Thank you for joining Reading International's earnings call to discuss our 2020 full year and fourth quarter results. My name is Andrzej Matyczynski, and I'm Reading's Executive Vice President of Global Operations.

With me, as usual, are Ellen Cotter, our President and Chief Executive Officer; and Gilbert Avanes, our Executive Vice President, Chief Financial Officer and Treasurer. Before we begin the substance of the call, I will just run through the usual caveats.

In accordance with 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 2020 fourth quarter earnings release on the company's website.

We have adjusted, where applicable, the EBITDA items we believe to be external to our business and not reflective of our costs of doing business or results of operation.

Such costs include legal expenses relating to extraordinary litigation and any other items that can be considered nonrecurring in accordance with the 2-year SEC requirement for determining an item is nonrecurring, infrequent or unusual in nature. We believe adjusted EBITDA is an important supplemental measure of our performance.

In today's call, we also use an industry-accepted financial measure called theater-level cash flow, which is theater-level revenue less direct theater-level expenses and property-level cash flow, which is property-level revenue less direct property 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-K and other filings with the U.S. Securities and Exchange Commission.

So with that behind us, I'll turn it over to Ellen, who will review the results for the fourth quarter and the full year 2020 and discuss our strategies for navigating ready through the COVID-19 pandemic to the post-COVID era, followed by Gilbert, who will provide a more detailed financial review.

Ellen?.

rental income received from our full floor tenant at our Culver City building in the U.S.; the elimination in Australia of our third-party property management contracts reflecting the continued strengthening of our internal property team; the receipt of live theater license fee revenue from certain tenants; various property tax rebates and waivers achieved in Australia; and a reduction in operating expenses due to a COVID-related rent abatement from a ground lessor in Australia.

As I just noted, throughout the fourth quarter, we continued to offer short-term rental relief through abatements and deferrals to our affected third-party tenants in Australia in order to ensure their long-term viability as our tenants.

In addition to our own negotiations, the government sponsored a COVID-19 National Cabinet Mandatory Code of Conduct, which provided the framework for those relief deals.

During Q4, in line with that code of conduct, we granted almost AUD 87,000 in rent abatements and approximately AUD 74,000 in rent deferrals to our third-party lease tenants in Australia.

The rent deferrals for Australia are to be repaid by tenants over a 24-month period once the code of conduct ends, which in most Australian states occurred in March of 2021. I'll also note that no COVID-related rent abatements were offered in New Zealand. As of today, 98% of our third-party lease tenants are open and trading.

Despite these tenants being opened, we expect the impact of our negotiated rental concessions through abatements and deferrals to be felt through the first quarter of 2021.

During Q4 2020 in Australia and New Zealand, where we have a combined total of 91 third party tenants and 90 that are open and trading, we collected 88% of our billed recurring rents which includes base rent and cost reimbursements.

As of December 31, 2020, our combined Australian and New Zealand portfolio consists of 102 third-party tenancies, which includes vacant tenant spaces, with a gross leasable area of over 365,000 square feet. Of our 102 third-party tenant spaces, 96% are currently occupied.

During Q4 2020, we maintained momentum with our third-party leasing activity by completing 4 leases and 3 lease renewals, all at Newmarket Village, collectively representing over 11,450 square feet.

And while we delayed all nonessential capital improvements in our Australian centers due to COVID-19, we did commit to certain tenant allowances and lessors' works for a few lease deals that we deemed essential to the long-term health of each center.

Regarding our live theaters in the U.S., we anticipate that the Orpheum and Minetta Lane Theatres will resume public performances in Q3 of 2021. Again, understanding the impact that our long-term tenant base, we provide a rent relief arrangements to certain producers who occupy our live theaters.

As I mentioned earlier, based on current market conditions in March of 2021, we listed our Royal George Theatre property in Chicago for sale. And now let's turn to the status of our key capital projects, beginning with our 44 Union Square property in New York City.

Despite the pandemic, on August 31, 2020, we received a renewable temporary certificate of occupancy for the core and shell of the 44 Union Square building, which allows potential tenants to come in and begin fitting out.

Gilbert will talk about this in a few minutes, but I'll note that on December 29, 2020, we extended the maturity date of our 44 Union Square construction financing to March 31, 2021 at a higher interest rate in order to give us the time to let the pandemic conditions improve and put in place a more realistic financing deal.

On March 26, 2021, we repaid this loan in full. At the moment, we own this proper -- this asset free and clear of all financing debt. However, we also received a financing commitment to loan us $55 million on our 44 Union Square property, which includes amounts for anticipated tenant improvements and leasing commissions.

We've been asked, what's a realistic time line for leasing 44 Union Square? At this point, we're not certain. The retail and office leasing environments in Manhattan and the Midtown South office market have been severely impacted by the pandemic. Despite this, we have been in discussions with some retailers.

But we'll wait to make the right deal, not a pandemic deal. We also strongly believe that the location of 44 Union Square will be key to the property success as it's one of the few brandable buildings in the area. We can't offer any assurance as to when the building will be fully leased, and we don't want to quantify $1 per square foot expectation.

In regard to our Culver City property, we began receiving rental payments in October of 2020. So this building is now 100% occupied. The tenants fit-out is underway and estimated to be completed by the end of April 2021. Turning to our Courtenay Central property in New Zealand.

During the last 12 months, we've dedicated internal resources to determining how to progress the development plans of Courtenay Central in light of the pandemic challenges. As our recovery starts to take shape, and we develop a new capital allocation strategy, we'll focus on the restoration and renewal of Courtenay Central and our adjacent assets.

We want to be able to take advantage of the opportunity directly across from Courtenay Central, a beautiful state-of-the-art convention center named to Takina, which is currently under construction with an anticipated opening date in 2023.

Working together with the various stakeholders in Wellington, we want to be part of the ongoing activation and reactivation of this world-class city.

Going forward into 2021, we'll be developing a new capital allocation strategy and focusing on building value, not only in our real estate assets in Wellington, but also in Cannon Park in Queensland, Newmarket Village in Queensland and our Cinema 1, 2 and 3 property in New York City and Viaduct properties in Philadelphia.

Two more important points before I turn it over to Gilbert for a financial review of the fourth quarter and the full year 2020. As we reported in our earnings release, I want to mention again that my brother, James Cotter Jr. passed away on March 10, 2021.

The entire Cotter family continues to be truly heartbroken by Jim's untimely passing at the young age of 51. We want to recognize Jim's long service to the company as a director from 2002 to 2018, including as our Vice Chairman for a number of years, and as the President and CEO from 2013 to 2015.

On behalf of Margaret, our Board and myself, we again want to extend our sincerest appreciation to the global Reading team, who've spent the last 12 months working tirelessly to ensure that our companies survive COVID-19 and beyond.

Everyone on the Reading team from our cinema managers, our property managers and our ETCs, our live theater managers, our programming and marketing teams, to our senior executives who run our cinema and property divisions, our legal department, our information technology and finance and accounting teams, all of them should be so proud of what they've accomplished to date.

For the last 12 months, they've shown only a can-do attitude marked by creativity, ingenuity, intelligence, dedication and perseverance. With that, I'll turn it over to Gilbert..

savings in payroll costs as a result of wage subsidy program and reduction in corporate staff; reduced costs related to corporate airfare and travel as a result of COVID-19 restrictions; decrease in professional and legal services.

The decrease was further impacted by affirmation on an appeal by Nevada Supreme Court of $0.8 million cost judgment entered in favor of our company and James Cotter Jr. derivative litigation. The wage subsidy program expired on August 25, 2020 and March 27, 2021 in New Zealand and Australia, respectively.

For the fourth quarter 2020, income tax expense decreased by $0.1 million compared to the same period last year. Conversely, we experienced an income tax benefit of $5 million for the year ended December 31, 2020 compared to the same period of prior year.

This is primarily driven by the tax benefit from the carryback of our company 2019 net operating losses as a result of CARES Act to the 2015 and 2016 tax years where federal tax rate was 35%, offset by an increase in valuation allowance in 2020.

The carryback of 2019 net operating loss and the refund claim for 100% of the remaining alternative minimum tax credit resulted in a tax refund receivable of approximately $5.1 million after the filing of 2019 federal income tax return. The $5.1 million refund has been received as of January 31, 2021.

For the quarter of 2020, our adjusted EBITDA decreased by $16.1 million compared to the same prior year period to a negative adjusted EBITDA of $7.8 million. For the year ended December 31, 2020, our adjusted EBITDA declined by $72.9 million to a negative adjusted EBITDA of $38.9 million.

This decrease was primarily due to flow through of the net loss in the fourth quarter and for the year-to-date 2020 driven by COVID-19 related factors. Shifting to cash flow.

For the year ended December 31, 2020, net cash provided by operating activities decreased by $54.8 million to net cash used of $30.2 million when compared to the same prior year period. This was primarily driven by a $61.

5 million decrease in cash inflow from operating activities as well as a $6.4 million increase in cash inflow due to increase in net change in operating assets and liabilities.

Cash used in investing activities during the year ended December 31, 2020 was $18.8 million, mainly related to a $15.4 million spent on capital expenditures primarily in the U.S., with $10.1 million of that comprised mainly of the 44 Union Square redevelopment and Kahala refurbishment.

$4.4 million in Australia, comprised mainly of launch of Reading Cinemas at Jindalee and $0.9 million in New Zealand comprised mainly of the redevelopment of Courtenay Central and Manukau, which has now been sold.

Cash provided by financing activities was $59.3 million during the year ended December 31, 2020 and was mainly related to the net loan proceed of $60.4 million offset by the first quarter of 2020, repurchase of stock of $0.7 million as part of the 2017, $25 million stock repurchase program. Turning now to our financial position.

Our total asset at December 31, 2020 increased to $690.2 million compared to $675 million at December 31, 2019 primarily driven by the increase in cash and cash equivalent due to drawdown on our line of credit.

Management drew down the available operating borrowing capacity in the first quarter of 2020 and continue to maintain these borrowing levels throughout the second quarter. During the third quarter of 2020, we paid down $5.8 million on the Bank of America revolving credit facility.

We subsequently borrowed $2 million on this line in the fourth quarter of 2020. Therefore, $3.8 million was available at December 31, 2020. As of December 31, 2020, our total outstanding borrowings were $285 million.

Our cash and cash equivalent at December 31, 2020 were $26.8 million, which includes approximately $7.7 million in U.S., $6.3 million in Australia and $12.8 million in New Zealand. The required shutdown and other operating impact on our business due to COVID-19 pandemic related issue has severely reduced our liquidity from operating sources.

As part of our strategy to mitigate the impact of the pandemic subsequent to December 31, 2020, we monetized 2 of our assets, one in Manukau, New Zealand for NZD 77.2 million, and one in Coachella, California for $11 million. As a 50% member in Shadow View Land and Farming, LLC, the company was entitled to 50% of the Coachella net sale proceeds.

We have listed our real estate, Royal George through -- and Auburn Redyard ETC for sale in the first quarter of 2021. Further, we have successfully negotiated certain modification to our loan agreement with Bank of America, NAB and Westpac for the quarter ended December 31, 2020, and in some cases, into the future.

These loan modifications include changes to some of the covenant compliance terms and waivers to certain covenant testing period. We believe that our lenders understand that the current situation is not of our making that we are doing everything that can reasonably be done and that our relationship with our lenders is good.

On December 29, 2020, we modified the core portion of our revolving corporate market loan facility, increasing it to AUD 43 million. The AUD 3 million increase was provided to fund the completion of our recently opened cinema at Jindalee, Queensland, and repayable in installment by October 31, 2023.

This amendment increases the facility limit to AUD 123 million, which will be reduced back to AUD 120 million as the Jindalee funding is repaid. With respect to the Westpac facility, on December 8, 2020, Westpac waived the requirement to test the certain covenants as of December 31, 2020.

The longer the COVID-19 pandemic and the associated legal and practical limitation on our business exists, the more likely, in the absence of other actions by our company, that we will be unable to meet these covenants on a going-forward basis. However, the company expects to be able to obtain an amendment or waiver from its lenders.

But of course, no assurance can be given in this regard. In the absence of such waivers, it is our current intention to look to pay down or pay off these loans. As Ellen noted, in regards to our 44 Union Square property, on December 29, 2020, we extended the maturity of the loan to March 31, 2021 at an interest rate of 17.5%.

On March 26, 2021, we repaid the $40.6 million construction loan that asset is now held free and clear of financial institutional debt.

On March 29, 2021, we entered into a loan commitment letter with a third-party lender providing for refinancing of these property pursuant to a $55 million first mortgage loan, which would include $12 million to fund tenant improvement and leasing commission.

While again, no assurance can be given, we're currently anticipating that this loan will close this quarter. As we continue to be focused on preserving our liquidity, we do not repurchase any of our shares in the fourth quarter of 2020. For the full year 2020, we repurchased 75,157 shares at an average price of $8.92 per share.

With COVID-19 impact on our overall liquidity, our stock repurchase program has and will likely continue to take a lower capital allocation priority for the foreseeable future. With that, I will now turn it over to Andrzej..

Thanks, Gilbert. First, I'd like to thank our stockholders for forwarding questions to our Investor Relations email. In addition to addressing some of your questions in Ellen's discourse, we've also compiled a set of questions and answers representing the most common questions and recurring themes e-mailed to us.

The first question we received were quite a few regarding our former railroad property owned by Reading, adjacent to Reading Viaduct in Philadelphia, which has been the subject of a lawsuit filed by certain groups in the city of Philadelphia.

What are our plans with respect to the demolition and the future? Ellen, would you like to take that?.

Yes. Yes. For background, the Reading Viaduct and certain adjacent properties are legacy assets from Reading's days as a railroad. The Viaduct itself is an interconnected raised right-of-way stretching through blocks of downtown Philadelphia.

The Viaduct is in a core urban area, and the neighborhood surrounding the Viaduct have seen positive change in recent years, including the creation of the Rail Park, a usable and beautiful public space. We are contesting the lawsuit filed and we'll continue to explore all available options for these assets..

Thanks, Ellen. Now we have a couple of questions that, Gilbert, perhaps you can fill it for us.

The first one, can you give us a sense of the post-tax amount for the 2 divestitures? And what is the company's current tax estimate or NOL balance?.

Sure. On March 4, 2021, we sold our land in Manukau, New Zealand for NZD 77 million or USD 56 million. And our available cash after tax is approximately NZD 70 million and USD 50 million. On March 5, 2021, we sold our land in Coachella, California for $11 million.

And as a 50% owner of the land, our available cash after tax for the sale is approximately $5 million. At December 31, 2020, we have approximately $46 million of federal NOLs and $13 million of New Zealand NOLs or NZD 19 million..

Thanks, Gilbert.

And while you're there, at what point were returning CapEx to normalized levels make sense? And what are your priorities?.

Returning capital expenditures to normalized level makes sense only after our cinema and real estate business segments stabilize and begin returning to pre-COVID-19 operating levels. Until this happens, the company's primary focus continues to be effectively manage liquidity, conserve cash and defer capital expenditures..

And expanding on that managing of liquidity, understanding that the current environment requires cash conservation, can you remind us of your capital allocation priorities in a post-COVID world, Gilbert?.

As part of our overall liquidity management practices that dealt with the impact on our business of COVID-19 pandemic-related closure, we postponed or reprioritized capital expenditures based on assessments of conditions and liquidity requirements during this time.

With our long-term diversified business plan, which features 2 business in 3 countries, we have different approaches and exposures to this worldwide pandemic as the world reopens for business.

We continue to improve our operating efficiencies, negotiate with our landlords to defer or abate rents, work with our lenders from loan amendments and waivers, if needed, and defer capital improvement, except for costs related to completing 44 Union Square, our Kahala Theatre renovation in Hawaii, our new Reading Cinema in Jindalee and funding our second floor tenants at Culver City office building.

These measurements continue to be impacted by restriction placed in operating capacity and the availability of uninterrupted film product. As we return to full operations, we will continue to review and update, as needed, our capital allocation priorities..

Thanks, Gilbert.

What has been your experience so far with Angelika Anywhere PVOD platform? Do you have Angelika Anywhere a similar offering or no offerings down in New Zealand or Australia? Can you provide some metrics to measure the success and goals for future growth? Do you contemplate this as a temporary offering? Or will you continue it postpandemic? Ellen?.

Since its soft launch in December of 2020, Angelika Anywhere has been well received by our core Angelika Film Center customers. Based on customer surveys, our audience appreciates the curation element, the functionality and the library of amazing content, which we're continually adding to.

While our theaters were closed, Angelika Anywhere was an easy and seamless way for our core audience to access signature Angelika programming. And for the future, the platform will be a logical extension to our theatrical brand. We anticipate that it will be constantly woven into our strategic approach to the extension of the Angelika brand.

Today, this initiative is in its infancy stages. And due to our liquidity issues, we've not dedicated any funds other than internal resources to its promotion and marketing. So we won't share today any hard metrics or goals. But our current plan is to launch Angelika Anywhere in Australia and New Zealand later in 2021..

Thanks, Ellen. Most larger chains have a recurring payment subscription program for movie attendance and consumption discounts.

While they are on hold during the pandemic, how do you view the long-term viability of the subscription model for theater exhibition postpandemic? Since such a program could be integrated with a change PVOD streaming platforms like Angelika Anywhere, creating a mini Netflix, what thought have you given to establishing a subscription plan in general for Reading in your 3 countries and also to integrate such a program with Angelika Anywhere or other streaming offerings? If not, why do you feel such a plan won't work for Reading? Ellen?.

Well, pre-COVID, we had not launched a dedicated subscription plan as we wrestled with the economics of those plans, and with respect to the U.S., the diversity of our geographic footprint.

However, pre-COVID, our company did offer both loyalty programs and comprehensive value pricing schemes as a way to generate increased attendance to our theaters and dedication to our brands.

In a post-COVID environment and at a time when we have launched a streaming service in the U.S., and have plans for international expansion of that service, we'll again look holistically at our various guest offers and programs to determine the most creative ways to both increase the tenants to our theaters and now, increase users to our platform.

Over the next 12 months, we anticipate announcing new initiatives that we feel will be attractive to both our guests and build further loyalty to our brands while also taking into account our bottom line..

Thanks, Ellen. And I filled this final question myself. Explain how the related party transactions with certain low capital and affiliate of the Cotter family interest that were called out in the 10-K with respect to both Cinemas, 1, 2 and 3 and Village East are fair to Reading and its independent shareholders.

Well, both of these transactions relate back to an agreement made way in July 2000, which gave us access to both of these properties, which were, at the time, subject to long-term leases by Sutton Hill Capital.

With the Cinemas 1, 2 and 3, we ultimately acquired the leasehold interest under this agreement and with our 25% partner, Sutton Hill Capital, then went on to acquire the freehold interest. Something that would have not been possible without the Sutton Hill agreement.

We are pleased by the interest shown in this property by our stockholders as we believe this asset will provide them significant long-term value. The Village East is following a similar path with a currently delay due to COVID-19 exercise of the final $5.9 million option to acquire the leasehold interest in that property.

This will provide Reading stockholders with interest in 2 strategic New York properties. More specifically, during 2020 and the year-to-date, we've carefully managed our liquidity. The 2020 and 2021 transaction described in the related party transaction footnote, assisted us in meeting our domestic liquidity requirements.

Each transaction was reviewed and approved by a Conflicts Committee, comprised entirely of independent directors. More specifically, on March 13, 2020, we refinanced our Cinemas 1, 2 and 3 loan with Valley National Bank, increasing the availability on that facility from $20 million to $25 million.

This increase in capacity enabled us to make a $1 million distribution, $750,000 to us and $250,000 to our 25% minority member in October of 2020. In November 2020, we closed out our right to receive certain incremental management fees with respect to the Cinema 1, 2 and 3 in consideration of a onetime cash payment of $112,500.

We also transferred all of our right, title and interest in certain personal property and equipment at that cinema. We considered tax benefits of the continued depreciation of these assets to be of no practical value.

On March 29, 2021, we extended the closing of our acquisition of the ground lease underlying our Village East Cinema to January 1, 2023, thereby deferring our obligation to pay the $5.9 million acquisition price. In the interim, we continue to lease this property.

We are grateful that we have a -- we have a good relationship with our minority member, Sutton Hill Capital, without whose cooperation, we would not have had the flexibility we enjoyed in meeting these liquidity challenges. So with that, that marks the conclusion of the call. We appreciate, as always, you listening to the call today.

Thank you for your attention and wish everyone good health and safety..