National CineMedia, Inc. Files 2023 Annual Report on Form 10-K

TL;DR

<b>National CineMedia, Inc. filed its 2023 10-K report detailing its financial performance and business operations.</b>

AI Summary

National CineMedia, Inc. (NCMI) filed a Annual Report (10-K) with the SEC on March 18, 2024. The company's fiscal year ended on December 28, 2023. The filing is a 10-K annual report. The company's principal business address is in Centennial, CO. The company has issued time-based and performance-based restricted stock to employees. The company's Standard Industrial Classification is Services-Advertising [7310].

Why It Matters

For investors and stakeholders tracking National CineMedia, Inc., this filing contains several important signals. This 10-K filing provides a comprehensive overview of the company's financial health and strategic direction for the fiscal year ended December 28, 2023. Understanding the details of their stock compensation plans and business classification is crucial for investors assessing the company's operational structure and potential future performance.

Risk Assessment

Risk Level: medium — National CineMedia, Inc. shows moderate risk based on this filing. The company operates in the advertising services sector, which can be subject to economic downturns and shifts in media consumption, as indicated by its SIC code and business description.

Analyst Insight

Review the detailed financial statements and risk factors in the 10-K to assess the company's performance and outlook in the advertising industry.

Key Numbers

• 2023-12-28 — Fiscal Year End (Conformed period of report)
• 2024-03-18 — Filing Date (Filed as of date)

Key Players & Entities

• National CineMedia, Inc. (company) — Filer name
• Centennial, CO (location) — Business and mailing address
• 7310 (industry_code) — Standard Industrial Classification

FAQ

Risk Factors

• Employee Stock Compensation [medium — operational]: The company issues time-based restricted stock vesting over three years and performance-based restricted stock contingent on achieving specified non-GAAP targets.

Industry Context

National CineMedia operates within the advertising services industry, specifically focusing on in-theater advertising and related media.

Regulatory Implications

As a publicly traded company in the US, National CineMedia, Inc. is subject to the reporting requirements of the Securities and Exchange Commission (SEC) under the Securities Exchange Act of 1934.

What Investors Should Do

1. Analyze the company's revenue streams and growth trends for the fiscal year 2023.
2. Evaluate the details of the restricted stock plans and their potential impact on future dilution.
3. Assess the company's competitive positioning within the advertising and media sector.

Glossary

10-K

An annual report required by the U.S. Securities and Exchange Commission (SEC), which gives a comprehensive summary of a company's financial performance. (This filing provides the official annual financial overview for National CineMedia, Inc.)

Year-Over-Year Comparison

This filing represents the company's annual report for the fiscal year ending December 28, 2023, providing updated financial and operational information compared to previous filings.

Key Financial Figures

• $0.01 — ich registered Common Stock, par value $0.01 per share NCMI The Nasdaq Stock Market
• $15 million — ), (iii) make a capital contribution of $15 million to NCM LLC (the "NCMI Capital Contribut
• $15.0 m — denture, received its pro rata share of $15.0 million, with (i) $14.5 million contribut
• $14.5 million — o rata share of $15.0 million, with (i) $14.5 million contributed by NCM LLC and (ii) $0.5 mi
• $0.5 million — million contributed by NCM LLC and (ii) $0.5 million contributed directly from NCM, Inc. (th
• $50,000 — eneral unsecured claim in the amount of $50,000 or less received payment in full in cas
• $15.5 million — an, NCM, Inc. transferred approximately $15.5 million to NCM LLC consistent with the NCMI 901
• $8.8 million — LC. Upon emergence, NCM LLC transferred $8.8 million of cash to a professional fees escrow a
• $15.0 million — a professional fees escrow account and $15.0 million to an unsecured creditor settlements es
• $3.0 million — unsecured creditors and held a total of $3.0 million within the escrow accounts and accruals

Filing Documents

• ncmi-20231228.htm (10-K) — 2149KB
• thebylawsasamendedfebruary.htm (EX-3.1) — 156KB
• descriptionoftheregistrant.htm (EX-4.5) — 29KB
• ncmllcthirdamendedandresta.htm (EX-10.1) — 391KB
• ng-firstsecondandthirdamen.htm (EX-10.71) — 29KB
• q42023ncmincex211.htm (EX-21.1) — 2KB
• deloitteconsentex231122823.htm (EX-23.1) — 2KB
• poa10-kex2412023.htm (EX-24.1) — 18KB
• q4-2023xncmxincxexx311.htm (EX-31.1) — 8KB
• q4-2023xncmxincxexx312.htm (EX-31.2) — 8KB
• q4-2023xncmxincxexx321.htm (EX-32.1) — 5KB
• q4-2023xncmxincxexx322.htm (EX-32.2) — 5KB
• ncmincentivecompensationre.htm (EX-97.1) — 24KB
• ncmi-20231228_g1.jpg (GRAPHIC) — 373KB
• ncmi-20231228_g2.jpg (GRAPHIC) — 34KB
• ncmi-20231228_g3.jpg (GRAPHIC) — 196KB
• 0001377630-24-000042.txt (&nbsp;) — 15353KB
• ncmi-20231228.xsd (EX-101.SCH) — 134KB
• ncmi-20231228_cal.xml (EX-101.CAL) — 110KB
• ncmi-20231228_def.xml (EX-101.DEF) — 820KB
• ncmi-20231228_lab.xml (EX-101.LAB) — 1248KB
• ncmi-20231228_pre.xml (EX-101.PRE) — 1120KB
• ncmi-20231228_htm.xml (XML) — 1354KB

Risk Factors

Item 1A. Risk Factors 19

Unresolved Staff Comments

Item 1B. Unresolved Staff Comments 32

Cybersecurity

Item 1C. Cybersecurity 32

Properties

Item 2. Properties 33

Legal Proceedings

Item 3. Legal Proceedings 33

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 33 PART II

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 34

[Reserved] 35

Item 6. [Reserved] 35

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 36

Quantitative and Qualitative Disclosures about Market Risk

Item 7A. Quantitative and Qualitative Disclosures about Market Risk 51

Financial Statements and Supplementary Data

Item 8. Financial Statements and Supplementary Data 52

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 89

Controls and Procedures

Item 9A. Controls and Procedures 89

Other Information

Item 9B. Other Information 89

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 89 PART III

Directors, Executive Officers and Corporate Governance

Item 10. Directors, Executive Officers and Corporate Governance 89

Executive Compensation

Item 11. Executive Compensation 89

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 90

Certain Relationships and Related Transactions, and Director Independence

Item 13. Certain Relationships and Related Transactions, and Director Independence 90

Principal Accounting Fees and Services

Item 14. Principal Accounting Fees and Services 90 PART IV

Exhibits, Financial Statement Schedules

Item 15. Exhibits, Financial Statement Schedules 91

Form 10-K Summary

Item 16. Form 10-K Summary 95

Signatures

Signatures 96 Certain Definitions In this document, unless the context otherwise requires: "NCM, Inc.," "NCM," "the Company," "we," "us" or "our" refer to National CineMedia, Inc., a Delaware corporation, and its consolidated subsidiary National CineMedia, LLC. "NCM LLC" refers to National CineMedia, LLC, a Delaware limited liability company, the current operating company for our business, which NCM, Inc. acquired an interest in, and became a member and the sole manager of, upon completion of our initial public offering, or "IPO," which closed on February 13, 2007. "ESAs" refers to the amended and restated exhibitor services agreements entered into by NCM LLC with each of NCM LLC's original founding members (AMC, Cinemark and Regal) upon completion of the IPO, which were further amended and restated on December 26, 2013 in connection with the sale of the Fathom Events business and, in the case of the ESAs with Cinemark and Regal, were further amended on September 17, 2019 (the "2019 ESA Amendments") to extend the terms of the ESAs and modify the program distributed by NCM LLC through its DCN for exhibition in Cinemark and Regal theaters. On July 14, 2023, Regal terminated their ESA with NCM LLC. "AMC" refers to AMC Entertainment Holdings, Inc. and its subsidiaries, National Cinema Network, Inc., which contributed assets used in the operations of NCM LLC and formed NCM LLC in March 2005, AMC ShowPlace Theatres, Inc., AMC Starplex, LLC and American Multi-Cinema, Inc., which is a party to an ESA with NCM LLC. "Cinemark" refers to Cinemark Holdings, Inc. and its subsidiaries, Cinemark Media, Inc., which joined NCM LLC in July 2005, and Cinemark USA, Inc., which is a party to an ESA with NCM LLC. "Regal" refers to Cineworld Group plc, Regal Entertainment Group and its subsidiaries, Regal CineMedia Corporation, which contributed assets used in the operations of NCM LLC, Regal CineMedia Holdings, LLC, which formed NCM LLC in March 2005, and Regal Cinemas, Inc.,

Business

Item 1. Business The Company NCM, Inc., a Delaware corporation, was organized on October 5, 2006 and began operations on February 13, 2007 upon completion of its IPO. NCM, Inc. is a holding company that manages its consolidated subsidiary, NCM LLC. NCM, Inc. has no business operations or material assets other than its cash and ownership interest of 100.0% of the common membership units in NCM LLC as of December 28, 2023. In December 2022, AMC and Regal each redeemed all of their outstanding membership units in exchange for shares of NCM, Inc. common stock, reducing AMC's and Regal's ownership interest in NCM LLC to 0.0% as of December 29, 2022. On February 23, 2023 and March 23, 2023, Cinemark redeemed all of their outstanding membership units in exchange for shares of NCM, Inc. common stock reducing Cinemark's ownership interest in NCM LLC to 0.0% as of December 28, 2023. NCM, Inc.'s primary source of cash flow from operations is distributions from NCM LLC pursuant to the NCM LLC Operating Agreement. NCM, Inc. also receives management fees pursuant to a management services agreement with NCM LLC in exchange for providing specified management services to NCM LLC. Chapter 11 Proceedings On April 11, 2023, NCM LLC filed a voluntary petition for reorganization ("Chapter 11 Case") with a prearranged Chapter 11 plan under Chapter 11 of Title 11 of the United States Code (the "Bankruptcy Code") in the U.S. Bankruptcy Court for the Southern District of Texas (the "Bankruptcy Court"). On April 11, 2023, NCM, Inc. entered into a restructuring support agreement (the "Restructuring Support Agreement") with NCM LLC and certain of NCM LLC's (a) prepetition lenders under (i) the Term Loan Credit Agreement, dated as of June 18, 2018 among NCM LLC as borrower, JPMorgan Chase Bank, N.A. ("JPM") in its capacity as administrative agent, and the lenders party thereto (as amended, supplemented or otherwise modified from time to time, the "Credit Agreement"); (ii) the Revolving Cr

View Full Filing

View this 10-K filing on SEC EDGAR