Reading International (RDI) posts Q1 2026 loss but outlines refinancing and real estate monetization strategy
Rhea-AI Filing Summary
Reading International, Inc. reported a wider net loss for the quarter ended March 31, 2026 while emphasizing a liquidity plan built on real estate monetization and refinancing. Total revenue rose to $45.1 million from $40.2 million, driven mainly by stronger cinema attendance and higher food and beverage sales in the U.S. and Australia.
Despite this top-line growth, the company posted a net loss attributable to Reading of $8.1 million, compared with a loss of $4.8 million a year earlier, and basic and diluted loss per share of $0.36. Cash and cash equivalents declined to $5.5 million, with negative working capital of about $86.1 million and current debt of $35.5 million.
Management performed a detailed going concern assessment under ASC 205-40 and concluded that planned real estate asset sales and debt refinancings, including the ongoing process to monetize the Cinemas 1,2,3 property and prior sales totaling $197.5 million since 2021, make it probable the company can meet obligations over the next 12 months, alleviating substantial doubt about its ability to continue as a going concern.
Positive
- Revenue growth and operating improvement: Total revenue increased to $45.1 million from $40.2 million, and operating loss narrowed to $(3.6) million from $(6.9) million, reflecting stronger cinema performance, especially in the U.S. and Australia.
- Management concludes going concern doubt is alleviated: After assessing ASC 205-40, the company states that planned real estate monetizations and refinancings make it probable it can meet obligations over the next 12 months.
- Successful history of asset monetization and refinancings: Since 2021, nine property sales have generated combined proceeds of $197.5 million, and several major debt facilities have been extended, including the NAB corporate term loan maturing in 2030.
Negative
- Widening net loss and negative equity: Net loss attributable to Reading increased to $(8.1) million from $(4.8) million, and total Reading stockholders’ equity deteriorated to $(25.5) million, indicating continued erosion of the capital base.
- Heightened liquidity and refinancing risk: The company reports cash of $5.5 million, negative working capital of about $(86.1) million, and current debt of $35.5 million, requiring successful execution of asset sales and debt extensions to meet near-term obligations.
- Leverage remains substantial: Total liabilities of $456.9 million exceed total assets of $431.5 million, with total borrowings around $177.7 million and significant exposure to variable-rate debt, sustaining financial risk despite recent extensions.
Insights
Revenue is improving, but losses, leverage and liquidity pressure remain high.
Reading International grew revenue to $45.1 million in Q1 2026, yet operating income stayed negative at $(3.6) million and net loss deepened to $(8.1) million. Total liabilities of $456.9 million exceed assets, leaving stockholders’ equity at $(25.4) million.
Liquidity is tight: cash is $5.5 million, current debt $35.5 million, and working capital roughly $(86.1) million. Management’s going concern evaluation under ASC 205-40 relies on continued refinancing and monetizing real estate, including the Cinemas 1,2,3 property and other held-for-sale assets.
The company has refinanced and extended key facilities—such as the $64.6 million NAB term loan maturing in 2030 and the $46.1 million Union Square loan maturing in 2026 with an extension option—while having previously raised $197.5 million from nine property sales since 2021. Future filings detailing execution on asset sales, debt extensions and cinema cash generation will be central to assessing ongoing balance-sheet risk.
Key Figures
Key Terms
going concern financial
ASC 205-40 financial
held for sale financial
segment operating income financial
Trust Preferred Securities financial
interest rate contracts financial
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 ___________
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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 May 14, 2026, there were
READING INTERNATIONAL, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
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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 Cash Flows (Unaudited) | 7 |
Condensed Consolidated Statements of Stockholders’ Equity (Unaudited) | 6 |
Notes to Condensed Consolidated Financial Statements (Unaudited) | 8 |
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations | 27 |
Item 3 – Quantitative and Qualitative Disclosure about Market Risk | 47 |
Item 4 – Controls and Procedures | 48 |
PART II – Other Information | 49 |
Item 1 – Legal Proceedings | 49 |
Item 1A – Risk Factors | 49 |
Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds | 49 |
Item 3 – Defaults Upon Senior Securities | 49 |
Item 4 – Mine Safety Disclosure | 49 |
Item 5 – Other Information | 49 |
Item 6 – Exhibits | 50 |
SIGNATURES | 51 |
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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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 March 31, 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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| Three Months Ended | ||||
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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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| Three Months Ended | ||||
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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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(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 | | $ | | | $ | | $ | | $ | ( | $ | ( | $ | ( | $ | ( | $ | | $ | ( |
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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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Share-based compensation expense | — |
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At March 31, 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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| Three Months Ended | ||||
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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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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 three Months Ended March 31, 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:
-Bank of America $
-Valley National $
-Emerald Creek $
-NAB $
Moreover, 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. 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 three months ended March 31, 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
against our forecasts is dependent on several variables and conditions, many of which are subject to the uncertainties associated with among other things, the factors presented above, and as a result, actual results may materially differ from management’s estimates.
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.
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 ended March 31, 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.
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. The Company is 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, as while all our cinemas are engaged in substantially the same business activities, 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 concession 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 or termination of cinema leases
-the execution, renewal 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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| Three Months Ended |
| Three Months Ended | ||||||||||||||
| March 31, 2026 |
| March 31, 2025 | ||||||||||||||
(Dollars in thousands) | Cinema |
| Real |
| Total |
| Cinema |
| Real |
| Total | ||||||
Revenue - third party | $ | |
| $ | |
| $ | |
| $ | |
| $ | |
| $ | |
Inter-segment revenue (1) |
| — |
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Total segment revenue |
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Operating expense |
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| — |
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| — |
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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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| ( |
Inter-Segment Operating Expenses (1) |
| ( |
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| — |
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| ( |
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| ( |
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| — |
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| ( |
Total of services and products (excluding depreciation and amortization) |
| ( |
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| ( |
Depreciation and amortization |
| ( |
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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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| ( |
Total operating expense |
| ( |
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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 quarters ended March 31, 2026 and March 31, 2025, is as follows:
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| Three Months Ended | ||||
(Dollars in thousands) | March 31, 2026 |
| March 31, 2025 | ||||
REVENUE |
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| United States | Admissions revenue | $ | |
| $ | |
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| Concessions revenue |
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| Advertising and other revenue |
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| $ | |
| $ | |
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| Australia | Admissions revenue | $ | |
| $ | |
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| Concessions revenue |
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| Advertising and other revenue |
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| $ | |
| $ | |
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| New Zealand | Admissions revenue | $ | |
| $ | |
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| Concessions revenue |
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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 | $ | ( |
| $ | ( |
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| Food & beverage cost |
| ( |
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| ( |
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| Occupancy expense |
| ( |
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| ( |
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| Labor cost |
| ( |
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| ( |
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| Utilities |
| ( |
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| ( |
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| Cleaning and maintenance |
| ( |
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| ( |
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| Other operating expenses |
| ( |
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| ( |
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| $ | ( |
| $ | ( |
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| Australia | 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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| Labor cost |
| ( |
|
| ( |
|
| Utilities |
| ( |
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| ( |
|
| Cleaning and maintenance |
| ( |
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| ( |
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| Other operating expenses |
| ( |
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| ( |
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| $ | ( |
| $ | ( |
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| New Zealand | Film rent and advertising cost | $ | ( |
| $ | ( |
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| Food & beverage cost |
| ( |
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| ( |
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| Occupancy expense |
| ( |
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| ( |
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| Labor cost |
| ( |
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| ( |
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| Utilities |
| ( |
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| ( |
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| Cleaning and maintenance |
| ( |
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| ( |
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| Other operating expenses |
| ( |
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| ( |
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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 | $ | ( |
| $ | ( |
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| General and administrative expense |
| ( |
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| ( |
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| $ | ( |
| $ | ( |
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| Australia | Depreciation and amortization | $ | ( |
| $ | ( |
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| General and administrative expense |
| ( |
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| ( |
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| $ | ( |
| $ | ( |
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| New Zealand | Depreciation and amortization | $ | ( |
| $ | ( |
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| General and administrative expense |
| — |
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| ( |
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| $ | ( |
| $ | ( |
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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 |
| |
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| ( | |
| New Zealand |
| ( |
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| ( | |
| Total Cinema operating income (loss) | $ | ( |
| $ | ( | |
A reconciliation of real estate segment revenue to segment operating income for the quarters ended March 31, 2026 and March 31, 2025, is as follows:
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| Three Months Ended | ||||
(Dollars in thousands) | March 31, 2026 |
| March 31, 2025 | ||||
REVENUE |
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| United States | Live theatre rental and ancillary income | $ | |
| $ | |
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| Property rental income |
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| Australia | Property rental income |
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| New Zealand | Property rental income |
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| Total revenue | $ | |
| $ | | |
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OPERATING EXPENSE |
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| United States | Live theatre cost | $ | ( |
| $ | ( |
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| Occupancy expense |
| ( |
|
| ( |
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| Utilities |
| ( |
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| ( |
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| Cleaning and maintenance |
| ( |
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| ( |
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| Other operating expenses |
| ( |
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| ( |
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| $ | ( |
| $ | ( |
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| Australia | Occupancy expense | $ | ( |
| $ | ( |
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| Labor cost |
| ( |
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| ( |
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| Utilities |
| ( |
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| ( |
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| Cleaning and maintenance |
| ( |
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| ( |
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| Other operating expenses |
| ( |
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| ( |
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| $ | ( |
| $ | ( |
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| New Zealand | Occupancy expense | $ | ( |
| $ | ( |
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| Labor cost |
| — |
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| ( |
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| Utilities |
| — |
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| ( |
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| Cleaning and maintenance |
| — |
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| ( |
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| Other operating expenses |
| ( |
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| ( |
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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 | $ | ( |
| $ | ( |
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| General and administrative expense |
| ( |
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| ( |
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| ( |
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| ( |
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| Australia | Depreciation and amortization | $ | ( |
| $ | ( |
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| General and administrative expense |
| ( |
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| ( |
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| ( |
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| ( |
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| New Zealand | Depreciation and amortization |
| ( |
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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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| Total depreciation, amortization, general and administrative expense | $ | ( |
| $ | ( | |
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OPERATING INCOME (LOSS) - REAL ESTATE |
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| United States | $ | |
| $ | | |
| Australia |
| |
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| | |
| New Zealand |
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| ( | |
| Total real estate operating income (loss) | $ | |
| $ | | |
A reconciliation of segment operating income to income before income taxes is as follows:
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| Three Months Ended | ||||
(Dollars in thousands) | March 31, 2026 |
| March 31, 2025 | ||
Segment operating income (loss) | $ | |
| $ | ( |
Unallocated corporate expense: |
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Depreciation and amortization expense |
| ( |
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| ( |
General and administrative expense |
| ( |
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| ( |
Interest expense, net |
| ( |
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| ( |
Equity earnings (loss) of unconsolidated joint ventures |
| |
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| |
Gain (loss) on sale of assets |
| — |
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Other (expense) income |
| ( |
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| ( |
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:
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| March 31, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
By segment: |
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Cinema |
| $ | |
| $ | |
Real estate |
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Corporate (1) |
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Total assets |
| $ | |
| $ | |
By country: |
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United States |
| $ | |
| $ | |
Australia |
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New Zealand |
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Total assets |
| $ | |
| $ | |
(1) Corporate Assets includes cash and cash equivalents of $5.5 million and $10.5 million as of March 31, 2026 and December 31, 2025, respectively.
The following table sets forth our operating properties by country:
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| March 31, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
United States |
| $ | |
| $ | |
Australia |
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New Zealand |
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Total operating property |
| $ | |
| $ | |
The table below summarizes capital expenditures for the three months ended March 31, 2026
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| Three Months Ended | ||||
(Dollars in thousands) | March 31, 2026 |
| March 31, 2025 | ||
Segment capital expenditures | $ | |
| $ | |
Corporate capital expenditures |
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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 March 31, 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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| Foreign Currency / USD | |||||
| As of and |
| As of and |
| As of and |
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| March 31, 2026 | December 31, 2025 |
| March 31, 2025 | ||
Spot Rate |
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Australian Dollar |
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New Zealand Dollar |
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Average Rate |
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Australian Dollar |
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New Zealand Dollar |
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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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| Three Months Ended | ||||
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| March 31, | ||||
(Dollars in thousands, except share data) |
| 2026 |
| 2025 | ||
Numerator: |
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Net income (loss) attributable to Reading International, Inc. |
| $ | ( |
| $ | ( |
Denominator: |
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Weighted average number of shares of common stock – basic |
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Weighted average dilutive impact of awards |
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| — |
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| — |
Weighted average number of shares of common stock – diluted |
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Basic earnings (loss) per share |
| $ | ( |
| $ | ( |
Diluted earnings (loss) per share |
| $ | ( |
| $ | ( |
Awards excluded from diluted earnings (loss) per share |
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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 March 31, 2026 and December 31, 2025, is summarized as follows:
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| March 31, |
| December 31, | ||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
Land |
| $ | |
| $ | |
Building and improvements |
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Leasehold improvements |
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Fixtures and equipment |
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Construction-in-progress |
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Total cost |
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Less: accumulated depreciation |
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| ( |
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| ( |
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 three months ended March 31, 2026, are shown below:
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(Dollars in thousands) |
| Balance, |
| Additions during the period |
| Completed |
| Transferred to Held for Sale |
| Foreign |
| Balance, | ||||||
Cinema developments and improvements |
| $ | |
| $ | |
| $ | — |
| $ | ( |
| $ | |
| $ | |
Other real estate projects |
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| — |
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| — |
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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 three months ended March 31, 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:
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| March 31 | |
(Dollars in thousands) |
| 2025 | |
Sales price |
| $ | |
Net book value |
|
| ( |
Gain on sale, gross of direct costs |
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Direct sale costs incurred |
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| ( |
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
On December 19, 2025, we purchased Sutton Hill Associates, a California general partnership. As a consequence of that transaction (i) we took on $
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:
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| Three Months Ended | ||||
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| March 31, | ||||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
Lease cost |
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Finance lease cost: |
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Amortization of right-of-use assets |
| $ | — |
| $ | |
Interest on lease liabilities |
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| — |
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Operating lease cost |
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Variable lease cost |
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| ( |
Total lease cost |
| $ | |
| $ | |
Supplemental cash flow information related to leases is as follows:
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| Three Months Ended | ||||
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| March 31, | ||||
(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:
|
|
|
|
|
|
|
|
| March 31, |
| 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:
|
|
|
|
|
|
|
|
| Three Months Ended | ||||
|
| March 31, | ||||
(Dollars in thousands) |
| 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:
|
|
|
|
|
|
|
|
| March 31, |
| 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 March 31, 2026, and December 31, 2025.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands) |
| Cinema |
| Real Estate |
| Total | |||
Balance at December 31, 2025 |
| $ | |
| $ | |
| $ | |
Foreign currency translation adjustment |
|
| |
|
| — |
|
| |
Balance at March 31, 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 March 31, 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 March 31, 2026, and December 31, 2025, respectively.
|
|
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|
|
|
|
|
|
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|
|
|
|
|
|
|
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|
|
|
|
|
| As of March 31, 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 |
|
| ( |
|
| ( |
|
| ( |
|
| ( |
Less: Impairments |
|
| — |
|
| — |
|
| — |
|
| — |
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
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three Months Ended | ||||
|
| March 31, | ||||
(Dollars in thousands) |
| 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
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| March 31, |
| December 31, | ||
(Dollars in thousands) |
| Interest |
| 2026 |
| 2025 | ||
Rialto Cinemas |
|
| $ | ( |
| $ | ( | |
Mt. Gravatt |
|
|
| |
|
| | |
Total investments |
|
|
| $ | |
| $ | |
For the quarters ended March 31, 2026 and 2025, the recognized share of equity earnings from our investments in unconsolidated joint ventures are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three Months Ended | ||||
|
| March 31, | ||||
(Dollars in thousands) |
| 2026 |
| 2025 | ||
Rialto Cinemas |
| $ | ( |
| $ | ( |
Mt. Gravatt |
|
| |
|
| |
Total equity earnings |
| $ | |
| $ | |
Prepaid and other assets are summarized as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| March 31, |
| 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 |
|
|
|
|
|
|
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 benefit of $
Our Company’s borrowings at March 31, 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:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| As of March 31, 2026 | |||||||||||||
(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) |
|
|
| |
|
| |
|
| |
|
| |||
Union Square Financing (US) (2) |
|
|
| |
|
| |
|
| |
|
| |||
Nationwide Theaters Corp. (US) (3) |
|
|
| |
|
| |
|
| |
|
| |||
Denominated in foreign currency ("FC") (4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NAB Corporate Term Loan (AU) |
|
|
| |
|
| |
|
| |
|
| |||
|
|
|
| $ | |
| $ | |
| $ | |
|
|
|
|
(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 foreign currency denominated borrowings were translated into U.S. dollars based on the applicable exchange rates as of March 31, 2026.
|
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|
|
|
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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) |
|
|
| |
|
| |
|
| |
|
| |||
Union Square Financing (US) (3) |
|
|
| |
|
| |
|
| |
|
| |||
Nationwide Theaters Corp. (US) (4) |
|
|
| |
|
| |
|
| |
|
| |||
Denominated in foreign currency ("FC") (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NAB Corporate Term Loan (AU) |
|
|
| |
|
| |
|
| |
|
| |||
Total |
|
|
| $ | |
| $ | |
| $ | |
|
|
|
|
(1)Net of deferred financing costs amounting to $
(2)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.
(3)This loan has an option to extend for one year, which is within our control and we intend to exercise.
(4)This debt is carried net of debt discounts of $
Our loan arrangements are presented, net of the deferred financing costs, on the face of our consolidated balance sheet as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| March 31, |
| December 31, | ||
Balance Sheet Caption (Dollars in thousands) |
| 2026 |
| 2025 | ||
Debt - current portion |
| $ | |
| $ | |
Debt - long-term 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)
As of March 31, 2025, our Revolving Corporate Markets Loan Facility with National Australia Bank (“NAB”) matured on July 31, 2026. It consisted of (i) an AU$
On April 2, 2025, we executed an amendment that among other things, increased the bank guarantee facility from AU$
On November 12, 2025, we extended the maturity of this loan to
Other liabilities are summarized as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| March 31, |
| 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 ended March 31, 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 | $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
| $ | ( |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change related to derivatives |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 March 31, 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 (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, a federal statute enacted in 1988. 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 it 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.
By Opinion and Order dated March 12, 2026, the District Court granted our Company’s motion and dismissed the 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.
We also believe that we have defenses to the Valentini Case 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) alleges violations of certain sections of the Philadelphia Code on property allegedly owned or under the control of Reading International in Philadelphia; (ii) seeks 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 (the “Premises”) to conduct an interior inspection; and (iii) seeks an order compelling the Defendants to correct all alleged violations. We believe that it we have a variety of defenses to the claims, including defenses based on the fact, among other things, that some of the alleged violations were timely cured, that other allegations were timely appealed at the administrative level and that Reading International Inc. did not own the property in question (such property is owned by a subsidiary). We are in discussions with the City and have initiated measures including demolition of a building on the property and taking other actions to correct alleged violations through which we believe a resolution of the dispute will be accomplished. We are still in the talking stage with the City and discovery has not yet begun, but based on such conversations with the City and our review of the facts, we do not currently believe that there is a reasonable likelihood that the litigation will result in a material liability to the Company.
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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|
|
|
|
| March 31, |
| 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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|
| Three Months Ended | ||||
|
| March 31, | ||||
(Dollars in thousands) |
| 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 March 31, 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 ended March 31, 2026, we recorded a compensation expense of $
The following table summarizes the number of options outstanding and exercisable as of March 31, 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 - March 31, 2026 |
| |
| $ | |
| |
| $ | — |
Restricted Stock Units
The following table summarizes the status of RSUs granted to date as of March 31, 2026:
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| Restricted Stock Units | ||||||||||
|
| RSU Grants (in units) |
|
|
| Vested, |
| Unvested, |
| Forfeited, | ||
Grant Date |
| Directors |
| Management |
| Total |
| March 31, 2026 |
| March 31, 2026 |
| March 31, 2026 |
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Opening balance |
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April 11, 2023 |
| — |
| |
| |
| |
| |
| |
April 21, 2023 |
| — |
| |
| |
| |
| |
| |
April 28, 2023 |
| — |
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Total |
| |
| |
| |
| |
| |
| |
Time vested RSU awards to management typically vest
For the quarter ended March 31, 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 March 31, 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 | ||||||||
|
| March 31, |
| 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 ended March 31, 2026 and March 31, 2025, respectively, the derivative instruments affected Comprehensive Income as follows:
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(Dollars in thousands) | Location of Loss Recognized in Income on Derivatives |
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| Three Months Ended March 31 | ||||
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|
| 2026 |
|
| 2025 |
Interest rate contracts |
| $ | ( |
| $ | — | |
Total |
|
| $ | ( |
| $ | — |
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|
(Dollars in thousands) |
| Amount | ||||
|
| Three Months Ended March 31 | ||||
|
|
| 2026 |
|
| 2025 |
Interest rate contracts |
| $ | ( |
| $ | |
Total |
| $ | ( |
| $ | |
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Line Item |
| Amount | ||||
|
| Three Months Ended March 31 | ||||
|
|
| 2026 |
|
| 2025 |
Interest expense |
| $ | ( |
| $ | — |
Total |
| $ | ( |
| $ | — |
As of March 31, 2026, we expect to release $
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 March 31, 2026, and December 31, 2025, by level within the fair value hierarchy.
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| Fair Value Measurement at March 31, 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 |
|
| |
|
| — |
|
| — |
|
| |
|
| |
|
| $ | |
| $ | — |
| $ | — |
| $ | |
| $ | |
(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 March 31, 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 March 31, 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
There were no material subsequent events identified as of the date of this report.
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 first quarter of 2026, which reinforces our confidence in the continued recovery of our operations and the global cinema industry. While macroeconomic challenges remain, our first quarter 2026 results reflect improving industry momentum and support our confidence in the continued growth of our cinema business. Q1 2026 benefited from theatrical successes including Project Hail Mary, Wuthering Heights, GOAT, and Hoppers. Additionally, this quarter also saw the continued momentum of blockbuster hits from last quarter including Avatar: Fire and Ash, Zootopia 2, Wicked: For Good, Marty Supreme, and The Housemaid.
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;
The number of movies released by the major Hollywood studios and other distributors, while increasing from pandemic levels, have not yet returned to their higher pre-pandemic levels;
The traditional exclusive theatrical release window remains shorter than historic periods, however, the major studios are indicating their intent to return to longer exclusivity periods;
Inflationary pressures, ongoing supply chain issues and increased operating expenses continue to push up our variable costs while we encounter consumer resistance to higher ticket prices;
Labor costs continue to rise due to mandated minimum wage increases;
Significant and ongoing rises in fuel costs, which impact the cost of utilities;
Increased fixed costs for third party cinema rents, some of which are increasing due to base rent escalations, some of which are fixed and some of which are adjusted by reference to changes in the cost of living index, which are exacerbated by our obligation to also pay deferrals of past rent. We have been able to mitigate this somewhat by negotiating for rent abatements and revised rental terms and through the closure of certain underperforming venues; and
General market and economic conditions.
We believe that our ongoing focus on operational efficiency and strategic initiatives has improved our operations results. Over the past quarter, we have worked to optimize the efficiency of our locations, by:
Renegotiating our cinema leases and aligning our occupancy costs more effectively with attendance levels that, in general, remain behind pre-pandemic levels.
Prioritizing the elevation of the guest experience through our expanded Food and Beverage program. Beer and wine, and liquor service is available at nearly every one of our U.S. cinema locations. These enhancements are mirrored in our Australian and New Zealand markets, ensuring a consistent and premium experience for audiences across all regions. This strong focus on Food and Beverage contributed in revenue increases in all countries for the quarter compared to same period in the prior year.
We are expanding our loyalty and membership ecosystem to strengthen guest engagement. In late 2024, we transitioned from Reel Club to Reading Rewards and Angelika Rewards in Australia and New Zealand. Members can also upgrade to Reading and Angelika Rewards Boost with a fee. In the United States, we transitioned from Cinema Extras in our U.S. Consolidated Theatres to a new free to join Consolidated rewards program and paid subscription premium membership at the end of 2025 and in our U.S. Reading Cinemas to a new free-to-join Reading rewards program and paid subscription premium membership in early 2026. Our existing Angelika free membership program in the U.S. continues to grow, with membership increasing meaningfully compared to the prior year and we plan to add an Angelika paid subscription premium membership in Q2 2026.
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, titles such as Super Mario Galaxy Movie and Michael have generated strong box office results, reinforcing continued audience appetite for compelling, broadly appealing theatrical releases. We will continue to have highly anticipated major releases throughout the remainder of the year including The Devil Wears Prada 2, Toy Story 5, Supergirl, Minions 3, Moana, The Odyssey, Spider Man: Brand New Day, The Cat in the Hat, Avengers: Doomsday, and Dune: Part Three. These 2026 future releases are positioned to appeal to a wide variety of audiences, which should allow for a strong carry-through for the rest of the year. These titles cover a wide range of genres, from family animation to science fiction, each with the potential to produce significant box office results. Supported by our strategic operational initiatives and continued audience engagement efforts, this diverse slate positions us for a robust 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. At our 44 Union Square property in New York, Petco continues to occupy the cellar, ground, and second floors under a long-term lease on a full rent-paying basis, while we work to secure tenant(s) for the remaining space. We believe that 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.
In New Zealand, we signed a purchase and sale agreement on March 4, 2026 to monetize our Napier property. The transaction is currently in its due diligence period.
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 58 cinemas.
Real estate, including real estate development and the rental of retail, commercial, and Live Theatre assets.
In the post-pandemic period, we have monetized nine property assets, but 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 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. To address anticipated liquidity needs, Newberry Yard and Cinemas 1,2,3 are held for sale. Following 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 has been the continued enhancement of food and beverage offerings across several of our global cinema locations. We have a total of 38 theater locations that offer elevated food and beverage menus (i.e. menus that are beyond traditional popcorn, soda, and candy). We use F&B SPP as a measure of our food and beverage operational performance as compared to that of our competitors. Although the profitability of our food and beverage operations is influenced by numerous factors, including labor and cost of goods, F&B SPP serves as an indicator of our ability to achieve consistent strong top-line performance. In addition, F&B SPP highlights our ability to optimize revenue by effectively promoting and selling supplementary products to our customers during each visit. Moreover, this metric assists in evaluating how well we can differentiate our F&B offerings from our competitors. Management uses F&B SPP to adjust food and beverage pricing strategies at our individual theaters, measure the effectiveness of promotional marketing initiatives, optimize menu offerings, and ensure price barriers are not created for our customers. F&B revenue is particularly important to cinema operators, as film distributors do not share in this revenue stream.
Our F&B SPP in functional currency for the three months ended March 31, 2026, and March 31, 2025, are as follows:
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| Three Months Ended |
| |||||||
|
| March 31, |
|
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| |||||
Country |
| 2026 |
| 2025 |
| % Change |
| |||
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|
United States |
| $8.38 |
| $7.97 |
| 5.1% |
| |||
Australia |
| $8.09 |
| $7.83 |
| 3.3% |
| |||
New Zealand |
| $6.73 |
| $6.80 |
| (1.0)% |
| |||
Average Ticket Price per Patron
An additional key performance indicator utilized by management in our cinema exhibition segment is Average Ticket Price (“ATP”) Per Patron, which 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 three months ended March 31, 2026, and March 31, 2025, are as follows:
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| Three Months Ended |
| |||||||
|
| March 31, |
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| |||||
Country |
| 2026 |
| 2025 |
| % Change |
| |||
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|
United States |
| $13.71 |
| $13.49 |
| 1.6% |
| |||
Australia |
| $16.19 |
| $15.52 |
| 4.3% |
| |||
New Zealand |
| $14.87 |
| $13.74 |
| 8.2% |
| |||
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 three months ended March 31, 2026, and March 31, 2025, measured in functional currencies, are as follows:
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| Three Months Ended |
| |||||||
|
| March 31, |
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| |||||
Country | KPI | 2026 |
| 2025 |
| % Change |
| |||
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United States | Net Operating Income (Loss) | $ | (321) |
| $ | (146) |
| (119.6)% |
| |
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|
Australia | Net Operating Income (Loss) | $ | 597 |
| $ | 1,022 |
| (41.6)% |
| |
| Occupancy Factor |
| 98.3% |
|
| 95.4% |
| 2.9 | points |
|
| Average Lease Duration |
| 3.72 Years |
|
| 3.89 Years |
| (0.17) years |
| |
|
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|
|
New Zealand | Net Operating Income (Loss) | $ | (192) |
| $ | (475) |
| 59.6% |
| |
| Occupancy Factor |
| 100% |
|
| 100% |
| - | points |
|
| Average Lease Duration |
| 0 Years |
|
| 0.42 Years |
| (0.42) years |
| |
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. Our Live Theatre rental revenue and ancillary income for the first quarter of 2026 improved to $0.7 million compared to $0.5 million for the first quarter of 2025.
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, the State Cinema by Angelika, and for our one unconsolidated joint venture theatre, Event Cinemas brands.
in New Zealand, under the Reading Cinemas and for our two unconsolidated joint venture theatres, Rialto Cinemas brands.
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 March 31, 2026.
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| State / Territory / |
| Location |
| Screen |
| Interest in Asset |
|
| ||
Country |
| Region |
| Count(3) |
| Count |
| Leased |
| Owned |
| Operating Brands |
United States |
| Hawaii |
| 6 |
| 74 |
| 6 |
|
|
| Consolidated Theatres |
|
| California |
| 5 |
| 58 |
| 5 |
|
|
| Reading Cinemas, Angelika Film Center |
|
| New York |
| 3 |
| 16 |
| 2 |
| 1 |
| Angelika Film Center |
|
| Texas |
| 1 |
| 8 |
| 1 |
|
|
| Angelika Film Center |
|
| New Jersey |
| 1 |
| 12 |
| 1 |
|
|
| Reading Cinemas |
|
| Virginia |
| 1 |
| 8 |
| 1 |
|
|
| Angelika Film Center |
|
| Washington, D.C. |
| 1 |
| 3 |
| 1 |
|
|
| Angelika Film Center |
|
| U.S. Total |
| 18 |
| 179 |
| 17 |
| 1 |
|
|
Australia |
| Victoria |
| 9 |
| 62 |
| 9 |
|
|
| Reading Cinemas |
|
| New South Wales |
| 6 |
| 44 |
| 6 |
|
|
| Reading Cinemas |
|
| Queensland |
| 7 |
| 64 |
| 5 |
| 2 |
| Reading Cinemas, Angelika Cinemas, Event Cinemas(1) |
|
| Western Australia |
| 4 |
| 27 |
| 3 |
| 1 |
| Reading Cinemas |
|
| South Australia |
| 2 |
| 15 |
| 2 |
|
|
| Reading Cinemas |
|
| Tasmania |
| 2 |
| 14 |
| 2 |
|
|
| Reading Cinemas, State Cinema by Angelika |
|
| Australia Total |
| 30 |
| 226 |
| 27 |
| 3 |
|
|
New Zealand |
| Wellington |
| 2 |
| 15 |
| 2 |
|
|
| Reading Cinemas |
|
| Otago |
| 2 |
| 12 |
| 1 |
| 1 |
| Reading Cinemas, Rialto Cinemas(2) |
|
| Auckland |
| 2 |
| 15 |
| 2 |
|
|
| Reading Cinemas, Rialto Cinemas(2) |
|
| Canterbury |
| 1 |
| 8 |
| 1 |
|
|
| Reading Cinemas |
|
| Southland |
| 1 |
| 5 |
| 1 |
|
|
| 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 |
|
|
| 58 |
| 469 |
| 51 |
| 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 consist primarily of cinema ticket sales, F&B sales, screen advertising, gift card sales, cinema rentals, and online convenience fee revenue generated by the sale of our cinema tickets through our websites and mobile apps. 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 our 2025 Form 10-K.
Cinema Pipeline and Closures
On January 31, 2025, in connection with our sale of our Wellington Properties to Prime Property Group Limited (“Prime”), we entered into an Agreement to Lease with Prime to fit out and operate under a long-term lease our previously owned 10 screen cinema at the to be redeveloped Courtenay Central in Wellington, New Zealand (the “ATL”). Under the ATL, Prime is obligated to redevelop Courtenay Central and upgrade it to meet current earthquake standards. We intend to renovate the existing cinema to a “best-in-class” standard.
Our Board has also authorized management to proceed with the negotiation of a lease for a new state-of-the-art cinema, located in Noosa, Queensland, Australia.
On February 9, 2025, we closed our underperforming cinema located in Queenstown.
On April 15, 2025, we closed our underperforming cinema located in San Diego, California.
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 March 31, 2026:
|
|
|
|
|
|
|
|
| Location Count |
| Screen |
Screen Format |
|
|
|
IMAX | 1 |
| 1 |
TITAN LUXE and TITAN XC | 27 |
| 33 |
70mm and/or 35mm projection | 14 |
| 16 |
Dine-in Service |
|
|
|
Gold Lounge (AU/NZ)(1) | 11 |
| 29 |
Premium (AU/NZ)(2) | 18 |
| 47 |
Upgraded Food & Beverage menu (U.S.)(3) | 15 |
| n/a |
Premium Seating (features recliner seating) | 35 |
| 210 |
Liquor Licenses (4) | 49 |
| 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 (less intimate 80-seat cinemas), 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, 86% of our cinemas are licensed and we have no liquor licenses pending. In New Zealand, 38% 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 ETCs. In addition to owning the fee interests in 7 of our cinemas (as presented in the table under Cinema Exhibition Overview), as of March 31, 2026, we:
own our 44 Union Square property in Manhattan comprised of retail and office space, which is currently in the lease-up phase. The cellar, ground floor, and second floor of the building are now fully leased to Petco, which is in occupancy of its premises on a full rent paying basis;
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, a limited liability company, 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 being 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 material 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 holdings in Coachella, California (March 5, 2021) and Manukau, New Zealand (March 4, 2021);
(ii)Our Redyard ETC in Auburn, Australia (June 9, 2021);
(iii)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);
(iv)The land underlying our cinema in Invercargill, New Zealand (August 30, 2021);
(v)Our non-competitive four-screen cinema in Maitland, Australia (October 25, 2023);
(vi)Our administrative office building in Culver City, California (February 23, 2024);
(vii) On January 31, 2025, our approximately 3.7 acre five-parcel assemblage in the entertainment center of Wellington, New Zealand, which includes the Courtenay Central building; and
(viii) 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, such reasons have included without limitation
(i)our need for liquidity due to the circumstances referred to above,
(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)in the case of our Culver City office building, the property was not required for our operations because it exceeded our office size requirements. Since the sale of this office building, we have been working remotely in Southern California.
As of the date of this Report, we continue to own our approximately 23.9-acre Newberry Yard in Williamsport, Pennsylvania (also currently non-income producing), which is being held for sale.
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. Petco continues to be open for business and in occupancy on a full rent paying basis. 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 first quarter of 2026, Audible presented a number of original productions, including The Disappear, Michael Cruz Kayne – What Else What Else, and the critically acclaimed play Sexual Misconduct of the Middle Class with Hugh Jackman, which played previously during the second quarter of 2025.
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, which will run through next quarter.
Cinemas 1,2,3 (New York, N.Y.) – Currently operated as the Cinemas 1,2,3, we have historically treated this property as an asset held for long term development. However, in February 2026, we classified our Cinemas 1,2,3 property as held for sale.
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.
On May 21, 2025, we sold our Cannon Park ETC in Townsville, Queensland, Australia, which consisted of our Cannon Park City Center and Cannon Park Discount Center properties, 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 (including the Courtenay Central building) to Prime Property Group (“Prime”) for a purchase price of $21.5 million (NZ$38.0 million). We understand that Prime intends to redevelop the properties, including a seismic upgrade of the existing Courtenay Central building. As a part of that sale transaction, we have entered into an Agreement to Lease for the cinema component of the to be upgraded Courtenay Central building.
On March 4, 2026, we signed a purchase and sale agreement to monetize our Napier, New Zealand property for a purchase price of NZ$2.5 million. The transaction is currently in its due diligence period.
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 ended March 31, 2026, and March 31, 2025, respectively:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three Months Ended |
| % Change | ||||||
(Dollars in thousands) |
| March 31, |
| March 31, |
| Fav/ | |||||
SEGMENT RESULTS |
|
|
|
|
|
|
|
|
| ||
| Revenue |
|
|
|
|
|
|
|
|
|
|
| Cinema exhibition |
| $ | 41,461 |
| $ | 36,404 |
| 14 | % | |
| Real estate |
|
| 4,596 |
|
| 4,845 |
| (5) | % | |
| Inter-segment elimination |
|
| (933) |
|
| (1,080) |
| 14 | % | |
| Total revenue |
|
| 45,124 |
|
| 40,169 |
| 12 | % | |
| Operating expense |
|
|
|
|
|
|
|
|
|
|
| Cinema exhibition |
|
| (39,827) |
|
| (37,657) |
| (6) | % | |
| Real estate |
|
| (1,886) |
|
| (1,955) |
| 4 | % | |
| Inter-segment elimination |
|
| 933 |
|
| 1,080 |
| (14) | % | |
| Total operating expense |
|
| (40,780) |
|
| (38,532) |
| (6) | % | |
| Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
| Cinema exhibition |
|
| (1,993) |
|
| (2,141) |
| 7 | % | |
| Real estate |
|
| (1,141) |
|
| (1,102) |
| (4) | % | |
| Total depreciation and amortization |
|
| (3,134) |
|
| (3,243) |
| 3 | % | |
| General and administrative expense |
|
|
|
|
|
|
|
|
|
|
| Cinema exhibition |
|
| (983) |
|
| (1,081) |
| 9 | % | |
| Real estate |
|
| (179) |
|
| (194) |
| 8 | % | |
| Total general and administrative expense |
|
| (1,162) |
|
| (1,275) |
| 9 | % | |
| Segment operating income |
|
|
|
|
|
|
|
|
|
|
| Cinema exhibition |
|
| (1,342) |
|
| (4,475) |
| 70 | % | |
| Real estate |
|
| 1,390 |
|
| 1,594 |
| (13) | % | |
| Total segment operating income (loss) |
| $ | 48 |
| $ | (2,881) |
| >100 | % | |
NON-SEGMENT RESULTS |
|
|
|
|
|
|
|
|
| ||
| Depreciation and amortization expense |
|
| (96) |
|
| (133) |
| 28 | % | |
| General and administrative expense |
|
| (3,584) |
|
| (3,877) |
| 8 | % | |
| Interest expense, net |
|
| (4,228) |
|
| (4,742) |
| 11 | % | |
| Equity earnings of unconsolidated joint ventures |
|
| 71 |
|
| 23 |
| >100 | % | |
| Gain (loss) on sale of assets |
|
| — |
|
| 6,526 |
| 100 | % | |
| Other income (expense) |
|
| (488) |
|
| (331) |
| (47) | % | |
| Income before income taxes |
|
| (8,277) |
|
| (5,415) |
| (53) | % | |
| Income tax benefit (expense) |
|
| 143 |
|
| 472 |
| (70) | % | |
Net income (loss) |
|
| (8,134) |
|
| (4,943) |
| (65) | % | ||
| Less: net income (loss) attributable to noncontrolling interests |
|
| 13 |
|
| (191) |
| >100 | % | |
Net income (loss) attributable to Reading International, Inc. |
| $ | (8,147) |
| $ | (4,752) |
| (71) | % | ||
Basic earnings (loss) per share |
| $ | (0.36) |
| $ | (0.21) |
| (71) | % | ||
Consolidated and Non-Segment Results:
First Quarter Net Results
Revenue
Revenue for the quarter ended March 31, 2026, increased by 12% (or $5.0 million), to $45.1 million, compared to the same period in the prior year, primarily due to (i) increased cinema revenues in the U.S. and Australia as a result of stronger overall movie slate in the first quarter of 2026 compared to the same period 2025 (despite a cinema closure in the U.S. in the second quarter of 2025), (ii) increased real estate revenues in the U.S., and (iii) the strengthening of the AU/NZ foreign exchange rates against the U.S. dollar. These increases in revenue were offset by (i) a decline in real estate rent revenues in Australia due to the sale of Cannon Park, and (ii) increased costs in Australia and New Zealand due to the above referenced strengthening of the AU/NZ foreign exchange rate.
Segment Operating Income/(Loss)
Our total segment operating income for the quarter ended March 31, 2026, increased by $2.9 million, from a loss of $2.9 million to net operating income of $48,000, due to improved box office revenue and Food & Beverage revenues in U.S. and Australia as a result of a stronger movie slate, which included Avatar: Fire and Ash, Project Hail Mary and Wuthering Heights.
During the first quarter of 2026, both the Australia and New Zealand dollars strengthened against the U.S. dollar. The average Australia dollar exchange rate against the U.S. dollar for the first quarter of 2026 increased by 10.8% compared to the same period in 2025. The average New Zealand dollar exchange rate against the U.S. dollar for the first quarter of 2026 increased by 3.9% compared to the same period in 2025.
Net Income/(Loss)
For the quarter ended March 31, 2026, net loss attributable to Reading International, Inc. increased by 71%, from a loss of $4.8 million to a loss of $8.1 million, when compared to the same period in the prior year primarily. This was primarily due to a $6.6 million gain on sale of our property assets in Wellington, New Zealand including Courtenay Central in the first quarter of 2025 (income not replicated in the first quarter of 2026), offset by improved segment results, decreased interest expense (a reduction of $514,000), and decreased general and administrative expense (a reduction of $293,000).
Income Tax Expense
Income tax benefit for the three months ended March 31, 2026, decreased by $0.3 million compared to the equivalent prior-year period. The change between 2026 and 2025 is primarily related to an increase in reserve for valuation allowance in 2026.
Business Segment Results
Cinema Exhibition
The following table details our cinema exhibition segment operating results for the quarter ended March 31, 2026, and March 31, 2025, respectively:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three Months Ended |
| % Change | ||||||
(Dollars in thousands) | March 31, | % of Revenue | March 31, | % of Revenue |
| Fav/ | |||||
REVENUE |
|
|
|
|
|
|
|
|
| ||
| United States | Admissions revenue | $ | 10,746 | 26% | $ | 10,245 | 28% |
| 5 | % |
|
| Food & beverage revenue |
| 6,708 | 16% |
| 6,108 | 17% |
| 10 | % |
|
| Advertising and other revenue |
| 2,009 | 5% |
| 1,942 | 5% |
| 3 | % |
|
|
| $ | 19,463 | 47% | $ | 18,295 | 50% |
| 6 | % |
|
|
|
|
|
|
|
|
|
|
|
|
| Australia | Admissions revenue | $ | 12,177 | 29% | $ | 9,630 | 26% |
| 26 | % |
|
| Food & beverage revenue |
| 6,086 | 15% |
| 4,856 | 13% |
| 25 | % |
|
| Advertising and other revenue |
| 1,443 | 3% |
| 1,196 | 3% |
| 21 | % |
|
|
| $ | 19,706 | 48% | $ | 15,682 | 43% |
| 26 | % |
|
|
|
|
|
|
|
|
|
|
|
|
| New Zealand | Admissions revenue | $ | 1,498 | 4% | $ | 1,546 | 4% |
| (3) | % |
|
| Food & beverage revenue |
| 679 | 2% |
| 766 | 2% |
| (11) | % |
|
| Advertising and other revenue |
| 115 | 0% |
| 115 | 0% |
| - | % |
|
|
| $ | 2,292 | 6% | $ | 2,427 | 7% |
| (6) | % |
|
|
|
|
|
|
|
|
|
|
|
|
| Total revenue | $ | 41,461 | 100% | $ | 36,404 | 100% |
| 14 | % | |
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSE |
|
|
|
|
|
|
|
|
| ||
| United States | Film rent and advertising cost | $ | (5,639) | 14% | $ | (5,058) | 14% |
| (11) | % |
|
| Food & beverage cost |
| (1,627) | 4% |
| (1,583) | 4% |
| (3) | % |
|
| Occupancy expense |
| (4,027) | 10% |
| (3,967) | 11% |
| (2) | % |
|
| Labor cost |
| (3,661) | 9% |
| (4,082) | 11% |
| 10 | % |
|
| Utilities |
| (1,203) | 3% |
| (1,218) | 3% |
| 1 | % |
|
| Cleaning and maintenance |
| (1,287) | 3% |
| (1,541) | 4% |
| 16 | % |
|
| Other operating expenses |
| (1,958) | 5% |
| (2,146) | 6% |
| 9 | % |
|
|
| $ | (19,402) | 47% | $ | (19,595) | 54% |
| 1 | % |
|
|
|
|
|
|
|
|
|
|
|
|
| Australia | Film rent and advertising cost | $ | (5,075) | 12% | $ | (3,956) | 11% |
| (28) | % |
|
| Food & beverage cost |
| (1,366) | 3% |
| (1,075) | 3% |
| (27) | % |
|
| Occupancy expense |
| (4,785) | 12% |
| (4,295) | 12% |
| (11) | % |
|
| Labor cost |
| (3,699) | 9% |
| (3,307) | 9% |
| (12) | % |
|
| Utilities |
| (1,080) | 3% |
| (842) | 2% |
| (28) | % |
|
| Cleaning and maintenance |
| (1,131) | 3% |
| (1,149) | 3% |
| 2 | % |
|
| Other operating expenses |
| (894) | 2% |
| (775) | 2% |
| (15) | % |
|
|
| $ | (18,030) | 43% | $ | (15,399) | 42% |
| (17) | % |
|
|
|
|
|
|
|
|
|
|
|
|
| New Zealand | Film rent and advertising cost | $ | (580) | 1% | $ | (649) | 2% |
| 11 | % |
|
| Food & beverage cost |
| (139) | 0% |
| (148) | 0% |
| 6 | % |
|
| Occupancy expense |
| (744) | 2% |
| (733) | 2% |
| (2) | % |
|
| Labor cost |
| (483) | 1% |
| (534) | 1% |
| 10 | % |
|
| Utilities |
| (99) | 0% |
| (98) | 0% |
| (1) | % |
|
| Cleaning and maintenance |
| (145) | 0% |
| (194) | 1% |
| 25 | % |
|
| Other operating expenses |
| (205) | 0% |
| (307) | 1% |
| 33 | % |
|
|
| $ | (2,395) | 6% | $ | (2,663) | 7% |
| 10 | % |
|
|
|
|
|
|
|
|
|
|
|
|
| Total operating expense | $ | (39,827) | 96% | $ | (37,657) | 103% |
| (6) | % | |
|
|
|
|
|
|
|
|
|
|
|
|
DEPRECIATION, AMORTIZATION, IMPAIRMENT AND GENERAL AND ADMINISTRATIVE EXPENSE |
|
|
|
|
|
|
|
|
| ||
| United States | Depreciation and amortization | $ | (969) | 2% | $ | (1,121) | 3% |
| 14 | % |
|
| General and administrative expense |
| (647) | 2% |
| (725) | 2% |
| 11 | % |
|
|
| $ | (1,616) | 4% | $ | (1,846) | 5% |
| 12 | % |
|
|
|
|
|
|
|
|
|
|
|
|
| Australia | Depreciation and amortization | $ | (914) | 2% | $ | (913) | 3% |
| - | % |
|
| General and administrative expense |
| (336) | 1% |
| (344) | 1% |
| 2 | % |
|
|
| $ | (1,250) | 3% | $ | (1,257) | 3% |
| 1 | % |
|
|
|
|
|
|
|
|
|
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|
|
| New Zealand | Depreciation and amortization | $ | (110) | 0% | $ | (107) | 0% |
| (3) | % |
|
| General and administrative expense |
| — | 0% |
| (12) | 0% |
| 100 | % |
|
|
| $ | (110) | 0% | $ | (119) | 0% |
| 8 | % |
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| Total depreciation, amortization, general and administrative expense | $ | (2,976) | 7% | $ | (3,222) | 9% |
| 8 | % | |
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OPERATING INCOME (LOSS) – CINEMA |
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| ||
| United States | $ | (1,555) | (4)% | $ | (3,146) | (9)% |
| 51 | % | |
| Australia |
| 426 | 1% |
| (974) | (3)% |
| >100 | % | |
| New Zealand |
| (213) | (1)% |
| (355) | (1)% |
| 40 | % | |
| Total Cinema operating income (loss) | $ | (1,342) | (3)% | $ | (4,475) | (12)% |
| 70 | % | |
First Quarter Results
Revenue
For the quarter ended March 31, 2026, cinema revenue increased by $5.1 million, to $41.5 million compared to the same period in the prior year. Despite the closure of a 14-screen U.S. cinema, this increase was primarily driven by (i) improved box office revenues in the U.S. and Australia due to a stronger movie slate including Avatar: Fire and Ash, Project Hail Mary and Wuthering Heights (ii) higher Food & Beverage revenues in our U.S. and Australia cinema circuit due to increased attendance combined with higher F&B SPP and (iii) the impact of the strengthening of the Australian and New Zealand dollars. Our results were partially offset by lower cinema revenues in New Zealand, which was adversely impacted by the closure of an underperforming cinema in the first quarter of 2025.
Cinema Exhibition Segment Operating Income/(Loss)
Cinema exhibition segment operating loss for the quarter ended March 31, 2026, improved by $3.1 million, from a loss of $4.5 million to a loss of $1.3 million when compared to the same period in the prior year. The improvement in segment operating loss is due to (i) increased cinema revenues in all three categories in the U.S. and Australia resulting from a better movie slate and higher attendance (ii) and a decrease in depreciation and amortization globally, partially offset by an increase in operating expenses in Australia.
Operating Expenses
Operating expenses for the quarter ended March 31, 2026, increased by $2.2 million to $39.8 million, compared to $37.7 million in the same period in the prior year, due to due to higher attendance in the U.S. and Australia, which resulted in higher film rent, Food and Beverage cost, and other variable costs, plus higher occupancy cost globally. Furthermore, our expenses increased generally in U.S. dollar terms with the strengthening of the Australian and New Zealand dollars. This was offset by the savings in labor, cleaning and maintenance, and other operating expenses in the U.S. and a decrease in operating expense in New Zealand partly due to the closure of an underperforming cinema.
Depreciation, amortization, impairment, general and administrative expense
Depreciation, amortization, impairment, and general and administrative expenses for the quarter ended March 31, 2026, decreased by $0.2 million, to $3.0 million, compared to the same period in the prior year.
Real Estate
The following table details our real estate segment operating results for the quarter ended March 31, 2026 and March 31, 2025, respectively:
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| Three Months Ended |
| % Change | ||||||
(Dollars in thousands) | March 31, | % of | March 31, | % of |
| Fav/ | |||||
REVENUE |
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| ||
| United States | Live theatre rental and ancillary income | $ | 748 | 16% | $ | 543 | 11% |
| 38 | % |
|
| Property rental income |
| 1,052 | 23% |
| 1,044 | 22% |
| 1 | % |
|
|
|
| 1,800 | 39% |
| 1,587 | 33% |
| 13 | % |
| Australia | Property rental income |
| 2,582 | 56% |
| 3,015 | 62% |
| (14) | % |
| New Zealand | Property rental income |
| 214 | 5% |
| 243 | 5% |
| (12) | % |
| Total revenue |
| $ | 4,596 | 100% | $ | 4,845 | 100% |
| (5) | % |
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OPERATING EXPENSE |
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| ||
| United States | Live theatre cost | $ | (272) | 6% | $ | (237) | 5% |
| (15) | % |
|
| Occupancy expense |
| (225) | 5% |
| (177) | 4% |
| (27) | % |
|
| Utilities |
| (69) | 2% |
| (44) | 1% |
| (57) | % |
|
| Cleaning and maintenance |
| (36) | 1% |
| (31) | 1% |
| (16) | % |
|
| Other operating expenses |
| (215) | 5% |
| (165) | 3% |
| (30) | % |
|
|
| $ | (817) | 18% | $ | (654) | 13% |
| (25) | % |
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| Australia | Occupancy expense | $ | (451) | 10% | $ | (487) | 10% |
| 7 | % |
|
| Labor cost |
| (4) | 0% |
| (44) | 1% |
| 91 | % |
|
| Utilities |
| (31) | 1% |
| (13) | 0% |
| (>100) | % |
|
| Cleaning and maintenance |
| (251) | 5% |
| (220) | 5% |
| (14) | % |
|
| Other operating expenses |
| (247) | 5% |
| (258) | 5% |
| 4 | % |
|
|
| $ | (984) | 21% | $ | (1,022) | 21% |
| 4 | % |
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|
| New Zealand | Occupancy expense | $ | (34) | 1% | $ | (58) | 1% |
| 41 | % |
|
| Labor cost |
| — | 0% |
| (2) | 0% |
| 100 | % |
|
| Utilities |
| — | 0% |
| (5) | 0% |
| 100 | % |
|
| Cleaning and maintenance |
| — | 0% |
| (4) | 0% |
| 100 | % |
|
| Other operating expenses |
| (51) | 1% |
| (210) | 4% |
| 76 | % |
|
|
| $ | (85) | 2% | $ | (279) | 6% |
| 70 | % |
|
|
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|
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| Total operating expense |
| $ | (1,886) | 41% | $ | (1,955) | 40% |
| 4 | % |
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DEPRECIATION, AMORTIZATION, GENERAL AND ADMINISTRATIVE EXPENSE |
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|
| ||
| United States | Depreciation and amortization | $ | (657) | 14% | $ | (660) | 14% |
| - | % |
|
| General and administrative expense |
| (171) | 4% |
| (130) | 3% |
| (32) | % |
|
|
|
| (828) | 18% |
| (790) | 16% |
| (5) | % |
|
|
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|
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|
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|
| Australia | Depreciation and amortization | $ | (424) | 9% | $ | (385) | 8% |
| (10) | % |
|
| General and administrative expense |
| (8) | 0% |
| (63) | 1% |
| 87 | % |
|
|
|
| (432) | 9% |
| (448) | 9% |
| 4 | % |
|
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|
| New Zealand | Depreciation and amortization |
| (60) | 1% |
| (57) | 1% |
| (5) | % |
|
| General and administrative expense |
| — | 0% |
| (1) | 0% |
| 100 | % |
|
|
|
| (60) | 1% |
| (58) | 1% |
| (3) | % |
| Total depreciation, amortization, general and administrative expense | $ | (1,320) | 29% | $ | (1,296) | 27% |
| (2) | % | |
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OPERATING INCOME (LOSS) - REAL ESTATE |
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| ||
| United States | $ | 155 | 3% | $ | 143 | 3% |
| 8 | % | |
| Australia |
| 1,166 | 25% |
| 1,545 | 32% |
| (25) | % | |
| New Zealand |
| 69 | 2% |
| (94) | (2)% |
| >100 | % | |
| Total real estate operating income (loss) | $ | 1,390 | 30% | $ | 1,594 | 33% |
| (13) | % | |
First Quarter Results
Revenue
Real estate rent revenue for the quarter ended March 31, 2026, decreased by $0.2 million to $4.6 million, compared to the same period in the prior year primarily due to loss of Australia and New Zealand property rental income from the monetization of Wellington property assets in New Zealand in January 2025, and Cannon Park ETC in Townsville, Queensland, Australia in May 2025. This is partially offset by higher Live Theatre rental and ancillary income, and the impact of the strengthening of the Australian and New Zealand dollars.
Real Estate Segment Income/(Loss)
Real estate segment operating income for the quarter ended March 31, 2026 decreased by $0.2 million to $1.4 million, compared to $1.6 million in the same period in the prior year. This decrease was due to a reduction in Australia and New Zealand rental income and an increase in the U.S. operating expense, partially offset by an increase in U.S. Live Theatre rental and ancillary income and a reduction in Australia and New Zealand operating expenses.
LIQUIDITY AND CAPITAL RESOURCES
Our Financing 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.
However, disruptions to our cinema cash flow caused by 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, have made it necessary for us to defer capital expenditures and to rely on the proceeds of asset monetizations to cover our costs of operations, pay interest, and pay down debt.
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 believe that our 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.
While our Company believes that global cinema business is recovering, we still face macroeconomic pressures such as high interest rates, inflation, supply chain issues and increased film rent (particularly on popular releases), labor, and operating costs, many of which are beyond our control. 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. We closely monitor our debt maturity dates, and where appropriate, we may seek necessary term extensions. Notably, on November 12, 2025, we extended our NAB facility by 5 years and on November 13, 2025, and on March 30, 2026, in anticipation of the upcoming scheduled NAB debt repayments, NAB has agreed to reduce our minimum liquidity requirement for a limited defined period in 2026. On February 6, 2026, we executed an agreement to defer a $500,000 principal payment related to our 44 Union Square loan, which we then settled on March 13, 2026. On February 27, 2026, we modified our Bank of America facility to modify current principal repayments. The maturity date and interest rate remain unchanged. As of March 31, 2026, we have debt of $35.5 million coming due in the next 12 months. While the Central Banks of the three countries in which we do business have reduced interest rates from recent highs, rates remain elevated when compared to pre-pandemic periods.
As discussed elsewhere in this Report, we believe that cinema cash flow for 2026 will be stronger than in recent periods. However, if our Company is unable to generate sufficient cash flow in the upcoming months, we will be required to adopt one or more alternatives, such as reducing, delaying or eliminating planned capital expenditures, monetizing additional assets, restructuring our debt and/or our lease obligations or finding additional sources of liquidity. In May 2025, we sold our Cannon Park property assets in Australia for $20.7 million (AU$32.0 million) and repaid our $12.9 million (AU$20.0 million) Bridge Facility. In January 2025, we sold our Wellington property assets in New Zealand for $21.5 million (NZ$38.0 million) and repaid our $10.5 million (NZ$18.8 million) loan to Westpac and paid down $6.1 million to Bank of America.
In early 2024, understanding our reduced need for administrative space during the shift to remote-working, we decreased our overall general and administrative expense by selling our administrative building in Culver City, California, freeing up cash of approximately $1.3 million (after paying off our mortgage, brokerage commissions and transactional fees). We are currently reviewing our need for replacement of office space.
On March 4, 2026, we signed a purchase and sale agreement to monetize our Napier, New Zealand property. The transaction is in its due diligence period. Also, 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. Given the specialized nature of this property and the relatively limited carrying costs (principally property taxes), our disposition strategy is to wait for a strategic buyer who will place value on the nature of our rail yard property and its access to nationwide rail systems.
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 third quarter of this 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.
If we cannot obtain sufficient net proceeds from the disposition of these assets (or determine to defer disposition due to unfavorable market conditions), in addition to other strategies, we may look to monetize other real estate assets.
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.
The changes in cash and cash equivalents for the quarter ended March 31, 2026, and March 31, 2025, respectively, are discussed as follows:
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| Three Months Ended |
|
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| ||||
|
| March 31, |
|
|
| ||||
(Dollars in thousands) |
| 2026 |
| 2025 |
| % Change | |||
Net cash provided by (used in) operating activities |
| $ | (2,466) |
| $ | (7,702) |
| 68 | % |
Net cash provided by (used in) investing activities |
|
| (545) |
|
| 17,878 |
| (>100) | % |
Net cash provided by (used in) financing activities |
|
| (2,254) |
|
| (16,853) |
| 87 | % |
Effect of exchange rate on cash and restricted cash |
|
| 273 |
|
| (61) |
| >100 | % |
Increase (decrease) in cash and cash equivalents and restricted cash |
| $ | (4,992) |
| $ | (6,738) |
| 26 | % |
Operating activities
Cash used in operating activities for the quarter ended March 31, 2026, decreased by $5.2 million, to $2.5 million compared to cash used in the same period in prior year of $7.7 million. This was primarily driven by a decrease in net operating loss of $2.8 million and increase in net payables of $2.5 million.
Investing activities
Cash used in investing activities during the quarter ended March 31, 2026 was $0.5 million, compared to cash provided in the same prior year period of $17.9 million. This was due to proceeds from sale of our Wellington properties, New Zealand in the first quarter of 2025.
Financing activities
Cash used in financing activities for the quarter months ended March 31, 2026, decreased by $14.6 million, to $2.3 million compared to cash used by financing activities of $16.9 million in the same prior year period. This was primarily due to pay off of our $10.5 million loan to Westpac and a $6.1 million repayment to Bank of America, following the sale of our Wellington properties, New Zealand in the first quarter of 2025.
The table below presents the changes in our total available resources (cash and borrowings), debt-to-equity ratio, working capital, and other relevant information addressing our liquidity for the three months ended March 31, 2026, and preceding four years:
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| As of and |
| Year Ended December 31 | |||||||||||
($ in thousands) |
| March 31, 2026 |
| 2025 |
| 2024 |
| 2023 |
| 2022 | |||||
Total Resources (cash and borrowings) |
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|
|
Cash and cash equivalents (unrestricted) |
| $ | 5,524 |
| $ | 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 |
|
| 8,383 |
|
| 12,890 |
|
| 20,206 |
|
| 20,765 |
|
| 41,947 |
Total unrestricted resources at period end |
|
| 5,524 |
|
| 10,531 |
|
| 12,347 |
|
| 12,906 |
|
| 29,947 |
Debt-to-Equity Ratio |
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|
|
Total contractual facility |
| $ | 187,410 |
| $ | 187,450 |
| $ | 210,572 |
| $ | 218,159 |
| $ | 227,633 |
Total debt (gross of deferred financing costs) |
|
| 184,551 |
|
| 185,091 |
|
| 202,713 |
|
| 210,300 |
|
| 215,633 |
Current |
|
| 35,513 |
|
| 35,999 |
|
| 69,193 |
|
| 35,070 |
|
| 38,026 |
Non-current |
|
| 149,038 |
|
| 149,092 |
|
| 133,520 |
|
| 175,230 |
|
| 177,607 |
Finance lease liabilities |
|
| — |
|
| — |
|
| 43 |
|
| 83 |
|
| 28 |
Total book equity |
|
| (25,387) |
|
| (18,098) |
|
| (4,790) |
|
| 32,996 |
|
| 63,279 |
Debt-to-equity ratio |
|
| (7.27) |
|
| (10.23) |
|
| (42.32) |
|
| 6.37 |
|
| 3.41 |
Changes in Working Capital |
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Working capital (deficit)(1) |
| $ | (86,123) |
| $ | (106,765) |
| $ | (104,584) |
| $ | (88,373) |
| $ | (74,152) |
Current ratio |
|
| 0.34 |
|
| 0.17 |
|
| 0.35 |
|
| 0.30 |
|
| 0.39 |
Capital Expenditures (including acquisitions) |
| $ | 516 |
| $ | 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.
As of March 31, 2026, we had $5.5 million in unrestricted cash and cash equivalents compared to $10.5 million on December 31, 2025. On March 31, 2026, our total outstanding borrowings were $184.6 million compared to $185.1 million on December 31, 2025.
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. In the past, we used cash generated from operations and other excess cash to the extent not needed for any capital expenditures, to pay down our loans and credit facilities providing us some flexibility on our available loan facilities for future use and thereby, reducing interest charges.
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.
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 March 31, 2026:
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(Dollars in thousands) |
| 2026 |
| 2027 |
| 2028 |
| 2029 |
| 2030 |
| Thereafter |
| Total | |||||||
Debt(1) |
| $ | 82,187 |
| $ | 3,016 |
| $ | 3,016 |
| $ | 3,016 |
| $ | 51,755 |
| $ | 13,648 |
| $ | 156,638 |
Operating leases, including imputed interest |
|
| 29,264 |
|
| 27,045 |
|
| 25,707 |
|
| 23,992 |
|
| 22,033 |
|
| 111,637 |
|
| 239,678 |
Subordinated debt(1) |
|
| — |
|
| 27,913 |
|
| — |
|
| — |
|
| — |
|
| — |
|
| 27,913 |
Pension liability |
|
| 435 |
|
| 607 |
|
| 640 |
|
| 442 |
|
| — |
|
| — |
|
| 2,124 |
Interest on pension liability |
|
| 78 |
|
| 77 |
|
| 44 |
|
| 11 |
|
| — |
|
| — |
|
| 210 |
Estimated interest on debt (2) |
|
| 9,848 |
|
| 5,446 |
|
| 4,188 |
|
| 4,027 |
|
| 2,598 |
|
| 3,079 |
|
| 29,186 |
Total |
| $ | 121,812 |
| $ | 64,104 |
| $ | 33,595 |
| $ | 31,488 |
| $ | 76,386 |
| $ | 128,364 |
| $ | 455,749 |
(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 March 31, 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 March 31, 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; our expectations regarding the effects of our enhanced F&B offerings 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; 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 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 March 31, 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 March 31, 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 first quarter ended March 31, 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 March 31, 2026, no director or officer of the Company
Item 6 – Exhibits
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10.1* | Waiver and Twelfth Amendment to Second Amendment and Restated Credit Agreement, dated February 27, 2026, between Consolidated Amusement Holdings, LLC and Bank of America, N.A |
10.2*† | Amendment Deed dated March 31, 2026 between National Australia Bank Limited and Reading Entertainment Australia Pty Ltd. |
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 March 31, 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: May 15, 2026
By: /s/ Ellen M. Cotter
Ellen M. Cotter
President and Chief Executive Officer
Date: May 15, 2026
By: /s/ Gilbert Avanes
Gilbert Avanes
Executive Vice President, Chief Financial Officer and Treasurer
FAQ
How did Reading International (RDI) perform financially in Q1 2026?
Reading International posted a net loss attributable to the company of $8.1 million in Q1 2026, versus a $4.8 million loss a year earlier. Revenue increased to $45.1 million from $40.2 million, but higher costs and interest kept overall results negative.
What is Reading International’s liquidity and debt position as of March 31, 2026?
As of March 31, 2026, Reading held $5.5 million in cash and cash equivalents and reported negative working capital of about $(86.1) million. Total borrowings were approximately $177.7 million, including $35.5 million of current debt due within twelve months.
Did Reading International raise any going concern issues in this 10-Q?
Management evaluated going concern under ASC 205-40 and cited tight liquidity and upcoming debt maturities. It concluded that planned real estate asset monetizations and loan refinancings are probable enough to alleviate substantial doubt about the company’s ability to continue as a going concern over the next year.
How are Reading International’s cinema and real estate segments performing?
In Q1 2026, cinema revenue rose to $41.5 million and segment operating loss narrowed to $(1.3) million. Real estate generated $4.6 million of revenue and $1.4 million of segment operating income, providing positive contribution despite modest year-on-year revenue decline.
What real estate monetization plans does Reading International have?
The company is actively monetizing select properties to support liquidity, including classifying its Cinemas 1,2,3 property as held for sale at about $24.0 million book value and continuing efforts to sell the Newberry Yard industrial property, following nine asset sales totaling $197.5 million since 2021.
What are Reading International’s key upcoming debt maturities?
Key facilities include the Minetta & Orpheum loan maturing in June 2026, the Bank of America credit facility and Cinemas 1,2,3 term loan both maturing in late 2026, and Trust Preferred Securities due in April 2027. The NAB corporate term loan in Australia now matures in July 2030.