Welcome to Reading International's Third Quarter 2018 Earnings Call. Thank you for joining us to discuss our 2018 third quarter results. .

My name is Andrzej Matyczynski. I'm Reading's Executive Vice President of Global Operations. With me, as usual, are Ellen Cotter, our CEO; and Dev Ghose, our EVP and Chief Financial Officer. .

Before we begin the substance of the call, I'll start by stating that in accordance to the safe harbor provision of the Private Securities Litigation Reform Act of 1995, certain matters that will be addressed in this earnings call may constitute forward-looking statements.

Such statements are subject to risks, uncertainties and other factors that may cause our actual performance to be materially different from the performance indicated or implied by such statements. Such risk factors are clearly set out in our SEC filings. We undertake no obligation to publicly update or revise any forward-looking statements. .

In addition, we will discuss non-GAAP financial measures on this call. Reconciliations and definitions of non-GAAP financial measures, which are segment operating income, EBITDA and adjusted EBITDA, are included in our recently issued 2018 third quarter earnings release on the company's website.

In today's call, we also use an industry-accepted financial measure called theater level cash flow, which is theater level revenues less direct theater level expenses. Please note that our comments are necessarily summary in nature, and anything we say is qualified by the more detailed disclosure set forth in our Form 10-Q. .

So with that behind us, Dev will be talking to us about the financial results of the third quarter a little later. But first, I'll turn the call over to Ellen, who will update us on the company's operations for what has turned out to be an exciting quarter for the company. .

Thanks, Andrzej, and thank you, everyone, for joining us today and sending in your questions. We've tried to address many of your questions in our prepared remarks. .

Before we start, I wanted to mention that on Wednesday, November 7, Reading held its 2018 Annual Stockholders' Meeting at our newly renovated Reading Cinemas in Murrieta, California. Management's presentation to its stockholders has now been posted to our website at readingrdi.com..

Now let's turn to our third quarter results. Reading delivered another record-setting quarter. Our third quarter total revenues increased 12% to $74.3 million, which set an all-time record high for any third quarter.

Our global cinema business drove these record revenues, which were generated not only by an amazing and diverse slate of movies from both the major studios and independent film companies but also by the effective execution of our global cinema strategy. .

During the third quarter of 2018, we continued to enhance the value of our existing assets, investing just under $9 million into the further upgrading of our cinema and real estate portfolios. The majority of those investment dollars went into the continued construction of our 44 Union Square project in New York City. .

the United States, Australia and New Zealand. Here are some of the quarterly highlights. At $70.7 million, our quarterly total cinema revenues increased by 14% versus the third quarter in 2017. Our U.S. cinema division recorded the highest total revenue ever for a third quarter.

We delivered this performance despite the fact that one of our stronger consolidated theaters on the island of Oahu was closed for renovation for half of the third quarter. .

Also, we were adversely affected by the strengthening of the U.S. dollar as compared to the Australian and New Zealand currencies, which declined in value by 7.4% and 8.5%, respectively, on a quarter-to-quarter basis.

Our cinema divisions in Australia and New Zealand delivered the second highest total revenue ever for a third quarter in their local currencies. .

Impossible - Fallout, Ant-Man and the Wasp and Incredibles 2 delivered across all our commercial cinemas. In the U.S., where we operate the Angelika Film Centers, we also benefited from strong specialty films like Three Identical Strangers, Eighth Grade and Sorry to Bother You. Our U.S.

and New Zealand divisions realized the highest third quarter ever food and beverage revenue per patron. These terrific revenue results drove our third quarter 2018 cinema segment operating income to $8.2 million, which represented a 22% increase over the third quarter in 2017 and the second highest third quarter on record. .

Now more particularly on the U.S. cinemas division. Our total revenues grew by 24% to $40 million due to a 19% increase in attendance, a 9% increase in our average ticket price and a slight increase in F&B per patron. Each of these top line items led our team to deliver U.S.

cinema segment operating income of $2.3 million, which was a 233% increase versus last year and the second highest third quarter on record. .

The third quarter 2018 box office revenue and box office per capita for the U.S. cinema division established new records for the highest third quarter ever. In addition, our box office revenue and box office per capita were the second highest ever for any quarter, trailing only the second quarter of 2018. .

And looking at the period of 9 months ended September. Our attendance, box office revenue, F&B revenue, box office per capita and F&B per capita results for the 9 months ended September 2018 are each the highest year-to-date September results on record for the U.S. cinemas.

Again, these results occurred despite the fact that our 14-screen Consolidated Theatre in Mililani, Hawaii was and remains closed for the middle -- from the middle of the third quarter for a top-to-bottom renovation.

This exceptional performance is due to the advantageous alignment of great movies, both commercial and specialty films, and the successful execution of our global cinema strategy. The industry as a whole benefited from a strong slate of films.

The quality and diversity of films released in the third quarter continues to give us confidence in the cinema business and the theatrical window. .

2 Reading Cinemas in Murrieta, California and Manville, New Jersey; and 2 Consolidated Theatres on the island of Oahu. Combined, these renovations added 49 recliner-seat auditoriums, 4 more TITAN LUXE screens and enhanced F&B menus at 3 of the 4 theaters. Lastly, I'll note that our U.S.

circuit outperformed the industry box office by 24 percentage points. .

Turning to Australia. For the third quarter 2018, our quarterly total cinema revenues increased by 3% versus third quarter 2017 to $23.7 million primarily due to a 9% increase in attendance, offset by an 8% decrease in food and beverage revenue per cap, while average ticket price remained flat.

These results were also impacted by the 7.4% decline in the Australian dollar. These top line items led the team to deliver Australian cinema segment operating income of $4.7 million. Like the U.S., the strong commercial movies drove attendance to our Australian premium auditoriums.

Our 10 TITAN-branded auditoriums and 35 Gold Lounge or premium screens in Australia generated both higher average ticket prices and F&B per patron. .

This quarter's results include our new Reading Cinema at Newmarket Village just outside of Brisbane, which features a TITAN LUXE and 2 Gold Lounge screens. This cinema has now been in operation for a full 9 months and continues to grow in attendance. The cinema is also generating increased customer traffic for Newmarket Village in which it's located.

This is a situation where we're realizing the benefits of being both the operator and the landlord of the cinema at our own shopping center. This is a compelling point of difference for our company. .

Our Australian cinemas' box office outperformed the Australian cinema industry by almost 10 percentage points for the third quarter on a functional currency basis. In New Zealand, at $7 million, our quarterly total cinema revenue represented a slight increase over last year.

These results were achieved in spite of an 8.5% decline in the New Zealand dollar. Our New Zealand cinema box office outperformed the New Zealand cinema industry by almost 3 percentage points for the third quarter on a functional currency basis. .

In the third quarter 2018, we continued to execute on our global cinema strategy.

Our goal is to deliver our guests not only the most comfortable cinematic experience but also one that features the state-of-the-art presentation through a premium auditorium experience with uniquely designed lobby features and elevated food and beverage offerings that match our local markets.

We believe that our initial efforts in this regard are helping drive our performance. It's clear that moviegoers are continuing to enjoy movies in a theater environment as opposed to TV, iPad or other device as long as theater owners provide quality services and experiences. .

As I mentioned before, in the third quarter, we started a top-to-bottom renovation at our Consolidated Theatre in Mililani, Hawaii. We're converting all 14 screens to recliner seating, adding a TITAN LUXE screen and elevating the food and beverage offering.

We closed the theater on August 13 for renovations and anticipate reopening for the 2018 holiday season. Once Mililani is converted, we'll have 94 screens or 38% of our total U.S. screens converted to recliner seating. .

In Australia, the third quarter 2018 included the first 6 months of operations following renovations of our Reading Cinemas at Elizabeth in South Australia and Charlestown in New South Wales, each of which now have 2 premium screens with recliners and a TITAN LUXE with recliners.

During the third quarter, we added 3 premium screens and 1 TITAN LUXE to the Reading Cinemas at Redyard in Auburn outside of Sydney. .

Regarding the performance of our upgraded cinemas versus our non-upgraded cinemas.

While we do not provide specific numbers on a theater-by-theater basis, we believe that our company's outperformance of the market in 2018, as reflected in our annual stockholders' presentation box office results slide, and the operating income reflected in our most recently filed 10-Q, which includes higher depreciation amounts due to our investments, both demonstrate that our capital investment and the operating strategies are paying off, especially in the U.S.

.

Our strategic focus on food and beverage continued across the global circuit and helped drive our record third quarter performance. The U.S. and New Zealand cinema divisions on a functional currency basis set all-time F&B records for the quarter. And we continue to achieve third quarter F&B per cap records in the U.S. and New Zealand.

These improving metrics are a result of the upgraded quality and variety of our food in certain cinemas and the addition of beer, wine and/or spirits. .

In the U.S., our third quarter 2018 food and beverage revenues increased by 20% over the third quarter 2017, with a significant percentage of that increase attributed to our newly renovated Reading Cinema in Murrieta, California, which features Spotlight, our first dining concept, in 6 auditoriums.

The third quarter 2018 food and beverage revenues more than doubled the F&B revenue reported in the Q3 2017..

In the U.S., our third quarter F&B per cap at $4.92 again set a record for any third quarter. The F&B per patron at our renovated theaters in Murrieta, California; Manville, New Jersey; and Pearlridge, Hawaii helped to boost our overall cinema circuit result. .

As the management team has focused on improving the quality and variety of food offered, we were all thrilled that the readers of The San Diego Union-Tribune not only voted the Angelika Films Center on Carmel Mountain the best movie theater in San Diego for the third year in a row, but for the first time also nominated us for best hamburger..

We continue to focus on our digital relationships with our guests. During the third quarter, we further improved existing mobile apps, added online reserved seating to more theaters and improved our social media content. We can see those efforts paying off in the sale of tickets from our proprietary platforms.

As of September 30, 2018, we increased our net convenience fee revenue globally to $4.2 million for the last 12 months, which represented a 57% increase over the same period in the prior year. Led by Crazy Rich Asians and Ant-Man and the Wasp, online ticket sales in the U.S. exceeded our previous third quarter results by as much as 149%. .

South City Square in Brisbane; and Traralgon, outside of Melbourne. We anticipate announcing the third location in due course and bringing all 3 new cinemas online between 2019 and 2021. Meanwhile, we continue to progress other potential new locations. .

We continue to spend time evaluating acquisition opportunities in the market. Like we have been for years, we remain a disciplined buyer.

After reviewing certain circuits for sale, we've determined that to build the most value for our stockholders, we'd be better off investing in our own portfolio or finding new build sites where we can implement our global cinema strategy. .

Now let's turn to our real estate business. At $5.8 million, our third quarter 2018 real estate revenues decreased by about 5% from the prior period.

The decrease compared to last year primarily relates to the $468,000 in arbitration settlement proceeds received from the producers of STOMP in the third quarter of 2017 that were obviously not repeated this quarter.

Putting to one side the 2017 STOMP proceeds, the quarter reflects increased revenues from our Minetta Lane Theatre, where we have a new license agreement with Audible, a subsidiary of Amazon and the leader in audiobooks; and our Australian real estate portfolio, where our recently expanded centers, Newmarket Village and Redyard in Auburn, have contributed increased revenues.

However, these results were also negatively impacted by foreign currency movements. .

one, increased revenue from additional tenancies at Newmarket Village and Redyard; two, increased revenue at the Courtenay Central in New Zealand, which was open for the entire year in 2017; and three, the new Audible license agreement at Minetta Lane.

And again, these revenues were offset by the unfavorable impact of foreign currency movements and the decreased revenues due to the STOMP arbitration settlement recognized in 2017 in our live theater business. .

Our real estate operating income for the 9 months ended September 30, 2018, decreased by 14% to $4.9 million versus the same period last year.

This was not only attributable to lower live theater revenue due to the $1.1 million of STOMP settlement proceeds received in 2017 but also the New Zealand business interruption insurance proceeds recorded in the second quarter of 2017.

If the STOMP arbitration proceeds of $1.1 million were removed from the year-to-date 2017, our year-to-date 2018 real estate operating income would have increased by 8%. .

I'll mention a few real estate segment highlights for the quarter. Turning first to our entertainment-themed centers in Australia. The end of the third quarter 2018 marked the first full 9 months of operation of our Newmarket Village expansion, which includes our new Reading Cinema and about 10,000 square feet of new F&B retail.

93% of this new retail space has been leased and is now occupied by tenants who are open and trading. To date, all 7 new restaurants in the expanded wing are pleased with their business. .

With respect to Redyard in Auburn, outside of Sydney, we settled the Telstra building purchase in early October 2018, which was the property that was almost literally in the middle of Redyard. This strategic acquisition will provide us with great flexibility and optionality into the future.

Including this purchase, we've added 6 incremental tenancies to Redyard since 2017. We also completed a very attractive upgrade of our common areas and upgrade to the Reading Cinemas, which included a TITAN LUXE and 3 premium screens. .

During the first 9 months of 2018, we continued the repositioning of Belmont Common, located in the suburb of Perth, which now features 3 new leading restaurants, Dome Café, Tavolo and Tao; upgraded common areas; and 2 new premium screens at the Reading Cinemas there. .

We received a few questions on our New Zealand portfolio. Let me first mention, during the first 9 months of 2018, our international property team continued working through necessary planning related to each of Courtenay Central and our undeveloped property in Manukau. .

With respect to Courtenay Central, we're continuing to work through the re-imagination of our center in Wellington. As we said in the past, the opportunity posed by the necessary demolition of the Tory Street carpark as a result of the late 2016 earthquake has allowed us to rethink the overall master plan for Courtenay Central.

Our focus has been on containing both the seismic and construction risk while developing incremental uses to drive more income. .

As we noted at our recent stockholder meeting, the current thinking presents a much bigger development with potential for including a hotel, incremental entertainment uses, upgraded premium Countdown supermarket, a 9-level carpark with a ground floor of retail, an upgraded food hall concept and creative office.

Wellington is a thriving capital city, and we have a wonderful opportunity to reshape our part of that city. We'll be deliberate in our approach to generate the greatest long-term value. .

Turning to our 2 adjoining undeveloped parcels in Manukau. As you know, collectively with 2 adjoining landowners, who together with us are known as the Southern Gateway Consortium, we completed initial master planning and industrial zoning on our properties.

The Auckland City Council has said that prior to any operational activities occurring on our properties, certain roading infrastructure needs to be completed by the landowners. Over the last quarter, the Southern Gateway Consortium continued to work with governmental agencies with a view towards delivering the infrastructure requirements by 2020. .

The industrial real estate market in this area of New Zealand remains very strong. For now, we are focused on the completion of the infrastructure works. However, we'll continue to watch the market. We'll have a better sense of timing for each of these New Zealand projects in the next 6 months. .

Now turning to the U.S. Our 44 Union Square building in New York City is really taking shape. The concrete superstructure and exterior facade work is done, and the mechanical, electrical and plumbing work is progressing and should be done by the end of Q2 2019. Most importantly, installation of the iconic glass dome started this month.

The crane was put in place this past weekend to start setting the steel frame. According to our contractors, we're on target to deliver space to potential tenants for an early start of tenant improvement work during the first quarter of 2019. .

Turning to the leasing. The Midtown South office submarket in New York City, where 44 Union Square is located, is doing very well. We've been talking to potential tenants, but we've spent a couple of months now working with one potential tenant, a credit-worthy global brand.

This potential tenant and its consulting team have been working with us towards finalizing terms. If we finish a deal with them, they will likely take a significant part of the building.

We continue to believe, based on where we are today, that this project will deliver significant value and achieve the expectations on which we greenlighted its development. Once we have a definitive lease in place, we will share the news with the market. .

Now let me mention some other notable recent developments. Regarding Jim Cotter, Jr.'s derivative litigation against all directors, which was dismissed with prejudice against all those directors earlier in 2018, earlier this week, the Nevada District Court awarded a cause judgment against Jim in favor of Reading in the amount of $1.55 million. .

Regarding Jim Cotter, Jr.'s employment arbitration, the matter was heard earlier this month and is now in a post-hearing briefing phase. It's not currently anticipated that the company will receive notice of the arbitrator's ruling on the merits of Jim's claims until December 2018 or January of 2019. .

Regarding Jim Cotter, Jr.'s ex parte motion seeking an appointment of a trustee ad litem to solicit offers to purchase the Cotter voting stock, the California appellate court has stayed all actions in the lower court. And the oral argument before the appellate court will likely not be heard until sometime in December 2018 at the earliest.

The matter has yet to be scheduled for argument before that appellate court. .

Now before turning the call over to Dev, I want to briefly address the unsolicited conditional indication of interest from Patton Vision.

As we disclosed in our press release, the board is committed to acting in the best interest of all stockholders and will review the revised unsolicited conditional indication of interest in due course, as we've done with previous indications of interest from Patton Vision. The board is well advised and is aware of their fiduciary responsibilities. .

Now with that, I'll turn the call over to Dev for a financial review of the third quarter. .

one, increases in attendance in our U.S., Australian and New Zealand cinemas; two, the U.S. cinema's increase in average ticket price; and three, the opening of our new state-of-the-art 8-screen Reading Cinema at Newmarket Village on December 14, 2017.

These results were achieved in spite of a 7.4% decline in the value of the Australian dollar and an 8.5% decline in the New Zealand dollar for the quarter ended September 30, 2018, compared to the corresponding period the prior year. .

Our revenues for the first 9 months of 2018 also increased by 13% or $26.4 million to $234.4 million.

The revenue increase for the 9 months ended September 30, 2018 compared to the corresponding period of the prior year was due to the cinema business segment growth and a slight increase in revenues from the real estate business segment, offset by the nonrecurring revenue derived in New Zealand from the receipt of business interruption proceeds in the second quarter of 2017, which was received in connection with the closure of our Courtenay Central entertainment-themed center.

In addition, our live theater revenue decreased compared to the prior year due to recognition in 2017 of the nonrecurring settlement payment received by the company related to the STOMP arbitration. .

While the improvement in the cinema business has been positively impacted by the much better film slate this year, we believe that the results also demonstrate the impact of our renovations and refurbishments over the past couple of years. .

Net income attributable to RDI common shareholders decreased by $300,000 to $1.3 million for the third quarter of 2018 and by $14.3 million to $9.4 million for the 9 months ended September 30, 2018. For the quarter, the decrease was mainly attributed to an increase in income tax expense and general and administrative expenses for the year-to-date.

The decrease was principally due to the onetime gain on insurance recoveries of $9.2 million and the $9.4 million gain on the sale of our Burwood property that was recognized during the second quarter of 2017. .

Additionally, there was an increase in non-segment G&A expenses for the 9 months of 2018. In fact, non-segment G&A expense for the quarter and 9 months ended September 30, 2018 compared to the prior year increased by 7% or $300,000 or 20% or $2.8 million, respectively.

For the third quarter, this increase primarily relates to higher payroll and bonus-related expenses attributable to reversals in 2017 for prior year incentive compensation accruals not deemed necessary, offset by a reduction in total legal fees for the quarter ended September 30, 2018 compared to the same period last year. .

For the 9 months ended September 30, 2018 compared to the same period in 2017, the increase was related to legal expenses incurred on the derivative litigation, the Cotter Employment Arbitration and other Cotter litigation matters, collectively known as the Cotter litigation costs; and higher compensation costs due to headcount, annual salary increases and increases in variable compensation costs.

We believe that our defense costs with respect to the derivative litigation will be substantially reduced due to grant of summary judgment in favor of all of our defendant directors by the Nevada District Court prior to the trial.

Going forward, we believe the costs with regard to this matter will, at least in the near term, be limited to the defense of Mr. Cotter, Jr.'s appeal of the Nevada District Court's determination and the Cotter Employment Arbitration, which we discussed and which was heard in October 2018. .

Income tax expense for the quarter ended September 30, 2018 increased $700,000 compared to the same quarter in the prior year.

A large part of the increase in tax expense for the third quarter 2018 compared to the same quarter of the prior year is due to increases in taxes related to the recently released IRS guidance regarding the global intangible low-taxed income. .

Income tax expense for the 9 months ended September 30, 2018 decreased by $3.7 million compared to the equivalent prior year period. The decrease for the 9 months ended September 30, 2018 is primarily related to lower pretax income and the reduction of U.S.

statutory corporate tax rates as a result of the tax act, partially offset by higher tax rates overseas and also from the nontaxable insurance proceeds received in 2017..

After adjusting prior year's adjusted EBITDA for the onetime gain on the sale of assets of $9.4 million, the current year's adjusted EBITDA of $39 million represents a 22% increase year-over-year. We believe adjusted EBITDA as defined in our earnings releases is an important supplemental measure of our performance. .

Shifting to cash flows. Our net income provided from operations for the 9 months ended September 30, 2018 was $19.1 million, which is a $10.3 million increase compared to the comparable period in 2017. This was primarily driven by $7.4 million higher cash inflows from operating activities as well as a $3 million decrease in net operating assets.

Cash flows from operating activities continues to be an important source of capital for the company. .

Cash used in investing activities during the first 9 months of the year was $51.7 million, mainly related to our ongoing real estate development and cinema refurbishment activities. We repaid $29.5 million of borrowings and took on additional borrowings of $65.2 million. .

Turning now to our financial position. Our total assets increased by $12.3 million to $435.7 million. Our financial position remains strong with $179.9 million and book shareholders' equity supporting our assets. Additionally, our liquidity position remains strong with $15.7 million of cash on our balance sheet at September 30, 2018.

Of our total cash balance amount, $2.9 million and $4.3 million were held by our Australian and New Zealand subsidiaries, respectively. .

We used the amounts that we received from our cinema and real estate business to pay down our long-term borrowings and realize savings from lower interest expense. We then settle our operating expenses generally with a lag within traditional trade terms. This generates a working capital deficit, which is a positive for the company.

We manage our cash investments and capital structure so as to be able to meet both short-term and long-term obligations for our business while maintaining financial flexibility and liquidity. .

As of September 30, 2018, there was approximately $101.1 million of additional unused capacity under our borrowing arrangements in the U.S., Australia and New Zealand, with $43.6 million of that $101.1 million being unrestricted capacity.

Our overall global operating strategy is to conduct business mostly on a self-funding basis, except where it's organizationally and economically better for us to move funds between the jurisdictions where we do business. .

As of September 30, 2018, we have gross debt of $167.1 million in our debt-to-adjusted EBITDA ratio, excluding debt allocated to facilities under construction that is not generating any EBITDA, which continues to be strong at slightly above 2x coverage. .

And with that, I'll now turn the call back to Andrzej. .

Thanks, Dev. First, I'd like to thank our stockholders for forwarding questions to our Investor Relations email. We were very pleased with the number of inquiries. .

We've compiled the set of questions and answers that represents the most common questions and recurring themes that were emailed to us and incorporated some answers in the body of the call. As always, we are available after the webcast to address any additional questions and encourage you to continue reaching out. .

Can you provide somewhat of a worst-case scenario for Union Square on your tenant leasing decision? How long would you be willing to leave the property unoccupied if you do not see lease terms you prefer versus taking something less than desirable in order to get the property occupied? Ellen, would you like to field this?.

Yes, Andrzej. As a company, while we perform sensitivity analysis on various potential scenarios for each capital project, we don't expect a worst-case scenario to occur for our Union Square project.

Our brokers have consistently advised us that the leasing efforts would only start getting traction when the building was to take shape, so the potential tenants could get a clearer understanding of what their space would feel like and have certainty of delivery dates.

We're encouraged with the project -- progress of the project and the tenant dialogue we're having and don't expect the property to sit unoccupied. .

Okay. Another question.

Now that the predevelopment agreement to codevelop Cinemas 1, 2 and 3 with its neighboring parcel has expired with mostly an initial feasibility study completed, what are the next steps and timing milestones on this real estate? Ellen?.

The Cinema 1, 2 and 3 continues to be one of our principal assets. It continues to work for us now as a cinema while we progress its redevelopment into a higher and better use. As most of you know, we've tried for a while to work out a joint development deal with our neighbors on the north.

We believe that the possible synergies for a combination -- from a combination of the 2 properties will benefit both them and Reading. To date, we haven't been able to reach agreement to a fair allocation of the JV ownership that's in the best interest of our stockholders, including with respect to the control of the development.

Our inability to reach agreement on getting -- on these gating issues gives us concern as to the difficulties that we may face in making other fundamental development decisions. And therefore, we're now looking at developing our property on a stand-alone basis.

Our footprint is just about 8,000 square feet, and we have the potential to increase the square footage to just over 90,000 square feet, with current zoning being commercial, residential or community facility.

To be clear, while we work to negotiate a joint venture structure, we've not been standing still and have been addressing issues that will need to be resolved whether we proceed on a stand-alone development or as part of a joint venture. Our Cinema 1, 2 and 3 continues to deliver healthy cash flow.

As 44 Union Square nears completion, we'll focus more of our domestic resources on advancing the redevelopment of the Cinema 1, 2 and 3. We have no plan to sell the asset as we believe it offers our company and our stockholders continuing cash flow plus the potential to build long-term sustainable tangible asset value.

We look forward to keeping you updated. .

Can you remind us of Reading's long-term plan as it relates to growth in both real estate and all cinema exhibition? What growth rates are you targeting? And is there a specific growth metric, revenue growth, EBITDA growth, you are using as a benchmark to measure the success of your efforts? Dev, how about you?.

Thanks, Andrzej. We started on a more in-depth review of our cinema investments in 2005 and have added recliner seats, premium screens and enhanced food and beverage options in select locations.

In doing so, we have generated -- generally targeted mid-teens type returns on the cinema growth investments, recognizing that in a few such instances, investments have necessarily to be defensive in nature. On the real estate side, we look for returns in the high single digits on a stabilized cash-on-cash basis. .

Dev, perhaps we can stick with you with the next question.

With the expected maturity of U.S., New Zealand and Australia loans in 2019, are they going to be refinanced prior to adding to Reading's working capital deficit by allowing them to be classified as additional current maturities of long-term debt?.

Andrzej, we are in advanced discussions with our credit sources in Australia, New Zealand and the U.S. with regard to renewing and refinancing our primary lines of credit for the next several years. We are encouraged by what we have been hearing and hope to be able to update our investors in early 2019 in connection with our 2018 year-end reporting.

We've received indications that we have the flexibility to increase our credit facilities should we elect to do so. .

And another question on our debt.

The new Minetta Lane and Orpheum loans 1 or 2 and subject to prepayment penalties? Dev?.

Andrzej, in October 2018, we closed on a new long-term loan covering the Minetta and Orpheum theaters. We will be able to repay the loan without penalty during the last year, year 5, of the loan. We do not currently anticipate any events for these 2 sites that would require a prepayment before that date.

Naturally, the prepayment feature is just one element of an overall financial package and impacts the rate paid. .

With a $25 million share buyback authorized and the company's management and board taking the position that RDI are undervalued, why is the company not repurchasing shares?.

I think I can answer that one. Our board has committed to the $25 million buyback. Today, just under $7 million of that authorization has been utilized. We are continuously evaluating our capital allocation needs as it relates to the buyback and our capital project -- projects.

As you can see from the amount we recently invested in our existing portfolio, we have put our capital to good use. Additionally, in the past months, we've been evaluating certain transactions that might have increased our capital needs. And finally, legal restrictions and blackout periods have materially limited our activity in the market.

Note that this has only been relatively recently that our stock price has fallen below our historic buyback pricing levels. With that said, our board and management remains committed to our buyback. .

That marks the conclusion of the call. As usual, we're available for any follow-up calls, so please do not hesitate to reach out. .

We appreciate you listening to the call today, and thank you for your attention..