Earnings call transcript: Reading International Q4 2025 misses forecasts

Reading International Inc. (RDI) reported its fourth-quarter earnings for 2025, revealing a greater-than-expected loss and a significant revenue shortfall. The company’s earnings per share (EPS) came in at -$0.11, missing the forecast of -$0.0992 by 10.89%. Revenue was reported at $50.27 million, falling short of the anticipated $57.93 million, marking a 13.22% miss. Despite these results, the stock price remained unchanged at $1.09 in pre-market trading.

Reading International faced a challenging fourth quarter in 2025, with a net loss of $2.6 million, compared to a $2.3 million loss in the same period last year. The company’s consolidated revenue decreased by $8.3 million or 14.2% quarter-over-quarter from Q4 2024. Despite these setbacks, Reading International achieved record food and beverage sales, driven by innovative menu offerings and merchandise sales tied to popular movies.

Reading International’s Q4 2025 EPS of -$0.11 fell short of the forecasted -$0.0992, resulting in a 10.89% negative surprise. Revenue was also below expectations, with actual figures at $50.27 million against a forecast of $57.93 million, a 13.22% shortfall.

Looking ahead, Reading International has set ambitious targets for EPS and revenue in future quarters, with projections indicating a return to positive EPS by FY 2027. The company plans to continue its strategic focus on asset monetization and debt reduction, which have been pivotal in improving its financial position.

CEO Ellen Cotter stated, "While our Q4 results were below expectations, our strategic initiatives in asset sales and cost management have positioned us well for future growth. Our record-breaking food and beverage performance underscores the strength of our cinema offerings."

During the earnings call, analysts questioned the company’s ability to sustain its debt reduction strategy and expressed interest in the potential impact of upcoming cinema renovations on future earnings. Management emphasized their commitment to financial discipline and operational improvements.

Gilbert Avanes, Chief Financial Officer and Treasurer, Reading International, Inc.: Thanks for joining the 2025 fourth quarter and the full year earnings call for Reading International, Inc. My name is Gilbert Avanes. I’m the company’s Chief Financial Officer and Treasurer. Joining me today is Ellen Cotter, President and CEO. Today, we’re going to modify the order of our call. After I run through normal caveats, I’ll start first by presenting the results from our 2025 fourth quarter and full year. I will also talk about our balance sheet, liquidity, and provide a summary of our debt position. Then I’ll turn the call over to Ellen, who will discuss our business strategy. After that, we’ll address some specific questions that came in from our stockholders, understanding that we have tried to weave answers to many stockholders’ question into our prepared remark. Let me start with running through the usual caveats.

Some of the statements that we make today regarding our business, operations, and financial performance may be considered forward-looking. Such statements are based on our current expectations and assumptions that are subject to a number of risks and uncertainties. We undertake no obligation to update any forward-looking statements. Actual results could differ materially. Please refer to our Forms 10-K and 10-Q, including the risk factors. During this call, we will present both GAAP and non-GAAP financial measures. A reconciliation of non-GAAP and GAAP measures is included in our earnings release issued March 31, 2026, which is distributed and available to the public through our website located at investors.readingrdi.com. With that behind us, I will go over the results from Q4 2025 and the full year 2025. Before I do that, I want to point out a few important transactions completed in 2025.

In Q1 2025, we completed the sale of our property assets in Wellington, New Zealand for NZD 38 million or $21.5 million. In May 2025, we completed the sale of our Cannon Park asset in Townsville, Australia for AUD 32 million or $20.7 million. On December 19, 2025, we completed the purchase of Sutton Hill Associates, a California general partnership, which owned a 25% interest in Sutton Hill Properties, LLC, the owner of the Cinemas 1, 2, 3. As part of this deal, we assumed certain indebtedness owed by Sutton Hill Associates to a third party. That indebtedness at December 31, 2025, had a face amount of $13.6 million, with interest payable quarterly at 4.7% per annum, with all principal due and payable in bullet payment on September 30, 2035.

Now I’ll turn to the fourth quarter results, which overall were somewhat disappointing compared to the prior period. Q4 2025 consolidated revenue decreased by $8.3 million to $50.3 million quarter-over-quarter. A few factors drove this decline. The film slate for the quarter in the U.S., Australia and New Zealand could not match the strength of the film lineup in Q4 2024. We closed two unprofitable theaters, one in U.S. and one in New Zealand. A decrease in our Australia and New Zealand real estate rent revenue due to the sale of our Cannon Park and Wellington, New Zealand assets. At $203 million, our consolidated revenue decreased by 4% year-over-year. The same factors drove this decrease. Lingering impact from industry-wide movie release schedule changes.

The closure of two unprofitable theaters, one in U.S. and one in New Zealand. The elimination of our property revenue generated from our Wellington and Cannon Park properties. In addition, the continued weakening of our Australian New Zealand foreign exchange rate against the US dollar negatively impacted our consolidated revenue. With respect to our net loss position for the quarter, our net loss attributable to Reading International, Inc. increased by $0.3 million to a loss of $2.6 million quarter-over-quarter. Our basic loss per share for Q4 2025 increased by $0.01 to a loss per share of $0.11, compared to a basic loss per share of $0.10 for Q4 2024. Again, these results were primarily due to weaker cinema performance and a $2.2 million decrease in other income compared to the same period in 2024.

This was offset by a $0.6 million reduction in interest expense and a gain on sale of $2.7 million due to the acquisition of non-controlling interest related to Sutton Hill Associates transaction. Our net loss attributable to Reading International, Inc. for the full year improved by $21.2 million from a loss of $35.3 million to a loss of $14.1 million year-over-year. Our basic loss per share improved by $0.96 to a loss of $0.62, compared to a loss of $1.58 for the full year 2024. These improved results were primarily due to stronger income results from our segments, a $3.2 million reduction in interest expense, a $2.7 million gain on acquisition of non-controlling interest of Sutton Hill Properties, LLC.

A $8.4 million gain on sale of assets from the sale of our Cannon Park and Wellington properties in 2025, compared to a loss of $1.3 million on the sale of our Culver City office in 2024, and a $0.9 million reduction in G&A expenses, partially offset by $3.7 million increase in other expenses. Our total company depreciation, amortization, impairment, and G&A expenses for Q4 2025 decreased by $0.9 million to $7.3 million, compared to $8.2 million for Q4 2024.

For the year ended December 31, 2025, total company depreciation, amortization, impairment, and G&A expenses decreased by $3.4 million to $32.5 million compared to the same period in the prior year, primarily driven by cinema closures in the U.S. and New Zealand, the sale of our Wellington and Cannon Park properties, and delays in CapEx spending. Income tax expense for the year ended December 31, 2025 increased by $0.4 million to income tax expense of $0.9 million, compared to an income tax expense of $0.5 million for the equivalent prior year period. The change between 2025 and 2024 is primarily due to increase in income tax expense from Australia in 2025. Our Q4 2025 global operating loss was $1 million, compared to an operating income of $1.1 million in Q4 2024.

At $5.1 million, our Q4 2025 adjusted EBITDA decreased by $1.7 million or 25% compared to the same time period last year. On a full-year basis, our 2025 global operating loss of $5.3 million improved by $8.7 million or 62% from an operating loss of $14 million in Q4 2024. At $17.8 million, our adjusted EBITDA increased by $15.7 million or 744% compared to the same time period last year. These annual improvements were due to $9.7 million increase in gain from our asset sales, $2.7 million gain on acquisition of non-controlling interest, and improved operating results primarily through the efficient management of operating expenses and reducing general and administrative expenses. Shifting to cash flow.

For the full year 2025, net cash used in operating activities decreased by $2.2 million to $1.6 million compared to cash used in the same period of prior year of $3.8 million. This was primarily driven by a decrease in net operating loss of $11.5 million, partially offset by a $9.3 million decrease in net operating assets, primarily due to increase in receivables and a small increase in accounts payable and accrued expenses, plus deferred revenues and other liabilities. Cash provided by investing activities during the twelve months ended December 31, 2025 increased by $33.1 million to cash provided of $37.1 million from a cash provided of $4 million in the same period of prior year.

This was primarily due to higher proceeds from sale of our Cannon Park property assets in May 2025 and the Wellington property assets in January 2025 compared to proceeds from the sale of our Culver City office in February 2024, and a reduction in capital expenditures in 2025 compared to 2024. Cash used in financing activities for 12 months ended December 31, 2025 increased by $38.2 million from cash provided of $0