Reading International (RDI) grows revenue but faces heavy near-term debt load
Rhea-AI Filing Summary
Reading International, Inc. reported stronger operating results for the quarter ended June 30, 2026 while continuing to face tight liquidity and a highly leveraged balance sheet. Total revenue for the quarter rose to $66.9 million, up from $60.4 million a year earlier, driven mainly by higher cinema revenue in Australia. Quarterly operating income increased to $7.5 million from $2.9 million, and net income attributable to Reading improved to a profit of $2.3 million, compared with a $2.7 million loss in the prior-year quarter.
For the first six months of 2026, revenue was $112.0 million versus $100.5 million in 2025, and the net loss attributable to Reading narrowed to $5.9 million from $7.4 million. Cash and cash equivalents were $5.7 million at June 30, 2026 versus $10.5 million at year-end, and the company reported negative working capital of $157.4 million, including $108.0 million of debt due within twelve months. Management is pursuing refinancing and real estate monetization, and based on these plans and recent progress, concludes that it is probable sufficient liquidity will be raised such that substantial doubt about the company’s ability to continue as a going concern is alleviated under ASC 205‑40.
Positive
- Revenue and profitability improved: Quarterly revenue rose to $66.9 million from $60.4 million, with operating income increasing to $7.5 million from $2.9 million and net income swinging to a $2.3 million profit from a loss.
- Cash flow from operations turned positive: Net cash provided by operating activities for the first six months of 2026 was $0.7 million, compared with negative $6.2 million in the prior-year period.
Negative
- Significant near-term debt and negative working capital: The company has $108.0 million of debt due within twelve months, cash of $5.7 million, and negative working capital of $157.4 million, highlighting ongoing liquidity pressure.
- Negative equity position: Total Reading International stockholders’ equity was negative $23.3 million at June 30, 2026, compared with negative $18.2 million at December 31, 2025, indicating liabilities exceed assets attributable to common shareholders.
Filing Explained
At June 30, the filing leaves existing holders with a larger Class A share base and a balance sheet showing negative equity.
As of
Current liabilities were
The equity rollforward records Class A nonvoting shares issued as restricted stock units; Class A shares outstanding were 21,209,537 at June 30 versus 21,036,670 at December 31.
Under the supplied dilution definition, additional shares increase the total share count and reduce an existing holder’s percentage ownership absent offsetting changes; the disclosed issuance therefore expands the Class A share base for existing holders.
The filing’s named milestones are the October 1, 2026 Santander and Valley National maturities, the November 6 Emerald Creek maturity with extension options, and the December 21 Bank of America maturity, alongside the planned liquidity actions.
Key Figures
Key Terms
ASC 205-40 Going Concern financial
negative working capital financial
real estate asset monetization financial
segment operating income financial
inter-segment revenue financial
right-of-use assets financial
FAQ
How did Reading International (RDI) perform financially in the quarter ended June 30, 2026?
What is Reading International’s (RDI) liquidity position and near-term debt load?
Did Reading International (RDI) generate positive operating cash flow in the first half of 2026?
What is the status of Reading International’s (RDI) going concern assessment?
How leveraged is Reading International (RDI) as of June 30, 2026?
How did Reading International’s (RDI) cinema segment perform by geography?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM
(Mark One)
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended:
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ___________ to ___________
Commission file number
(Exact name of Registrant as specified in its charter)
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State or other jurisdiction of incorporation or organization) | (IRS Employer Identification Number) |
(Address of principal executive offices) |
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Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer ¨ Accelerated Filer ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of August 13, 2026, there were
READING INTERNATIONAL, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
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| Page |
PART I - Financial Information | 3 |
Item 1 – Financial Statements | 3 |
Condensed Consolidated Balance Sheets (Unaudited) | 3 |
Condensed Consolidated Statements of Operations (Unaudited) | 4 |
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) | 5 |
Condensed Consolidated Statements of Stockholders’ Equity (Unaudited) | 6 |
Condensed Consolidated Statements of Cash Flows (Unaudited) | 7 |
Notes to Condensed Consolidated Financial Statements (Unaudited) | 8 |
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations | 30 |
Item 3 – Quantitative and Qualitative Disclosure about Market Risk | 50 |
Item 4 – Controls and Procedures | 51 |
PART II – Other Information | 52 |
Item 1 – Legal Proceedings | 52 |
Item 1A – Risk Factors | 52 |
Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds | 52 |
Item 3 – Defaults Upon Senior Securities | 52 |
Item 4 – Mine Safety Disclosure | 52 |
Item 5 – Other Information | 52 |
Item 6 – Exhibits | 53 |
SIGNATURES | 54 |
Certifications |
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PART 1 – FINANCIAL INFORMATION
Item 1 - Financial Statements
READING INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except share information)
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ASSETS |
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Current Assets: |
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Cash and cash equivalents |
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Restricted cash |
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Receivables |
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Inventories |
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Prepaid and other current assets |
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Asset groups held for sale |
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Total current assets |
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Operating properties, net |
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Operating lease right-of-use assets |
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Investment in unconsolidated joint ventures |
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Goodwill |
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Intangible assets, net |
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Deferred tax asset, net |
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Other assets |
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Total assets |
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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Current Liabilities: |
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Accounts payable and accrued liabilities |
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Film rent payable |
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Debt - current portion |
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Subordinated debt - current portion |
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Derivative financial instruments - current portion |
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Taxes payable - current |
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Deferred current revenue |
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Operating lease liabilities - current portion |
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Other current liabilities |
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Total current liabilities |
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Debt - long-term portion |
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Subordinated debt, non-current portion |
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Noncurrent tax liabilities |
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Operating lease liabilities - non-current portion |
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Other liabilities |
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Total liabilities |
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Commitments and contingencies (Note 16) |
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Stockholders’ equity: |
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Class A non-voting common shares, par value $ |
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Class B voting common shares, par value $ |
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Nonvoting preferred shares, par value $ |
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or outstanding shares at June 30, 2026 and December 31, 2025 |
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Additional paid-in capital |
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Retained earnings/(accumulated deficit) |
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Treasury shares, at cost |
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Accumulated other comprehensive income |
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Total Reading International, Inc. stockholders’ equity |
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Noncontrolling interests |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity |
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See accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.
READING INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited; U.S. dollars in thousands, except per share data)
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Revenue |
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Cinema |
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Real estate |
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Total revenue |
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Costs and expenses |
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Cinema |
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Real estate |
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Depreciation and amortization |
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General and administrative |
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Total costs and expenses |
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Operating income (loss) |
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Interest expense, net |
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Gain (loss) on sale of assets |
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Other income (expense) |
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Income (loss) before income tax expense and equity earnings of unconsolidated joint ventures |
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Equity earnings of unconsolidated joint ventures |
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Income (loss) before income taxes |
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Income tax benefit (expense) |
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Net income (loss) |
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Less: net income (loss) attributable to noncontrolling interests |
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Net income (loss) attributable to Reading International, Inc. |
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Basic earnings (loss) per share |
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Diluted earnings (loss) per share |
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Weighted average number of shares outstanding–basic |
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Weighted average number of shares outstanding–diluted |
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See accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.
READING INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Unaudited; U.S. dollars in thousands)
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| Quarter Ended |
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| 2025 |
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Net income (loss) |
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Foreign currency translation gain (loss) |
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Gain (loss) on cash flow hedges |
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Other |
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Comprehensive income (loss) |
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Less: net income (loss) attributable to noncontrolling interests |
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Less: comprehensive income (loss) attributable to noncontrolling interests |
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Comprehensive income (loss) |
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See accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.
READING INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited; U.S. dollars in thousands)
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| Common Stock |
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| Accumulated | Reading |
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| Class A | Class A | Class B | Class B | Additional | Earnings |
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| Other | International Inc. |
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| Non-Voting | Par | Voting | Par | Paid-In | (Accumulated | Treasury | Comprehensive | Stockholders’ | Noncontrolling | Stockholders’ | |||||||||
(Dollars in thousands, except shares) | Shares | Value | Shares | Value | Capital | Deficit) | Shares | Income (Loss) | Equity | Interests | Equity | |||||||||
At January 1, 2026 | | $ | | | $ | | $ | | $ | ( | $ | ( | $ | ( | $ | ( | $ | | $ | ( |
Net income (loss) | — |
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Other comprehensive income, net | — |
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Share-based compensation expense | — |
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At March 31, 2026 | | $ | | | $ | | $ | | $ | ( | $ | ( | $ | ( | $ | ( | $ | | $ | ( |
Net income | — |
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Other comprehensive income, net | — |
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Share-based compensation expense | — |
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Restricted Stock Units | |
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At June 30, 2026 | | $ | | | $ | | $ | | $ | ( | $ | ( | $ | ( | $ | ( | $ | | $ | ( |
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(Dollars in thousands, except shares) | Shares | Value | Shares | Value | Capital | Deficit) | Shares | Income (Loss) | Equity | Interests | Equity | |||||||||
At January 1, 2025 | | $ | | | $ | | $ | | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( |
Net income (loss) | — |
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Other comprehensive income, net | — |
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At March 31, 2025 | | $ | | | $ | | $ | | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( |
Net income | — |
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Other comprehensive income, net | — |
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At June 30, 2025 | | $ | | | $ | | $ | | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( |
See accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.
READING INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited; U.S. dollars in thousands)
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Operating Activities |
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Net income (loss) |
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Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
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Equity earnings of unconsolidated joint ventures |
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Distributions of earnings from unconsolidated joint ventures |
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(Gain) loss recognized on foreign currency transactions |
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(Gain) loss on sale of assets |
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Amortization of operating leases |
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Amortization of finance leases |
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Change in operating lease liabilities |
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Change in net deferred tax assets |
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Depreciation and amortization |
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Other amortization |
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Stock based compensation expense |
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Net changes in operating assets and liabilities: |
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Receivables |
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Prepaid and other assets |
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Payments for accrued pension |
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Accounts payable and accrued expenses |
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Film rent payable |
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Taxes payable |
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Deferred revenue and other liabilities |
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Net cash provided by (used in) operating activities |
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Investing Activities |
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Purchases of and additions to operating and investment properties |
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Contributions to unconsolidated joint ventures |
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Proceeds from sale of assets |
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Net cash provided by (used in) investing activities |
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Financing Activities |
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Repayment of borrowings |
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Repayment of finance lease principal |
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Capitalized borrowing costs |
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(Cash paid) proceeds from the settlement of employee share transactions |
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Net cash provided by (used in) financing activities |
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Effect of exchange rate on cash and restricted cash |
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Net increase (decrease) in cash and cash equivalents and restricted cash |
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Cash and cash equivalents and restricted cash at the beginning of the period |
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Cash and cash equivalents and restricted cash at the end of the period |
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Cash and cash equivalents and restricted cash consists of: |
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Cash and cash equivalents |
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Restricted cash |
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Supplemental Disclosures |
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Interest paid |
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Income taxes (refunded) paid |
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Non-Cash Transactions |
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Additions to operating and investing properties through accrued expenses |
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See accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.
READING INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
As of and for the six months ended June 30, 2026
Our Company
Reading International, Inc., a Nevada corporation (“RDI” and collectively with our consolidated subsidiaries and corporate predecessors, the “Company,” “Reading,” and “we,” “us,” or “our”) was incorporated in 1999. Our businesses consist primarily of:
the development, ownership, and operation of cinemas in the United States, Australia, and New Zealand; and
the development, ownership, operation and/or rental of retail, commercial and live venue real estate assets in Australia, New Zealand, and the United States.
Going Concern
We continue to evaluate the going concern assertion required by ASC 205-40 Going Concern as it relates to our Company. The evaluation of the going concern assertion involves considering whether it is probable that our Company has sufficient resources, as at the issue date of the financial statements, to meet its obligations as they fall due for twelve months following the issue date. Should it be probable that there are not sufficient resources, we must develop plans to overcome that shortfall. We must then determine whether it is probable that our plans will be effectively implemented and will mitigate the consequential going concern substantial doubt.
We have $
While we believe that, with an increase in the quantity and quality of films being released to cinemas compared to pre-pandemic levels, patronage and operating revenue levels will improve, we have no control over attendance levels and no assurances can be given as to the nature of the reception of future movies by the movie-going public.
We continue the process of refinancing and/or extending certain loans, as further discussed in Note 13, Borrowings. In summary, we have extended the maturity dates on, or otherwise amended, the following facilities (stated gross of direct financing costs):
-Santander $
-Bank of America $
-Valley National $
-Emerald Creek $
-NAB $
We have retained an advisor to assist with the refinancing of our $
We intend to raise the liquidity necessary for the next twelve months from refinancings and real estate asset monetization. Management has been authorized to pursue such actions where necessary. In February 2026, we began the process of monetizing our Cinemas 1,2,3 property. We believe we have more than sufficient marketable real estate assets that can be monetized on a timely basis and at the values required to meet our funding needs over the next twelve months. Having sold nine property assets with combined proceeds of $
In conclusion, as of the date of issuance of these financial statements, based on our evaluation of ASC 205-40 Going Concern and the current conditions and events, considered in the aggregate, and our various plans for enhancing liquidity and the extent to which those plans are progressing, we conclude that our plan to raise sufficient liquidity, primarily through certain real estate asset monetizations to the extent needed is probable of being implemented to the extent required such that this alleviates the substantial doubt about our Company’s ability to continue as a going concern.
Impairment Considerations
Our Company considers that the events and factors described above constitute impairment indicators under ASC 360 Property, Plant and Equipment (“ASC 360”). At December 31, 2025, our Company performed a quantitative recoverability test of the carrying values
of all its asset groups. Our Company estimated the undiscounted future cash flows expected to result from the use of these asset groups and found that no impairment charge was necessary. The quarter and six months ended June 30, 2026, produced higher revenues and operating income compared to the same period in 2025, and we believe that this improved performance at an asset group level will continue throughout the remainder of 2026. As a result, we recorded
Our Company also considers that the events and factors described above continue to constitute impairment indicators under ASC 350 Intangibles – Goodwill and Other. Our Company performed a quantitative goodwill impairment test and determined that our goodwill was not impaired as of December 31, 2025. The test was performed at a reporting unit level by comparing each reporting unit’s carrying value, including goodwill, to its fair value. The fair value of each reporting unit was assessed using a discounted cash flow model based on the budgetary revisions performed by management in response to the developing market conditions. For the same reasons as our impairment considerations under ASC 360,
The accompanying condensed consolidated financial statements include the accounts of our Company’s wholly-owned subsidiaries as well as majority-owned subsidiaries that our Company controls and should be read in conjunction with our Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2025 (“2025 Form 10-K”). All significant intercompany balances and transactions have been eliminated on consolidation. These condensed consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim reporting with the instructions for Form 10-Q and Rule 10-01 of Regulation S-X of the Securities and Exchange Commission (“SEC”). As such, they do not include all information and footnotes required by U.S. GAAP for complete financial statements. We believe that we have included all normal and recurring adjustments necessary for a fair presentation of the results for the interim period.
Operating results for the quarter and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026.
Adopted:
ASU 2023-07 Segment Reporting: Improvements to Reportable Segment Disclosures
On December 16, 2024, we adopted ASU 2023-07 Segment Reporting: Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-07 expands the disclosures required by public entities for reportable segments. Adoption of ASU 2023-07 has had no material effect on our condensed consolidated financial statements from a recognition and measurement perspective, and has not altered our reportable segments, but has enhanced our disclosure of certain expenses and profitability measurement.
ASU 2023-09 Income Taxes: Improvements to Income Tax Disclosures
Effective for the year ended December 31, 2025, we adopted ASU 2023-09 Income Taxes: Improvements to Income Tax Disclosures (“ASU 2023-09”). The amendments in ASU 2023-09 require entities to disclose on an annual basis (i) specific categories in the rate reconciliation and (ii) provide additional information for reconciling items that meet a quantitative threshold. The amendments also require that entities disclose various information about income taxes paid and (i) income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and (ii) foreign and income tax expense (or benefit) from continuing operations disaggregated by federal (national), state, and foreign. Adoption of ASU 2023-09 has had no material effect on our condensed consolidated financial statements from a recognition and measurement perspective, but has enhanced our disclosure of certain income tax matters in our 2025 Form 10-K.
Recently Announced:
ASU 2024-03 Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures
In November 2024, the FASB issued ASU 2024-03 Income Statement (Subtopic 220-40)—Reporting Comprehensive Income-Expense Disaggregation Disclosures (“ASU 2024-03”). The amendments in ASU 2024-03 require that public business entities disclose additional information about specific expense categories in the notes to financial statements for interim and annual reporting periods. ASU 2024-03 is effective for the Company for the year ending December 31, 2027. We are currently evaluating the impact of this new standard on our condensed consolidated financial statements upon adoption.
ASU 2025-11 Interim Reporting (Topic 270) Narrow-Scope Improvements
We report information about operating segments in accordance with ASC 280-10 Segment Reporting, which requires financial information to be reported based on the way management organizes segments with a company for making operating decisions and evaluating performance. We have organized our business into
Our cinema exhibition segment aggregates all our cinemas, both leased and owned, across the United States, Australia and New Zealand. Each of our cinemas earns revenue through the sale of movie tickets, food and beverage, screen advertising, theatre rentals, merchandise, gift card and loyalty membership, and other ancillary sales. The segment also earns revenue through service fees related to online ticket sales. Expenses are incurred through film rent, wages and salaries, food and beverage costs, occupancy costs, utilities, and other ancillary costs. We further organize this segment by geography, because each geography is subject to its own unique regulatory and business conditions.
Our real estate segment aggregates all our retail, commercial and live theatre real estate assets across Australia, New Zealand, and the United States. Our retail and commercial real estate assets earn revenue through the leasing or licensing of space to third party tenants.
Our live theatre assets in the United States earn revenue through leasing or licensing space to third party production companies, an activity we consider sufficiently similar to our broader real estate base to support inclusion in our real estate segment. Our live theatre operations also earn revenue by providing front of house and box office services and through sale of food and beverage. All of our real estate assets incur expenses from property maintenance, utilities, taxes, and other costs of maintaining real estate and in some cases third party property management.
Each of these segments has discrete and separate financial information and for which operating results are evaluated regularly by our President, Chief Executive Officer and Vice Chair of the Board of Directors, the chief operating decision-maker (“CODM”) of the Company. The CODM is responsible for the allocation of resources to, and the assessment of the performance of, our operating segments. The CODM determines, among other things:
-the execution, renewal and/or termination of cinema leases
-the execution, renewal and/or termination of third-party tenant leases
-significant capital expenditures
-internal resource allocation
-operational budgets.
Segment operating income is a key measure of profit or loss used by the CODM to assess segment performance and allocate resources. Segment operating income includes certain amounts charged by our real estate segment to our cinema exhibition segment where a cinema is a tenant of the real estate segment. These charges are eliminated for condensed consolidated financial statement purposes in the consolidated statement of operations, but are presented gross to the CODM.
The tables below summarize the results of operations for each of our business segments, presenting a reconciliation of segment revenue to operating segment income, and the impact of inter-segment transactions.
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| Quarter Ended |
| Quarter Ended |
| Six Months Ended |
| Six Months Ended | ||||||||||||||||||||||||||||
| June 30, 2026 |
| June 30, 2025 |
| June 30, 2026 |
| June 30, 2025 | ||||||||||||||||||||||||||||
(Dollars in thousands) | Cinema |
| Real |
| Total |
| Cinema |
| Real |
| Total |
| Cinema |
| Real |
| Total |
| Cinema |
| Real |
| Total | ||||||||||||
Revenue - third party | $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
Inter-segment revenue (1) |
| — |
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| — |
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| — |
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| — |
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Total segment revenue |
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Operating expense |
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Operating Expense - Third Party |
| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
|
| ( |
Inter-Segment Operating Expenses (1) |
| ( |
|
| — |
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| ( |
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| ( |
|
| — |
|
| ( |
|
| ( |
|
| — |
|
| ( |
|
| ( |
|
| — |
|
| ( |
Total of services and products (excluding depreciation and amortization) |
| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
Depreciation and amortization |
| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
General and administrative expense |
| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
Total operating expense |
| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
Segment operating income (loss) | $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
(1)Inter-segment Revenues and Operating Expense relates to the internal charge between the two segments where the cinema operates within real estate owned within the group.
A reconciliation of cinema exhibition segment revenue to segment operating income for the quarter and six months ended June 30, 2026 and June 30, 2025, is as follows:
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| Quarter Ended |
| Six Months Ended | ||||||||
(Dollars in thousands) | June 30, 2026 |
| June 30, 2025 |
| June 30, 2026 |
| June 30, 2025 | ||||||
REVENUE |
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| United States | Admissions revenue | $ | |
| $ | |
| $ | |
| $ | |
|
| Concessions revenue |
| |
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| |
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| |
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| |
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| Advertising and other revenue |
| |
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| |
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| |
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| $ | |
| $ | |
| $ | |
| $ | |
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| Australia | Admissions revenue | $ | |
| $ | |
| $ | |
| $ | |
|
| Concessions revenue |
| |
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| |
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| |
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| |
|
| Advertising and other revenue |
| |
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| |
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| |
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| $ | |
| $ | |
| $ | |
| $ | |
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| New Zealand | Admissions revenue | $ | |
| $ | |
| $ | |
| $ | |
|
| Concessions revenue |
| |
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| |
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| |
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| Advertising and other revenue |
| |
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| $ | |
| $ | |
| $ | |
| $ | |
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| Total revenue | $ | |
| $ | |
| $ | |
| $ | | |
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OPERATING EXPENSE |
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| United States | Film rent and advertising cost | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| Food & beverage cost |
| ( |
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| ( |
|
| ( |
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| ( |
|
| Occupancy expense |
| ( |
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| ( |
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| ( |
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| ( |
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| Labor cost |
| ( |
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| ( |
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| ( |
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| ( |
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| Utilities |
| ( |
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| ( |
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| ( |
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| ( |
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| Cleaning and maintenance |
| ( |
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| ( |
|
| ( |
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| ( |
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| Other operating expenses |
| ( |
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| ( |
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| ( |
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| ( |
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| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
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| Australia | Film rent and advertising cost | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| Food & beverage cost |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Occupancy expense |
| ( |
|
| ( |
|
| ( |
|
| ( |
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| Labor cost |
| ( |
|
| ( |
|
| ( |
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| ( |
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| Utilities |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Cleaning and maintenance |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Other operating expenses |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
|
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
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|
| New Zealand | Film rent and advertising cost | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| Food & beverage cost |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Occupancy expense |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Labor cost |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Utilities |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Cleaning and maintenance |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Other operating expenses |
| ( |
|
| ( |
|
| ( |
|
| ( |
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|
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
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| Total operating expense | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( | |
|
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DEPRECIATION, AMORTIZATION, GENERAL AND ADMINISTRATIVE EXPENSE |
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| ||
| United States | Depreciation and amortization | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| General and administrative expense |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
|
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
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| Australia | Depreciation and amortization | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| General and administrative expense |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
|
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
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| New Zealand | Depreciation and amortization | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| General and administrative expense |
| |
|
| ( |
|
| |
|
| ( |
|
|
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
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| Total depreciation, amortization, general and administrative expense | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( | |
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OPERATING INCOME (LOSS) - CINEMA |
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| United States | $ | |
| $ | |
| $ | |
| $ | ( | |
| Australia |
| |
|
| |
|
| |
|
| | |
| New Zealand |
| |
|
| |
|
| |
|
| ( | |
| Total Cinema operating income (loss) | $ | |
| $ | |
| $ | |
| $ | | |
A reconciliation of real estate segment revenue to segment operating income for the quarter and six months ended June 30, 2026 and June 30, 2025, is as follows:
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| Quarter Ended |
| Six Months Ended | ||||||||
(Dollars in thousands) | June 30, 2026 |
| June 30, 2025 |
| June 30, 2026 |
| June 30, 2025 | ||||||
REVENUE |
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| United States | Live theatre rental and ancillary income | $ | |
| $ | |
| $ | |
| $ | |
|
| Property rental income |
| |
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| |
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| |
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| |
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| |
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| |
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| |
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| |
| Australia | Property rental income |
| |
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| |
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| |
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| |
| New Zealand | Property rental income |
| |
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| |
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| |
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| |
| Total revenue | $ | |
| $ | |
| $ | |
| $ | | |
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OPERATING EXPENSE |
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| ||
| United States | Live theatre cost | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| Occupancy expense |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Utilities |
| ( |
|
| |
|
| ( |
|
| ( |
|
| Cleaning and maintenance |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Other operating expenses |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
|
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
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|
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|
| Australia | Occupancy expense | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| Labor cost |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Utilities |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Cleaning and maintenance |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| Other operating expenses |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
|
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
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|
| New Zealand | Occupancy expense | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| Labor cost |
| — |
|
| — |
|
| — |
|
| ( |
|
| Utilities |
| — |
|
| — |
|
| — |
|
| ( |
|
| Cleaning and maintenance |
| — |
|
| — |
|
| — |
|
| ( |
|
| Other operating expenses |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
|
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
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|
| Total operating expense | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( | |
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DEPRECIATION, AMORTIZATION, GENERAL AND ADMINISTRATIVE EXPENSE |
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| United States | Depreciation and amortization | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| General and administrative expense |
| ( |
|
| ( |
|
| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| Australia | Depreciation and amortization | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
| General and administrative expense |
| ( |
|
| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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| ( |
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|
|
| New Zealand | Depreciation and amortization |
| ( |
|
| ( |
|
| ( |
|
| ( |
|
| General and administrative expense |
| ( |
|
| — |
|
| ( |
|
| ( |
|
|
|
| ( |
|
| ( |
|
| ( |
|
| ( |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total depreciation, amortization, general and administrative expense | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING INCOME (LOSS) - REAL ESTATE |
|
|
|
|
|
|
|
|
|
|
| ||
| United States | $ | |
| $ | |
| $ | |
| $ | | |
| Australia |
| |
|
| |
|
| |
|
| | |
| New Zealand |
| |
|
| |
|
| |
|
| ( | |
| Total real estate operating income (loss) | $ | |
| $ | |
| $ | |
| $ | | |
A reconciliation of segment operating income to income before income taxes is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
| Quarter Ended |
| Six Months Ended | ||||||||
(Dollars in thousands) | June 30, 2026 |
| June 30, 2025 |
| June 30, 2026 |
| June 30, 2025 | ||||
Segment operating income (loss) | $ | |
| $ | |
| $ | |
| $ | |
Unallocated corporate expense: |
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization expense |
| ( |
|
| ( |
|
| ( |
|
| ( |
General and administrative expense |
| ( |
|
| ( |
|
| ( |
|
| ( |
Interest expense, net |
| ( |
|
| ( |
|
| ( |
|
| ( |
Equity earnings (loss) of unconsolidated joint ventures |
| |
|
| |
|
| |
|
| |
Gain (loss) on sale of assets |
| — |
|
| |
|
| — |
|
| |
Other (expense) income |
| |
|
| ( |
|
| ( |
|
| ( |
Income (loss) before income taxes | $ | |
| $ | ( |
| $ | ( |
| $ | ( |
Assuming cash and cash equivalents are accounted for as corporate assets, total assets by business segment and by country are presented as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| June 30, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
By segment: |
|
|
|
|
|
|
Cinema |
| $ | |
| $ | |
Real estate |
|
| |
|
| |
Corporate (1) |
|
| |
|
| |
Total assets |
| $ | |
| $ | |
By country: |
|
|
|
|
|
|
United States |
| $ | |
| $ | |
Australia |
|
| |
|
| |
New Zealand |
|
| |
|
| |
Total assets |
| $ | |
| $ | |
(1) Corporate Assets includes cash and cash equivalents of $
The following table sets forth our operating properties by country:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| June 30, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
United States |
| $ | |
| $ | |
Australia |
|
| |
|
| |
New Zealand |
|
| |
|
| |
Total operating property |
| $ | |
| $ | |
The table below summarizes capital expenditures for the six months ended June 30, 2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Six Months Ended | ||||
(Dollars in thousands) |
|
|
|
|
|
| June 30, 2026 |
| June 30, 2025 | ||
Segment capital expenditures |
|
|
|
|
|
| $ | |
| $ | |
Total capital expenditures |
|
|
|
|
|
| $ | |
| $ | |
We have significant assets in Australia and New Zealand. Historically, we have conducted our Australian and New Zealand operations (collectively “foreign operations”) on a self-funding basis, where we use cash flows generated by our foreign operations to pay for the expenses of those foreign operations. However, in recent periods, cash flows from our overseas operations have been used to cover our domestic general and administrative costs, interest expense, and losses from our U.S. cinema operations. Our Australian and New Zealand assets and liabilities are translated from their functional currencies of Australian dollar (“AU$”) and New Zealand dollar
(“NZ$”), respectively, to the U.S. dollar based on the exchange rate as of June 30, 2026. The carrying value of the assets and liabilities of our foreign operations fluctuates as a result of changes in the exchange rates between the functional currencies of the foreign operations and the U.S. dollar. The translation adjustments are accumulated in the Accumulated Other Comprehensive Income in the Consolidated Balance Sheets.
We take a global view of our financial resources and are flexible in making use of resources between jurisdictions.
Presented in the table below are the currency exchange rates for Australia and New Zealand:
|
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|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
| Foreign Currency / USD | ||||||||
| As of and |
| As of and |
| As of and |
| As of and |
| As of and |
| June 30, 2026 |
| December 31, 2025 |
| June 30, 2025 | ||||
Spot Rate |
|
|
|
|
|
|
|
|
|
Australian Dollar |
|
| |||||||
New Zealand Dollar |
|
| |||||||
Average Rate |
|
|
|
|
|
|
|
|
|
Australian Dollar |
|
|
|
| |||||
New Zealand Dollar |
|
|
|
| |||||
Basic earnings per share (“EPS”) is calculated by dividing the net income attributable to our Company by the weighted average number of common shares outstanding during the period. Diluted EPS is calculated by dividing the net income attributable to our Company by the weighted average number of common and common equivalent shares outstanding during the period and is calculated using the treasury stock method for equity-based compensation awards.
The following table sets forth the computation of basic and diluted EPS and a reconciliation of the weighted average number of common and common equivalent shares outstanding:
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Quarter Ended |
| Six Months Ended | ||||||||
|
| June 30, |
| June 30, | ||||||||
(Dollars in thousands, except share data) |
| 2026 |
| 2025 |
| 2026 |
| 2025 | ||||
Numerator: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to Reading International, Inc. |
| $ | |
| $ | ( |
| $ | ( |
| $ | ( |
Denominator: |
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares of common stock – basic |
|
| |
|
| |
|
| |
|
| |
Weighted average dilutive impact of awards |
|
| |
|
| — |
|
| — |
|
| — |
Weighted average number of shares of common stock – diluted |
|
| |
|
| |
|
| |
|
| |
Basic earnings (loss) per share |
| $ | |
| $ | ( |
| $ | ( |
| $ | ( |
Diluted earnings (loss) per share |
| $ | |
| $ | ( |
| $ | ( |
| $ | ( |
Awards excluded from diluted earnings (loss) per share |
|
| |
|
| |
|
| |
|
| |
Our weighted average number of shares of common stock - basic increased, primarily as a result of the vesting of restricted stock units. We did
Outstanding awards of
Operating Property, net
Property associated with our operating activities as at June 30, 2026 and December 31, 2025, is summarized as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| June 30, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
Land |
| $ | |
| $ | |
Building and improvements |
|
| |
|
| |
Leasehold improvements |
|
| |
|
| |
Fixtures and equipment |
|
| |
|
| |
Construction-in-progress |
|
| |
|
| |
Total cost |
|
| |
|
| |
Less: accumulated depreciation |
|
| ( |
|
| ( |
Operating property, net |
| $ | |
| $ | |
Depreciation expense for operating property was $
Construction-in-Progress – Operating Properties
Construction-in-Progress balances are included in our operating properties. The balances of our major projects along with the movements for the six months ended June 30, 2026, are shown below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands) |
| Balance, |
| Additions during the period |
| Completed |
| Transferred to Held for Sale |
| Foreign |
| Balance, | ||||||
Cinema developments and improvements |
|
| |
|
| |
|
| ( |
|
| ( |
|
| |
|
| |
Other real estate projects |
|
| |
|
| |
|
| — |
|
| — |
|
| |
|
| |
Total |
| $ | |
| $ | |
| $ | ( |
| $ | ( |
| $ | |
| $ | |
Recent Real Estate Monetizations
In order to support our liquidity, we have monetized certain of our real estate holdings. Details of those monetizations for the six months ended June 30, 2026, and the year ended December 31, 2025, are provided below.
Wellington, New Zealand property assets
On January 31, 2025, we sold our property assets in Wellington, New Zealand, including Courtenay Central, Tory Street car park and Wakefield Street car park, at a gross sale price of $
The gain on sale of this property was calculated as follows:
|
|
|
|
|
| March 31 | |
(Dollars in thousands) |
| 2025 | |
Sales price |
| $ | |
Net book value |
|
| ( |
Gain on sale, gross of direct costs |
|
| |
Direct sale costs incurred |
|
| ( |
Gain on sale, net of direct costs |
| $ | |
Cannon Park, Townsville, Queensland, Australia
In May 2025, we sold our Cannon Park ETC property in Townsville, Queensland, Australia, for a gross sale price of $
The gain on sale of this property was calculated as follows:
|
|
|
|
|
| June 30 | |
(Dollars in thousands) |
| 2025 | |
Sales price |
| $ | |
Net book value |
|
| ( |
Gain on sale, gross of direct costs |
|
| |
Direct sale costs incurred |
|
| ( |
Gain on sale, net of direct costs |
| $ | |
Disposal Groups Held for Sale
Cinemas 1,2,3, Manhattan
In February 2026 we classified our Cinemas 1,2,3 property as held for sale at the lower of cost and fair value less costs to sell.
Newberry Yard, Williamsport, Pennsylvania
In June 2023, we classified our industrial property at Newberry Yard, Williamsport, Pennsylvania, as held for sale at the lower of cost and fair value less costs to sell. The property is part of our historic railroad operations, consisting of land and an industrial building, and certain rail bed improvements.
Real Estate Acquisitions
Sutton Hill Associates
In all leases, whether we are the lessor or lessee, we define lease term as the non-cancellable term of the lease plus any renewals covered by renewal options that are reasonably certain of exercise based on our assessment of economic factors relevant to the lessee. The non-cancellable term of the lease commences on the date the lessor makes the underlying property in the lease available to the lessee, irrespective of when lease payments begin under the contract.
As Lessee
We have operating leases for certain cinemas, and finance leases for certain equipment assets. Our leases have remaining lease terms of
The components of lease expense are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Quarter Ended |
| Six Months Ended | ||||||||
|
| June 30, |
| June 30, | ||||||||
(Dollars in thousands) |
| 2026 |
| 2025 |
| 2026 |
| 2025 | ||||
Lease cost |
|
|
|
|
|
|
|
|
|
|
|
|
Finance lease cost: |
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of right-of-use assets |
| $ | — |
| $ | |
| $ | — |
| $ | |
Interest on lease liabilities |
|
| — |
|
| |
|
| — |
|
| |
Operating lease cost |
|
| |
|
| |
|
| |
|
| |
Variable lease cost |
|
| |
|
| |
|
| |
|
| |
Total lease cost |
| $ | |
| $ | |
| $ | |
| $ | |
Supplemental cash flow information related to leases is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Six Months Ended | ||||
|
| June 30, | ||||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
Cash flows relating to lease cost |
|
|
|
|
|
|
Cash paid for amounts included in the measurement of lease liabilities: |
|
|
|
|
|
|
Operating cash flows for finance leases |
| $ | — |
| $ | |
Operating cash flows for operating leases |
|
| |
|
| |
Right-of-use assets obtained in exchange for new operating lease liabilities |
|
| |
|
| |
Supplemental balance sheet information related to leases is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| June 30, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
Operating leases |
|
|
|
|
|
|
Operating lease right-of-use assets |
| $ | |
| $ | |
Operating lease liabilities - current portion |
|
| |
|
| |
Operating lease liabilities - non-current portion |
|
| |
|
| |
Total operating lease liabilities |
| $ | |
| $ | |
Finance leases |
|
|
|
|
|
|
Property plant and equipment, gross |
|
| |
|
| |
Accumulated depreciation |
|
| ( |
|
| ( |
Property plant and equipment, net |
| $ | — |
| $ | — |
|
|
|
|
|
|
|
Other information |
|
|
|
|
|
|
Weighted-average remaining lease term - operating leases |
|
| |
|
| |
Weighted-average discount rate - finance leases |
|
|
|
| ||
Weighted-average discount rate - operating leases |
|
|
|
| ||
The maturities of our leases were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands) |
| Operating |
| Finance | ||
2026 |
| $ | |
| $ | — |
2027 |
|
| |
|
| — |
2028 |
|
| |
|
| — |
2029 |
|
| |
|
| — |
2030 |
|
| |
|
| — |
Thereafter |
|
| |
|
| — |
Total lease payments |
| $ | |
| $ | — |
Less imputed interest |
|
| ( |
|
| — |
Total |
| $ | |
| $ | — |
As Lessor
We have entered into various leases as a lessor for our owned real estate properties. These leases vary in length between
Lease income relating to operating lease payments was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Quarter Ended |
| Six Months Ended | ||||||||
|
| June 30, |
| June 30, | ||||||||
(Dollars in thousands) |
| 2026 |
| 2025 |
| 2026 |
| 2025 | ||||
Components of lease income |
|
|
|
|
|
|
|
|
|
|
|
|
Lease payments |
| $ | |
| $ | |
| $ | |
| $ | |
Variable lease payments |
|
| |
|
| |
|
| |
|
| |
Total lease income |
| $ | |
| $ | |
| $ | |
| $ | |
The book value of underlying assets under operating leases from owned assets was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| June 30, |
| December 31, | ||
(Dollars in thousands) |
|
|
|
|
|
|
| 2026 |
| 2025 | ||
Building and improvements |
|
|
|
|
|
|
|
|
|
|
|
|
Gross balance |
|
|
|
|
|
|
| $ | |
| $ | |
Accumulated depreciation |
|
|
|
|
|
|
|
| ( |
|
| ( |
Net Book Value |
|
|
|
|
|
|
| $ | |
| $ | |
The minimum contractual rent payments due on our leases are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands) |
|
|
|
|
|
|
|
|
|
| Operating | |
2026 |
|
|
|
|
|
|
|
|
|
| $ | |
2027 |
|
|
|
|
|
|
|
|
|
|
| |
2028 |
|
|
|
|
|
|
|
|
|
|
| |
2029 |
|
|
|
|
|
|
|
|
|
|
| |
2030 |
|
|
|
|
|
|
|
|
|
|
| |
Thereafter |
|
|
|
|
|
|
|
|
|
|
| |
Total |
|
|
|
|
|
|
|
|
|
| $ | |
The table below summarizes goodwill by business segment as of June 30, 2026, and December 31, 2025.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands) |
| Cinema |
| Real Estate |
| Total | |||
Balance at December 31, 2025 |
| $ | |
| $ | |
| $ | |
Foreign currency translation adjustment |
|
| |
|
| — |
|
| |
Balance at June 30, 2026 |
| $ | |
| $ | |
| $ | |
Our Company is required to test goodwill and other intangible assets for impairment on an annual basis and, if current events or circumstances require them, on an interim basis. Our next annual evaluation of goodwill and other intangible assets is scheduled during the fourth quarter of 2026. To test the impairment of goodwill, our Company compares the fair value of each reporting unit to its carrying amount, including the goodwill, to determine if there is potential goodwill impairment. A reporting unit is generally one level below the operating segment. As of June 30, 2026, we were not aware that any events indicating potential impairment of goodwill had occurred outside of those described at Note 2 – Liquidity and Impairment Assessment.
The tables below summarize intangible assets other than goodwill, as of June 30, 2026, and December 31, 2025, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| As of June 30, 2026 | ||||||||||
(Dollars in thousands) |
| Beneficial |
| Trade |
| Other |
| Total | ||||
Gross carrying amount |
| $ | |
| $ | |
| $ | |
| $ | |
Less: Accumulated amortization |
|
| ( |
|
| ( |
|
| ( |
|
| ( |
Net intangible assets other than goodwill |
| $ | |
| $ | |
| $ | |
| $ | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| As of December 31, 2025 | ||||||||||
(Dollars in thousands) |
| Beneficial |
| Trade |
| Other |
| Total | ||||
Gross carrying amount |
| $ | |
| $ | |
| $ | |
| $ | |
Less: Accumulated amortization |
|
| ( |
|
| ( |
|
| ( |
|
| ( |
Net intangible assets other than goodwill |
| $ | |
| $ | |
| $ | |
| $ | |
Beneficial leases obtained in business combinations where we are the landlord are amortized over the life of the relevant leases. Trade names are amortized based on the accelerated amortization method over their estimated useful life of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Quarter Ended |
| Six Months Ended | ||||||||
|
| June 30, |
| June 30, | ||||||||
(Dollars in thousands) |
| 2026 |
| 2025 |
| 2026 |
| 2025 | ||||
Beneficial lease amortization |
| $ | |
| $ | |
| $ | |
| $ | |
Other amortization |
|
| |
|
| |
|
| |
|
| |
Total intangible assets amortization |
| $ | |
| $ | |
| $ | |
| $ | |
Our investments in unconsolidated joint ventures are accounted for under the equity method of accounting.
The table below summarizes our active investment holdings in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| June 30, |
| December 31, | ||
(Dollars in thousands) |
| Interest |
| 2026 |
| 2025 | ||
Rialto Cinemas |
|
| $ | |
| $ | ( | |
Mt. Gravatt |
|
|
| |
|
| | |
Total investments |
|
|
| $ | |
| $ | |
For the quarter and six months ended June 30, 2026 and 2025, the recognized share of equity earnings from our investments in unconsolidated joint ventures are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Quarter Ended |
| Six Months Ended | ||||||||
|
| June 30, |
| June 30, | ||||||||
(Dollars in thousands) |
| 2026 |
| 2025 |
| 2026 |
| 2025 | ||||
Rialto Cinemas |
| $ | |
| $ | |
| $ | |
| $ | |
Mt. Gravatt |
|
| |
|
| |
|
| |
|
| |
Total equity earnings |
| $ | |
| $ | |
| $ | |
| $ | |
Prepaid and other assets are summarized as follows:
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|
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|
|
|
|
| June 30, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
Prepaid and other current assets |
|
|
|
|
|
|
Prepaid expenses |
| $ | |
| $ | |
Prepaid taxes |
|
| |
|
| |
Deposits |
|
| |
|
| |
Straight-line rent asset |
|
| |
|
| — |
Investments in marketable securities |
|
| |
|
| |
Total prepaid and other current assets |
| $ | |
| $ | |
Other non-current assets |
|
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|
|
|
|
Other non-cinema and non-rental real estate assets |
|
| |
|
| |
Investment in Reading International Trust I |
|
| |
|
| |
Straight-line rent asset |
|
| |
|
| |
Long-term deposits |
|
| |
|
| |
Other |
|
| — |
|
| |
Total other non-current assets |
| $ | |
| $ | |
An income tax expense of $
Our Company’s borrowings at June 30, 2026 and December 31, 2025, net of deferred financing costs and including the impact of interest rate derivatives on effective interest rates, are summarized below:
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| As of June 30, 2026 | |||||||||||||
(Dollars in thousands) |
| Maturity Date |
| Contractual |
| Balance, |
| Balance, |
| Stated |
| Effective | |||
Denominated in USD |
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|
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|
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|
|
Trust Preferred Securities (US) |
|
| $ | |
| $ | |
| $ | |
|
| |||
Bank of America Credit Facility (US) |
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| |
|
| |
|
| |
|
| |||
Cinemas 1, 2, 3 Term Loan (US) |
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| |
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| |
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| |
|
| |||
Minetta & Orpheum Theatres Loan (US) |
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| |
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| |
|
| |||
Union Square Financing (US) | (2) |
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| |
|
| |||
Nationwide Theaters Corp. (US) | (3) |
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| |
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| |
|
| |||
Denominated in foreign currency ("FC") | (4) |
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NAB Corporate Term Loan (AU) |
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| |
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| |
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| |
|
| |||
|
|
|
| $ | |
| $ | |
| $ | |
|
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|
|
(1)Net of deferred financing costs amounting to $
(2)This loan has an option to extend to up to May 2027. This option is within our control and we intend to exercise it.
(3)This debt is carried net of debt discounts of $
(4)The contractual facilities and outstanding balances of the foreign currency denominated borrowings were translated into U.S. dollars based on the applicable exchange rates as of June 30, 2026.
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|
|
| As of December 31, 2025 | |||||||||||||
(Dollars in thousands) |
| Maturity Date |
| Contractual |
| Balance, |
| Balance, |
| Stated |
| Effective | |||
Denominated in USD |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trust Preferred Securities (US) |
|
| $ | |
| $ | |
| $ | |
|
| |||
Bank of America Credit Facility (US) |
|
|
| |
|
| |
|
| |
|
| |||
Cinemas 1, 2, 3 Term Loan (US) |
|
|
| |
|
| |
|
| |
|
| |||
Minetta & Orpheum Theatres Loan (US) |
|
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| |
|
| |
|
| |
|
| |||
Union Square Financing (US) | (2) |
|
| |
|
| |
|
| |
|
| |||
Nationwide Theaters Corp. (US) | (3) |
|
| |
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| |
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| |
|
| |||
Denominated in foreign currency ("FC") | (4) |
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|
|
NAB Corporate Term Loan (AU) |
|
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| |
|
| |
|
| |
|
| |||
Total |
|
|
| $ | |
| $ | |
| $ | |
|
|
|
|
(1)Net of deferred financing costs amounting to $
(2)This loan has an option to extend for one year, which is within our control and we intend to exercise.
(3)This debt is carried net of debt discounts of $
(4)The contractual facilities and outstanding balances of the FC-denominated borrowings were translated into U.S. dollars based on exchange rates as of December 31, 2025.
Our loan arrangements are presented, net of the deferred financing costs, on the face of our consolidated balance sheet as follows:
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|
|
|
|
|
| June 30, |
| December 31, | ||
Balance Sheet Caption (Dollars in thousands) |
| 2026 |
| 2025 | ||
Debt - current portion |
| $ | |
| $ | |
Debt - long-term portion |
|
| |
|
| |
Subordinated debt - current portion |
|
| |
|
| — |
Subordinated debt - long-term portion |
|
| — |
|
| |
Total borrowings |
| $ | |
| $ | |
Trust Preferred Securities
Our $
Minetta and Orpheum Theatres Loan
Our $
Bank of America Credit Facility
Our $
Cinemas 1,2,3 Term Loan
Our $
On February 26, 2025, we exercised the last of our extension options on this loan, extending the maturity to October 1, 2025. On November 13, 2025, we extended the maturity of this loan to its current maturity date of
Union Square Financing
Our $
On May 2, 2025, we extended the maturity date of this loan to
Nationwide Theaters Corp.
At the time of our acquisition of Sutton Hill Associates (“SHA”) on December 19, 2025, SHA held $
Debt denominated in foreign currencies
Australian NAB Corporate Term Loan (AU)
Our $
November 12, 2025, we extended the maturity of this loan to its current maturity date of
Other liabilities are summarized as follows:
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|
|
|
|
|
|
| June 30, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
Current liabilities |
|
|
|
|
|
|
Accrued pension |
| $ | |
| $ | |
Security deposit payable |
|
| |
|
| |
Other |
|
| |
|
| |
Other current liabilities |
| $ | |
| $ | |
Other liabilities |
|
|
|
|
|
|
Lease make-good provision |
|
| |
|
| |
Accrued pension |
|
| |
|
| |
Deferred rent liability |
|
| |
|
| |
Environmental reserve |
|
| |
|
| |
Other non-current liabilities |
| $ | |
| $ | |
Pension Liability – Supplemental Executive Retirement Plan
Details of our Supplemental Executive Retirement Plan are disclosed in Note 14 – Pension and Other Liabilities in our 2025 Form 10-K.
Included in our current and non-current liabilities are accrued pension costs of $
During the quarter and six months ended June 30, 2026, the interest cost was $
The following table summarizes the changes in each component of accumulated other comprehensive income attributable to RDI:
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|
|
(Dollars in thousands) | Foreign |
| Unrealized |
| Accrued |
| Hedge |
| Total | |||||
Balance at January 1, 2026 | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
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|
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Change related to derivatives |
|
|
|
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|
|
|
|
|
|
|
|
|
|
Total change in hedge fair value recorded in Other Comprehensive Income |
| — |
|
| — |
|
| — |
|
| |
|
| |
Amounts reclassified from accumulated other comprehensive income |
| — |
|
| — |
|
| — |
|
| ( |
|
| ( |
Net change related to derivatives |
| — |
|
| — |
|
| — |
|
| |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net current-period other comprehensive income (loss) |
| ( |
|
| ( |
|
| |
|
| |
|
| |
Balance at June 30, 2026 | $ | ( |
| $ | ( |
| $ | ( |
| $ | — |
| $ | ( |
Litigation Matters
We are currently involved in certain legal proceedings, and we may from time to time, in the normal course of business, be a party to various ordinary course claims from vendors, landlords, tenants, employees and competitors and to other legal proceedings. If management believes that a loss arising from the action is probable and can reasonably be estimated, the Company records the amount
of the loss or the minimum estimated liability when the loss is estimated using a range and no point in the range is more probable than another. Management believes that the ultimate outcome of the matters discussed below, individually and in the aggregate, will not likely have a material adverse effect on the Company’s financial position or overall trends in results of operations. However, litigation and claims are subject to inherent uncertainties and unfavorable outcomes can occur. An unfavorable outcome might include monetary damages. If an unfavorable outcome were to occur, there exists the possibility of a material adverse impact on the results of operation in the period in which the outcome occurs or in future periods. An unfavorable outcome could also have a material adverse effect on the Company’s financial position or the market prices of the Company’s securities.
Environmental and Asbestos Claims on Reading Legacy Operations
Certain of our subsidiaries were historically involved in railroad operations, coal mining, and manufacturing. Certain of these subsidiaries appear in the chain-of-title of properties that may suffer from environmental issues. Accordingly, certain of these subsidiaries have, from time to time, been named in and may in the future be named in various actions brought under applicable environmental laws. We are in the real estate development business and may encounter from time-to-time environmental conditions at properties that we have acquired for development and which will need to be addressed in the future as part of the development process. These environmental conditions can increase the cost of such projects and adversely affect the value and potential for profit of such projects. We do not currently believe that our exposure under applicable environmental laws is material in amount.
From time to time, there are claims brought against us relating to the exposure of former employees to asbestos and/or coal dust. These are generally covered by an insurance settlement reached in September 1990 with our insurance providers. However, this insurance settlement does not cover litigation by people who were not employees of our historic railroad operations and who may claim direct or second-hand exposure to asbestos, coal dust and/or other chemicals or elements now recognized as potentially causing cancer in humans. Our known exposure to these types of claims, asserted or probable of being asserted, is in our opinion not material.
Certain Civil Litigation
Putative Class Action Litigation
Our Company is a defendant in two actions asserting putative class action claims under the Video Privacy Protection Act, a federal statute enacted in 1988 (the “VPPA”): Daniel Valentini and Dallace Butler v. Reading International, Inc (2:24-cv-00255-RFB-MDC (D. Nev.)) (“The Valentini Case”), and Berryman v. Reading International, Inc. (1:24-cv-00750-PAE (S.D.N.Y.)) (“The Berryman Case”). The plaintiffs in these cases allege that our Company is a video tape service provider and knowingly disclosed plaintiff’s movie purchase and video-viewing habits to third parties in violation of the VPPA. Valentini and Butler also allege violation of a parallel state statute (California Code section 1799.3, the “California Statute”). Berryman also asserts claims under a similar statute (New York General Business Law Section 671 et seq (the “NY Statute”) and under the NY Arts and Cultural Affairs Law Section 25.07(4) (the “NY AC Statute”) which regulates the disclosure requirements applicable to ticketing service charges and provides a right to recover “actual damages or fifty dollars per violation, whichever is greater.”
Only limited case law exists as to claims under VPPA. We have not identified any U.S. case in which an adverse VPPA judgment has been entered against a motion picture exhibition company on facts substantially similar to those alleged in this case. Further, the precedent that does exist suggests that theatres with websites selling tickets to cinema exhibitions are not video tape service providers under the statute, even if they operate websites to sell tickets and that the information disclosed through consumer use of cinema websites like ours does not include “personally identifiable information,” a necessary condition for liability under the VPPA.
Our Company has filed motions to dismiss the Valentini and the Berryman claims under Federal rule of Procedure 12(b)(6) for failure to state a claim for which relief can be provided. The Valentini motion is on hold, pending the outcome of an appeal to the Ninth Circuit of a trial court decision which the Company believes, if affirmed, will likely result in the dismissal of the Valentini case with prejudice.
By Opinion and Order dated March 12, 2026, the District Court granted our Company’s motion and dismissed Berryman’s VPPA and NY Statute claims in their entirety, without leave to amend on the basis that we did not disclose an “personally identifiable information.” As a result of the Court’s ruling, no VPPA or NY Statute claims remain pending against the Company in the Berryman action. Plaintiff has no right to appeal such decision until after resolution of the entire case including the below discussed NY AC Statute claims.
Berryman also asserts claims under the NY AC Statute alleging deficiencies in the disclosure provided by our Company with respect to service charges to residents of New York who purchased tickets online to our New York cinemas. These claims were not the subject of the Company’s renewed motion to dismiss and remain pending. We believe that our disclosure satisfied the requirements of the NY AC Statute. Berryman has moved for class certification of her claims under the NY AC Statute, and we will file our opposition no later than August 12, 2026. Due to the individualized nature of the allegations, we believe it is unlikely that class certification will be granted on the NY AC Statute claim, and that we will be able to resolve the matter on an individual named-Plaintiff-only basis.
We also anticipate a full dismissal of the Valentini VPPA claims, as the Ninth Circuit is likely to affirm a district court decision that theaters are not subject to the VPPA. Even if Valentini’s claims survive dismissal, we believe that we have strong defenses to the VPPA claims, including defense on the grounds that provided the basis for the above described dismissal of the Berryman VPPA claims.
Wellington Construction Damage Litigation
A subsidiary of the Company is the defendant in litigation in Wellington, New Zealand titled Body Corporate 78693 v. Courtenay Car Park Limited & Ors (CIV-2021-485-612 & CIV-2023-485-67) which involves various claims related to the dropping of a concrete beam onto adjacent property by a construction subcontractor working for the general contractor engaged by such subsidiary to do demolition work on our subsidiary’s property. In March 2026, the Court has issued its findings that, while our subsidiary would be liable to the plaintiff’s under a theory of strict liability due to the inherently dangerous nature of the construction activity, our subsidiary is entitled to full indemnity from its general contractor under both contractual indemnity and breach of contract theories of recovery. To the extent our general contractor should for any reason fail to make good on its indemnity obligations to us, our subsidiary’s liability is fully covered by insurance. Our co-defendants have appealed the Court’s decision and, in light of such appeal, we have likewise appealed to protect our position. We are advised by counsel that the appeals process is likely to take a couple of years. As of the date of this disclosure, we have
Philadelphia Code Violation Litigation
During the third quarter of 2025, our Company was served with a petition styled City of Philadelphia-Plaintiff vs. Reading International, Inc. Control Number 25074006 filed in the Court of Common Pleas under the City’s Code Enforcement Case Program, which among other things, (i) alleged violations of certain sections of the Philadelphia Code on property allegedly owned or under the control of Reading International in Philadelphia; (ii) sought an order imposing statutory fines and reinspection fees and allowing the Department of Licenses and Inspections to enter the premises identified as 1120 Callowhill Street, Philadelphia Pennsylvania to conduct an interior inspection; and (iii) sought an order compelling the Defendants to correct all alleged violations. This case was settled during the second quarter of 2026 for a nominal amount.
These are composed of the following enterprises:
Australia Country Cinemas Pty Ltd. -
Shadow View Land and Farming, LLC -
The components of noncontrolling interests are as follows:
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|
|
|
|
|
|
|
|
|
|
| June 30, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
Australian Country Cinemas, Pty Ltd |
| $ | |
| $ | |
Shadow View Land and Farming, LLC |
|
| ( |
|
| ( |
Noncontrolling interests in consolidated subsidiaries |
| $ | |
| $ | |
The components of income attributable to noncontrolling interests are as follows:
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|
|
| Quarter Ended |
| Six Months Ended | ||||||||
|
| June 30, |
| June 30, | ||||||||
(Dollars in thousands) |
| 2026 |
| 2025 |
| 2026 |
| 2025 | ||||
Australian Country Cinemas, Pty Ltd |
| $ | |
| $ | |
| $ | |
| $ | |
Sutton Hill Properties, LLC |
|
| — |
|
| ( |
|
| — |
|
| ( |
Net income (loss) attributable to noncontrolling interests |
| $ | |
| $ | ( |
| $ | |
| $ | ( |
In December 2025, we acquired the
Employee and Director Stock Incentive Plan
2020 Stock Incentive Plan
On December 5, 2024, the Company’s stockholders, upon recommendation of the Company’s board of directors, approved the Second Amendment to the 2020 Stock Incentive Plan, increasing the number of Class A Common Stock reserved for issuance under the 2020 Plan by an additional
Under the 2020 Plan, the Company may grant stock options and other share-based payment awards of our Class A Common Stock to eligible employees, directors and consultants. At June 30, 2026, there were
Stock options are granted at exercise prices equal to the grant-date market prices and typically expire on either the fifth or tenth anniversary of the grant date, although the Company’s Compensation and Stock Options Committee (the “Compensation Committee”) may set different vesting times. In contrast to a stock option where the grantee buys our Company’s share at an exercise price determined on the grant date, a restricted stock unit (“RSU”) entitles the grantee to receive
Stock Options
We have estimated the grant-date fair value of our stock options using the Black-Scholes option-valuation model, which takes into account assumptions such as the dividend yield, the risk-free interest rate, the expected stock price volatility, and the expected life of the options. We expensed the estimated grant-date fair values of options over the vesting period on a straight-line basis. Based on our historical experience, the “deemed exercise” of expiring in-the-money options and the relative market price to strike price of the options, we have not estimated any forfeitures of vested or unvested options.
For the quarter and six months ended June 30, 2026, we recorded a compensation expense of $
The following table summarizes the number of options outstanding and exercisable as of June 30, 2026, and December 31, 2025:
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| Outstanding Stock Options - Class A Shares | ||||||||
|
| Number |
| Weighted |
| Weighted |
| Aggregate | ||
|
| Class A |
| Class A |
| Class A |
| Class A | ||
Balance - December 31, 2024 |
| |
| $ | |
| |
| $ | — |
Granted |
| |
|
| |
| — |
|
| — |
Exercised |
| — |
|
| — |
| — |
|
| — |
Forfeited |
| — |
|
| — |
| — |
|
| — |
Balance - December 31, 2025 |
| |
| $ | |
| |
| $ | — |
Granted |
| — |
|
| — |
| — |
|
| — |
Exercised |
| — |
|
| — |
| — |
|
| — |
Forfeited |
| ( |
|
| — |
| — |
|
| — |
Balance - June 30, 2026 |
| |
| $ | |
| |
| $ | — |
Restricted Stock Units
The following table summarizes the status of RSUs granted to date as of June 30, 2026:
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|
|
|
| Restricted Stock Units | ||||||||||
|
| RSU Grants (in units) |
|
|
| Vested, |
| Unvested, |
| Forfeited, | ||
Grant Date |
| Directors |
| Management |
| Total |
| June 30, |
| June 30, |
| June 30, |
Opening balance |
| |
| |
| |
| |
| |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
April 11, 2023 |
| — |
| |
| |
| |
| |
| |
April 21, 2023 |
| — |
| |
| |
| |
| |
| |
April 28, 2023 |
| — |
| |
| |
| |
| |
| |
April 27, 2026 |
| — |
| |
| |
| — |
| |
| — |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
| |
| |
| |
| |
| |
| |
Time vested RSU awards to management typically vest
For the quarter and six months ended June 30, 2026, we recorded compensation expense of $
Stock Repurchase Program
Our Stock Repurchase Program expired on March 10, 2024, and has not been renewed.
As of June 30, 2026, our Company held derivative instruments to the notional value of $
The derivatives are recorded on the balance sheet at fair value and are included in the following line items:
|
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|
|
|
|
|
|
| Liability Derivatives | ||||||||
|
| June 30, |
| December 31, | ||||||
|
| 2026 |
| 2025 | ||||||
(Dollars in thousands) |
| Balance sheet location |
| Fair value |
| Balance sheet location |
| Fair value | ||
Interest rate contracts |
| Derivative financial instruments - current portion |
| $ | — |
| Derivative financial instruments - current portion |
| $ | |
|
| Derivative financial instruments - non-current portion |
|
| — |
| Derivative financial instruments - non-current portion |
|
| — |
Total derivatives designated as hedging instruments |
|
|
| $ | — |
|
|
| $ | |
Total derivatives |
|
|
| $ | — |
|
|
| $ | |
The changes in fair value of that instrument were recorded in Other Comprehensive Income and released into interest expense in the same period(s) in which the hedged transactions affect earnings. In the quarter and six months ended June 30, 2026 and June 30, 2025, respectively, the derivative instruments affected Comprehensive Income as follows:
|
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|
|
|
|
|
|
|
|
|
| Amount of Loss (Gain) Recognized in Income on Derivatives | ||||||||||
|
|
| Quarter Ended June 30 |
| Six Months Ended June 30 | ||||||||
(Dollars in thousands) | Location of Loss Recognized in Income on Derivatives |
|
| 2026 |
|
| 2025 |
|
| 2026 |
|
| 2025 |
Interest rate contracts | Interest expense |
| $ | — |
| $ | ( |
| $ | ( |
| $ | ( |
Total |
|
| $ | — |
| $ | ( |
| $ | ( |
| $ | ( |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Amount of Loss (Gain) Recognized in OCI on Derivatives (Effective Portion) | ||||||||||
|
| Quarter Ended June 30 |
| Six Months Ended June 30 | ||||||||
(Dollars in thousands) |
|
| 2026 |
|
| 2025 |
|
| 2026 |
|
| 2025 |
Interest expense |
| $ | ( |
| $ | |
| $ | ( |
| $ | |
Total |
| $ | ( |
| $ | |
| $ | ( |
| $ | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Amount of Loss (Gain) Reclassified from OCI into Income (Effective Portion) | ||||||||||
|
| Quarter Ended June 30 |
| Six Months Ended June 30 | ||||||||
(Dollars in thousands) |
|
| 2026 |
|
| 2025 |
|
| 2026 |
|
| 2025 |
Interest expense |
| $ | — |
| $ | ( |
| $ | ( |
| $ | ( |
Total |
| $ | — |
| $ | ( |
| $ | ( |
| $ | ( |
As of June 30, 2026, we expect no further releases to earnings, as the derivative has no value and matures in July 2026.
ASC 820 Fair Value Measurement establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The statement requires that assets and liabilities carried at fair value be classified and disclosed in one of the following three categories:
Level 1: Quoted market prices in active markets for identical assets or liabilities;
Level 2: Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
Level 3: Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
The following tables summarize our financial liabilities that are carried at cost and measured at fair value on a non-recurring basis as of June 30, 2026, and December 31, 2025, by level within the fair value hierarchy.
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| Fair Value Measurement at June 30, 2026 | ||||||||||
(Dollars in thousands) |
| Carrying |
| Level 1 |
| Level 2 |
| Level 3 |
| Total | |||||
Notes payable |
| $ | |
| $ | — |
| $ | — |
| $ | |
| $ | |
Subordinated debt |
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| — |
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| — |
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| $ | |
| $ | — |
| $ | — |
| $ | |
| $ | |
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| Fair Value Measurement at December 31, 2025 | ||||||||||
(Dollars in thousands) |
| Carrying |
| Level 1 |
| Level 2 |
| Level 3 |
| Total | |||||
Notes payable |
| $ | |
| $ | — |
| $ | — |
| $ | |
| $ | |
Subordinated debt |
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| — |
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| — |
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| $ | |
| $ | — |
| $ | — |
| $ | |
| $ | |
(1)These balances are presented before any deduction for deferred financing costs.
The following is a description of the valuation methodologies used to estimate the fair value of our financial assets and liabilities. There have been no changes in the methodologies used as of June 30, 2026, and December 31, 2025.
Level 1 investments in marketable securities primarily consist of investments associated with the ownership of marketable securities in U.S. and New Zealand. These investments are valued based on observable market quotes on the last trading date of the reporting period.
Level 2 derivative financial instruments are valued based on discounted cash flow models that incorporate observable inputs such as interest rates and yield curves from the derivative counterparties. The credit valuation adjustments associated with our non-performance risk and counterparty credit risk are incorporated in the fair value estimates of our derivatives. As of June 30, 2026, and December 31, 2025, we concluded that the credit valuation adjustments were not significant to the overall valuation of our derivatives.
Level 3 borrowings include our secured and unsecured notes payable, trust preferred securities and other debt instruments. The borrowings are valued based on discounted cash flow models that incorporate appropriate market discount rates. We calculated the market discount rate by obtaining period-end treasury rates for fixed-rate debt, or SOFR for variable-rate debt, for maturities that correspond to the maturities of our debt, adding appropriate credit spreads derived from information obtained from third-party financial institutions. These credit spreads take into account factors such as our credit rate, debt maturity, types of borrowings, and the loan-to-value ratios of the debt.
Our Company’s financial instruments also include cash, cash equivalents, receivables and accounts payable. The carrying values of these financial instruments approximate the fair values due to their short maturities. Additionally, there were
On August 11, 2026, we extended the maturity of our Minetta and Orpheum Theaters Loan with Santander Bank to
This MD&A should be read in conjunction with the accompanying unaudited condensed consolidated financial statements included in Part I, Item 1 (Financial Statements). The foregoing discussions and analyses contain certain forward-looking statements. Please refer to the “Cautionary Statement Regarding Forward-Looking Statements” included at the conclusion of this section and our “Risk Factors” set forth in our 2025 Form 10-K, Part 1 – Financial Information, Item 1A and the Risk Factors set out below.
Item 2 – Management’s Discussion and Analysis (“MD&A”) of Financial Condition and Results of Operations
The MD&A should be read in conjunction with our condensed consolidated financial statements and related notes in this Report.
Business Overview & Updates
Cinema Exhibition Segment
We are encouraged by the improved performance of our cinema business in the second quarter of 2026 While macroeconomic challenges remain, our second quarter results reflect improving global cinema industry momentum and support our confidence in the continued growth of our cinema business. Q2 2026 benefited from theatrical successes including The Super Mario Galaxy Movie, The Devil Wears Prada 2, Michael, Backrooms, Obsession, and Toy Story 5. These releases continued the momentum that was set in Q1 2026 by releases such as Project Hail Mary, Wuthering Heights, and Hoppers.
Certain current macroeconomic conditions continued to present challenges for our cinema operations during the relevant periods, which are listed below:
Cinema attendance levels have not returned to pre-pandemic levels;
Inflationary pressures, ongoing supply chain issues, increases in labor costs, fuel costs, and operating expenses in general continue to push up our variable costs while we encounter consumer resistance to higher ticket prices;
Higher fixed third-party cinema rent, including base rent escalations and cost-of-living adjustments, together with deferred rent obligations; and
General market and economic conditions.
We believe that our ongoing focus on operational efficiency and strategic initiatives has improved our operational results, and we continue to respond to the prevailing macroeconomic challenges by:
Driving guest attendance and engagement levels through:
oOur expanded Food and Beverage program. Beer and wine, and liquor service is available at nearly every one of our U.S. cinema locations. We are working towards mirroring these enhancements in our Australian and New Zealand markets, ensuring a consistent and premium experience for audiences across all regions.
oExpanding our loyalty and membership ecosystem. In late 2024, we replaced our former loyalty program, Reel Club with Reading Rewards and Angelika Rewards in Australia and New Zealand, with a paid Boost tier available for each. In the United States, we replaced our former loyalty program, Cinema Extras at Consolidated Theatres at the end of 2025 with both a free to join and membership. In early 2026 we launched a new free and paid membership loyalty program at Reading Cinemas. Our Angelika U.S. free membership program continues to grow, and we plan to launch a paid subscription tier in Q3 2026.
Applying a laser focus to cost control, with particular emphasis on cinema labor and utilities; and
Renegotiating our cinema leases and aligning our occupancy costs more effectively with current attendance levels, through abatements, revised lease terms, and where necessary, the closure of certain underperforming venues.
These initiatives have contributed to improved revenue generation and enhanced cost management, while highlighting our focus on delivering a compelling and differentiated cinema experience that supports repeat visitation.
Looking ahead, we believe that the rest of the 2026 film slate presents a major opportunity to continue the positive momentum that we are seeing. As of today, Q3 2026 titles such as The Odyssey, Minions & Monsters, and Spider Man: Brand New Day, and other compelling releases later in 2026, including The Hunger Games: Sunrise on the Reaping, Avengers: Doomsday, Dune: Part Three and Jumanji 3. These 2026 future releases are positioned to appeal to a wide variety of audiences. They cover a wide range of genres, from family animation to science fiction, and each have the potential to produce significant box office results. Supported by our strategic operational initiatives and continued audience engagement efforts, we believe that this diverse slate positions us well for a robust second half of the year.
Real Estate Segment
In the United States, we now own 100% of our Cinemas 1,2,3 property and as of February 2026 we have classified this property as held for sale. Our sales efforts are progressing, and we expect to complete the sale by the end of 2026. We continue to work to secure tenant(s) for the remaining space at our 44 Union Square property in New York, and we believe demand for space in the Union Square submarket is improving. Additionally, we continue to hold our Newberry Yard property in Williamsport, Pennsylvania for sale.
In Australia, our real estate revenues continue to have steady, strong performance, especially when measured in local currency.
Our monetization of our property in Napier, New Zealand, which we signed a purchase and sale agreement for on March 4, 2026, is on hold while we work with the buyer to resolve certain unforeseen issues with the owner of the car park, which the cinema leases.
To align with our liquidity priorities, we have largely deferred new real estate development. Capital spending in 2025 and to date in 2026 has been primarily focused on upgrades to our existing cinemas.
Company Overview
We are an internationally diversified company principally focused on the development, ownership, and operation of entertainment and real estate assets in the United States, Australia, and New Zealand. Currently, we operate in two business segments:
Cinema exhibition, through our 57 cinemas.
Real estate, including real estate development and the rental of retail, commercial, and Live Theatre assets.
Despite having monetized nine property assets since the pandemic, we believe our cinema and real estate segments remain complementary and central to our long-term growth strategy. Prior to the pandemic, cinema generated cash flows supported the capital requirements of our real estate development activities. During this period, we relied more heavily on income from our real estate assets and selectively monetized assets with embedded value to support the Company. With the effects of COVID-19 and the 2023 Hollywood strikes now largely behind us, we expect improved film quality and consistency to drive increased attendance and restore cinema generated cash flows as a key source of capital to expand and enhance our existing cinema and real estate portfolios. Currently, to address anticipated liquidity needs, Newberry Yard and Cinemas 1,2,3 are held for sale. Despite these planned dispositions, we expect to retain assets in Pennsylvania, Manhattan, and Australia that we believe offer meaningful long term value creation opportunities as capital resources permit.
Cinema Key Performance Indicators (“KPIs”)
(Unaudited; U.S. Dollars and functional currency thousands, except per patron data)
Food and Beverage Spend Per Patron
A key performance indicator utilized by management in our cinema exhibition segment is Food and Beverage (“F&B”) Spend Per Patron (“SPP”), which is calculated based on our total Food & Beverage Revenues on a post-tax basis divided by our attendance during a specific period.
One of our key strategic priorities is the continued enhancement of F&B offerings across several of our global cinema locations and is particularly important because F&B revenue is not shared with film distributors. We have a total of 37 theater locations globally that offer elevated food and beverage menus with options beyond traditional concessions like popcorn, soda, and candy. We use F&B SPP to assess top-line performance, benchmark against competitors, and evaluate pricing, promotions, and menu strategies at both global and individual location levels. While cinema profitability depends on factors such as labor and cost of goods, F&B SPP helps management optimize revenue.
Our F&B SPP in functional currency for the quarter and six months ended June 30, 2026, and June 30, 2025, are as follows:
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| Quarter Ended |
| % Change |
| Six Months Ended |
| % Change | ||||||||||||
Country |
| June 30, |
| June 30, |
| Fav/ |
| June 30, |
| June 30, |
| Fav/ | |||||||||
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United States |
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| $8.97 |
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| $9.13 |
| (1.8)% |
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| $8.73 |
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| $8.68 |
| 0.6% |
| ||
Australia |
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| $8.37 |
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| $8.26 |
| 1.3% |
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| $8.25 |
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| $8.08 |
| 2.1% |
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New Zealand |
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| $7.22 |
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| $7.14 |
| 1.1% |
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| $7.02 |
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| $6.99 |
| 0.4% |
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Average Ticket Price per Patron
Average Ticket Price (“ATP”) Per Patron is an important key performance indicator utilized by management in our cinema exhibition segment. It is calculated based on our total Box Office Revenues on a post-tax basis divided by our attendance during a specific period. ATP serves to measure our operational cinema performance when compared to that of our competitors. ATP is a useful metric for evaluating our ability to achieve a strong top line performance, gauging the effectiveness of our cinemas’ pricing strategies and our ability to draw audiences back to our theaters. Management uses ATP to adjust and inform ticket pricing schemes for our individual theaters, measure the effectiveness of our content programming, and ensure that price barriers are not created for core guests.
Our ATP in functional currency for the quarter and six months ended June 30, 2026, and June 30, 2025, are as follows:
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| Quarter Ended |
| % Change |
| Six Months Ended |
| % Change | ||||||||||||
Country |
| June 30, |
| June 30, |
| Fav/ |
| June 30, |
| June 30, |
| Fav/ | |||||||||
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United States |
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| $13.77 |
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| $13.44 |
| 2.5% |
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| $13.75 |
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| $13.46 |
| 2.1% |
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Australia |
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| $16.89 |
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| $16.34 |
| 3.4% |
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| $16.61 |
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| $16.00 |
| 3.8% |
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New Zealand |
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| $15.58 |
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| $14.70 |
| 6.0% |
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| $15.29 |
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| $14.30 |
| 6.9% |
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Real Estate Key Performance Indicators
The key performance indicators used by management in our real estate segment vary according to jurisdiction. At the current time, in the United States, we assess our real estate division (including 44 Union Square and our historical railroad assets, but excluding our Live Theatres), solely on a net operating income basis. We have no specific key performance standards to compare performance from period to period. Rather we analyze operating budgets and projections and compare actual results to budgeted or projected results from time to time.
In Australia and New Zealand, we assess our properties held for rent using net operating income, occupancy factor (the percentage of the net rentable area of our properties that are leased) and average lease duration. We believe our chosen indicators help us effectively assess the return on investment on our real estate assets.
Our real estate key performance indicator results for the quarter and six months ended June 30, 2026, and June 30, 2025, measured in functional currencies, are as follows:
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| Quarter Ended |
| % Change |
| Six Months Ended |
| % Change | ||||||||||||
Country | KPI |
| June 30, |
| June 30, |
| Fav/ |
| June 30, |
| June 30, |
| Fav/ | ||||||||
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United States | Net Operating Income (Loss) |
| $ | (371) |
| $ | (275) |
| (34.9) | % |
| $ | (680) |
| $ | (421) |
| (61.5) | % | ||
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Australia | Net Operating Income (Loss) |
| $ | 808 |
| $ | 718 |
| 12.5 | % |
| $ | 1,405 |
| $ | 1,740 |
| (19.3) | % | ||
| Occupancy Factor |
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| 98.3% |
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| 98.8% |
| (0.5) | %age points |
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| 98.3% |
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| 98.8% |
| (0.5) | %age points | ||
| Average Lease Duration |
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| 2.58 years |
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| 3.79 Years |
| (1.2) | yrs |
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| 2.58 years |
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| 3.79 Years |
| (1.2) | yrs | ||
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New Zealand | Net Operating Income (Loss) |
| $ | (217) |
| $ | (209) |
| (3.8) | % |
| $ | (409) |
| $ | (684) |
| 40.2 | % | ||
| Occupancy Factor |
|
| 100% |
|
| 100% |
| 0.0 | %age points |
|
| 100% |
|
| 100% |
| 0.0 | %age points | ||
| Average Lease Duration |
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| 0.17 years |
|
| 0.58 Years |
| (0.4) | yrs |
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| 0.17 years |
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| 0.58 Years |
| (0.4) | yrs | ||
In the case of our Live Theatres, with respect to key performance indicators, we primarily look to the Live Theatre rental revenue and ancillary income from the theatres. This key performance indicator represents box office revenues less amounts paid to producers for license fee settlements, plus ancillary income earned by us from certain theatre operations.
Cinema Exhibition Segment Overview
We operate our worldwide cinema businesses through various subsidiaries under various brands:
in the U.S., under the Reading Cinemas, Angelika Film Centers, and Consolidated Theatres brands.
in Australia, under the Reading Cinemas, Angelika Cinemas, and the State Cinema by Angelika brands, and for our one unconsolidated joint venture theatre, Event Cinemas.
in New Zealand, under the Reading Cinemas brand and for our two unconsolidated joint venture theatres, Rialto Cinemas.
Shown in the following table are the number of locations and screens in our cinema circuit in each country, by state/territory/region, our cinema brands, and our interest in the underlying assets as of June 30, 2026.
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| State / Territory / |
| Location |
| Screen |
| Interest in Asset |
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| ||
Country |
| Region |
| Count(3) |
| Count |
| Leased |
| Owned |
| Operating Brands |
United States |
| Hawaii |
| 6 |
| 74 |
| 6 |
| 0 |
| Consolidated Theatres |
|
| California |
| 4 |
| 48 |
| 4 |
| 0 |
| Angelika Film Center, Reading Cinemas |
|
| New York |
| 3 |
| 16 |
| 2 |
| 1 |
| Angelika Film Center |
|
| Texas |
| 1 |
| 8 |
| 1 |
| 0 |
| Angelika Film Center |
|
| New Jersey |
| 1 |
| 12 |
| 1 |
| 0 |
| Reading Cinemas |
|
| Virginia |
| 1 |
| 8 |
| 1 |
| 0 |
| Angelika Film Center |
|
| Washington, D.C. |
| 1 |
| 3 |
| 1 |
| 0 |
| Angelika Film Center |
|
| U.S. Total |
| 17 |
| 169 |
| 16 |
| 1 |
|
|
Australia |
| Victoria |
| 9 |
| 62 |
| 9 |
| 0 |
| Reading Cinemas |
|
| New South Wales |
| 6 |
| 42 |
| 6 |
| 0 |
| Reading Cinemas |
|
| Queensland |
| 7 |
| 63 |
| 5 |
| 2 |
| Reading Cinemas, Angelika Film Center, Event Cinemas |
|
| Western Australia |
| 4 |
| 27 |
| 3 |
| 1 |
| Reading Cinemas |
|
| South Australia |
| 2 |
| 15 |
| 2 |
| 0 |
| Reading Cinemas |
|
| Tasmania |
| 2 |
| 14 |
| 2 |
| 0 |
| Reading Cinemas, State Cinema by Angelika |
|
| Australia Total |
| 30 |
| 223 |
| 27 |
| 3 |
|
|
New Zealand |
| Wellington |
| 2 |
| 15 |
| 2 |
| 0 |
| Reading Cinemas |
|
| Otago |
| 2 |
| 12 |
| 1 |
| 1 |
| Reading Cinemas, Rialto Cinemas |
|
| Auckland |
| 2 |
| 15 |
| 2 |
| 0 |
| Reading Cinemas, Rialto Cinemas |
|
| Canterbury |
| 1 |
| 8 |
| 1 |
| 0 |
| Reading Cinemas |
|
| Southland |
| 1 |
| 5 |
| 1 |
| 0 |
| Reading Cinemas |
|
| Bay of Plenty |
| 1 |
| 5 |
| 0 |
| 1 |
| Reading Cinemas |
|
| Hawke's Bay |
| 1 |
| 4 |
| 0 |
| 1 |
| Reading Cinemas |
|
| New Zealand Total |
| 10 |
| 64 |
| 7 |
| 3 |
|
|
GRAND TOTAL |
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|
| 57 |
| 456 |
| 50 |
| 7 |
|
|
(1)Our Company has a 33.3% unincorporated joint venture interest in a 16-screen cinema located in Mt. Gravatt, Queensland managed by Event Cinemas.
(2)Our Company is a 50% joint venture partner in two New Zealand Rialto Cinemas, with a total of 13 screens. We are responsible for the booking of these cinemas and our joint venture partner, Event Cinemas, manages their day-to-day operations.
Our cinema revenues are primarily generated from ticket sales and rentals, food and beverage sales, screen advertising, gift cards and certificates, and booking fees from certain online and app purchases. Cinema operating expenses consist of the costs directly attributable to the operation of the cinemas, including (i) film rent expense, (ii) cost of goods sold, (iii) operating costs, such as labor costs and utilities, and (iv) occupancy costs. Cinema revenues and certain expenses fluctuate with the availability of quality content and the number of weeks such content stays on screen.
For a breakdown of our current cinema assets that we own and/or manage, please refer to Part I, Item 1 – Our Business of the Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2025 (the “2025 Form 10-K”).
Cinema Pipeline and Closures
We continue to actively evaluate multiple cinema opportunities, where we believe that they will provide an appropriate commercial return.
On April 15, 2025, we closed our underperforming cinema located in San Diego, California, and a second underperforming cinema in La Mesa, California, on May 31, 2026.
On February 9, 2025, we closed our underperforming cinema located in Queenstown.
Our Board has authorized management to proceed with the negotiation of a lease for a new state-of-the-art cinema, located in Noosa, Queensland, Australia.
On January 31, 2025, we sold our Wellington, New Zealand properties, including the Courtenay Central building, to Prime Property Group Limited (“Prime”) for $21.5 million (NZ$38.0 million). In connection with the sale, we entered into an Agreement to Lease with Prime for the cinema component of the to-be-redeveloped Courtenay Central building, under which Prime is obligated to redevelop the property and complete seismic upgrades to meet current earthquake standards. We intend to fit out and operate the existing 10-screen cinema under a long-term lease and renovate it to a “best-in-class” standard.
Cinema Upgrades
The upgrades to our cinema circuit’s film exhibition technology and amenities over the years are as summarized in the following table as of June 30, 2026:
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| Location Count |
| Screen |
Screen Format |
|
|
|
IMAX | 1 |
| 1 |
TITAN LUXE and TITAN XC | 26 |
| 32 |
70mm and/or 35mm projection | 13 |
| 20 |
Dine-in Service |
|
|
|
Gold Lounge (AU/NZ)(1) | 11 |
| 29 |
Premium (AU/NZ)(2) | 18 |
| 47 |
Upgraded Food & Beverage menu (U.S.)(3) | 14 |
| n/a |
Premium Seating (features recliner seating) | 35 |
| 210 |
Liquor Licenses (4) | 48 |
| n/a |
(1)Gold Lounge: This is our "First Class Full Dine-in Service" in our Australian and New Zealand cinemas, which includes an upgraded F&B menu (with alcoholic beverages), luxury recliner seating features (intimate 25-50 seat cinemas) and waiter service.
(2)Premium Service: This is our "Business Class Dine-in Service" in our Australian and New Zealand cinemas, which typically includes upgraded F&B menu (some with alcoholic beverages) and may include luxury recliner seating features, but no waiter service.
(3)Upgraded Food & Beverage Menu: Features an elevated F&B menu including a menu of locally inspired and freshly prepared items that go beyond traditional concessions, which we have worked with former Food Network executives to create. The elevated menu also includes beer, wine and/or spirits at most of our locations.
(4)Liquor Licenses: Licenses are applicable at each cinema location, rather than each cinema auditorium. As of today, we have beer and wine licenses in 100% of our cinemas and liquor licenses in all but three of our cinemas operating in the U.S. In Australia, 87% of our cinemas are licensed and we have no liquor licenses pending. In New Zealand, 3 of our cinemas are licensed.
Real Estate Segment Overview
Through our various subsidiaries, we engage in the real estate business through the development, ownership, rental or licensing to third parties of retail, commercial, and Live Theatre assets. Our real estate business creates long-term value for our stockholders through the continuous improvement and development of our investment and operating properties, including our Entertainment Themed Centers (“ETCs”). In addition to owning the fee interests in 7 of our cinemas (as presented in the table under Cinema Exhibition Overview), as of June 30, 2026, we:
own our 44 Union Square property in Manhattan comprised of retail and office space, which is partially leased to Petco;
own and operate two ETCs known as Newmarket Village (in a suburb of Brisbane), and the Belmont Common (in a suburb of Perth), the cinema components of which are included in the fee owned screen count above;
own and operate our administrative office building in South Melbourne, Australia;
own and operate the fee interests in two developed commercial properties in Manhattan improved with Live Theatres comprised of a single stage in each location;
own a 100% interest in Sutton Hill Properties LLC, which in turn owns the fee interest in and improvements constituting our Cinemas 1,2,3 located in Manhattan. In addition, in the fourth quarter of 2025, we wound up our long-term relationship with Sutton Hill Associates pursuant to a transaction whereby we purchased the 25% non-controlling minority interest in our Cinemas 1,2,3, property (also identified above as an “owned” cinema property) that we did not already own and the ground-lessee’s interest in the land and improvements constituting our Village East property. In February 2026, we classified our Cinemas 1,2,3 property as held for sale;
own the approximately 23.9-acre Newberry Yard property in Williamsport, Pennsylvania, which is currently held for sale; and
own approximately 201-acres principally in Pennsylvania from our legacy railroad business, including the Reading Viaduct in downtown Philadelphia.
For a breakdown of our real estate assets, made current by our discussion below, please refer to Part I, Item 1 – Our Business of our 2025 Form 10-K.
The combination of the COVID-19 pandemic, the lack of any U.S. public pandemic financial assistance due to our public company status, the 2023 Hollywood Strikes, increased interest rates, inflation, increased labor costs, and decreases in the value of the Australian Dollar and New Zealand Dollar vis-a-vis the U.S. Dollar over the past five years, have significantly impacted our cinema operations and necessitated capital conservation to sustain our cinema operations and service our debt. This has required us to rethink our real estate business plan and to monetize a number of properties that had pre-COVID been slated for long-term development.
Since 2021, we have monetized the following property assets:
(i)Our non-income producing land holding in Manukau, New Zealand (March 4, 2021);
(ii)Our non-income producing land holding in Coachella, California (March 5, 2021);
(iii)Our Redyard ETC in Auburn, Australia (June 9, 2021);
(iv)Our Royal George Live Theatre complex in Chicago (June 30, 2021, slated for redevelopment, and now being redeveloped for residential purposes by the new owner);
(v)The land underlying our cinema in Invercargill, New Zealand (August 30, 2021);
(vi)Our non-competitive four-screen cinema in Maitland, Australia (October 25, 2023);
(vii)Our administrative office building in Culver City, California (February 23, 2024);
(viii)On January 31, 2025, our Wellington properties, which included the Courtenay Central building; and
(ix)Most recently, on May 21, 2025, our Cannon Park property in Townsville, Queensland, Australia.
These properties were identified for sale and sold for various reasons, including:
(i)previously discussed liquidity needs,
(ii)the amount of capital required to materially increase their value in the immediate to mid-term,
(iii)with respect to certain assets, their immaterial or non-income producing nature, or
(iv)with respect to our Culver City office building, remote working making the property surplus to requirements.
United States:
44 Union Square Redevelopment (New York, N.Y.) – On January 27, 2022, we entered a long-term lease with Petco for the lower level, ground floor, and second floor of the building. We continue to explore a variety of possible office and non-office types of uses for the remainder of the building.
Minetta Lane Theatre (New York, N.Y.) – Audible has a license agreement with us through March 15, 2027. Audible presents productions and special live performance engagements on the Audible streaming service. During the second quarter of 2026, Audible presented a number of original productions, including the critically acclaimed play Sexual Misconduct of the Middle Class with Hugh Jackman (which opened in March 2026 and ran through April 2026, and which played previously during the second quarter of 2025), Tom Noonan’s What Happened Was, and Ella Hickson’s New Born.
Orpheum Theatre (New York, N.Y.) – STOMP closed (after 30 years at our theatre) on January 8, 2023. Under our termination agreement with the producers of STOMP, we have certain rights to provide the New York City venue for any future production of that show. Following STOMP’s historic run at the Orpheum, the theatre has hosted a variety of productions including Rachel Bloom’s Death, Let Me Do My Show, Hamlet starring Eddie Izzard, The Big Gay Jamboree, The Jonathon Larson Project, Ginger Twinsies, and 11 to Midnight.
Cinemas 1,2,3 (New York, N.Y.) – Currently operated as the Cinemas 1,2,3, and classified as held for sale from February 2026.
The Reading Viaduct and Adjacent Properties (Philadelphia, Pennsylvania) – We continue work to realize the value of our real estate holdings in the City of Philadelphia. Our properties include the 0.7-mile-long Reading Viaduct – a raised railbed with bridges spanning the Callowhill and Poplar neighborhoods of Philadelphia and reaching Vine Street in the City’s Central Business District. The Reading Viaduct comprises over 6.0 acres of land, calculated inclusive of our contiguous properties and bridges arching over various public streets and sidewalks that connect our multiple parcels into one continuous land-holding, unimpaired by public thoroughfares. Representatives of the City of Philadelphia and the City Center District have expressed interest in acquiring the Reading Viaduct for park purposes as an extension to the existing Rail Park. According to its website, the City Center District is “a private-sector organization dedicated to making Center City Philadelphia clean, safe, and attractive, is committed to maintaining Center City’s competitive edge as a regional employment center, a quality place to live, and a premier regional destination for dining, shopping, and cultural attractions.” For more information, go to www.CenterCityPhila.org. In December 2023, the City adopted an ordinance enabling the condemnation of the Reading Viaduct, and the transfer of the property to the City Center District for use as a public park. Furthering these initiatives, since railroad property (such as the Reading Viaduct) is exempt from condemnation by state governments so long as such property is subject to the jurisdiction and oversight of the Federal Surface Transportation Board (the “STB”), the City has petitioned the STB for a determination that the Reading Viaduct is no longer railroad property subject to STB jurisdiction and oversight (the “STB Proceeding”). On September 24, 2025 the STB ruled in the City’s favor, which determination we have appealed. We continue to believe that Reading Viaduct offers a substantial long-term opportunity for our Company through a potential sale, lease or joint venture of part or all of the property. Our properties adjoining our Reading Viaduct include various free-standing legal parcels that could be monetized separately and/or apart from the main body of our Reading Viaduct.
Australia:
Newmarket Village ETC (Brisbane, Australia) – We will continue to operate our Newmarket Village ETC, which includes Reading Cinemas as an anchor tenant. Our site includes a 23,218 square foot parcel adjacent to the center, improved with an office building. Over the next few years, we will be evaluating different development options for this space. The combined center and office building is 98% leased.
The Belmont Common, (Belmont, Perth, Australia) – The total gross leasable area of the Belmont Common is 60,117 square feet of net rentable land. Our multiplex cinema is the anchor tenant with six third-party tenants. The site is currently 100% leased.
Cannon Park ETC (Queensland, Australia) - On May 21, 2025, we sold our Cannon Park ETC, comprising approximately 9.4-acres, for a purchase price of $20.7 million (AU$32.0 million). We have retained a long-term lease of the cinema component of that property.
New Zealand:
On January 31, 2025, we sold all of our properties in Wellington, New Zealand. As discussed above, once the new landlord completes certain seismic upgrades we intend to fit out and operate the existing 10-screen cinema under a long-term lease and renovate it to a “best-in-class” standard.
Our monetization of our property in Napier, New Zealand, which we signed a purchase and sale agreement for on March 4, 2026, is on hold while we work with the buyer to resolve certain unforeseen issues with the owner of the car park, which the cinema leases.
For a complete list of our principal properties, see Part I, Item 2 – Properties under the heading “Investment and Development Property” in our 2025 Form 10-K.
Corporate Matters
Refer to Part I – Financial Information, Item 1 – Notes to Condensed Consolidated Financial Statements - Note 18 – Stock-Based Compensation and Stock Repurchases for details regarding our stock repurchase program and Board, Executive and Employee stock-based remuneration programs.
Please refer to our 2025 Form 10-K for more details on our cinema and real estate segments.
RESULTS OF OPERATIONS
The table below summarizes the results of operations for each of our principal business segments along with the non-segment information for the quarter and six months ended June 30, 2026, and June 30, 2025, respectively:
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| Quarter Ended |
| % Change |
| Six Months Ended |
| % Change | ||||||||||||
(Dollars in thousands) |
| June 30, |
| June 30, |
| Fav/ |
| June 30, |
| June 30, |
| Fav/ | |||||||||
SEGMENT RESULTS |
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| Revenue |
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| Cinema exhibition |
| $ | 62,990 |
|
| 56,782 |
| 11 | % |
| $ | 104,451 |
| $ | 93,186 |
| 12 | % | ||
| Real estate |
|
| 4,853 |
|
| 4,653 |
| 4 | % |
|
| 9,449 |
|
| 9,498 |
| (1) | % | ||
| Inter-segment elimination |
|
| (947) |
|
| (1,057) |
| 10 | % |
|
| (1,880) |
|
| (2,137) |
| 12 | % | ||
| Total revenue |
|
| 66,896 |
|
| 60,378 |
| 11 | % |
|
| 112,020 |
|
| 100,547 |
| 11 | % | ||
| Operating expense |
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| Cinema exhibition |
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| (50,857) |
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| (47,940) |
| (6) | % |
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| (90,683) |
|
| (85,597) |
| (6) | % | ||
| Real estate |
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| (1,936) |
|
| (1,840) |
| (5) | % |
|
| (3,822) |
|
| (3,795) |
| (1) | % | ||
| Inter-segment elimination |
|
| 947 |
|
| 1,057 |
| (10) | % |
|
| 1,880 |
|
| 2,137 |
| (12) | % | ||
| Total operating expense |
|
| (51,846) |
|
| (48,723) |
| (6) | % |
|
| (92,625) |
|
| (87,255) |
| (6) | % | ||
| Depreciation and amortization |
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| Cinema exhibition |
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| (1,953) |
|
| (2,172) |
| 10 | % |
|
| (3,946) |
|
| (4,312) |
| 8 | % | ||
| Real estate |
|
| (1,136) |
|
| (1,125) |
| (1) | % |
|
| (2,278) |
|
| (2,226) |
| (2) | % | ||
| Total depreciation and amortization |
|
| (3,089) |
|
| (3,297) |
| 6 | % |
|
| (6,224) |
|
| (6,538) |
| 5 | % | ||
| General and administrative expense |
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| Cinema exhibition |
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| (1,022) |
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| (1,217) |
| 16 | % |
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| (2,005) |
|
| (2,298) |
| 13 | % | ||
| Real estate |
|
| (203) |
|
| (209) |
| 3 | % |
|
| (382) |
|
| (403) |
| 5 | % | ||
| Total general and administrative expense |
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| (1,225) |
|
| (1,426) |
| 14 | % |
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| (2,387) |
|
| (2,701) |
| 12 | % | ||
| Segment operating income |
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| Cinema exhibition |
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| 9,158 |
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| 5,453 |
| 68 | % |
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| 7,817 |
|
| 979 |
| >100 | % | ||
| Real estate |
|
| 1,578 |
|
| 1,479 |
| 7 | % |
|
| 2,967 |
|
| 3,074 |
| (3) | % | ||
| Total segment operating income (loss) |
| $ | 10,736 |
| $ | 6,932 |
| 55 | % |
| $ | 10,784 |
| $ | 4,053 |
| >100 | % | ||
NON-SEGMENT RESULTS |
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| Depreciation and amortization expense |
|
| (83) |
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| (84) |
| 1 | % |
|
| (178) |
|
| (219) |
| 19 | % | ||
| General and administrative expense |
|
| (3,175) |
|
| (3,957) |
| 20 | % |
|
| (6,760) |
|
| (7,835) |
| 14 | % | ||
| Interest expense, net |
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| (4,321) |
|
| (4,354) |
| 1 | % |
|
| (8,549) |
|
| (9,096) |
| 6 | % | ||
| Equity earnings of unconsolidated joint ventures |
|
| 360 |
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| 285 |
| 26 | % |
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| 431 |
|
| 308 |
| 40 | % | ||
| Gain (loss) on sale of assets |
|
| — |
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| 1,872 |
| (>100) | % |
|
| — |
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| 8,398 |
| (>100) | % | ||
| Other income (expense) |
|
| 294 |
|
| (2,273) |
| >100 | % |
|
| (194) |
|
| (2,607) |
| 93 | % | ||
| Income before income taxes |
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| 3,811 |
|
| (1,579) |
| >100 | % |
|
| (4,466) |
|
| (6,998) |
| 36 | % | ||
| Income tax benefit (expense) |
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| (1,497) |
|
| (1,225) |
| (22) | % |
|
| (1,354) |
|
| (753) |
| (80) | % | ||
Net income (loss) |
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| 2,314 |
|
| (2,804) |
| >100 | % |
|
| (5,820) |
|
| (7,751) |
| 25 | % | |||
| Less: net income (loss) attributable to noncontrolling interests |
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| 44 |
|
| (137) |
| >100 | % |
|
| 57 |
|
| (328) |
| >100 | % | ||
Net income (loss) attributable to Reading International, Inc. |
| $ | 2,270 |
| $ | (2,667) |
| >100 | % |
| $ | (5,877) |
| $ | (7,423) |
| 21 | % | |||
Basic earnings (loss) per share |
| $ | 0.10 |
| $ | (0.12) |
| >100 | % |
| $ | (0.26) |
| $ | (0.33) |
| 21 | % | |||
Consolidated and Non-Segment Results:
Second Quarter Net Results
Revenue
Global revenue for the quarter ended June 30, 2026 increased by 11% from $60.4 million to $66.9 million compared to the equivalent prior-year period. This was driven by increased cinema revenues, primarily in Australia due to an improved movie slate led by movies
such Michael, The Super Mario Galaxy Movie, The Devil Wears Prada 2, and Toy Story 5. Such movies led to higher total circuit attendance volumes and higher ATP when compared to the second quarter of 2025. Our cinema revenues also benefited from an increase in 11% in the value of the Australian dollar against the comparative period. Real estate revenues held steady despite the impact of the sale of Cannon Park in May 2025 being offset by favorable exchange rate movements.
Global revenue for the six months ended June 30, 2026 increased by 11% from $100.5 million to $112.0 million compared to the equivalent prior-year period. This was driven by increased cinema revenues and an increase in 11% in the value of the Australian dollar across the comparative six month period. In addition to Q2’s movies, the six months to June 30, 2026 also benefited from the success of Project Hail Mary and Avatar: Fire and Ash in the first quarter. Real estate revenues held steady, with the impact of the sale of Cannon Park in May 2025 being offset by favorable exchange rate movements.
Segment Operating Income/(Loss)
Our total global segment operating income for the quarter ended June 30, 2026, increased by 55%, from net operating income of $6.9 million to net operating income of $10.7 million compared to the equivalent prior-year period. Our segment operating income benefited from increased attendance volumes due to an improved movie slate, and our major variable costs, being film rent, F&B and labor, while increasing, remained relatively consistent as a percentage of cinema revenue when compared to the prior period. Our reduced depreciation expense is a reflection of deferred capital investment in certain of our cinemas.
Our total global segment operating income for the six months ended June 30, 2026, increased by 166%, from net operating income of $4.1 million to net operating income of $10.8 million compared to the equivalent prior-year period. This was due to our second quarter performance, which resulted in a 52% increase in cinema revenues when compared to the quarter ended March 31, 2026.
During the second quarter of 2026, and indeed for the six months ended June 30, 2026, the Australia dollar strengthened against the U.S. dollar. The average Australia dollar exchange rate against the U.S. dollar for the second quarter of 2026 increased by 10.8% compared to the same period in 2025. The New Zealand dollar value has remained stable, with this exchange rate against the U.S. dollar weakened by only 1.5% in the second quarter of 2026 compared to the same period in 2025, but strengthened against the U.S. dollar by 1.1% in the six months to June 30, 2025.
Income Tax Expense
Income tax benefit for the quarter ended June 30, 2026, increased by 22% from $1.2 million to $1.5 million compared to the equivalent prior-year period. The change between 2026 and 2025 is primarily related to an increase in consolidated income in 2026.
Income tax expense for the six months ended June 30, 2026, increased by 80% from $0.8 million to $1.4 million compared to the equivalent prior-year period. The change between 2026 and 2025 is primarily related to a decrease in year-to-date consolidated losses in 2026.
Net Income/(Loss)
Our net income/(loss) for the quarter ended June 30, 2026, increased by 183%, from a net loss of $2.8 million to net income of $2.3 million. This was primarily due to our increased segment operating income and $794,000 of salary and bonus costs savings in general and administrative expenses, offset by a $1.9 million gain on sale of our property assets in Cannon Park, Australia and $2.3 million of foreign exchange losses not repeated in the current quarter.
Our net income/(loss) for the six months ended June 30, 2026, decreased by 25%, from a net loss of $7.8 million to a net loss of $5.8 million compared to the equivalent prior-year period. This was due to our improved segment operating income and a reduction of general and administrative expenses of $1.0 million. Such reductions were largely attributable to lower corporate salary and bonus costs, and were offset by a combined $8.4 million gain on sale on our Wellington, New Zealand and Cannon Park, Australia, properties. Income attributable to such sales was not replicated in the first six months of 2026. Additionally, a total of $2.6 million in exchange losses from the six months to June 30, 2025 were not repeated in the current period. Our interest expense reduced by $547,000 due to the pay down of debt from prior periods.
Business Segment Results
Cinema Exhibition
The following table details our cinema exhibition segment operating results for the quarter and six months ended June 30, 2026, and June 30, 2025, respectively:
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| % Change | |||
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| Quarter Ended |
| Six Months Ended |
| Fav/(Unfav) | |||||||||||||
(Dollars in thousands) | June 30, | % of Revenue | June 30, | % of Revenue |
| June 30, | % of Revenue | June 30, | % of Revenue |
| Quarter Ended | Six Months Ended | ||||||||
REVENUE |
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| United States | Admissions revenue | $ | 15,650 | 25% | $ | 16,099 | 28% |
| $ | 26,396 | 25% | $ | 26,344 | 28% |
| (3) | % | - | % |
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| Food & beverage revenue |
| 10,678 | 17% |
| 11,274 | 20% |
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| 17,386 | 17% |
| 17,382 | 19% |
| (5) | % | - | % |
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| Advertising and other revenue |
| 3,150 | 5% |
| 2,885 | 5% |
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| 5,159 | 5% |
| 4,827 | 5% |
| 9 | % | 7 | % |
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| $ | 29,478 | 47% | $ | 30,258 | 53% |
| $ | 48,941 | 47% | $ | 48,553 | 52% |
| (3) | % | 1 | % |
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| Australia | Admissions revenue | $ | 18,829 | 30% | $ | 14,275 | 25% |
| $ | 31,005 | 30% | $ | 23,905 | 26% |
| 32 | % | 30 | % |
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| Food & beverage revenue |
| 9,323 | 15% |
| 7,213 | 13% |
|
| 15,410 | 15% |
| 12,069 | 13% |
| 29 | % | 28 | % |
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| Advertising and other revenue |
| 1,829 | 3% |
| 1,421 | 3% |
|
| 3,272 | 3% |
| 2,617 | 3% |
| 29 | % | 25 | % |
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| $ | 29,981 | 48% | $ | 22,909 | 40% |
| $ | 49,687 | 48% | $ | 38,591 | 41% |
| 31 | % | 29 | % |
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| New Zealand | Admissions revenue | $ | 2,310 | 4% | $ | 2,338 | 4% |
| $ | 3,809 | 4% | $ | 3,884 | 4% |
| (1) | % | (2) | % |
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| Food & beverage revenue |
| 1,070 | 2% |
| 1,135 | 2% |
|
| 1,749 | 2% |
| 1,901 | 2% |
| (6) | % | (8) | % |
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| Advertising and other revenue |
| 151 | 0% |
| 142 | 0% |
|
| 265 | 0% |
| 257 | 0% |
| 6 | % | 3 | % |
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| $ | 3,531 | 6% | $ | 3,615 | 6% |
| $ | 5,823 | 6% | $ | 6,042 | 6% |
| (2) | % | (4) | % |
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| Total revenue | $ | 62,990 | 100% | $ | 56,782 | 100% |
| $ | 104,451 | 100% | $ | 93,186 | 100% |
| 11 | % | 12 | % | |
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OPERATING EXPENSE |
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| United States | Film rent and advertising cost | $ | (8,891) | 14% | $ | (9,108) | 16% |
| $ | (14,530) | 14% | $ | (14,166) | 15% |
| 2 | % | (3) | % |
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| Food & beverage cost |
| (2,661) | 4% |
| (2,931) | 5% |
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| (4,288) | 4% |
| (4,514) | 5% |
| 9 | % | 5 | % |
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| Occupancy expense |
| (3,968) | 6% |
| (4,420) | 8% |
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| (7,996) | 8% |
| (8,387) | 9% |
| 10 | % | 5 | % |
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| Labor cost |
| (4,343) | 7% |
| (4,212) | 7% |
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| (8,003) | 8% |
| (8,293) | 9% |
| (3) | % | 3 | % |
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| Utilities |
| (1,445) | 2% |
| (1,332) | 2% |
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| (2,648) | 3% |
| (2,551) | 3% |
| (8) | % | (4) | % |
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| Cleaning and maintenance |
| (1,509) | 2% |
| (1,754) | 3% |
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| (2,797) | 3% |
| (3,295) | 4% |
| 14 | % | 15 | % |
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| Other operating expenses |
| (1,906) | 3% |
| (2,321) | 4% |
|
| (3,865) | 4% |
| (4,468) | 5% |
| 18 | % | 13 | % |
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| $ | (24,723) | 39% | $ | (26,078) | 46% |
| $ | (44,127) | 42% | $ | (45,674) | 49% |
| 5 | % | 3 | % |
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| Australia | Film rent and advertising cost | $ | (8,515) | 14% | $ | (6,586) | 12% |
| $ | (13,590) | 13% | $ | (10,542) | 11% |
| (29) | % | (29) | % |
|
| Food & beverage cost |
| (2,024) | 3% |
| (1,531) | 3% |
|
| (3,391) | 3% |
| (2,606) | 3% |
| (32) | % | (30) | % |
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| Occupancy expense |
| (4,952) | 8% |
| (4,511) | 8% |
|
| (9,736) | 9% |
| (8,805) | 9% |
| (10) |
| (11) | % |
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| Labor cost |
| (4,242) | 7% |
| (3,425) | 6% |
|
| (7,941) | 8% |
| (6,732) | 7% |
| (24) |
| (18) | % |
|
| Utilities |
| (880) | 1% |
| (651) | 1% |
|
| (1,960) | 2% |
| (1,493) | 2% |
| (35) |
| (31) | % |
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| Cleaning and maintenance |
| (1,438) | 2% |
| (1,154) | 2% |
|
| (2,569) | 2% |
| (2,304) | 2% |
| (25) |
| (12) | % |
|
| Other operating expenses |
| (1,044) | 2% |
| (799) | 1% |
|
| (1,937) | 2% |
| (1,574) | 2% |
| (31) |
| (23) | % |
|
|
| $ | (23,095) | 37% | $ | (18,657) | 33% |
| $ | (41,124) | 39% | $ | (34,056) | 37% |
| (24) | % | (21) | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| New Zealand | Film rent and advertising cost | $ | (1,056) | 2% | $ | (1,141) | 2% |
| $ | (1,637) | 2% | $ | (1,789) | 2% |
| 7 | % | 8 | % |
|
| Food & beverage cost |
| (223) | 0% |
| (269) | 0% |
|
| (362) | 0% |
| (416) | 0% |
| 17 |
| 13 | % |
|
| Occupancy expense |
| (709) | 1% |
| (737) | 1% |
|
| (1,453) | 1% |
| (1,471) | 2% |
| 4 |
| 1 | % |
|
| Labor cost |
| (545) | 1% |
| (579) | 1% |
|
| (1,028) | 1% |
| (1,113) | 1% |
| 6 |
| 8 | % |
|
| Utilities |
| (132) | 0% |
| (136) | 0% |
|
| (231) | 0% |
| (234) | 0% |
| 3 |
| 1 | % |
|
| Cleaning and maintenance |
| (182) | 0% |
| (196) | 0% |
|
| (327) | 0% |
| (390) | 0% |
| 7 | % | 16 | % |
|
| Other operating expenses |
| (192) | 0% |
| (147) | 0% |
|
| (394) | 0% |
| (454) | 0% |
| (31) | % | 13 | % |
|
|
| $ | (3,039) | 5% | $ | (3,205) | 6% |
| $ | (5,432) | 5% | $ | (5,867) | 6% |
| 5 | % | 7 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total operating expense | $ | (50,857) | 81% | $ | (47,940) | 84% |
| $ | (90,683) | 87% | $ | (85,597) | 92% |
| (6) | % | (6) | % | |
|
|
|
|
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|
DEPRECIATION, AMORTIZATION, IMPAIRMENT AND GENERAL AND ADMINISTRATIVE EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
| United States | Depreciation and amortization | $ | (944) | 1% | $ | (1,157) | 2% |
| $ | (1,912) | 2% | $ | (2,278) | 2% |
| 18 | % | 16 | % |
|
| General and administrative expense |
| (606) | 1% |
| (731) | 1% |
|
| (1,253) | 1% |
| (1,456) | 2% |
| 17 | % | 14 | % |
|
|
| $ | (1,550) | 2% | $ | (1,888) | 3% |
| $ | (3,165) | 3% | $ | (3,734) | 4% |
| 18 | % | 15 | % |
|
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|
|
|
|
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|
|
|
|
|
|
|
|
| Australia | Depreciation and amortization | $ | (900) | 1% | $ | (905) | 2% |
| $ | (1,814) | 2% | $ | (1,819) | 2% |
| 1 | % | - | % |
|
| General and administrative expense |
| (420) | 1% |
| (427) | 1% |
|
| (756) | 1% |
| (772) | 1% |
| 2 | % | 2 | % |
|
|
| $ | (1,320) | 2% | $ | (1,332) | 2% |
| $ | (2,570) | 2% | $ | (2,591) | 3% |
| 1 | % | 1 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| New Zealand | Depreciation and amortization | $ | (109) | 0% | $ | (111) | 0% |
| $ | (219) | 0% | $ | (214) | 0% |
| 2 | % | (2) | % |
|
| General and administrative expense |
| 4 | (0)% |
| (58) | 0% |
|
| 3 | (0)% |
| (71) | 0% |
| >100 | % | >100 | % |
|
|
| $ | (105) | 0% | $ | (169) | 0% |
| $ | (216) | 0% | $ | (285) | 0% |
| 38 | % | 24 | % |
|
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|
| Total depreciation, amortization, general and administrative expense | $ | (2,975) | 5% | $ | (3,389) | 6% |
| $ | (5,951) | 6% | $ | (6,610) | 7% |
| 12 | % | 10 | % | |
|
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|
OPERATING INCOME (LOSS) – CINEMA |
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| ||
| United States | $ | 3,205 | 5% | $ | 2,292 | 4% |
| $ | 1,649 | 2% | $ | (855) | (1)% |
| 40 | % | >100 | % | |
| Australia |
| 5,566 | 9% |
| 2,920 | 5% |
|
| 5,993 | 6% |
| 1,944 | 2% |
| 91 | % | >100 | % | |
| New Zealand |
| 387 | 1% |
| 241 | 0% |
|
| 175 | 0% |
| (110) | (0)% |
| 61 | % | >100 | % | |
| Total Cinema operating income (loss) | $ | 9,158 | 15% | $ | 5,453 | 10% |
| $ | 7,817 | 7% | $ | 979 | 1% |
| 68 | % | >100 | % | |
Second Quarter Results
Revenue
Global cinema revenue for the quarter ended June 30, 2026, increased by 11% from $56.8 million to $63.0 million compared to the equivalent prior-year period. Mainstream movies such as Michael, The Super Mario Galaxy Movie, The Devil Wears Prada 2 and Toy Story 5 made for a mainstream slate that resonated with guests more strongly than the quarter ended June 30, 2025. Australia was the primary beneficiary of the increased cinema revenue with 15% higher attendance than the second quarter of 2025 and a 3.4% increased ATP. Australian cinema revenues benefited further from an increase in 11% in the value of the Australian dollar against the comparative period. The US saw a 2.4% increase in ATP, but overall attendance was down due to the May 2026 closure of our cinema 10-screen La Mesa cinema, the closure of our San Diego cinema in April 2025 and a weaker specialty slate compared to the comparative period. This quarter’s movie slate was not as well received in Hawaii as the same prior-year period, which further impacted our results. Our F&B revenue improvements in Australia were driven by attendance and foreign exchange benefits.
Global cinema revenue for the six months ended June 30, 2026, increased by 12% from $93.2 million to $104.5 million compared to the equivalent prior-year period. Movies such as Michael, The Super Mario Galaxy Movie, The Devil Wears Prada 2, Project Hail Mary and Toy Story 5 made for a mainstream movie slate which was stronger than the six months ended June 30, 2025. ATP increased for all three countries, while attendance reduced for the US due to the closure of our cinema in La Mesa in May 2026 and the closure of our San Diego cinema in April 2025, and a slightly weaker specialty movie slate.
Operating Expenses
Global cinema operating expenses for the quarter ended June 30, 2026, increased by 6% from $47.9 million to $50.9 million compared to the equivalent prior-year period. Operating expenses in Australia increased due to increased attendance and the impact of foreign exchange rates, but film rent costs as a proportion of box office attendance remained broadly similar. Our Australian occupancy cost increased due to scheduled rent increases and foreign exchange impacts, but our increases in revenue meant that occupancy cost as a proportion of revenue decreased. US expenses decreased 5% due to the overall reduced attendance caused by the closure of our La Mesa cinema, the closure of which also decreased our rent expense, but film rent patterns followed those of Australia.
Global cinema operating expenses for the six months ended June 30, 2026, increased by 6% from $85.6 million to $90.7 million compared to the equivalent prior-year period. This was driven by increased attendance in Australia, which increased cinema operating expenses while broadly holding our film rent, F&B and labor margins. US expenses decreased due to the impacts of increased attendance being offset by the closure of our La Mesa and San Diego cinemas, the impact of negotiated rent abatements, and savings in cleaning and maintenance and other operating expenses.
Depreciation, amortization, impairment, general and administrative expense
Depreciation, amortization, impairment, and general and administrative expenses for the quarter ended June 30, 2026, decreased by 12% from $3.4 million to $3.0 million, compared to the equivalent prior-year period.
Depreciation, amortization, impairment, and general and administrative expenses for the six months ended June 30, 2026, decreased by 10% from $6.6 million to $6.0 million, compared to the equivalent prior-year period.
Cinema Segment Operating Income/(Loss)
Our global cinema segment operating income/(loss) for the quarter ended June 30, 2026, increased by 68% from a net operating income of $5.5 million to net operating income of $9.2 million compared to the equivalent prior-year period. The improvement in segment operating income is due to increased cinema revenues in Australia offset by decreases in cinema revenues in the US and New Zealand, and decreases in operating expenses in the US and New Zealand offset by attendance-driven increases in Australia.
Our global cinema segment operating income/(loss) for the six ended June 30, 2026, increased by 698% from net operating income of $1.0 million to net operating income of $7.8 million compared to the equivalent prior-year period. The improvement in segment operating income is due to increased cinema revenues in Australia and the US offset by higher operating expenses in Australia.
Real Estate
The following table details our real estate segment operating results for the quarter ended June 30, 2026 and June 30, 2025, respectively:
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| % Change | |||
|
|
| Quarter Ended |
| Six Months Ended |
| Fav/(Unfav) | |||||||||||||
(Dollars in thousands) | June 30, | % of | June 30, | % of |
| June 30, | % of | June 30, | % of |
| Quarter Ended | Fav/ | ||||||||
REVENUE |
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| ||
| United States | Live theatre rental and ancillary income | $ | 824 | 17% | $ | 630 | 14% |
| $ | 1,572 | 17% | $ | 1,173 | 12% |
| 31 | % | 34 | % |
|
| Property rental income |
| 1,055 | 22% |
| 1,070 | 23% |
|
| 2,107 | 22% |
| 2,114 | 22% |
| (1) | % | - | % |
|
|
|
| 1,879 | 39% |
| 1,700 | 37% |
|
| 3,679 | 39% |
| 3,287 | 35% |
| 11 | % | 12 | % |
| Australia | Property rental income |
| 2,762 | 57% |
| 2,741 | 59% |
|
| 5,343 | 57% |
| 5,756 | 61% |
| 1 | % | (7) | % |
| New Zealand | Property rental income |
| 212 | 4% |
| 212 | 5% |
|
| 427 | 5% |
| 455 | 5% |
| - | % | (6) | % |
| Total revenue |
| $ | 4,853 | 100% | $ | 4,653 | 100% |
| $ | 9,449 | 100% | $ | 9,498 | 100% |
| 4 | % | (1) | % |
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OPERATING EXPENSE |
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|
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|
|
|
| ||
| United States | Live theatre cost | $ | (259) | 5% | $ | (255) | 5% |
| $ | (532) | 6% | $ | (492) | 5% |
| (2) | % | (8) | % |
|
| Occupancy expense |
| (220) | 5% |
| (174) | 4% |
|
| (445) | 5% |
| (352) | 4% |
| (26) | % | (26) | % |
|
| Utilities |
| (34) | 1% |
| 16 | (0)% |
|
| (103) | 1% |
| (28) | 0% |
| (>100) | % | (>100) | % |
|
| Cleaning and maintenance |
| (141) | 3% |
| (75) | 2% |
|
| (177) | 2% |
| (106) | 1% |
| (88) | % | (67) | % |
|
| Other operating expenses |
| (217) | 4% |
| (264) | 6% |
|
| (430) | 5% |
| (430) | 5% |
| 18 | % | - | % |
|
|
|
| (871) | 18% |
| (752) | 16% |
| $ | (1,687) | 18% | $ | (1,408) | 15% |
| (16) | % | (20) | % |
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
| Australia | Occupancy expense |
| (474) | 10% |
| (479) | 10% |
| $ | (925) | 10% | $ | (967) | 10% |
| 1 | % | 4 | % |
|
| Labor cost |
| (5) | 0% |
| (76) | 2% |
|
| (8) | 0% |
| (119) | 1% |
| 93 | % | 93 | % |
|
| Utilities |
| (18) | 0% |
| (20) | 0% |
|
| (49) | 1% |
| (34) | 0% |
| 10 | % | (44) | % |
|
| Cleaning and maintenance |
| (281) | 6% |
| (215) | 5% |
|
| (532) | 6% |
| (435) | 5% |
| (31) | % | (22) | % |
|
| Other operating expenses |
| (211) | 4% |
| (198) | 4% |
|
| (458) | 5% |
| (456) | 5% |
| (7) | % | - | % |
|
|
|
| (989) | 20% |
| (988) | 21% |
| $ | (1,972) | 21% | $ | (2,011) | 21% |
| - | % | 2 | % |
|
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|
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|
|
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|
|
|
|
| New Zealand | Occupancy expense |
| (35) | 1% |
| (31) | 1% |
| $ | (69) | 1% | $ | (89) | 1% |
| (13) | % | 22 | % |
|
| Labor cost |
| — | 0% |
| — | 0% |
|
| — | 0% |
| (2) | 0% |
| - | % | 100 | % |
|
| Utilities |
| — | 0% |
| — | 0% |
|
| — | 0% |
| (5) | 0% |
| - | % | 100 | % |
|
| Cleaning and maintenance |
| — | 0% |
| — | 0% |
|
| — | 0% |
| (4) | 0% |
| - | % | 100 | % |
|
| Other operating expenses |
| (41) | 1% |
| (69) | 1% |
|
| (94) | 1% |
| (276) | 3% |
| 41 | % | 66 | % |
|
|
|
| (76) | 2% |
| (100) | 2% |
| $ | (163) | 2% | $ | (376) | 4% |
| 24 | % | 57 | % |
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| Total operating expense |
| $ | (1,936) | 40% | $ | (1,840) | 40% |
| $ | (3,822) | 40% | $ | (3,795) | 40% |
| (5) | % | (1) | % |
|
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|
DEPRECIATION, AMORTIZATION, GENERAL AND ADMINISTRATIVE EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
| United States | Depreciation and amortization | $ | (651) | 13% | $ | (674) | 14% |
| $ | (1,309) | 14% | $ | (1,333) | 14% |
| 3 | % | 2 | % |
|
| General and administrative expense |
| (174) | 4% |
| (185) | 4% |
|
| (345) | 4% |
| (315) | 3% |
| 6 | % | (10) | % |
|
|
|
| (825) | 17% |
| (859) | 18% |
|
| (1,654) | 18% |
| (1,648) | 17% |
| 4 | % | - | % |
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| Australia | Depreciation and amortization | $ | (426) | 9% | $ | (391) | 8% |
| $ | (850) | 9% | $ | (776) | 8% |
| (9) | % | (10) | % |
|
| General and administrative expense |
| (5) | 0% |
| (24) | 1% |
|
| (13) | 0% |
| (87) | 1% |
| 79 | % | 85 | % |
|
|
|
| (431) | 9% |
| (415) | 9% |
|
| (863) | 9% |
| (863) | 9% |
| (4) | % | - | % |
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| New Zealand | Depreciation and amortization |
| (59) | 1% |
| (60) | 1% |
|
| (119) | 1% |
| (117) | 1% |
| 2 | % | (2) | % |
|
| General and administrative expense |
| (24) | 0% |
| — | 0% |
|
| (24) | 0% |
| (1) | 0% |
| - | % | (>100) | % |
|
|
|
| (83) | 2% |
| (60) | 1% |
|
| (143) | 2% |
| (118) | 1% |
| (38) | % | (21) | % |
|
|
|
| — |
|
| — |
|
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|
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|
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|
|
| - |
|
|
|
| Total depreciation, amortization, general and administrative expense | $ | (1,339) | 28% | $ | (1,334) | 29% |
| $ | (2,660) | 28% | $ | (2,629) | 28% |
| - | % | (1) | % | |
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|
OPERATING INCOME (LOSS) - REAL ESTATE |
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|
|
|
|
|
| ||
| United States | $ | 183 | 4% | $ | 89 | 2% |
| $ | 338 | 4% | $ | 231 | 2% |
| >100 | % | 46 | % | |
| Australia |
| 1,342 | 28% |
| 1,338 | 29% |
|
| 2,508 | 27% |
| 2,882 | 30% |
| - | % | (13) | % | |
| New Zealand |
| 53 | 1% |
| 52 | 1% |
|
| 121 | 1% |
| (39) | (0)% |
| 2 | % | >100 | % | |
| Total real estate operating income (loss) | $ | 1,578 | 33% | $ | 1,479 | 32% |
| $ | 2,967 | 31% | $ | 3,074 | 32% |
| 7 | % | (3) | % | |
Second Quarter Results
Revenue
Real estate revenue for the quarter ended June 30, 2026, remained broadly consistent with the equivalent prior-year period. This was due to the loss of property rental income from the monetization of Cannon Park in May 2025, offset by strengthening Australian dollar exchange rates and higher Live Theatre rental and ancillary income.
Real estate revenue for the six months ended June 30, 2026, remained broadly consistent with the equivalent prior-year period, reflective of the loss of rental revenue from the monetization of Cannon Park.
Real Estate Segment Income/(Loss)
Real estate segment operating income/(loss) for the quarter ended June 30, 2026, increased by 7% from net operating income of $1.5 million to net operating income of $1.6 million compared to the equivalent prior-year period. This was driven by movements in revenue, as costs remain broadly similar to the comparative period.
Real estate segment operating income/(loss) for the six months ended June 30, 2026, decreased by 3% from net operating income of $3.1 million to net operating income of $3.0 million compared to the equivalent prior-year period.
LIQUIDITY AND CAPITAL RESOURCES
Our Financing Position
As of June 30, 2026, we had $5.7 million in unrestricted cash and cash equivalents compared to $10.5 million on December 31, 2025. The changes in cash and cash equivalents for the quarter ended June 30, 2026, and June 30, 2025, respectively, are discussed as follows:
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| Six Months Ended |
|
|
| ||||
|
| June 30, |
|
|
| ||||
(Dollars in thousands) |
| 2026 |
| 2025 |
| % Change | |||
Net cash provided by (used in) operating activities |
| $ | 682 |
| $ | (6,151) |
| >100 | % |
Net cash provided by (used in) investing activities |
|
| (1,418) |
|
| 37,806 |
| (>100) | % |
Net cash provided by (used in) financing activities |
|
| (4,426) |
|
| (34,883) |
| 87 | % |
Effect of exchange rate on cash and restricted cash |
|
| 263 |
|
| 101 |
| >100 | % |
Increase (decrease) in cash and cash equivalents and restricted cash |
| $ | (4,899) |
| $ | (3,127) |
| (57) | % |
Operating activities
Cash used in operating activities for the six months ended June 30, 2026, increased from cash used of $6.2 million, to $0.7 million provided by operating activities compared to the same period in the prior year. This was due to increases in attendance driving improved operating results.
Investing activities
Cash used in investing activities during the six months ended June 30, 2026 was $1.4 million, compared to cash provided in the same prior year period of $37.8 million. This was due to the proceeds on sale of our Wellington and Cannon Park properties in the prior year period. In the current period, we continued to complete strategic upgrades and renovations of certain theaters.
Financing activities
Cash used in financing activities for the six months ended June 30, 2026, decreased from $34.9 million to $4.4 million compared to the same prior year period. In the six months to June 30, 2025, we repaid our $10.5 million Westpac loan and $6.1 million of our Bank of America loan following the monetization of our Wellington properties and Cannon Park. In the six months to June 30, 2026, we made scheduled repayments on certain loans, rather than larger pay downs triggered by maturities or asset monetizations.
On June 30, 2026, our total outstanding borrowings gross of direct financing costs were $183.1 million compared to $185.1 million on December 31, 2025. The table below presents the changes in our total available resources (cash and borrowings), debt-to-equity ratio, working capital, and other relevant information addressing our liquidity for the six months ended June 30, 2026, and preceding four years:
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| As of and |
| Year Ended December 31 | |||||||||||
(Dollars in thousands) |
| June 30, 2026 |
| 2025 |
| 2024 |
| 2023 |
| 2022 | |||||
Total Resources (cash and borrowings) |
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Cash and cash equivalents (unrestricted) |
| $ | 5,680 |
| $ | 10,531 |
| $ | 12,347 |
| $ | 12,906 |
| $ | 29,947 |
Unused borrowing facility |
|
| 2,859 |
|
| 2,359 |
|
| 7,859 |
|
| 7,859 |
|
| 12,000 |
Restricted for capital projects |
|
| 2,859 |
|
| 2,359 |
|
| 7,859 |
|
| 7,859 |
|
| 12,000 |
Unrestricted capacity |
|
| — |
|
| — |
|
| — |
|
| — |
|
| — |
Total resources at period end |
|
| 8,539 |
|
| 12,890 |
|
| 20,206 |
|
| 20,765 |
|
| 41,947 |
Total unrestricted resources at period end |
|
| 5,680 |
|
| 10,531 |
|
| 12,347 |
|
| 12,906 |
|
| 29,947 |
Debt-to-Equity Ratio |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total contractual facility |
| $ | 185,916 |
| $ | 187,450 |
| $ | 210,572 |
| $ | 218,159 |
| $ | 227,633 |
Total debt (gross of deferred financing costs) |
|
| 183,057 |
|
| 185,091 |
|
| 202,713 |
|
| 210,300 |
|
| 215,633 |
Current |
|
| 107,956 |
|
| 35,999 |
|
| 69,193 |
|
| 35,070 |
|
| 38,026 |
Non-current |
|
| 75,101 |
|
| 149,092 |
|
| 133,520 |
|
| 175,230 |
|
| 177,607 |
Finance lease liabilities |
|
| — |
|
| — |
|
| 43 |
|
| 83 |
|
| 28 |
Total book equity |
|
| (23,141) |
|
| (18,098) |
|
| (4,790) |
|
| 32,996 |
|
| 63,279 |
Debt-to-equity ratio |
|
| (7.91) |
|
| (10.23) |
|
| (42.32) |
|
| 6.37 |
|
| 3.41 |
Changes in Working Capital |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Working capital (deficit) |
| $ | (157,379) |
| $ | (106,765) |
| $ | (104,584) |
| $ | (88,373) |
| $ | (74,152) |
Current ratio |
|
| 0.23 |
|
| 0.17 |
|
| 0.35 |
|
| 0.30 |
|
| 0.39 |
Capital Expenditures (including acquisitions) |
| $ | 1,389 |
| $ | 1,498 |
| $ | 2,028 |
| $ | 4,711 |
| $ | 9,780 |
(1)Our working capital is reported as a deficit, as we receive revenue from our cinema business ahead of the time that we have to pay our associated liabilities. We use the money we receive to pay down our borrowings in the first instance.
Our working capital deficit increased at June 30, 2026, because of the loans due in twelve months as discussed in Note 13 - Borrowings and further below.
Our Financing Strategy
Responding to a rapidly evolving operating environment
We manage our cash, investments, and capital structure to meet the short-term and long-term obligations of our business, while maintaining financial flexibility and liquidity. We forecast, analyze, and monitor our cash flows to enable investment and financing within the overall constraints of our financial strategy.
Prior to the COVID-19 pandemic, we used cash generated from operations and other excess cash, to the extent not needed, to fund capital investments contemplated by our business plan, in order to pay down our loans and credit facilities. This provided us with availability under our loan facilities for future use and thereby, reduced interest charges. On a periodic basis, we reviewed the maturities of our borrowing arrangements and negotiated renewals and extensions where necessary.
The COVID-19 pandemic, the 2023 Hollywood Strikes and periods of weak theatrical releases, augmented by changing consumer habits due to each of the foregoing, and continuing macroeconomic headwinds such as high interest rates, inflation, supply chain issues and increased film rent (particularly on popular releases), labor, and operating costs, have necessitated a change in strategy while the global cinema business recovers. We have taken a variety of steps across our various operating jurisdictions to reduce our spending, including, without limitation, deferring non-essential capital expenditures, deferring certain operational expenses, renegotiating occupancy arrangements, closing certain unprofitable cinemas, deferring compensation expenses, and eliminating certain travel and entertainment expenses.
Actively managing our debt
As of June 30, 2026, we have debt of $108.0 million (being our current debt and our current subordinated debt) coming due in the next 12 months. Although central banks in the three countries in which we operate have reduced interest rates from recent highs, rates remain elevated compared with pre-pandemic levels (that being said, our New Zealand operations are unencumbered by debt). We continue to monitor debt maturities and, where appropriate, seek extensions or other modifications. We believe that our bank lenders understand that the continuing effects of the factors discussed in the preceding paragraph, and various economic factors, are not of our own making,
that we are taking aggressive steps to manage these industry headwinds, and that, generally speaking, our relationships with our lenders are positive.
In the U.S., we have recently modified our 44 Union Square and Bank of America loans to defer scheduled repayments with no changes to interest rates or maturity dates. We continue to make principal payments on this facility.
In Australia, our NAB financing requires that our Company comply with certain covenants. Furthermore, our Company’s use of loan funds from NAB is limited due to restrictions on the expatriation of funds from Australia to the United States. We have recently extended this facility by five years on November 12, 2025, to a current maturity date of July 31, 2030, and obtained temporary reductions to our minimum liquidity requirement for a defined period in 2026. We used a portion of the proceeds raised from the sale of Cannon Park in May 2025 to reduce our NAB facility by $12.9 million (AU$20.0 million). The U.S. dollar value of our Australian borrowings is subject to changes in foreign exchange rates, which may or may not be material depending on currency fluctuations. However, since we intend to repay this debt using Australian revenues, we do not consider such fluctuations material to our overall strategy.
For more information about our borrowings, please refer to Part I – Financial Information, Item 1 – Notes to Condensed Consolidated Financial Statements - Note 13 – Borrowings. For more information about our efforts to manage our liquidity issues, see Part I - Financial Information, Item 1 – Notes to Condensed Consolidated Financial Statements – Note 2 – Liquidity and Impairment Assessment.
Pursuing further asset monetizations where appropriate
As discussed elsewhere in this Report, we have monetized a number of assets and used the proceeds to support our ongoing liquidity, and are working towards two further monetizations.
Our Newberry Yard property in Williamsport, Pennsylvania continues to be listed as an asset held for sale. This property was historically used as a rail yard, and, accordingly, improved with tracks and switches and has direct access to the area’s rail system. Certain issues as to the location of various railroad rights of way have now been resolved on what we believe to be favorable terms and terms which enhanced the value of the property.
In December 2025 we wound up our relationship with Sutton Hill Associates (“SHA”) to among other things, obtain complete legal ownership of our Cinemas 1,2,3 property. Our 2025 Form 10-K discusses the mechanics of this transaction. In February 2026 we retained Newmark & Company Real Estate, Inc. to monetize the property. While no assurances can be given, we believe it reasonable to assume that these assets can be monetized before the end of the year. We assume that any buyer will be contemplating the redevelopment of the property for residential purposes (which we believe to be the highest and best use of the property and which we do not currently have the capital to pursue) and have advised our brokers that we are prepared to remain in occupancy during the development period. The only debt on our Cinemas 1,2,3 property is a $19.7 million first mortgage.
Liquidity expectations
We believe that cinema cash flow for 2026 will be stronger than in recent periods, but we continue to face significant macroeconomic challenges. While we are taking a variety of steps, as discussed above, to address these challenges, we may be required to adopt one or more alternatives to raise further liquidity if our Company is unable to generate sufficient cash flow in the upcoming months. Such alternatives may include, but are not limited to, further reducing, delaying or eliminating planning capital expenditures, monetizing additional assets, restructuring our debt and/or our lease obligations, or finding additional sources of liquidity. See also Note 2 – Liquidity and Impairment Assessment for discussion of our going concern assessment.
CONTRACTUAL OBLIGATIONS, COMMITMENTS AND CONTINGENCIES
The following table provides information with respect to the maturities and scheduled principal repayments of our recorded contractual obligations and certain of our commitments and contingencies, either recorded or off-balance sheet, as of June 30, 2026:
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
(Dollars in thousands) |
| 2026 |
| 2027 |
| 2028 |
| 2029 |
| 2030 |
| Thereafter |
| Total | |||||||
Debt(1) |
| $ | 81,337 |
| $ | 3,043 |
| $ | 3,043 |
| $ | 3,043 |
| $ | 51,033 |
| $ | 13,645 |
| $ | 155,144 |
Subordinated debt(1) |
|
| — |
|
| 27,913 |
|
| — |
|
| — |
|
| — |
|
| — |
|
| 27,913 |
Estimated interest on debt (2) |
|
| 6,031 |
|
| 5,738 |
|
| 4,454 |
|
| 4,282 |
|
| 2,745 |
|
| 3,079 |
|
| 26,329 |
Operating leases, including imputed interest |
|
| 29,496 |
|
| 26,722 |
|
| 25,440 |
|
| 23,442 |
|
| 21,699 |
|
| 106,979 |
|
| 233,778 |
Pension liability |
|
| 292 |
|
| 607 |
|
| 640 |
|
| 442 |
|
| — |
|
| — |
|
| 1,981 |
Interest on pension liability |
|
| 50 |
|
| 77 |
|
| 44 |
|
| 11 |
|
| — |
|
| — |
|
| 182 |
Total |
| $ | 117,206 |
| $ | 64,100 |
| $ | 33,621 |
| $ | 31,220 |
| $ | 75,477 |
| $ | 123,703 |
| $ | 445,327 |
(1)Information is presented gross of deferred financing costs.
(2)Estimated interest on debt is based on the anticipated loan balances for future periods and current applicable interest rates.
Litigation
We are currently involved in certain legal proceedings and, as required, have accrued estimates of probable and estimable losses for the resolution of these claims.
Please refer to Part I, Item 3 – Legal Proceedings in our 2025 Form 10-K for more information. There have been no material changes to our litigation since our 2025 Form 10-K, except as set forth in Notes to Condensed Consolidated Financial Statements - Note 16 – Commitments and Contingencies included herein in Part I – Financial Information, Item 1 – Financial Statements on this Quarterly Report on Form 10-Q. This note sets out our litigation accounting policies.
Off-Balance Sheet Arrangements
There are no off-balance sheet arrangements or obligations (including contingent obligations) that have, or are reasonably likely to have, a current or future material effect on our financial condition, changes in the financial condition, revenue or expense, results of operations, liquidity, capital expenditures or capital resources.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
We believe that the application of the following accounting policies requires significant judgments and estimates in the preparation of our Condensed Consolidated Financial Statements and hence, are critical to our business operations and the understanding of our financial results:
(i) Impairment of Long-lived Assets (other than Goodwill and Intangible Assets with indefinite lives) – we evaluate our long-lived assets and finite-lived intangible assets using historical and projected data of cash flows as our primary indicator of potential impairment and we take into consideration the seasonality of our business. If the sum of the estimated, undiscounted future cash flows is less than the carrying amount of the asset, then an impairment is recognized for the amount by which the carrying value of the asset exceeds its estimated fair value based on an appraisal or a discounted cash flow calculation. For certain non-income producing properties or for those assets with no consistent historical or projected cash flows, we obtain appraisals or other evidence to evaluate whether there are impairment indicators for these assets.
No impairment losses were recorded for long-lived and finite-lived intangible assets for the quarter ended June 30, 2026.
(ii) Impairment of Goodwill and Intangible Assets with indefinite lives – goodwill and intangible assets with indefinite useful lives are not amortized, but instead, tested for impairment at least annually on a reporting unit basis. The impairment evaluation is based on the present value of estimated future cash flows of each reporting unit plus the expected terminal value. There are significant assumptions and estimates used in determining the future cash flows and terminal value. The most significant assumptions include our cost of debt and cost of equity assumptions that comprise the weighted average cost of capital for each reporting unit. Accordingly, actual results could vary materially from such estimates.
No impairment losses were recorded for goodwill and indefinite-lived intangible assets for the quarter ended June 30, 2026.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Our statements in this quarterly report, including the documents incorporated herein by reference, contain a variety of forward-looking statements as defined by the Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: "may," "will," "expect," "believe," "intend," "future," and "anticipate" and similar references to future periods. Examples of forward-looking statements include, among others, our beliefs regarding the impact of the 2023 Hollywood Strikes on the cinema business; our expected operating results, including our ultimate return to pre-pandemic type results; our expectations regarding the recovery and future of the cinema exhibition industry, including the strength of movies anticipated for release in the future; our expectations regarding patrons returning to our theatres and continuing to use discretionary funds on entertainment outside of the home; our beliefs regarding the impact of our cinema-anchored real estate developments; our beliefs regarding the success of our diversified business strategy; our belief regarding the attractiveness of 44 Union Square to potential tenants and ability to lease space on acceptable terms; our ability to complete the sale of our Cinemas 1,2,3 property and our ability to remain at the property during the development period; our expectations regarding the effects of our enhanced F&B offerings and loyalty program changes on our operating results; our expectations regarding our ability to monetize our assets on terms acceptable to us; our expectations regarding credit facility covenant compliance and our ability to continue to obtain necessary covenant waivers and loan extensions on terms acceptable to us; our expectations regarding interest rate and currency exchange rate fluctuations; impacts of recent cinema closures on cinema revenue going forward; and our expectations of our liquidity and capital requirements and the allocation of funds.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following:
With respect to our cinema and Live Theatre operations:
reduced consumer demand due to inflationary pressures and other macroeconomic pressures;
the adverse continuing effects of external events of the past pandemic and the 2023 Hollywood strikes on our Company’s results from operations, liquidity, cash flows, financial condition, and access to credit markets;
a change in consumer behavior in favor of alternative forms or mediums of entertainment, and limited availability of wide motion picture release content;
reduction in operating margins (or negative operating margins) due to (i) decreased attendance, (ii) limited availability of wide release content, and (iii) increased operating expenses;
competition from cinema operators who have successfully used debtor laws to reduce their debt and/or rent exposure;
the uncertainty as to the scope and extent of our government’s potential responses to future outbreak of infectious diseases;
the number and attractiveness to moviegoers of the films released in future periods, and potential changes in release dates for motion pictures;
the lack of availability of films in the short- or long-term as a result of (i) major film distributors releasing scheduled theatrical films on alternative channels; (ii) disruptions of film production;
the amount of money spent by film distributors to promote their motion pictures;
the licensing fees and terms required by film distributors from motion picture exhibitors in order to exhibit their films;
the comparative attractiveness of motion pictures as a source of entertainment and willingness and/or ability of consumers (i) to spend their dollars on entertainment and (ii) to spend their entertainment dollars on movies in an outside-the-home environment;
the extent to which we encounter competition from other cinema exhibitors, from other sources of outside-the-home entertainment, and from inside-the-home entertainment options, such as “home cinemas” and competitive film product distribution technology, such as, streaming, cable, satellite broadcast, and video on demand platforms;
our ability to continue to obtain, to the extent needed, waivers or other financial accommodations from our lenders and landlords;
the impact of major movies being released directly to one of the multitudes of streaming services available;
the impact of certain competitors’ subscription or advance pay programs;
the failure of our new initiatives to gain significant customer acceptance and use or to generate meaningful profits;
the cost and impact of improvements to our cinemas, such as improved seating, enhanced F&B offerings, and other improvements;
the ability to negotiate favorable rent abatement, deferral and repayment terms with our landlords (which may include lenders who have foreclosed on the collateral held by our prior landlords);
disruptions during cinema improvements;
in the U.S., the impact of the termination and phase-out of the so called “Paramount Decree”;
the risk of damage and/or disruption of cinema businesses from earthquakes as certain of our operations are in geologically active areas;
the impact of protests, demonstrations, and civil unrest on, among other things, government policy, consumer willingness to go to the movies;
labor shortages and increased labor costs related to such shortages and to increasingly costly labor laws and regulations applicable to part time non-exempt workers;
disruptions in film supply and film marketing due to the 2023 Hollywood Strikes; and
competition from a newly restructured Regal, which may have lower occupancy costs than our cinemas.
With respect to our real estate development and operation activities:
the increased costs of wages, supplies, services and other development expenses from inflation;
the impact on tenants from inflationary pressures;
uncertainty as to governmental responses to infectious diseases;
the rental rates and capitalization rates applicable to the markets in which we operate and the quality of properties that we own;
the ability to negotiate and execute lease agreements with material tenants;
the extent to which we can obtain on a timely basis the various land use approvals and entitlements needed to develop our properties;
the risks and uncertainties associated with real estate development;
the availability and cost of labor and materials;
the ability to obtain all permits to construct improvements;
the ability to finance improvements, including, but not limited to increased cost of borrowing and tightened lender credit policies;
the disruptions to our business from construction and/or renovations;
the possibility of construction delays, work stoppage, and material shortage;
competition for development sites and tenants;
environmental remediation issues;
the extent to which our cinemas can continue to serve as an anchor tenant that will, in turn, be influenced by the same factors as will influence generally the results of our cinema operations;
the increased depreciation and amortization expense as construction projects transition to leased real property;
the ability to negotiate and execute joint venture opportunities and relationships;
the risk of damage and/or disruption of real estate businesses from earthquakes as certain of our operations are in geologically active areas;
the disruptions or reductions in the utilization of entertainment, shopping and hospitality venues, as well as in our operations, due to pandemics, epidemics, widespread health emergencies, or outbreaks of infectious diseases, or to changing consumer tastes and habits; and
the impact of protests, demonstrations, civil unrest on government policy, consumer willingness to visit shopping centers.
With respect to our operations generally as an international company involved in both the development and operation of cinemas and the development and operation of real estate and previously engaged for many years in the railroad business in the United States:
our ability to renew, extend, renegotiate or replace our loans that mature in 2026 and beyond, and the impact of increasing interest rates;
our ability to grow our Company and provide value to our stockholders;
our ongoing access to borrowed funds and capital and the interest that must be paid on that debt and the returns that must be paid on such capital, and our ability to borrow funds to help cover the cessation of cash flows we experienced during and following the COVID-19 pandemic;
our ability to reallocate funds among jurisdictions to meet short-term liquidity needs;
the relative values of the currency used in the countries in which we operate;
changes in government regulation, including by way of example, the costs resulting from the requirements of Sarbanes-Oxley and other increased regulatory requirements;
our labor relations and costs of labor (including future government requirements with respect to minimum wages, shift scheduling, the use of consultants, pension liabilities, disability insurance and health coverage, and vacations and leave);
our exposure from time to time to legal claims and to uninsurable risks, such as those related to our historic railroad operations, including potential environmental claims and health-related claims relating to alleged exposure to asbestos or other substances now or in the future recognized as being possible causes of cancer or other health related problems, and class actions and private attorney general wage and hour and/or safe workplace-based claims;
our exposure to cybersecurity risks, including misappropriation of customer information or other breaches of information security;
the impact of future major outbreaks of contagious diseases;
the availability of employees and/or their ability or willingness to conduct work under any revised work environment protocols;
the increased risks related to employee matters, including increased employment litigation and claims relating to terminations or furloughs caused by cinema and ETC closures;
our ability to generate significant cash flow from operations if our cinemas and/or ETCs continue to experience demand at levels significantly lower than historical levels, which could lead to a substantial increase in indebtedness and negatively impact our ability to comply with the financial covenants, if applicable, in our debt agreements;
our ability to comply with credit facility covenants and our ability to obtain necessary covenant waivers and necessary credit facility amendments;
changes in interest rates, which could increase borrowing costs, reduce cash flow, impair profitability, and limit our ability to refinance or obtain additional capital on favorable terms;
fluctuations in foreign currency exchange rates and related impacts to overall financial performance;
changes in future effective tax rates and the results of currently ongoing and future potential audits by taxing authorities having jurisdiction over our various companies;
inflationary pressures on labor and supplies, and supply chain disruptions;
changes in applicable accounting policies and practices;
changes in future effective tax rates and the results of currently ongoing and future potential audits by taxing authorities having jurisdiction over our various companies;
the impact of the conflict events occurring in Eastern Europe and the threats of potential conflicts in the Asia-Pacific region;
the impact of the conflict events occurring in Israel and the threats of other potential conflicts in the Middle East, and
the impact of tariff regulations enforced by the U.S. against various nations.
The above list is not necessarily exhaustive, as business is by definition unpredictable and risky, and subject to influence by numerous factors outside of our control, such as changes in government regulation or policy, competition, interest rates, supply, technological innovation, changes in consumer taste, weather, earthquakes, pandemics, and the extent to which consumers in our markets have the economic wherewithal to spend money on beyond-the-home entertainment. Refer to Item 1A - Risk Factors, as well as the risk factors set forth in any other filings made under the Securities Act of 1934, as amended, including any of our Quarterly Reports on Form 10-Q, for more information.
Given the variety and unpredictability of the factors that will ultimately influence our businesses and our results of operation, no guarantees can be given that any of our forward-looking statements will ultimately prove to be correct. Actual results will undoubtedly vary and there is no guarantee as to how our securities will perform either when considered in isolation or when compared to other securities or investment opportunities.
Forward-looking statements made by us in this quarter report are based only on information currently available to us and are current only as of the date of this Quarterly Report on Form 10-Q for the period ended June 30, 2026. We undertake no obligation to publicly update or to revise any of our forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable law. Accordingly, you should always note the date to which our forward-looking statements speak.
Item 3 – Quantitative and Qualitative Disclosure about Market Risk
Not Applicable.
Item 4 – Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Company’s reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the above-mentioned new controls, and our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Exchange Act. Based upon that evaluation, we concluded that, as of June 30, 2026, our disclosure controls and procedures were effective.
Changes in Internal Control over Financial Reporting
No change in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the second quarter ended June 30, 2026, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II – Other Information
Item 1 – Legal Proceedings
The information required under Part II, Item 1 (Legal Proceedings) is incorporated by reference to the information contained in Notes to Condensed Consolidated Financial Statements - Note 16 – Commitments and Contingencies included herein in Part I – Financial Information, Item 1 – Financial Statements on this Quarterly Report on Form 10-Q.
For further details on our legal proceedings, please refer to Part I, Item 3 – Legal Proceedings, contained in our 2025 Form 10-K.
Item 1A – Risk Factors
There have been no material changes to the risk factors we previously disclosed in Item 1A of our 2025 Form 10-K.
We encourage investors to review the risks and uncertainties relating to our business disclosed under the heading Risk Factors or otherwise in the 2025 Form 10-K, as well as those contained in Part I – Forward-Looking Statements thereof, as revised or supplemented by our Quarterly Reports filed with the SEC since the filing of the 2025 Form 10-K.
Item 2 – Sales of Equity Securities and Use of Proceeds
None.
Item 3 – Defaults upon Senior Securities
None.
Item 4 – Mine Safety Disclosure
Not applicable.
Item 5 – Other Information
During the quarter ended June 30, 2026, no director or officer of the Company
Item 6 – Exhibits
10
1
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10.1†* | Thirteenth Amendment to Second Amendment and Restated Credit Agreement, dated June 12, 2026, between Consolidated Amusement Holdings, LLC and Bank of America, N.A |
31.1* | Certification of the Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2* | Certification of the Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32** | Certifications Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101 | The following material from our Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2026 formatted in iXBRL (Inline Extensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Comprehensive Income (Loss), (iv) Condensed Consolidated Statements of Cash Flows, (v) Condensed Consolidated Statements of Stockholders’ Equity, and (vi) the Notes to the Condensed Consolidated Financial Statements. |
104 | Cover Page Interactive Data File (formatted in iXBRL and contained in Exhibit 101) |
___________________
* Filed herewith
** Furnished herewith
† Certain portions of this exhibit have been omitted pursuant to Items 601(a)(5) and 601(b)(10)(iv) of Regulation S-K. Information in this exhibit that has been omitted has been noted in this document with a placeholder identified by the mark “[***]”. The Company hereby agrees to furnish a copy of any omitted schedules or exhibits to the SEC upon request.”
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
READING INTERNATIONAL, INC.
Date: August 14, 2026
By: /s/ Ellen M. Cotter
Ellen M. Cotter
President and Chief Executive Officer
Date: August 14, 2026
By: /s/ Gilbert Avanes
Gilbert Avanes
Executive Vice President, Chief Financial Officer and Treasurer