Cineplex Blows Past Records, Sets Course for Target Leverage
Record Q2 revenue, double-digit EBITDA growth, and a clear path to 2.5-3x leverage highlight whether the exhibition revival is finally here.
CGX.TO · Earnings Call · 2026-08-11
A Defining Quarter
“We delivered total revenue of $383.7 million resulting in a new second quarter revenue record and growing nearly 10% year over year.” — Ellis Jacob FCPA, President and Chief Executive Officer · 2026-08-11 That set the tone. Attendance rose 9.3% to 12.7 million guests, and the company converted that into a 20.4% jump in adjusted EBITDA to $40.8 million. “The disproportionate growth in adjusted EBITDA relative to revenue reflects the operating leverage in our business...” — Gord Nelson, Chief Financial Officer · 2026-08-11 This is the crux of the story: every incremental guest brings high-margin revenue.Beyond the Box Office
Cineplex is no longer just an exhibitor. Cineplex Pictures distributed Michael, the highest-grossing film in its history, and upcoming titles like Godzilla Minus 1 and The Hunger Games: Sunrise on the Reaping cement its role. Merchandise became a breakout category, with sales up 45% year over year and a new quarterly record. The red popcorn purse from Devil Wears Prada 2 sold out immediately, and quarterly record concession per patron hit $10.26. As Gord explained, “So, you know, we call it that as being a record with growth and representing roughly, you know, a significant portion of the overall CPP growth.” — Gord Nelson, Chief Financial Officer · 2026-08-11 LBE remains soft, but the company opened Playdium in Vaughan and is confident in long-term potential. “We did see food and beverage increases... Amusement is the highest margin revenue category in that business.” — Gord Nelson, Chief Financial Officer · 2026-08-11 This mix shift is worth watching.Deleveraging and the Path to Returns
Gord highlighted that leverage has fallen 1.5 turns over the past year and a half, and the target is in sight.With domestic box office tracking toward $10 billion for the year, the company could hit that range by Q4 results. That would unlock both NCIB activity and the reintroduction of a dividend. Ellis confirmed his retirement timeline, “I am preparing to retire by the end of the year. And the Board is managing the process and it is well underway.” — Ellis Jacob FCPA, President and Chief Executive Officer · 2026-08-11 The succession plan is on track, and the team remains focused. Prior quarters have telegraphed this inflection. “2026, we look upon it being a strong year, and there's a lot of distribution of product.” — Ellis Jacob, President and Chief Executive Officer · 2025-11-06 And on media, “We had adopted programmatic slowly ramping it up over the past year or so...” — Gord Nelson, Chief Financial Officer · 2026-02-11 Now the company is harvesting those seeds.we have improved visibility toward achieving our long term target leverage ratio of 2.5 to 3x which we believe is achievable in the near term.