on-pay proposal, gives the corporation the opportunity to express their views on the corporation's named executive officer's compensation program. Although the vote is advisory and nonbinding in nature, the Board and the Compensation Committee will review the voting results and will consider shareholders' views in connection with our executive compensation program. May we have a motion to approve the corporation's named Executive Officer compensation program.

Mr. Chairman, my name is Robert Lister. I move that the corporation's named executive officer compensation program be approved.

Thank you, Rob. May we have a seconder, please?

My name is Kenneth Weissman. I second the motion.

Thank you, Ken. Jennifer, can you please advise if we have received any questions regarding this business item?

I can confirm that we have not received any questions specific to this business item.

We have now completed the motions related to the items to be voted upon at this meeting. We will pause here to provide one final minute to allow everyone to complete their voting. Your votes will automatically be accepted once the balloting closes. [Voting]

The electronic balloting has now closed. I ask that the scrutineer compile the results of the votes on all business matters into a report. Results will be published on a Form 8-K on EDGAR as well as on SEDAR. This concludes the formal business of the meeting. At this point, I would like to make some comments, and then the meeting will be open for questions. At last year's meeting, we spoke about 2025 as a transformative year for IMAX, a moment where the full potential of our strategy would begin to materialize. Now as we reach the halfway point of this pivotal year, I'm pleased to report that we're well on our way. The momentum we've generated across our business has been exceptional, and the industry has taken notice. We began this year with our highest grossing Q1 ever, nearly $300 million at the box office, driven by a record-breaking Chinese New Year, led by the animated film Ne Zha 2, which earned more than $165 million in IMAX. April followed with one of our best performances on record, powered by titles like Minecraft and Sinners, the ladder shot with IMAX film cameras and shown in IMAX 70-millimeter film. IMAX represented 20% of Sinners' global gross during its 2 weeks IMAX run. As summer kicks into high gear, we've surpassed our ambitious expectations for our 3-week run of Mission Impossible, The Final Reckoning, which has grossed more than $70 million in IMAX to date, and there's much more to come. Starting with the live action, How to Train Your Dragon and F1 this month and culminating in the highly anticipated, Avatar: Fire & Ash, the sequel to the 2 highest IMAX and grossing films of all time at Christmas. IMAX is not just thriving. We're among those setting the pace for global media and entertainment. And we continue to deliver on the strategic pillars that power our growth. First, expanding our global network. In 2024, we delivered year-over-year growth in system signings, and we're already on track to surpass that in '25 with over 105 signings secured before the halfway point of this year. That includes a renewed agreement with AMC, which will upgrade nearly the entirety of its North American IMAX footprint to IMAX with Laser, as well as signings with key partners across priority markets like Australia, Japan, the Middle East and Western Europe. Second, we're opening the aperture of the IMAX Experience. We're redefining what it means to be an IMAX Experience with all-inspiring filmmaking and events from around the world. This year, we are releasing the most diverse slate of film for IMAX titles in our company's history. From international blockbusters to groundbreaking documentaries, from exclusive events to live sports, the range and depth of our content has never been greater. We're also investing in local language storytelling with debuts in Vietnamese, Arabic and continued strength in China, Japan and India. Our documentary business is also set to expand with our first foreign language feature documentary in production in France, a direct extension of the successful launch of the Blue Angels, which continues to perform across platforms. Next, strengthening our industry partnerships our position across the industry has never been stronger. You may have noticed IMAX is playing a bigger role than ever in studio marketing campaigns. Campaigns for tentpole releases from powerhouse studios like Disney and Warner Bros, often showcase our brand more prominently than the title of the film itself. We've worked more closely with our partners to get them to lean into IMAX, which is driving our indexing and overall box office for movies like Sinners and Mission Impossible, and helping to sustain and grow our significant market share gains of recent years. Influential filmmakers like Tom Cruise, Ryan Coogler and Joe Kosinski, are also wielding IMAX technology for their biggest releases, again with exceptional results. And Christopher Nolan is committed to making the Odyssey, the first feature film ever to be shot entirely in IMAX 70-millimeter film. More streaming platforms are also embracing IMAX as a key differentiator. IMAX granted a groundbreaking IMAX exclusive release with a 28-day window for Greta Gerwig's Narnia. Apple prioritized an IMAX first strategy for F1 ahead of even securing a studio distribution partner. Amazon acquired our original documentary, The Blue Angels, and has committed major titles like Project Hail Mary and Mercy to the film for IMAX program. We continue innovating across content and format. We're also expanding the breadth of what IMAX audiences can experience. Music lovers pack theaters for the IMAX exclusive debuts of becoming Led Zeppelin and Pink Floyd live at Pompeii. We brought the remastered Princess Mononoke to audiences worldwide, achieving our best local language opening ever in North America with a nearly 30-year-old film. In France, we sold out a live sports test [ of the Classic ], a partnership with DAZN, that demonstrated the potential appetite for live events and sports in IMAX. And in China, we're encouraged by events such as last year's sold out broadcast of the League of Legends Esports finals and our exclusive broadcast of the Formula One Spanish Grand Prix. Speaking of China, we're optimistic about this year's promising local language film slate, including A Writer's Odyssey 2. Now looking ahead, 2025 is shaping up to be among the most successful years in IMAX's history. We are on pace for a record-breaking $1.2 billion in global box office. Our brand stands at the intersection of technology, creativity and culture, and that makes us uniquely positioned in today's entertainment landscape. Consumers, studios, streamers and exhibitors alike are aligned in their desire to partner with IMAX. Our technology powers unforgettable experiences and demand for those experiences is growing across every corner of the globe. IMAX is a premier global platform, and we're ready to seize the opportunity ahead of us. Thank you to our shareholders, partners and team for your continued belief in IMAX. With that, I will take questions from registered shareholders and duly appointed proxy holders. Please limit your questions to topics relating to today's subject matter. We'll answer as many questions as time permits. Jennifer, are there any questions?

I can confirm that no questions have been submitted.

Thank you, Jennifer. This completes the business of the meeting. A motion to conclude the proceedings is now in order.

Mr. Chairman, my name is Robert Lister. I move that the Annual General Meeting of the Shareholders of IMAX Corporation be concluded.

Thank you, Rob. Do we have a seconder?

My name is Kenneth Weissman. I second the motion.

Thank you, Ken, and thank you all for joining us today and for your continued interest and support of IMAX. The meeting has now concluded.

You may now disconnect. Everyone, have a great day.