Thank you for joining Reading International's earnings call to discuss our 2022 Third 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 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 2022 third quarter earnings release, on our company's website.

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

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

In today's call, we'll also use an industry accepted financial measure called theater level cash flow TLCF, which is a theater level revenue, less direct theater level expenses. We will also use a measure referred to as food and beverage, F&B, spend per patron, SPP, which is a key performance indicator for our cinemas.

The F&B SPP is calculated by dividing a cinema's revenues generated by food and beverage sales, by the number of admissions at that cinema. Please note that our comments are necessarily summary nature. And anything we say is qualified by the more detailed disclosure set forth in our Form 10-Q, 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 our 2022 third quarter results and discuss our strategies for navigating Reading through the post-COVID operating landscape, followed by Gilbert, who provide a more detailed financial review. Ellen..

Love and Thunder, which was directed by Kiwi, Taika Waititi and popular Aussie director Baz Luhrmann directed Elvis, which was also filmed in Australia. During the third quarter of this year, our team continued to deliver impressive F&B results in Australia. At $7.32 in Australian dollars, our F&B SPP. ranks as the highest quarter ever.

To generate an SPP this high during a well attended quarter bodes well for the prospects of our F&B business into the future. In Australia, we've rolled out both F&B online ordering capability for our customers, and a feature which allows customers to order online via QR codes in the cinema.

Our internal sales reporting suggests that these operational amenities have been embraced by our audiences, and have contributed to a healthy increase in the food and beverage, SPP. Because the sales are completed online, another benefit is improved labor costs due to reduced concession lines.

In the fourth quarter we will further enhance our online offer by developing functionality whereby customers can come back and add an F&B order to their advanced ticket purchase after they've made their initial ticket purchase. As we've reported before we continue to expand our cinema portfolio and pipeline in Australia.

We're finishing the design of an eight-screen complex to be operated under the Angelika Film Center brand in South Sydney Square, Brisbane and Queensland. It will feature all recliner seating, offer an elevated food and beverage menu which includes alcohol with an elegantly appointed lobby and patio area.

We're all excited about launching this boutique cinema that will be unique to the Brisbane market, which will now open in 2023. And by the end of 2023, we expect to launch a five-screen Reading cinema with TITAN LUX in Busselton, Western Australia.

And wrapping up with New Zealand, with respect to the third quarter of this year, our cinema revenues increased by 51% to $3.7 million compared to the third quarter in '21 and represents 64% of the third quarter 2019 cinema revenue. Our cinema segment operating income increased over 100% to $274,000 compared to Q3 '21.

Like Australia we will note that the positive New Zealand cinema circuit results are reflected in U.S. dollars and not Kiwi dollars. Because they're not reflected in functional currency, they're somewhat understated due to the third quarter of 2022 weakness of the New Zealand dollar.

And highlighting the strength of our F&B team, at $6.28 in New Zealand dollars, our F&B SPP, ranked as the highest quarter ever. Like Australia our internal reporting suggests that the improvements to our F&B online ordering capabilities helped with these positive results.

In terms of portfolio improvements in New Zealand, just in time for the 2022 holiday season, we'll reopen our Reading cinemas in Invercargill, following a renovation that features one screen of recliner seating, a new lobby, elevated F&B program and a connection to the Invercargill Central, a new $165 million shopping center, developed by the consortium that bought our underlying land in 2021, and then leased back our Reading cinema to us.

This impressive mixed-use project will be completed by the end of 2022, and will feature national retail brands, hospitality, residential and office and will effectively serve as the new vibrant and bustling center of the Invercargill CBD. Now let's turn to our real estate business. Our improved third quarter 2022.

Operational results demonstrate that this business continues to establish long term value for our stockholders.

This is the first third quarter to fully reflect the elimination of all rental revenue and income from the sales of Auburn/Redyard, Invercargill and the Royal George Theatre in Chicago, and the carrying costs of our land holding in Coachella, California and Manukau New Zealand, all assets we held for decades, and were monetized in order to survive the devastating impacts of the pandemic.

Note that as of September 30 of this year, following the monetization of these assets our international property portfolio still reflects 74 third party tenants, nine owned Reading cinemas, about 250,000 square feet of gross lettable area with a 95% occupancy rate.

At $4.1 million, our third quarter 2022 total global real estate revenue increased 28% over the third quarter of last year. Our total global real estate operating loss reduced by 90% to a loss of $144,000. A few factors drove these Q3 improvements.

We restarted charging internal rent to our owned Reading cinemas in Australia and New Zealand following a period of abatement in 2021 due to the pandemic, consistent and steady third party rental streams from our Australian properties such as Newmarket Village, Cannon Park and the Belmont Common.

We're pleased to report that at the end of the third quarter both our office building at Newmarket Village and retail at Belmont Common are now 100% occupied, which increased our overall property portfolio occupancy rate to 95%.

And reflecting the strength of our well curated property portfolio due to some third party tenants trading above their sales threshold, we earned percentage rent in the quarter. We should further point out that these improved quarterly results are reported in U.S. dollars and reflect the headwinds of foreign currency translation impacts.

They reflect the payment of certain 44 Union Square expenses even though we haven't begun to collect straight line right yet, and again, reflect the elimination of long held real estate assets that generated both rental revenue and income for us. Taking into account all of these drivers, I'll touch on each country's Q3 2022 results.

In Australia, our real estate revenue increased by 32% to $3.2 million versus the third quarter last year.

And real estate segment operating income increased by over 100% to $1.4 million compared to the third quarter in '21 In New Zealand real estate revenue increased by 70% to $400,000, compared to the third quarter of '21, and our operating loss shrank by 34% to a loss of $300,000 compared to the third quarter of '21. In the U.S.

real estate revenue decreased by 5% to a $0.5 million, versus the third quarter of '21. And our real estate operating loss reduced by 19%, compared to the same period in 2021, to a loss of $1.2 million.

On a final note, during the third quarter of this year, as per the terms of our existing agreement, Audible an Amazon company opted to extend its license agreement for the Minetta Lane Theatre in New York through March of 2024, which allows Audible to continue to produce and exhibit their own content at the Minetta Lane.

During the third quarter of 2022, our global property team progressed our key development projects. At 44 Union Square in New York City in October, we substantially completed our landlord work on the seller ground and second floors for our new international retail tenant.

The space has now been turned over to our tenant to complete their fit out for their new New York City flagship store. We expect cash rent to begin flowing before the end of December 2022 and anticipate their grand opening in early 23. Our exclusive leasing agents CBRE has been working to lease the remaining four floors.

While no assurances can be given, through CBRE's efforts we've been in discussions and trading term sheets with prospective tenants interested in leasing the entirety of the remainder of the space.

Each has interesting uses that we see could work well and are unique and brandable space, and each would exploit both the building's one of a kind 800 piece glass dome roof, and location as the iconic and monumental Northeast anchor to Union Square Park in New York City. Prospective tenants are looking for specialty space, not generic office space.

So we don't believe we're in direct competition with traditional office landlords generally in the Union Square market. With respect to our Wellington, New Zealand property assets, we have 161,000 square feet of land, of which 85,000 square feet is improved with our Courtney Central building.

Our Courtney Central building includes 54,000 square feet of retail space and our 10 screen Reading cinema which remains temporarily closed for seismic reasons. Our parcels in the creative heart of New Zealand's capital city are within walking distance of the expansive Wellington Harbor and Te Papa New Zealand's national museum.

In the third quarter of this year, we settled our arbitration with a potential supermarket tenant with whom we had signed an agreement to lease in 2013.

So after a decade of working with them, which saw the intervention of the Kaikoura earthquake, and the resulting loss of our nine storey parking garage, each party has agreed that the contract is terminated and to bear their own costs.

This pivotal settlement which has provided us a path to freely and strategically work with various stakeholders, potential tenants development partners and governmental groups to advance and overall rethinking and master plan for our properties and to reestablish our assets as the key Wellington destination for film, families and fun.

When our Reading cinemas in Wellington was open, it consistently ranked as one of the top highest grossing cinemas in the country. Our plan would be to complete a top to bottom renovation of this theater with full luxury recliners, beautifully renovated lobby spaces and an elevated F&B experience.

While the timing of this settlement and the ability to master plan comes at a time when the macroeconomic conditions are not ideal, it does come at a time when the Wellington City Council is preparing to further elevate Wellington's status as both the arts and cultural capital of New Zealand and one of the most livable cities in the world.

In mid-July 2022, the Wellington City Council sought comments on its proposed district plan that outlines the strategic priorities for Wellington City and looks at its major planning and environmental issues, including housing supply, growth and infrastructure, biodiversity, climate change and natural hazards.

With the closure of the original submission period in mid-September 2022, the city will summarize and seek further submissions in November of 2022. Tākina, the beautiful new state-of-the-art Convention and Exhibition Center, across the street from our properties and owned by the Wellington City Council is on track to open in mid-2023.

A few months ago, it was publicly reported that almost 80 events are already booked. Our executive team recently got a tour of the building and can confidently report it's a stunning architectural accomplishment that has changed the look of the Wellington skyline. The St.

James Theatre, which is also owned by the Wellington City Council directly across the street from Courtney Central, and the crown jewel of Wellington's live performance scene reopened in July of 2022 after a three year renovation and seismic strengthening.

Next year, the theater will bring not only Kinky Boots, but will also mount Wicked, one of Broadway's biggest shows for the first time in Wellington. We believe that these developments have all added value to our holdings. And we expect to report more concretely about our development progress in Wellington during the first part of 2023.

Now before I turn it over to Gilbert for a financial review of the third quarter, on behalf of Margaret, our Board and myself, we want to again extend our sincerest appreciation to the global Reading team. Our team continues to work tirelessly through unprecedented times. We know we're not out of the woods yet.

But it's the consistent diligent and thoughtful efforts of our team that are responsible for ensuring our company and its various divisions reach a more stabilized position for our stockholders. Again, thank you..

Thank you Ellen. Consolidated revenues for the third quarter of 2022 increased by 61% to $51.2 million, when compared to the same period of prior year, which is 73% of comparable 2019 pre-pandemic revenue for the same quarter.

Consolidated revenues for the nine months ended September 30, 2022 increased by 75% to $155.9 million when compared to the same period last year, which is 75% of comparable 2019 pre-pandemic revenue for the same nine months period.

These increases were attributable to a strong film slate as well as substantially all our cinemas operating during the first nine months of 2022 compared to the same period in 2021 when a portion of our cinemas were closed due to local government COVID mandates for part of the reporting period.

Net loss attributable to our company for the quarter, ended September 30, 2022 improve by $4.9 million, a loss of $5.2 million when compared to the same period in 2021. Basic loss per share was $0.23 for the quarter ended September 30, 2022 compared to a basic loss per share of $0.46 for the quarter ended September 30, 2021.

This was primarily due to an increase in cinema revenue related to a much stronger film slate, which drove higher attendance, partially offset by the weakening of the Australia and New Zealand dollars. During the third quarter of 2022 both Australia and New Zealand dollars devalued against U.S. dollars.

The average Australian dollar exchange rate against the U.S. dollar for the three months in Q3 2022 decreased 7% compared to the same period in 2021. The average Zealand dollar exchange rate against the U.S. dollar for the three months in Q3 2022 decreased 12.5% compared to the same period in 2021.

The devaluation of the Australia and New Zealand currency, negatively impacts segment operating income and positively impacts segment operating loss in U.S. dollar terms.

Net income attributable to Reading International, Inc., for the nine months ended September 30, 2022 decreased by $54.5 million from an income of $31.6 million to a loss of $23 million when compared to the same period in 2021.

Basic loss per share was $1.04 for the nine months ended September 30, 2022 compared to the basic earnings per share of $1.45 for the nine months ended September 30, 2021. This was mainly due to the sale of assets during the same nine months of the prior year partially offset by our increased cinema income and decreased income tax expense.

For the third quarter of 2022, income tax expense increased by $1.2 million to $0.3 [ph] million compared to the COVID impaired prior year period, primarily related to an increase in valuation allowance and partially offset by a decrease in GILTI tax in 2022.

For the nine months ended September 30, 2022, income tax expense decreased by $10.9 million to income tax expense of $1.5 million compared to the equivalent prior year period.

The change between 2022 and 2021 is primarily due to a decrease in pre-tax income in 2022, mainly due to the non-recurring monetization of assets in 2021 that were not repeated in 2022 as well as changing GILTI tax valuation allowance and unrecognized tax benefit in 2022.

Turning now to our cash flow, for the nine months ended September 30, 2022, net cash used in operating activities increased by $8.4 million to $26.1 million when compared to the same period in 2021.

This was driven by $39.4 million increase in net change in operating assets and liabilities primarily resulting from taxes payable and accounts payable and accrued expenses offset by $31.1 million decrease mainly attributable to the improved cinema operating performance compared to the prior year period.

Cash used in investing activities during the nine months ended September 30, 2022, was $6.4 million. There was no repeat of the monetization of certain assets in the nine months to September 30, 2021, which led to a rise of $133.7 million of cash from investing activity in this period.

Cash used in financing activities decreased by $33 million to $7.9 million during the nine months ended September 30, 2022 primarily due to using proceeds from asset sales to pay down debt as well as paid off non-controlling interest in 2021.

Shifting to our financial position, our total assets on September 30, 2022 were $589.7 million compared to $687.7 million on December 31, 2021. This $98 million reduction was primarily driven by a decline in cash and cash equivalent by which we fund our ongoing business operation and paid down debt, asset depreciation and amortization of leases.

As of September 30, 2022 our total outstanding borrowings were $219.4 million compared to $236.9 million on December 31, 2021. This decrease was due to the pay down of debt, and foreign exchange rate impact on our non-U.S. debt. Our cash and cash equivalents as of September 30, 2022, were $39.6 million.

We exercised the second six months extension for our Raleigh [ph] National Loan. After balance date, but before filing the Q, we were also extending the closing of our agreements to purchase the ground lessee interest underlying of Village East Cinemas $5.9 million to July 1, 2024. We are currently in compliance with our loan covenants.

While no assurance can be given, we believe that our relationship with our various lenders are good, and anticipate that we'll either refinance or obtain extension for the current portion of our debt. We continue to be in compliance with the terms of our loan agreement without the need for additional loan modifications.

We believe that our lenders continue to understand our current situation relating to COVID-19 pandemic and its aftermath, knowing that it was clearly not of our making, and that we are doing everything we can to deliver on our strategic priorities. We feel that we can continue to have good relationship with our lenders.

We did not repurchase any shares in the third quarter of 2022. Due to the COVID-19 pandemic and its impact on our overall liquidity, our stock repurchase program has and will likely continue to take lower capital allocation priorities for the foreseeable future. I will now turn it over to Andrzej..

Thank you, Gilbert. As usual, for those questions that we did not address in the presentations by Ellen and Gilbert, we've put together three or four questions that we will address now.

The first one of those, which Ellen will take, what are you hearing and seeing with respect of an increase in the quantity of film to be premiered in theaters, versus reduced number of film studios, have directed to theaters even now post pandemic.

Ellen?.

Across the Spider-Verse, Universal will release Super Mario Brothers, another Fast and Furious movie and Chris Nolan's Oppenheimer. And Tom Cruise returns with another highly anticipated Mission Impossible.

Clearly, I haven't offered an exhaustive list of strong Hollywood titles, but just this list alone is encouraging from a quantity, quality and grossing perspective. I also think there's room in the future for unique content to continue filling out the release schedule.

In our markets over the last few pandemic years, we've enjoyed noteworthy grosses from non-studio content like Annie Mae, Indian films or local films from Australia and New Zealand. Into the future, our circuit will continue to seek out this content and try and maximize the gaps in the release schedules..

Thank you, Ellen. The second question relates to $5.9 million purchase price under the option for the Village East ground lease. As that lease continues to amortize off, if no adjustment to the purchase price, have the rents the theater has been paying to related party Sutton Hill Capital already been adjusted down to just the ground lease costs.

Gilbert?.

We exercised this option on August 28, 2019. Accordingly, we're legally obligated to close. Due to cash constraint however, we have negotiated various extension of our obligation to close, most recently to July 1, 2024..

Thanks, Gilbert. We received several questions about the status of the Cinemas 1, 2 and 3 and the company's development plans. Stockholders have inquired as to why we have not sold the building and used the proceeds to repurchase shares.

Ellen?.

We believe that our Cinema 1, 2, and 3 building in New York City, which is located on Third Avenue across the street from Bloomingdale's continues to be a key long term asset. Right now we're operating the building as a three screen cinema.

And we've determined it's not the optimal time to shut down a cash flowing venue and commence redevelopment and/or to commence the sale process, when the New York City prices have been negatively impacted by the pandemic, and now the current macroeconomic environment. Accordingly, this asset is not held-for-sale.

At the current time, we're also engaged in the negotiation of various loan extensions, re-financings and rent modifications. While we share the view that our shares are materially underpriced, in light of the company's current conditions in negotiations, we don't believe now's the time to activate our stock repurchase program..

And keeping in line with the stock repurchase program, our final question is an amalgam of questions centered on the company's willingness and ability to repurchase the stock.

What better use of money is there than buying back shares at these prices? In light of the very cheap RDI stock price, what additional assets could be monetized and used to pay down costly and/or near term debt and thereafter fund the buyback of more deeply undervalued RDI shares? And are there any loan covenants preventing share repurchases? Let me address this.

As mentioned in prior earnings calls, we still must face the reality of the COVID effect, ebbing though it may be.

Based on our reported numbers, we have supported our business in the first nine months of 2022 to the tune of some $25 million excluding debt repayment and including what we would consider minimal investment in the CapEx need of our business. We are working diligently with our lenders to minimize the impacts of current debt repayment schedules.

We had an unrestricted cash balance of approximately $14 million on September 30, 2020. The aforementioned the dollar amounts remained substantially unchanged from June 30 of this year. As stewards of our shareholders money, we need to be certain that what has so far been a strong recovery from the COVID era is sustainable for the future.

And we must avoid being placed in a position of either having to sell more assets, taking on expensive debt and/or diluting existing shareholders by issuing stock.

Whilst there are no direct loan covenants that would preclude us from repurchasing our stock on the open market, we are in the process of renegotiating various lending arrangements, and we do have liquidity covenants to consider.

We believe that our lenders take comfort from our cash balances, even though they do not have any security interest in such deposits. Management reviews and discusses our cash position and capital allocation on an almost daily basis. And buying back a bunch of our shares continues to be an option that forms part of those discussions.

We continue to balance the needs of the business so that there is a business to manage in the future against the opportunity currently afforded to us based on the current stock price. .

So that marks the conclusion of the call. As usual, we appreciate your listening to the call today. Thank you for your attention, and we wish everyone good health and safety..