Cinemark Holdings CEO Mark Zoradi, who knows a thing or two about how to achieve premium customer experience and customer engagement after a 30-year career at Disney and some time at DreamWorks (on the studio side), came to Cinemark for one very specific reason.
“I knew exhibitors all over the world ran international and domestic distribution and marketing and Cinemark always stood out to me, and so when the opportunity – I was on the Board at Cinemark – came and Tim Warner was retiring and the Board asked if I would step into that role, it was a big decision to move to Dallas, which I’ve done, but I did so because Cinemark really is truly doing all those things that you see on the page,” Zoradi said at the Dec. 10 Wedbush California Dreamin Consumer Management Access Brokers Conference, according to Seeking Alpha.
During a Q&A session, Zoradi pointed to four key strategies for Cinemark, including enhancing the customer experience via XD, sound, projection, Luxury Loungers, and technological innovation.
“We are now 100% digital both in North America and South America,” Zoradi explained. “We’re 100% satellite delivered in North America and by the end of next year we’ll be 100% satellite delivered in South America. The reason I bring that up is, basically what that means, is we will then have 6,000 screens that are effectively networked together two-way satellite capability. So it’s very, very important to us as we look at alternative content because we can get that content to theaters all over North and South America.”
Zoradi noted that Cinemark is the No. 1 attended movie theater in the world, has the highest EBITDA, the highest EBITDA margin, and an extremely experienced management team.
“We’re trying to focus on growth in not only our existing but also new markets,” Zoradi said. “We are absolutely the most diverse footprint. I think it’s a key differentiator for us. We have very strong and stable cash flow in the U.S. which is able to fund all of our debt, fund our dividend, and fund our expansion domestically. And then we couple that with a really robust self-funded growth in Latin America where we’re not putting fresh U.S. dollars down there, completely self-funded in an area that’s got a higher growth rate than what we can see in North America. And then, of course, we balance that with a really strong balance sheet which gives us the flexibility and nimbleness to be able to look at M&A opportunities that arise.”
Cinemark is fully repositioning many of its theaters with Luxury Loungers.
“By the end of this year, we’ll be at 400 screens,” Zoradi said. “By the end of next year, we’ll be at 850 screens. That will represent about 20% of our network that will have recliners. We’re only doing these in theaters where it makes complete financial sense.”