It’s too late to imagine that ticket buyers might put their smartphones away during the pre-show ads and programming. “That horse is out of the barn already,” National CineMedia‘s Kurt Hall conceded today at the MKM Partners Investor Day Conference. But the head of the No. 1 cinema ad sales company says people might be willing to pocket their phones during the trailers. “That’s where the real interruptions are.” His company could help, he says, by using its technologies that enable advertisers to send messages to phones tied to content that appears on the screen. If you want people to turn off their phones during trailers then “why not have that message come up on the phone itself? It’s a hell of a lot stronger message than having it just come up on the screen.” We’ll see. Meanwhile, Hall says that he’s optimistic about his business as companies — including auto makers — increasingly use movie ads to introduce products and models. “There’s some good news out there about the number of product launches. That’s good news for cinema.”
National CineMedia, operator of the nation’s largest in-theater ad network, reported today after the closing bell that it grew revenue by 8.2% year-over-year to $136 million during the third quarter. That’s a quarterly record for the company, which saw its ad revenue jump 8% to $127.1 million; ad revenue is up 3.3% year to date. Net income for the quarter was $16.8 million, or 31 cents a share, compared with $11.8 million and 24 cents a share in 2010. Income for the year is up 40.9%. The company also said that it has authorized a 3Q cash dividend of 22 cents per share of common stock to be paid on December 1 and intends to pay a regular quarterly dividend for the foreseeable future.
National CineMedia’s 2Q results — basically in line with expectations — and the company’s decision to raise its dividend seemed to balance whatever disappointment investors may have felt about the slight trim executives made in their financial forecast for 2011. The share price for the No. 1 movie advertising and event company was unchanged in after-hours trading after it said that it expects to end the year with as much as $470M in revenue. In May the forecast went as high as $475M. But net income in 2Q of $9M was up 95.6% vs the same period last year on revenues of $114M, up 15%. Earnings at 16 cents a share matched the consensus estimate among analysts who follow the company. They also expected $109.7M in revenue. The company attributes its growth to higher ad rates as well as a 6.4% increase in attendance at theater chains — including AMC, Cinemark, and Regal — that show its ads and features. National CineMedia says that beginning in September its dividend will rise 10% to 22 cents a share. “With the progress we are making to expand our business we look forward to continuing to provide shareholders with a unique combination of growth and current income,” CEO Kurt Hall said. NCM’s stock price has dropped 31.3% in 2011 as investors became concerned about overall movie attendance and prospects for the ad market.