Description Of Business And Segment Reporting

12 Months Ended

Dec. 31, 2022

Description Of Business And Segment Reporting [Abstract]

Description Of Business And Segment Reporting

NOTE 1 – DESCRIPTION OF BUSINESS AND SEGMENT REPORTING

The 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.

Business Segments

Our business is comprised of two operating segments, as follows: (i) cinema exhibition and (ii) real estate. Each of these segments has discrete and separate financial information and for which operating results are evaluated regularly by our Chief Executive Officer, the chief operating decision-maker of the Company. As part of our real estate activities, we have historically held undeveloped land in urban and suburban centers in the United States, Australia, and New Zealand. However, in 2021, we monetized certain raw landholdings and other real estate assets as detailed at Note 5 – Real Estate Transactions.

The tables below summarize the results of operations for each of our business segments. Operating expense includes costs associated with the day-to-day operations of the cinemas and the management of rental properties, including our live theatre assets.



	2022						2021						2020
(Dollars in thousands)	Cinema		Real ‎Estate		Total		Cinema		Real ‎Estate		Total		Cinema		Real ‎Estate		Total
Revenue - third party	$	191,321	$	11,794	$	203,115	$	126,812	$	12,248	$	139,060	$	67,014	$	10,848	$	77,862
Inter-segment revenue ⁽¹⁾		—		5,023		5,023		—		515		515		—		2,115		2,115
Total segment revenue		191,321		16,817		208,138		126,812		12,763		139,575		67,014		12,963		79,977
Operating expense
Operating Expense - Third Party		(178,768)		(8,947)		(187,715)		(122,901)		(10,106)		(133,007)		(91,065)		(8,578)		(99,643)
Inter-Segment Operating Expenses ⁽¹⁾		(5,023)		—		(5,023)		(515)		—		(515)		(2,115)		—		(2,115)
Total of services and products (excluding depreciation and amortization)		(183,791)		(8,947)		(192,738)		(123,416)		(10,106)		(133,522)		(93,180)		(8,578)		(101,758)
Depreciation and amortization		(13,351)		(6,495)		(19,846)		(14,422)		(7,092)		(21,514)		(15,246)		(6,101)		(21,347)
Impairment of long-lived assets		(1,549)		—		(1,549)		—		—		—		(217)		—		(217)
General and administrative expense		(4,346)		(869)		(5,215)		(7,611)		(920)		(8,531)		(3,427)		(747)		(4,174)
Total operating expense		(203,037)		(16,311)		(219,348)		(145,449)		(18,118)		(163,567)		(112,070)		(15,426)		(127,496)
Segment operating income (loss)	$	(11,716)	$	506	$	(11,210)	$	(18,637)	$	(5,355)	$	(23,992)	$	(45,056)	$	(2,463)	$	(47,519)

(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 segment operating income to income before income taxes is as follows:



(Dollars in thousands)	2022		2021		2020
Segment operating income (loss)	$	(11,210)	$	(23,992)	$	(47,519)
Unallocated corporate expense:
Depreciation and amortization expense		(1,072)		(1,232)		(970)
General and administrative expense		(16,201)		(16,569)		(12,824)
Interest expense, net		(14,392)		(13,688)		(9,354)
Equity earnings (loss) of unconsolidated joint ventures		271		258		(449)
Gain (loss) on sale of assets		(54)		92,219		(1)
Other (expense) income		6,817		3,762		293
Income (loss) before income taxes	$	(35,841)	$	40,758	$	(70,824)

Assuming cash and cash equivalents are accounted for as corporate assets, total assets by business segment and by country are presented as follows:



	December 31,
(Dollars in thousands)	2022		2021
By segment:
Cinema	$	267,874	$	316,169
Real estate		247,247		257,224
Corporate ⁽¹⁾		71,934		114,309
Total assets	$	587,055	$	687,702
By country:
United States	$	337,595	$	336,029
Australia		200,220		274,330
New Zealand		49,240		77,343
Total assets	$	587,055	$	687,702

(1)Corporate Assets includes cash and cash equivalents of $29.9 million and $83.3 million as of December 31, 2022 and 2021, respectively.

The following table sets forth our operating properties by country:



	December 31,
(Dollars in thousands)	2022		2021
United States	$	171,756	$	177,918
Australia		95,467		107,343
New Zealand		19,729		21,396
Total operating property	$	286,952	$	306,657

The table below summarizes capital expenditures for the three years ended December 31, 2022:



(Dollars in thousands)	2022		2021		2020
Segment capital expenditures	$	9,780	$	14,428	$	16,686
Corporate capital expenditures		—		—		73
Total capital expenditures	$	9,780	$	14,428	$	16,759