The disparity in the CEO’s compensation vs last year appears to be due to a judgement call that resulted in no option awards, which came to $3.2M last year. In a year when IMAX shares were up 18.7%, Gelfond‘s package included $750,000 salary, $1M bonus, $1.7M change in pension value, and $126,275 in other compensation. The “other” category included $26,865 for personal use of a company car, according to the company proxy filed at the SEC today. Gelfond’s package was 2.3 times the median for IMAX’s four other top execs, comfortably below the level (3 times) that worries analysts and academics who are suspicious of concentrated CEO power. Last year Gelfond’s pay was 4.3 times higher than his colleagues’ which put him on our out-of-whack list. Shareholders at the annual meeting, to be held June 11 in New York, can register their opinion about this year’s compensation in an advisory say-on-pay vote.
The large screen theater company set a high bar for itself this morning when it reported a 55.7% jump in the gross box office for its films in Q4. But CEO Rich Gelfond will try to beat that in 2013 by taking more control over the films IMAX theaters show. One initiative, unveiled this morning, will deploy digital projectors in about 30 of the company’s most popular theaters which currently use conventional film — including Regal’s IMAX theaters in Irvine, Cal.; Ontario, Cal.; and Orlando, Fla. The change is needed because film stock is “disappearing faster than we had anticipated” and the cost of processing it is rising. “With a digital projector we can show 25 films a year because each hard drive costs $150,” he tells me. “You can swap it in or out, no big deal. In a film theater each print costs $30,000. They’re big, bulky, and expensive.” But the digital projectors aren’t powerful enough to light some of the largest screens including theaters in New York’s Lincoln Square, Los Angeles’ Howard Hughes Center, and the Universal CityWalk. That’s one reason why the digital projectors are merely an “interim solution” until late 2014 when IMAX will roll out its more powerful laser projectors.
Wall Street’s backlash against 3D movies is growing serious. Just weeks after movie executives and investors wondered how well 3D films would do this summer, they’ve begun to ask much tougher questions including: When will movie theater chains begin to cancel orders for 3D projection equipment? And could continued weakening in ticket sales force AMC Entertainment to shelve its plan to go public and raise as much as $450 million?
Defenders of the technology are urging everyone to wait and see whether there’s an uptick in 3D ticket sales for Paramount’s Transformers: Dark Of The Moon, which opens July 1, and Warner Bros’ Harry Potter And The Deathly Hallows, Part II, which opens July 15. The films should “help provide for a more positive outlook” for 3D in general and particularly for 3D technology company RealD, says Merriman Capital analyst Eric Wold.
But investors didn’t appear to agree on Friday. RealD’s stock price fell 13.2% to $20.90 the day after executives responded to the Street’s concerns with talking points that simply urged people not to read too much into disappointing 3D sales for just a few films. RealD shares now have lost 41.3% of their value since May 19. “While management dismisses a change in consumer enthusiasm toward 3D, the public is speaking and 3D is simply being overused with ticket premiums far too high,” says BTIG analyst Rich Greenfield — who has a “sell” rating on RealD.
Here’s the strange thing about IMAX these days: the large screen exhibitor reported terrible financial results for the first quarter although analysts were projecting it would continue to …