Kinemax Case Study

Company presentation

365careers, 2014

Index

Group Structure

Historical Timeline

Business Formula

Geographical Footprint

Country Comparison

Future Growth Prospects

Financials at a Glance

Summary Table

365careers, 2014

10

Group Structure

Timeline

Business Formula

Geographical
Footprint

Country
comparison

Growth
Prospects

Financials

Summary table

Group Structure
Kinemax Group:

Kinemax
Kinemax Sarl
Sarl

Kinemax
Kinemax
Italia
Italia Spa
Spa
Kinemax
Kinemax
Deutschland
Deutschland
Saar
Saar

*100%

*100%

2010

*100%

*80%

2011
*49%

2009

Kinemax
Kinemax
UK
UK ltd
ltd

Kinemax
Kinemax
Turkey
TurkeyA.S
A.S
Kinemax
Kinemax
Brasil
Brasil
LTDA
LTDA

2010

2011

2012

Legend:
Joint Venture

Kinemax Group Perimeter

Parent Company
Subsidiaries

*%

Percentage held by
Parent Company

365careers, 2014

Kinemax Group
Kinemax Sarl was founded in 2009 by a prominent
French entrepreneur. The company owns a chain of
cinema multiplexes, targeted at children audiences.
Kinemax tries to take advantage of the fastest growing
niche within the cinema market
International expansion
Soon after the company started its operations in
France, it started looking abroad. Currently, the
company is present in 5 foreign markets mainly in
Europe
Two of Kinemaxs most recent investments are related
to the fast growing markets of Turkey and Brazil. The
company owns a majority stake in its investment in
Turkey (80%), and decided to form a Joint Venture in
order to access the Brazilian market
Structure of the Group
Kinemax Sarl, the French legal entity, is the Groups
owner. The company has direct participation in all of
the other companies
Kinemax consolidates fully all of its subsidiaries, given
that the company is the major shareholder in all five of
them and is able to exercise control
Accounting principles
All legal entities within the Kinemax Group prepare
their financial figures under IFRS

Group Structure

Timeline

Business Formula

Geographical
Footprint

Country
comparison

Growth
Prospects

Financials

Summary table

Historical Timeline

Company was
founded
June
2009

Country Country
opening opening
February
2010

Financing, 2009
First Round
50 million

Country
opening

November
2010

March
2011

Country
opening

Country
opening

July
2011

November
2012

Financing, 2010
Second Round
50 million

Financing, 2012
Third Round
40 million

Future
Future Developments
Developments

New Service
Line, 2014
Event rooms

Acquisition
Moviez - 25 million

365careers, 2014

Group Structure

Timeline

Business
Formula

Geographical
Footprint

Country
comparison

Growth
Prospects

Financials

Summary table

Business Formula

Target
Target aa Niche
Niche
Market
Market

Access
Access Growth
Growth
Markets
Markets

Partnerships
Partnerships with
with
Local
Players
Local Players

International
International
Presence
Presence

Kinemaxs
Business Model

Organize
Organize Promotional
Promotional
Events
Events

Extended
Extended Service
Service
Line
Line

Strong
Strong Bargaining
Bargaining
Power
Power

Leverage
Leverage Customer
Customer
Behavior
Behavior

365careers, 2014

Group Structure

Timeline

Business Formula

Geographical
Footprint

Country
comparison

Growth
Prospects

Financials

Summary table

Geographical Footprint

Kinemax
Kinemax UK
UK

Kinemax
Kinemax Deutschland
Deutschland
52.5m

43.4m

Total Revenues

Total Revenues

Headcount:
Headcount: 192
192

Headcount:
Headcount: 134
134

Kinemax
Kinemax Sarl
Sarl
Kinemax
Kinemax Turkey
Turkey

135.7m
Total Revenues

24.8m

Headcount:
Headcount: 342
342

Total Revenues

Headcount:
Headcount: 124
124
Kinemax
Kinemax Italia
Italia

Kinemax
Kinemax Brasil
Brasil

46.3m

4.4m

Total Revenues

Total Revenues

Headcount:
Headcount: 156
156

Headcount:
Headcount: 38
38

Kinemax
Kinemax operates
operates on
on 33 continents
continents and
and in
in 66 countries;
countries;
The
The company
company has
has aa Headcount
Headcount of
of 986
986 employees
employees and
and its
its Total
Total Revenues
Revenues amount
amount to
to 307.2m
307.2m

365careers, 2014

Group Structure

Timeline

Business Formula

Geographical
Footprint

Country
comparison

Growth
Prospects

Financials

Summary table

Country Comparison
Market
Market
Penetration
Penetration

Kinemax
Kinemax

Lo

iu

gh
Hi

Cinema
Cinema
Revenues
Revenues
Percentage
Percentage
vs.
vs. Total
Total

High

France
France

Countries of
of Operation
Operation
Countries

ed

Revenue
Revenue
percentage
percentage

Italy
Italy

Turkey
Turkey

Brazil
Brazil

Low

Low

Over
30

50%

17 % of Revenues

51 % vs.
49%

54 % vs.
46%

54%

46%

14 % of Revenues

50 % vs.
50%

57%

16%

27%

13 % of Revenues

62 % vs.
38%

61%

7%

32%

3 % of Revenues

68 % vs.
32%

18 % of Revenues

Medium

14-30

35 % of Revenues

Medium

Germany
Germany

Under
14

56 % vs.
44%

Medium

UK
UK

Customers
Customers

365careers, 2014

56%

12%

15%

32%

35%

Gross
Gross
Margin
Margin
0% 20% 40% 60% 80%100%

26% Gross
Margin
26%

25% Gross
Margin
25%

9%

37%

30% Gross
Margin
30%

21%

32%

32% Gross
Margin
32%

22% Gross
Margin
22%

19% Gross
Margin
19%

Group Structure

Timeline

Geographical
Footprint

Business Formula

Country
comparison

Growth
Prospects

Financials

Summary table

Future Growth Prospects

South
South American
American Market
Market

New
New European
European Markets
Markets

The
The South
SouthAmerican
American Market
Market is
is one
one of
of the
the prime
prime
opportunities
opportunities ahead
ahead of
of Kinemax
Kinemax

Kinemax
Kinemax plans
plans to
to start
start operations
operations in
in the
the
Netherlands,
Netherlands, Spain
Spain and
and in
in Norway
Norway

The
The firm
firm has
has already
already acquired
acquired some
some limited
limited
experience
experience from
from its
its Joint
Joint Venture
Venture in
in Brazil
Brazil

The
The firm
firm has
has acquired
acquired experience
experience from
from its
its
activities
activities in
in other
other European
European countries
countries

The
The South
SouthAmerican
American Market
Market is
is expected
expected to
to grow
grow in
in
double
figures
in
the
next
5
years
double figures in the next 5 years

Kinemax
Kinemax Growth
Growth
Prospects
Prospects
Penetration
Penetration in
in existing
existing Markets
Markets

Extension
Extension of
of offered
offered Services
Services

Kinemax
Kinemax will
will likely
likelystep
step up
up its
its effort
effort to
to solidify
solidifyits
its
leadership
position
in
the
markets,
in
which
leadership position in the markets, in which the
the
company
company is
is already
alreadypresent
present

Kinemax
Kinemax plans
plans to
to introduce
introduce aa new
new service
service in
in its
its
locations:
locations: Event
Event rooms
rooms
Similar
Similar service
service lines
lines reinforce
reinforce its
its image
image as
as the
the
place
place to
to be
be for
for children
children in
in the
the under
under 14
14 segment
segment

There
There isis significant
significant room
room for
for growth
growth in
in Turkey
Turkey and
and
in
Brazil
in Brazil

365careers, 2014

Group Structure

Timeline

Business Formula

Geographical
Footprint

Country
comparison

Growth
Prospects

Financials

Summary table

Financials at a Glance
Revenues development
Kinemaxs revenues experienced a double digit
growth throughout the period under analysis
Both cinema and other revenues grew by more
than 10%, although other revenues outpaced
the growth of cinema revenues (16% vs. 11%)
It seems that the companys revenue mix is
heading to a 50/50 split between Cinema and
Other revenues
Gross Margin
Higher revenues transferred into a higher Gross
Margin % (22.7% in FY11 vs. 25.5% in FY13)
Kinemax is able to sell its products at a good
margin
Gross Margin % could be further improved by
ramping up the investments in Turkey and Brazil
EBITDA
Kinemax improved its EBITDA margin as well in
the period under analysis (from 7.6% in FY11 to
10.3% in FY13)
Operating expenses did not increase as fast as
Gross Margin, thus EBITDA increased
Cash Conversion Ratio
The ratio between Operating Cash Flow and
EBITDA varied between 76.2% and 94.3%
It was lower in FY13 due to investments in new
projects

365careers, 2014

Group Structure

Timeline

Business Formula

Geographical
Footprint

Country
comparison

Growth
Prospects

Financials

Summary table

Summary Table

Legal
Legal Entity
Entity
Ki
ne
m
ax
Gr
ou
p

Country
Country

Company
Company type
type

Owned
Owned
at
at

Start
Start of
of
Operations
Operations

Fill
Fill rate
rate
%
%

Avg.
Avg. Ticket
Ticket
Price
Price

Gross
Gross
Margin
Margin %
%

Kinemax
Sarl

France

Holding

Not
applicable

June 2009

43.9%

5.5

26.3%

Kinemax Italia Spa

Italy

Subsidiary

100%

February 2010

37.4%

5.9

24.8%

Kinemax UK Ltd

United
Kingdom

Subsidiary

100%

November
2010

37.1%

6.1

29.8%

Kinemax
Deutschland Saar

Germany

Subsidiary

100%

March 2011

42.3%

6.5

32.3%

Kinemax Turkey A.S.

Turkey

Subsidiary

80%

July 2011

42.9%

4.8

22.7%

Kinemax Brasil LTDA

Brasil

Joint Venture

49%

November
2012

29.3%

3.9

18.6%

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