What changed in this filing

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Item 1. Financial Statements

2024-10-30 compared with 2024-07-25 · 249 added, 235 removed, 1247 unchanged (28% of the section changed)

1 unchanged sentence

The following unaudited Condensed Consolidated Financial Statements are filed as part of this Report:

Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023

Condensed Consolidated Statements of Operations for the three and six months ended June 30 , 2024 and 2023

Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30 , 2024 and 2023

Condensed Consolidated Statements of Cash Flows for the six months ended June 30 , 2024 and 2023

Condensed Consolidated Statements of Shareholders’ Equity for the three and six months ended June 30 , 2024 and 2023

Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023

Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023

Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2024 and 2023

Condensed Consolidated Statements of Cash Flows for the nine months ended Septem ber 30, 2024 and 2023

Condensed Consolidated Statements of Shareholders’ Equity for the three and nine months ended September 30, 2024 and 2023

Notes to Condensed Consolidated Financial Statements

3 unchanged sentences

Dollars, except share amounts)

June 30, December 31,

September 30, December 31,

Cash and cash equivalents $ 104,504 $ 76,200

43 unchanged sentences

Dollars, except per share amounts)

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2024 2023 2024 2023

23 unchanged sentences

1,544 1,107 4,208 3,328

Credit loss expense, net

Credit loss (reversal) expense, net

( 1,137 ) 523 ( 963 ) 1,589

3 unchanged sentences

Realized and unrealized investment gains

32 364 94 436

Retirement benefits non-service expense

6 unchanged sentences

17,719 21,574 29,374 44,656

Income tax recovery (expense)

Income tax expense

( 2,376 ) ( 6,555 ) ( 3,538 ) ( 14,901 )

5 unchanged sentences

Net income per share attributable to common shareholders:

Basic and diluted

$ 0.26 $ 0.22 $ 0.39 $ 0.42

$ 0.26 $ 0.22 $ 0.39 $ 0.41

Weighted average shares outstanding (in thousands):

5 unchanged sentences

(In thousands of U.S.

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2024 2023 2024 2023

$ 15,343 $ 15,019 $ 25,836 $ 29,755

Other comprehensive loss before tax

Unrealized net (loss) gain from cash flow hedging instruments

Other comprehensive income (loss) before tax

Unrealized net gain (loss) from cash flow hedging instruments

337 ( 1,048 ) ( 944 ) ( 226 )

4 unchanged sentences

Defined benefit and postretirement benefit plans ( 149 ) ( 176 ) ( 547 ) ( 528 )

Total other comprehensive loss before tax

Total other comprehensive income (loss) before tax

4,125 10 1,528 ( 6,677 )

Income tax benefit (expense) related to other comprehensive loss

Income tax (expense) benefit related to other comprehensive income (loss)

( 92 ) 274 328 30

Other comprehensive loss, net of tax

Other comprehensive income (loss), net of tax

4,033 284 1,856 ( 6,647 )

1 unchanged sentence

19,376 15,303 27,692 23,108

Comprehensive (income) loss attributable to non-controlling interests

Comprehensive income attributable to non-controlling interests

( 2,521 ) ( 3,328 ) ( 5,872 ) ( 5,104 )

5 unchanged sentences

(In thousands of U.S.

Six Months Ended

Nine Months Ended

September 30,

Operating Activities

4 unchanged sentences

Amortization of deferred financing costs

Credit loss expense, net

Credit loss (reversal) expense, net

( 963 ) 1,589

Write-downs, including asset impairments

3 unchanged sentences

17,261 17,830

Unrealized foreign currency exchange loss

Unrealized foreign currency exchange (gain) loss

Realized and unrealized investment gain

2 unchanged sentences

Accounts receivable

23,001 ( 2,392 )

Inventories ( 6,181 ) ( 13,771 )

26 unchanged sentences

( 4,978 ) ( 6,458 )

Common shares issued - stock options exercised

Principal payment under finance lease obligations

( 480 ) ( 480 )

Dividends paid to non-controlling interests

Net cash provided by (used in) financing activities

Net cash used in financing activities

( 951 ) ( 24,349 )

Effects of exchange rate changes on cash

Increase (decrease) in cash and cash equivalents during period

Increase in cash and cash equivalents during period

28,304 12,202

7 unchanged sentences

(In thousands of U.S.

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2024 2023 2024 2023

2 unchanged sentences

$ 394,493 $ 390,238 $ 389,048 $ 376,715

Employee stock options exercised

Average carrying value of repurchased and retired common shares

15 unchanged sentences

Change in ownership interest related to IMAX China

( 11 ) — ( 89 ) —

Balance, end of period

17 unchanged sentences

( 13,974 ) ( 14,622 ) ( 12,081 ) ( 9,846 )

Other comprehensive loss, net of tax

Other comprehensive income (loss), net of tax

2,959 ( 15 ) 1,066 ( 4,791 )

6 unchanged sentences

1,431 3,100 5,067 7,021

Other comprehensive loss, net of tax

Other comprehensive income (loss), net of tax

1,073 299 789 ( 1,856 )

3 unchanged sentences

Change in ownership interest related to IMAX China common share repurchases

( 104 ) — ( 25 ) —

Balance, end of period

16 unchanged sentences

The interim results presented in the Company’s Condensed Consolidated Statements of Operations are not necessarily indicative of results for a full year.

These Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements included in the Company’s 2023 Annual Report on Form 10-K (the “2023 Form 10-K”), which should be consulted for a summary of the significant accounting policies utilized by the Company.

These Condensed Consolidated Financial Statements are prepared following the same accounting policies disclosed in the 2023 Form 10-K.

8 unchanged sentences

The Company uses the equity method of accounting for these entities, which are not material to the Company’s Condensed Consolidated Financial Statements.

A loss in the value of an equity method investment that is other than temporary is recognized as a charge in the Condensed Consolidated Statements of Operations.

As of June 30, 2024 and December 31, 2023, total assets and liabilities of the Company’s consolidated VIEs are as follows:

June 30, December 31,

A change in the value of an equity method investment that is other than temporary is recognized in the Condensed Consolidated Statements of Operations.

As of September 30, 2024 and December 31, 2023, total assets and liabilities of the Company’s consolidated VIEs are as follows:

September 30, December 31,

(In thousands of U.S.

31 unchanged sentences

The Company is in the process of evaluating the impact of this ASU on its Consolidated Financial Statements.

In December 2023, the FASB issued Accounting Standard Update 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures (“ASU 2023-09”).

In December 2023, the FASB issued Accounting Standard Update No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”).

The amendments in ASU 2023-09 improve the transparency of income tax disclosures by requiring (i) consistent categories and greater disaggregation of information in the rate reconciliation, and (ii) income taxes paid disaggregated by jurisdiction.

1 unchanged sentence

The Company is in the process of evaluating the impact of this ASU on its Consolidated Financial Statements.

In March 2024, the FASB issued Accounting Standard Update 2024-01, Compensation - Stock Compensation (Topic 718):

Scope Application of Profits Interest and Similar Awards (“ASU 2024-01”).

ASU 2024-01 amends the guidance in Accounting Standard Codification 718 (“ASC 718”) by adding an illustrative example to demonstrate and clarify how to apply the scope guidance to determine whether profits interests and similar awards should be accounted for as share-based payment arrangement under ASC 718 or another standard.

ASU 2024-01 will be effective for the Company’s period ended March 31, 2025.

The Company is in the process of evaluating the impact of ASU 2024-01 on its Condensed Consolidated Financial Statements.

The Company considers the applicability and impact of all recently issued FASB accounting standard codification updates.

Accounting standard updates that are not noted above were assessed and determined to be not applicable or not significant to the Company’s Condensed Consolidated Financial Statements for the period ended June 30, 2024.

The ability of the Company to collect its receivables is principally dependent on the viability and solvency of individual theater operators which is significantly influenced by consumer behavior and general economic conditions.

31 unchanged sentences

Accounts receivable also includes amounts due to the Company from movie studios and other content creators principally for digitally remastering films into IMAX formats, as well as for film distribution and post-production services.

The following tables summarize the activity in the allowance for credit losses related to Accounts Receivable for the three and six months ended June 30, 2024 and 2023:

Three Months Ended Six Months Ended

June 30, 2024 June 30, 2024

The following tables summarize the activity in the allowance for credit losses related to Accounts Receivable for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended Nine Months Ended

September 30, 2024 September 30, 2024

(In thousands of U.S.

4 unchanged sentences

$ 14,095 $ 651 $ 1,080 $ 15,826 $ 14,355 $ 616 $ 1,006 $ 15,977

Current period provision (reversal), net

Current period (reversal) provision, net

( 2,079 ) 600 ( 13 ) ( 1,492 ) ( 2,120 ) 638 61 ( 1,421 )

5 unchanged sentences

$ 12,134 $ 1,251 $ 1,067 $ 14,452 $ 12,134 $ 1,251 $ 1,067 $ 14,452

Three Months Ended Six Months Ended

June 30, 2023 June 30, 2023

Three Months Ended Nine Months Ended

September 30, 2023 September 30, 2023

(In thousands of U.S.

12 unchanged sentences

$ 13,104 $ 994 $ 1,023 $ 15,121 $ 13,104 $ 994 $ 1,023 $ 15,121

For the three and six months ended June 30, 2024, the Company’s allowance for current expected credit losses related to Accounts Receivable decreased by $ 0.1 million and $ 0.2 million, respectively.

For the three and six months ended June 30, 2023, the Company’s allowance for current expected credit losses related to Accounts Receivable increased by $ 0.2 million and decreased by $ 0.1 million, respectively.

For the three and nine months ended September 30, 2024, the Company’s allowance for current expected credit losses related to Accounts Receivable decreased by $ 1.4 million and $ 1.5 million, respectively.

For the three and nine months ended September 30, 2023, the Company’s allowance for current expected credit losses related to Accounts Receivable increased by $ 1.1 million and $ 1.0 million, respectively.

Financing Receivables

Financing receivables are due from theater operators and consist of the Company’s net investment in sales-type leases and receivables associated with financed sales of IMAX Systems.

As of June 30, 2024 and December 31, 2023, financing receivables consist of the following:

June 30, December 31,

As of September 30, 2024 and December 31, 2023, financing receivables consist of the following:

September 30, December 31,

(In thousands of U.S.

29 unchanged sentences

$ 95,397 $ 97,615

As of June 30, 2024 and December 31, 2023, the weighted-average remaining lease term and weighted-average interest rate associated with the Company’s sales-type lease arrangements and financed sales receivables, as applicable, are as follows:

June 30, December 31,

As of September 30, 2024 and December 31, 2023, the weighted-average remaining lease term and weighted-average interest rate associated with the Company’s sales-type lease arrangements and financed sales receivables, as applicable, are as follows:

September 30, December 31,

(In thousands of U.S.

6 unchanged sentences

8.94 % 8.97 %

The tables below provide information on the Company’s net investment in leases by credit quality indicator as of June 30, 2024 and December 31, 2023.

The tables below provide information on the Company’s net investment in leases by credit quality indicator as of September 30, 2024 and December 31, 2023.

The amounts disclosed for each credit quality classification are determined on a customer-by-customer basis as per the origination year of the relationship, and include both billed and unbilled amounts.

1 unchanged sentence

By Origination Year

As of June 30, 2024

As of September 30, 2024

2024 2023 2022 2021 2020 Prior Total

25 unchanged sentences

$ 2,435 $ 3,752 $ 9,703 $ 3,355 $ 6,898 $ 3,849 $ 29,992

The tables below provide information on the Company’s financed sales receivables by credit quality indicator as of June 30, 2024 and December 31, 2023.

The tables below provide information on the Company’s financed sales receivables by credit quality indicator as of September 30, 2024 and December 31, 2023.

1 unchanged sentence

By Origination Year

As of June 30, 2024

As of September 30, 2024

2024 2023 2022 2021 2020 Prior Total

25 unchanged sentences

$ 7,267 $ 6,264 $ 9,308 $ 7,215 $ 12,005 $ 65,173 $ 107,232

The following tables provide an aging analysis for the Company’s net investment in leases and financed sales receivables as of June 30, 2024 and December 31, 2023:

As of June 30, 2024

The following tables provide an aging analysis for the Company’s net investment in leases and financed sales receivables as of September 30, 2024 and December 31, 2023:

As of September 30, 2024

(In thousands of U.S.

15 unchanged sentences

Total $ 1,828 $ 1,408 $ 15,302 $ 18,538 $ 118,686 $ 137,224 $ ( 10,070 ) $ 127,154

The following tables provide information about the Company’s net investment in leases and financed sale receivables with billed amounts past due for which it continues to accrue finance income as of June 30, 2024 and December 31, 2023.

The amounts disclosed for each credit quality classification are determined on a customer-by-customer basis and include both billed and unbilled amounts.

As of June 30, 2024

As of September 30, 2024

(In thousands of U.S.

15 unchanged sentences

Total $ 1,057 $ 994 $ 15,115 $ 17,166 $ 56,203 $ ( 1,207 ) $ 72,162

The following table provides information about the Company’s net investment in leases and financed sale receivables that are on nonaccrual status as of June 30, 2024 and December 31, 2023:

As of June 30, 2024

The following table provides information about the Company’s net investment in leases and financed sale receivables that are on nonaccrual status as of September 30, 2024 and December 31, 2023:

As of September 30, 2024

As of December 31, 2023

7 unchanged sentences

Total $ 27,939 $ ( 9,389 ) $ 18,550 $ 29,605 $ ( 9,285 ) $ 20,320

For the three and six months ended June 30, 2024 and 2023, the Company did not recognize Finance Income related to the net investment in leases on non-accrual status.

For the three and six months ended June 30, 2024, the Company recognized $ 0.3 million and $ 0.7 million, respectively (2023 — less than $ 0.1 million and less than $ 0.1 million, respectively) in Finance Income related to the financed sales receivables in nonaccrual status.

The following tables summarize the activity in the allowance for credit losses related to the Company’s net investment in leases and financed sale receivables for the three and six months ended June 30, 2024 and 2023:

Three Months Ended Six Months Ended

June 30, 2024 June 30, 2024

For the three and nine months ended September 30, 2024 and 2023, the Company did not recognize Finance Income related to the net investment in leases on non-accrual status.

For the three and nine months ended September 30, 2024, the Company recognized $ 0.4 million and $ 1.0 million, respectively (2023 — less than $ 0.1 million and $ 0.2 million, respectively) in Finance Income related to the financed sales receivables in nonaccrual status.

The following tables summarize the activity in the allowance for credit losses related to the Company’s net investment in leases and financed sale receivables for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended Nine Months Ended

September 30, 2024 September 30, 2024

(In thousands of U.S.

6 unchanged sentences

$ 450 $ 9,625 $ 453 $ 9,617

Current period (reversal) provision, net

Current period provision (reversal), net

67 ( 148 ) 70 ( 135 )

3 unchanged sentences

$ 517 $ 9,504 $ 517 $ 9,504

Three Months Ended Six Months Ended

June 30, 2023 June 30, 2023

Three Months Ended Nine Months Ended

September 30, 2023 September 30, 2023

(In thousands of U.S.

6 unchanged sentences

$ 689 $ 11,027 $ 776 $ 10,945

Current period (reversal) provision, net

Current period reversal, net

11 ( 1,075 ) ( 70 ) ( 862 )

3 unchanged sentences

$ 680 $ 10,071 $ 680 $ 10,071

For the three and six months ended June 30, 2024, the Company’s allowance for current expected credit losses related to its net investment in leases decreased by less than $ 0.1 million, respectively, and financed sale receivables increased by less than $ 0.1 million, respectively.

For the three and six months ended June 30, 2023, the Company’s allowance for current expected credit losses related to its net investment in leases decreased by $ 0.1 million, respectively, and financed sale receivables decreased by $ 0.5 million and increased by $ 0.1 million, respectively.

For the three and nine months ended September 30, 2024, the Company’s allowance for current expected credit losses related to its net investment in leases increased by $ 0.1 million, respectively, and financed sale receivables decreased by $ 0.1 million, respectively.

For the three and nine months ended September 30, 2023, the Company’s allowance for current expected credit losses related to its net investment in leases decreased by less than $ 0.1 million and $ 0.1 million, respectively, and financed sale receivables decreased by $ 1.0 million and $ 0.9 million, respectively.

Variable Consideration Receivables

2 unchanged sentences

Variable consideration is only recognized to the extent the Company believes there is not a risk of significant revenue reversal.

The following table summarizes the activity in the Allowance for Credit Losses related to Variable Consideration Receivables for the three and six months ended June 30, 2024 and 2023:

Three Months Ended Six Months Ended

June 30, June 30,

The following table summarizes the activity in the Allowance for Credit Losses related to Variable Consideration Receivables for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended Nine Months Ended

September 30, September 30,

2024 2023 2024 2023

3 unchanged sentences

Current period provision, net

116 37 160 134

Foreign exchange

2 unchanged sentences

$ 796 $ 727 $ 796 $ 727

For the three and six months ended June 30, 2024, the Company’s allowance for current expected credit losses related to Variable Consideration Receivables increased by less than $ 0.1 million, respectively (2023 — increased by $ 0.2 million and $ 0.1 million, respectively).

For the three and nine months ended September 30, 2024, the Company’s allowance for current expected credit losses related to Variable Consideration Receivables increased by $ 0.1 million and $ 0.2 million, respectively (2023 — increased by less than $ 0.1 million and $ 0.1 million, respectively).

Lease Arrangements

13 unchanged sentences

The incremental borrowing rate used in the calculation of the lease liabilities is based on the rate of interest the Company would have to pay to borrow on a collateralized basis over a similar term.

For the three and six months ended June 30, 2024 and 2023, the components of lease expense recorded within Selling, General and Administrative Expenses are as follows:

Three Months Ended Six Months Ended

June 30, June 30,

For the three and nine months ended September 30, 2024 and 2023, the components of lease expense recorded within Selling, General and Administrative Expenses are as follows:

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands of U.S.

8 unchanged sentences

Total lease cost $ 853 $ 988 $ 2,697 $ 3,192

For the six months ended June 30, 2024 and 2023, supplemental cash and non-cash information related to leases is as follows:

Six Months Ended

For the nine months ended September 30, 2024 and 2023, supplemental cash and non-cash information related to leases is as follows:

Nine Months Ended

September 30,

(In thousands of U.S.

4 unchanged sentences

Right-of-use assets obtained in exchange for operating lease obligations $ 456 $ 278

Right-of-use assets obtained in exchange for finance lease obligations — —

As of June 30, 2024 and December 31, 2023, supplemental balance sheet information related to leases is as follows:

June 30, December 31,

As of September 30, 2024 and December 31, 2023, supplemental balance sheet information related to leases is as follows:

September 30, December 31,

(In thousands of U.S.

11 unchanged sentences

Accrued and other liabilities

As of June 30, 2024 and December 31, 2023, the weighted-average remaining lease term and weighted-average interest rate associated with the Company’s leases are as follows:

June 30, December 31,

As of September 30, 2024 and December 31, 2023, the weighted-average remaining lease term and weighted-average interest rate associated with the Company’s leases are as follows:

September 30, December 31,

Operating leases:

6 unchanged sentences

6.00 % 6.00 %

As of June 30, 2024, the maturities of the Company’s operating and finance lease liabilities are as follows:

As of September 30, 2024, the maturities of the Company’s operating and finance lease liabilities are as follows:

(In thousands of U.S.

1 unchanged sentence

Finance Leases

2024 (six months remaining) $ 1,250 $ 515

2024 (three months remaining) $ 690 $ 35

Thereafter 2,205 —

16 unchanged sentences

The Company also provides IMAX Systems to customers through joint revenue sharing arrangements.

Under the traditional form of these arrangements, in exchange for providing the IMAX System under a long-term lease, the Company earns rent based on a percentage of contingent box office receipts and, in some cases, concession revenues, rather than a fixed upfront fee or annual minimum payments.

minimum payments.

Under certain other joint revenue sharing arrangements, known as hybrid arrangements, the customer is responsible for making fixed upfront payments prior to the delivery and installation of the IMAX System.

5 unchanged sentences

The customer is responsible for obtaining insurance coverage for the IMAX System commencing on the date specified in the arrangement’s shipping terms and ending on the date the IMAX System is returned to the Company.

The following lease payments are expected to be received by the Company for its sales-type leases and joint revenue sharing arrangements in each of the next five years and thereafter following the June 30, 2024 balance sheet date:

The following lease payments are expected to be received by the Company for its sales-type leases and joint revenue sharing arrangements in each of the next four years and thereafter following the September 30, 2024 balance sheet date:

(In thousands of U.S.

Joint Revenue Sharing Arrangements

2024 (six months remaining) $ 1,608 $ 47

2024 (three months remaining) $ 788 $ 16

2025 3,089 27

1 unchanged sentence

$ 29,732 $ 43

As of June 30, 2024 and December 31, 2023, Inventories consist of the following:

June 30, December 31,

As of September 30, 2024 and December 31, 2023, Inventories consist of the following:

September 30, December 31,

(In thousands of U.S.

4 unchanged sentences

Total $ 37,612 $ 31,584

As of June 30, 2024, Inventories include finished goods of $ 1.7 million (December 31, 2023 — $ 0.6 million) for which title had passed to the customers, but the criteria for revenue recognition were not met as of the balance sheet date.

During the three and six months ended June 30, 2024, the Company recorded write-downs of $ 0.2 million, respectively (2023 — write-downs of $ 0.1 million, respectively) in Costs and Expenses Applicable to Revenues ― Technology Sales.

As of September 30, 2024, Inventories include finished goods of $ 4.7 million (December 31, 2023 — $ 0.6 million) for which title had passed to the customers, but the criteria for revenue recognition were not met as of the balance sheet date.

During the three and nine months ended September 30, 2024, the Company recorded write-downs of $ 0.1 million and $ 0.3 million, respectively, (2023 — a recovery of $ 0.1 million and less than $ 0.1 million, respectively) in Costs and Expenses Applicable to Revenues ― Technology Sales.

Revolving Credit Facility Borrowings, Net

As of June 30, 2024 and December 31, 2023, Revolving Credit Facility Borrowings, Net includes the following:

June 30, December 31,

As of September 30, 2024 and December 31, 2023, Revolving Credit Facility Borrowings, Net includes the following:

September 30, December 31,

(In thousands of U.S.

12 unchanged sentences

The Senior Secured Net Leverage Ratio is calculated using Adjusted EBITDA per Credit Facility determined on a trailing twelve-month basis.

The Company was in compliance with this requirement as of June 30, 2024 as the Senior Secured Net Leverage Ratio was 0.06 :1.00.

Loans under the Credit Facility bear interest, at the Company’s option, at (i) Term Secure Overnight Financing Rate (“SOFR”), Eurocurrency Rate or Canadian Dollar Offered Rate (“CDOR”) plus a margin ranging from 1.00 % to 1.75 % per annum;

The Company was in compliance with this requirement as of September 30, 2024 as the Senior Secured Net Leverage Ratio was 0.00 :1.00.

Loans under the Credit Facility bear interest, at the Company’s option, at (i) Term Secure Overnight Financing Rate (“Term SOFR”), Eurocurrency Rate or Canadian Dollar Offered Rate (“CDOR”) plus a margin ranging from 1.00 % to 1.75 % per annum;

or (ii) the U.S.

base rate or the Canadian prime rate plus a margin ranging from 0.25 % to 1.00 % per annum, in each case depending on the Company’s total leverage ratio.

In no event will Term SOFR, Eurocurrency Rate be less than 0.00 % per annum.

As of June 30, 2024, borrowings under the Credit Facility were $ 54.0 million (December 31, 2023 — $ 24.0 million) and bear interest at Term SOFR, plus a margin of 1.75 % per annum based on the Company’s total leverage ratio.

The effective interest rate for the three and six months ended June 30, 2024 was 7.10 % and 7.03 %, respectively.

In no event will Term SOFR, Eurocurrency Rate, or CDOR be less than 0.00 % per annum.

As of September 30, 2024, borrowings under the Credit Facility were $ 47.0 million (December 31, 2023 — $ 24.0 million) and bear interest at Term SOFR, plus a margin of 1.75 % per annum based on the Company’s total leverage ratio.

The effective interest rate for the three and nine months ended September 30, 2024 was 7.13 % and 7.06 %, respectively.

The Credit Agreement contains customary affirmative and negative covenants, including covenants that limit indebtedness, liens, asset sales, investments and restricted payments, in each case subject to negotiated exceptions and baskets.

The Credit Agreement also contains customary representations, warranties and event of default provisions.

As of June 30, 2024, and December 31, 2023, the Company had no letters of credit or advance payment guarantees outstanding under the Credit Facility.

As of June 30, 2024, the amount available for future borrowings under the Credit Facility was $ 246.0 million (December 31, 2023 — $ 276.0 million).

As of September 30, 2024, and December 31, 2023, the Company had no letters of credit or advance payment guarantees outstanding under the Credit Facility.

As of September 30, 2024, the amount available for future borrowings under the Credit Facility was $ 253.0 million (December 31, 2023 — $ 276.0 million).

Foreign Exchange Facility

Within the Credit Facility, the Company is able to purchase foreign currency forward contracts and/or other swap arrangements.

As of June 30, 2024, the net unrealized loss on the Company’s outstanding foreign currency forward contracts was $ 0.4 million, representing the amount by which the notional value of these forward contracts exceeded their fair value (December 31, 2023 — net unrealized gain of $ 0.8 million).

As of June 30, 2024, the notional value of the Company’s outstanding foreign currency forward contracts was $ 39.4 million (December 31, 2023 — $ 40.6 million).

As of September 30, 2024, the net unrealized gain on the Company’s outstanding foreign currency forward contracts was $ 0.1 million, representing the amount by which the notional value of these forward contracts exceeded their fair value (December 31, 2023 — net unrealized gain of $ 0.8 million).

As of September 30, 2024, the notional value of the Company’s outstanding foreign currency forward contracts was $ 31.8 million (December 31, 2023 — $ 40.6 million).

Bank of China Facility

2 unchanged sentences

The Bank of China Facility expired in September 2023, and has been renewed to February 21, 2025.

As of June 30, 2024, and December 31, 2023 there were no borrowings outstanding under the Bank of China Facility and outstanding letters of guarantee were RMB 0.2 million (less than $ 0.1 million).

As of June 30, 2024, the amount available for future borrowings under the Bank of China Facility was RMB 190.0 million ($ 26.7 million) and the amount available for letters of guarantee was RMB 9.8 million ($ 1.4 million).

As of September 30, 2024, and December 31, 2023, there were no borrowings outstanding under the Bank of China Facility and outstanding letters of guarantee were RMB 0.2 million (less than $ 0.1 million).

As of September 30, 2024, the amount available for future borrowings under the Bank of China Facility was RMB 190.0 million ($ 27.1 million) and the amount available for letters of guarantee was RMB 9.8 million ($ 1.4 million).

The amount available for future borrowings under the Bank of China Facility is not subject to a standby fee.

The effective interest rate for the three and six months ended June 30, 2024 was 0 %, respectively (2023 — 3.85 %, respectively).

The effective interest rate for the three and nine months ended September 30, 2024 was 0 %, respectively (2023 — 3.85 %, respectively).

HSBC China Facility

In June 2022, IMAX Shanghai entered into an unsecured revolving facility for up to RMB 200.0 million ($ 28.5 million) with HSBC Bank (China) Company Limited, Shanghai Branch to fund ongoing working capital requirements (the “HSBC China Facility”).

As of June 30, 2024 and December 31, 2023, no borrowings were outstanding under the HSBC China Facility.

As of June 30, 2024, the amount available for future borrowings under the HSBC China Facility was RMB 200.0 million ($ 28.1 million).

The effective interest rate for the three and six months ended June 30, 2024 was 0 %.

(2023 — 3.88 %).

As of September 30, 2024 and December 31, 2023, no borrowings were outstanding under the HSBC China Facility.

As of September 30, 2024, the amount available for future borrowings under the HSBC China Facility was RMB 200.0 million ($ 28.5 million).

The effective interest rate for the three and nine months ended September 30, 2024 was 0 % (2023 — 3.88 %).

In October 2019, the Company entered into a $ 5.0 million facility with National Bank of Canada (the “NBC Facility”) fully insured by Export Development Canada for use solely in conjunction with the issuance of performance guarantees and letters of credit.

The NBC Facility has been renewed to August 21, 2024.

On August 21, 2024, the Company renewed the NBC Facility to August 21, 2025.

The NBC Facility is renewable on the same terms and conditions on an annual basis.

The Company did not have any letters of credit or advance payment guarantees outstanding as of June 30, 2024 and December 31, 2023 under the NBC Facility.

The Company did not have any letters of credit or advance payment guarantees outstanding as of September 30, 2024 and December 31, 2023 under the NBC Facility.

Convertible Notes and Other Borrowings, Net

As of June 30, 2024 and December 31, 2023, Convertible Notes and Other Borrowings, Net includes the following:

June 30, December 31,

As of September 30, 2024 and December 31, 2023, Convertible Notes and Other Borrowings, Net includes the following:

September 30, December 31,

(In thousands of U.S.

37 unchanged sentences

Federal Economic Development Loan

The Company’s wholly-owned subsidiary, SSIMWAVE, entered into a contribution agreement with the Federal Economic Development Agency for Southern Ontario (the “Federal Economic Development Loan”) on May 29, 2019, under which SSIMWAVE received $ 4.2 million Canadian Dollars ($ 3.2 million) by way of repayable contributions toward certain eligible projects costs.

The Company’s wholly-owned subsidiary, SSIMWAVE Inc., entered into a contribution agreement with the Federal Economic Development Agency for Southern Ontario (the “Federal Economic Development Loan”) on May 29, 2019, under which SSIMWAVE Inc.

received $ 4.2 million Canadian Dollars ($ 3.2 million) by way of repayable contributions toward certain eligible projects costs.

The contributions under the agreement covered 35 % of the eligible and supported costs of SSIMWAVE between January 10, 2019 and December 31, 2022.

The contributions were repayable over 60 months, with repayments beginning in January 2024 and an annual interest rate of 0 %.

On January 1, 2024, SSIMWAVE was amalgamated into the Company.

On January 1, 2024, SSIMWAVE Inc.

was amalgamated into the Company.

On January 4, 2024, the Federal Economic Development Loan was assigned to the Company with amendment to the repayment term.

2 unchanged sentences

The benefit is recorded as the interest-free benefit of government funding within Interest Income on the Company’s Condensed Consolidated Statements of Operations.

The obligation is being accreted to its maturity amount, resulting in an interest expense of $ 0.1 million and $ 0.2 million during the three and six months ended June 30, 2024, respectively, which is being recorded within Interest Expense on the Company’s Condensed Consolidated Statements of Operations.

As of June 30, 2024, the Federal Economic Development Loan has a carrying value of $ 2.4 million, net of unaccreted interest benefit and is recorded within Convertible Notes and Other Borrowings, Net on the Company’s Condensed Consolidated Balance Sheets.

The obligation is being accreted to its maturity amount, resulting in an interest expense of $ 0.1 million and $ 0.2 million during the three and nine months ended September 30, 2024, respectively, which is being recorded within Interest Expense on the Company’s Condensed Consolidated Statements of Operations.

As of September 30, 2024, the Federal Economic Development Loan has a carrying value of $ 2.3 million, net of unaccreted interest benefit and is recorded within Convertible Notes and Other Borrowings, Net on the Company’s Condensed Consolidated Balance Sheets.

Commitments, Contingencies and Guarantees

15 unchanged sentences

On March 10, 2017, the Supreme Court of India dismissed E-City’s petition.

On March 29, 2017, the Company filed an Execution Application in the Bombay High Court seeking to enforce the ICC award against E-City and several related parties, which award the Company calculates to be $ 26.7 million, inclusive of interest, as of June 30, 2024.

That matter is currently pending.

On March 29, 2017, the Company filed an Execution Application in the Bombay High Court seeking to enforce the ICC award against E-City and several related parties.

On October 24, 2024, the Bombay High Court announced dismissal of the Company’s application, indicating that a written order will follow.

To date, the Company has not received such order, and it fully intends to continue pursuing its rights and seeking to enforce the arbitration award.

The Company has also taken steps to enforce the ICC final award outside of India.

In December 2011, the Ontario Superior Court of Justice issued an order recognizing the final award and requiring E-City to pay the Company $ 30,000 to cover the costs of the application, and in May 2012, the New York Supreme Court recognized the Canadian judgment and entered it as a New York judgment.

The Company intends to continue pursuing its rights and seeking to enforce the award, although no assurances can be given with respect to the ultimate outcome.

(ii) In addition to the matters described above, the Company is currently involved in other legal proceedings or governmental inquiries which, in the opinion of the Company’s management, will not materially affect the Company’s financial position or future operating results, although no assurance can be given with respect to the ultimate outcome of any such proceedings.

4 unchanged sentences

Product Warranties

The Company’s accrual for product warranties, which is recorded within Accrued and Other Liabilities in the Condensed Consolidated Balance Sheets, was less than $ 0.1 million and less than $ 0.1 million as of June 30, 2024 and December 31, 2023, respectively.

The Company’s accrual for product warranties, which is recorded within Accrued and Other Liabilities in the Condensed Consolidated Balance Sheets, was less than $ 0.1 million as of September 30, 2024 and December 31, 2023, respectively.

Director and Officer Indemnifications

3 unchanged sentences

The Company has purchased directors’ and officers’ liability insurance.

No amount has been accrued in the Company’s Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023, with respect to this indemnity.

No amount has been accrued in the Company’s Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, with respect to this indemnity.

Other Indemnification Agreements

12 unchanged sentences

Selling Expenses

The following table summarizes the Company’s selling expenses, including sales commissions and marketing and other, which are recognized within Costs and Expenses Applicable to Revenues in the Condensed Consolidated Statements of Operations, for three and six months ended June 30, 2024 and 2023:

Three Months Ended June 30,

Three Months Ended September 30,

(In thousands of U.S.

11 unchanged sentences

(2) Film exploitation costs, including advertising and marketing costs, are expensed as incurred.

(3) Sales commissions related to joint revenue sharing arrangements accounted for operating leases are recognized in the month they are earned by the salesperson, which is typically the month in which the IMAX System is installed, and are subject to subsequent performance-based adjustments.

(3) Sales commissions related to joint revenue sharing arrangements accounted for as operating leases are recognized in the month they are earned by the salesperson, which is typically the month in which the IMAX System is installed, and are subject to subsequent performance-based adjustments.

Direct advertising and marketing costs for each IMAX System are expensed as incurred.

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands of U.S.

11 unchanged sentences

(2) Film exploitation costs, including advertising and marketing costs, are expensed as incurred.

Direct advertising and marketing costs for each IMAX System are expensed as incurred.

Foreign Exchange

Included in Selling, General and Administrative Expenses for the three and six months ended June 30, 2024 are foreign currency net losses of $ 0.2 million and $ 0.5 million, respectively (2023 — net losses of $ 0.5 million and $ 0.6 million, respectively) resulting from changes in exchange rates related to foreign currency denominated monetary assets and liabilities.

Included in Selling, General and Administrative Expenses for the three and nine months ended September 30, 2024 are foreign currency net losses of $ 0.3 million and $ 0.8 million, respectively (2023 — net losses of $ 0.2 million and $ 0.8 million, respectively) resulting from changes in exchange rates related to foreign currency denominated monetary assets and liabilities.

See Note 15 for additional information.

3 unchanged sentences

Revenue attributable to transactions arising between the Company and its customers under joint revenue sharing arrangements are recorded within Revenues — Technology Sales (for hybrid joint revenue sharing arrangements) and Revenues — Technology Rentals (for traditional joint revenue sharing arrangements).

For the three and six months ended June 30, 2024, such revenues totaled $ 13.3 million and $ 32.5 million, respectively (2023 — $ 20.6 million and $ 40.7 million, respectively).

For the three and nine months ended September 30, 2024, such revenues totaled $ 15.9 million and $ 48.4 million, respectively (2023 — $ 23.1 million and $ 63.8 million, respectively).

IMAX Film Remastering and Distribution

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Revenue attributable to transactions arising between the Company and its customers under IMAX Film Remastering and distribution arrangements are included in Revenues – Image Enhancement and Maintenance Services.

For the three and six months ended June 30, 2024, such revenues totaled $ 21.3 million and $ 51.0 million, respectively (2023 — $ 29.2 million and $ 59.3 million, respectively).

For the three and nine months ended September 30, 2024, such revenues totaled $ 26.7 million and $ 77.7 million, respectively (2023 — $ 42.5 million and $ 101.8 million, respectively).

See Note 12 for a disaggregated presentation of the Company’s revenues.

3 unchanged sentences

Under these arrangements, both parties contribute to the funding of the production, distribution and exploitation costs associated with the film.

As of June 30, 2024, the Company is party to one co-produced film arrangement, which represents the VIE total assets balance of $ 1.4 million and liabilities balance of $ 0.2 million, and five other co-produced film arrangements, the terms of which are similar.

The accounting policies relating to co-produced film arrangements are disclosed in Notes 2(a) and 3(o) of the Company’s 2023 Form 10-K.

For the three and six months ended June 30, 2024, an expense of $ 2.9 million and $ 3.0 million, respectively (2023 — $ 0.2 million and $ 0.3 million, respectively) attributable to transactions between the Company and other parties involved in the production of the films have been included in Costs and Expenses Applicable to Revenues ― Image Enhancement and Maintenance Services.

As of September 30, 2024, the Company is party to one co-produced film arrangement, which represents the VIE total assets balance of $ 1.4 million and liabilities balance of $ 0.2 million, and five other co-produced film arrangements, the terms of which are similar.

The accounting policies relating to co-produced film arrangements are disclosed in Notes 2(a) and 3(o) of the Company’s audited Consolidated Financial Statements in its 2023 Form 10-K.

For the three and nine months ended September 30, 2024, an expense of $ 0.2 million and $ 3.2 million, respectively (2023 — $ 0.2 million and $ 0.5 million, respectively) attributable to transactions between the Company and other parties involved in the production of the films have been included in Costs and Expenses Applicable to Revenues ― Image Enhancement and Maintenance Services.

Condensed Consolidated Statements of Cash Flows – Supplemental Information

Changes in other operating assets and liabilities

Six Months Ended

Nine Months Ended

September 30,

(In thousands of U.S.

7 unchanged sentences

( 2,026 ) ( 4,615 )

(Decrease) increase in:

Accounts payable

4 unchanged sentences

Depreciation and amortization

Six Months Ended

Nine Months Ended

September 30,

(In thousands of U.S.

7 unchanged sentences

Total $ 48,902 $ 46,477

(1) Includes the amortization of laser projection systems, camera, and lens upgrades recorded in Research and Development on the Condensed Consolidated Statements of Operations of $ 0.2 million in the six months ended June 30, 2024 (2023 — $ 0.3 million).

(2) Includes the amortization of licenses and intellectual property recorded in Research and Development on the Condensed Consolidated Statements of Operations of $ 0.7 million in the six months ended June 30, 2024 (2023 — $ 0.6 million).

(1) Includes the amortization of laser projection systems, camera, and lens upgrades recorded in Research and Development on the Condensed Consolidated Statements of Operations of $ 0.4 million in the nine months ended September 30, 2024 (2023 — $ 0.4 million).

(2) Includes the amortization of licenses and intellectual property recorded in Research and Development on the Condensed Consolidated Statements of Operations of $ 1.0 million in the nine months ended September 30, 2024 (2023 — $ 1.0 million).

(3) Includes the amortization of lessee incentives provided by the Company to its customers under joint revenue sharing arrangements.

Six Months Ended

Nine Months Ended

September 30,

(In thousands of U.S.

5 unchanged sentences

$ 3,034 $ 872

(1) For the six months ended June 30, 2024, the Company recorded charges of $ 2.1 million (2023 ― $ 0.4 million) in Costs and Expenses Applicable to Revenues ― Technology Rentals mostly related to the write-down of joint revenue sharing arrangement systems related to customer amendments, as well as the closure of one IMAX System.

(1) For the nine months ended September 30, 2024, the Company recorded charges of $ 2.7 million (2023 ― $ 0.5 million) in Costs and Expenses Applicable to Revenues ― Technology Rentals mostly related to the write-down of systems under joint revenue sharing arrangements resulting from contract amendments, as well as the permanent closure of one IMAX System.

Significant non-cash investing activities

Six Months Ended

Nine Months Ended

September 30,

(In thousands of U.S.

Net (decrease) increase in accruals related to:

Net increase (decrease) in accruals related to:

Investment in equipment supporting joint revenue sharing arrangements

4 unchanged sentences

(1) Refer to Note 4 for supplemental disclosure of non-cash leasing activities.

Income Tax Benefit (Expense)

For the three months ended June 30, 2024, the Company recorded an income tax benefit of $ 4.0 million (2023 — tax expense of $ 3.5 million).

The Company’s effective tax rate of ( 371.5 %) for the three months ended June 30, 2024 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions and a tax benefit related to an internal asset sale during the quarter which was offset by an increase in the valuation allowance and withholding taxes.

The Company’s effective tax rate of 26.5% for the three months ended June 30, 2023 is similar to the Canadian statutory rate of 26.5% which includes tax rate differences in foreign jurisdictions that were offset by withholding taxes.

For the six months ended June 30, 2024, the Company recorded an income tax expense of $ 1.2 million (2023 — tax expense of $ 8.3 million).

The Company’s effective tax rate of 10.0 % for the six months ended June 30, 2024 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions and a tax benefit related to an internal asset sale during the quarter which is offset by an increase in the valuation allowance, withholding taxes and a shortfall in tax benefits related to share-based compensation.

The Company’s effective tax rate of 36.2 % for the six months ended June 30, 2023 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions which was offset by an increase in the valuation allowance and withholding taxes.

During the quarter, the Company completed an internal asset sale to more closely align its intellectual property ownership with its operations.

Income Tax Expense

For the three months ended September 30, 2024, the Company recorded an income tax expense of $ 2.4 million (2023 — tax expense of $ 6.6 million).

The Company’s effective tax rate of 13.4 % for the three months ended September 30, 2024 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions and a decrease in the valuation allowance, which was partially offset by an increase in tax reserves, tax return adjustments and withholding taxes.

The Company’s effective tax rate of 30.4 % for the three months ended September 30, 2023 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions, which was offset by an increase in the valuation allowance, tax return adjustments and withholding taxes.

For the nine months ended September 30, 2024, the Company recorded an income tax expense of $ 3.5 million (2023 — tax expense of $ 14.9 million).

The Company’s effective tax rate of 12.0 % for the nine months ended September 30, 2024 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions and a tax benefit related to an internal asset sale during the second quarter which was partially offset by an increase in the valuation allowance, tax reserves, tax return adjustments, withholding taxes and a shortfall in tax benefits related to share-based compensation.

The Company’s effective tax rate of 33.4 % for the nine months ended September 30, 2023 differs from the Canadian statutory rate of 26.5% primarily due to tax rate differences in foreign jurisdictions which was offset by an increase in the valuation allowance, tax return adjustments and withholding taxes.

In the nine months ended September 30, 2024, the Company completed an internal asset sale to more closely align its intellectual property ownership with its operations.

In order to effect this internal asset sale, transactions between entities within the group resulted in capital gains for tax purposes.

1 unchanged sentence

Net deferred tax assets were also recorded on the transaction, resulting in a net tax benefit of $ 7.7 million.

As of June 30, 2024, the Company’s Condensed Consolidated Balance Sheets includes net deferred income tax assets of $ 16.1 million (December 31, 2023 — $ 8.0 million).

As of September 30, 2024, the Company’s Condensed Consolidated Balance Sheets includes net deferred income tax assets of $ 15.7 million (December 31, 2023 — $ 8.0 million).

Realization of net deferred tax assets is dependent upon generation of sufficient taxable income in future years to obtain benefit from the reversal of temporary differences, net operating loss carryforwards and tax credit carryforwards.

The amount of net deferred tax assets considered realizable is subject to adjustment in future periods if estimates of future taxable income change.

As of June 30, 2024, the Company’s Condensed Consolidated Balance Sheets also include deferred tax liabilities of $ 12.5 million (December 31, 2023 — $ 12.5 million) primarily related to foreign withholding taxes associated with the remaining balance of non-repatriated historical earnings that will not be indefinitely reinvested outside of Canada.

As of September 30, 2024, the Company’s Condensed Consolidated Balance Sheets also include deferred tax liabilities of $ 12.5 million (December 31, 2023 — $ 12.5 million) primarily related to foreign withholding taxes associated with the remaining balance of non-repatriated historical earnings that will not be indefinitely reinvested outside of Canada.

Share Buyback Tax

Legislation to introduce a 2% tax on the value of certain share buybacks net of share issuances by publicly traded Canadian-resident corporations was enacted during the quarter.

Legislation to introduce a 2% tax on the value of certain share buybacks net of share issuances by publicly traded Canadian-resident corporations was enacted during the second quarter of 2024.

The tax applies to net share repurchases on or after January 1, 2024, with certain exceptions.

The tax is imposed on the repurchasing corporation itself and will be included in the cost basis of the repurchased treasury stock.

The Company has recorded a tax liability in the amount of $ 0.1 million at June 30, 2024.

The Company has recorded a tax liability in the amount of $ 0.1 million at September 30, 2024.

Capital Stock and Reserves

Share-Based Compensation

For the three and six months ended June 30, 2024, share-based compensation expense totaled $ 6.9 million and $ 11.5 million, respectively (2023 — $ 6.8 million and $ 11.9 million, respectively) and is reflected in the following accounts in the Condensed Consolidated Statements of Operations:

Three Months Ended Six Months Ended

June 30, June 30,

For the three and nine months ended September 30, 2024, share-based compensation expense totaled $ 5.4 million and $ 16.9 million, respectively (2023 — $ 5.2 million and $ 17.1 million, respectively) and is reflected in the following accounts in the Condensed Consolidated Statements of Operations:

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands of U.S.

10 unchanged sentences

Total $ 5,399 $ 5,218 $ 16,938 $ 17,100

The following table summarizes the Company’s share-based compensation expense by each award type:

Three Months Ended Six Months Ended

June 30, June 30,

The following table summarizes the Company’s share-based compensation expense (recovery) by each award type:

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands of U.S.

13 unchanged sentences

$ 5,399 $ 5,218 $ 16,938 $ 17,100

For the three and six months ended June 30, 2024, the Company’s share-based compensation expense includes $ 1.7 million related to restricted share units granted to non-employees (2023 — $ 1.7 million).

For the three and nine months ended September 30, 2024, the Company’s share-based compensation expense includes $ 0.1 million and $ 1.8 million related to restricted share units granted to non-employees (2023 — $ nil and $ 1.7 million, respectively).

Stock Option Summary

The following table summarizes the activity under the Company’s Stock Option Plan (“SOP”) and the IMAX Corporation Second Amended and Restated Long-Term Incentive Plan (as may be amended, “IMAX LTIP”) for the six months ended June 30, 2024 and 2023:

Number of Shares Weighted Average Exercise

3 unchanged sentences

3,329,422 3,604,739 $ 26.23 $ 26.36

( 4,687 ) — 20.85 —

Expired ( 607,114 ) ( 275,317 ) 28.15 27.95

6 unchanged sentences

IMAX LTIP Restricted Share Units (“RSU”) Summary

The following table summarizes the activity in respect of RSUs issued under the IMAX LTIP for the six months ended June 30, 2024 and 2023:

The following table summarizes the activity in respect of RSUs issued under the IMAX LTIP for the nine months ended September 30, 2024 and 2023:

Number of Shares Weighted Average Grant Date

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Conversely, if, as a result of management’s assessment, it is projected that a lower number of PSUs will vest than previously anticipated, a life-to-date adjustment to decrease compensation expense is recorded in the period that such determination is made.

The expense recognized in the six months ended June 30, 2024 and 2023 includes adjustments reflecting management’s estimate of the number of Adjusted EBITDA PSUs expected to vest.

The following table summarizes the activity in respect of PSUs issued under the IMAX LTIP for the six months ended June 30, 2024 and 2023:

The expense recognized in the nine months ended September 30, 2024 and 2023 includes adjustments reflecting management’s estimate of the number of Adjusted EBITDA PSUs expected to vest.

The following table summarizes the activity in respect of PSUs issued under the IMAX LTIP for the nine months ended September 30, 2024 and 2023:

Number of Awards Weighted Average Grant Date

10 unchanged sentences

1,100,967 933,340 18.32 19.16

(1) For the six months ended June 30, 2024, the balance of shares granted includes 135,511 additional shares, at a weighted average grant date fair value per share of $ 19.71 , as PSUs granted in 2021 with Adjusted EBITDA targets vested at 175 % on account of full achievement of the targets.

(1) For the nine months ended September 30, 2024, the balance of shares granted includes 135,511 additional shares, at a weighted average grant date fair value per share of $ 19.71 , as PSUs granted in 2021 with Adjusted EBITDA targets vested at 175 % on account of full achievement of the targets.

(2) Forfeited PSUs include the TSR target awards issued in 2021 which did not vest as the market condition was not satisfied.

Since the grant date, the Company recorded an expense of $ 1.5 million associated with these 68,850 shares which, despite the awards not vesting, will not be reversed into income.

As of June 30, 2024, the maximum number of common shares that may be issued with respect to PSUs outstanding is 1,876,792 , assuming full achievement of the Adjusted EBITDA and TSR targets.

As of September 30, 2024, the maximum number of common shares that may be issued with respect to PSUs outstanding is 1,876,792 , assuming full achievement of the Adjusted EBITDA and TSR targets.

Issuer Purchases of Equity Securities

1 unchanged sentence

In 2023, the Company’s Board of Directors approved a 36-month extension to its share repurchase program through June 30, 2026.

As of June 30, 2024, the Company has $ 150.7 million available under the program.

As of September 30, 2024, the Company has $ 150.7 million available under the program.

The repurchases may be made either in the open market or through private transactions, including repurchases made pursuant to a plan intended to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, subject to market conditions, applicable legal requirements, and other relevant factors.

The Company has no obligation to repurchase shares and the share repurchase program may be suspended or discontinued by the Company at any time.

During the three and six months ended June 30, 2024, the Company repurchased 7,646 and 1,166,370 common shares, respectively, at an average price of $ 14.98 and $ 13.99 per share, respectively, for a total of $ 0.1 million and $ 16.3 million, respectively, excluding commissions.

During the three and six months ended June 30, 2023, the Company repurchased 21,024 and 130,501 common shares, respectively, at an average price of $ 16.89 and $ 15.20 per share, for a total of $ 0.4 million and $ 2.0 million, respectively, excluding commissions.

The repurchases for the six months ended June 30, 2024 excludes repurchases of 108,393 shares for a total of $ 1.6 million with trade dates in December 2023 (June 30, 2023 — 140,000 shares for a total of $ 2.0 million with trade dates in December 2022).

During the six months ended June 30, 2024 and 2023, there were no shares purchases in the administration of employee share-based plans.

As of June 30, 2024 and December 31, 2023, the IMAX LTIP trustee did not hold any shares.

During the three months ended September 30, 2024, the Company did no t have any repurchases of common shares.

During the nine months ended September 30, 2024, the Company repurchased 1,166,370 common shares at an average price of $ 13.99 per share, for a total of $ 16.3 million, excluding commissions.

During the three and nine months ended September 30, 2023, the Company repurchased 13,981 and 144,482 common shares, respectively, at an average price of $ 18.00 and $ 15.47 per share, for a total of $ 0.3 million and $ 2.2 million, respectively, excluding commissions.

The repurchases for the nine months ended September 30, 2024 excludes repurchases of 108,393 shares, at an average price of $ 14.98 for a total of $ 1.6 million with trade dates in December 2023 (2023 — 140,000 shares at an average price of $ 14.45 , for a total of $ 2.0 million, with trade dates in December 2022).

During the nine months ended September 30, 2024 and 2023, there were no shares purchases in the administration of employee share-based plans.

As of September 30, 2024 and December 31, 2023, the IMAX LTIP trustee did not hold any shares.

Any shares held with the trustee are recorded at cost and are reported as a reduction against Capital Stock on the Company’s Condensed Consolidated Balance Sheets.

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IMAX China has no obligation to repurchase its shares and the share repurchase program may be suspended or discontinued by IMAX China at any time.

During the three and six months ended June 30, 2024, IMAX China repurchased 119,900 common shares, at an average price of HKD 7.43 per share ($ 0.95 per share) for a total of HKD 0.9 million ($ 0.1 million).

IMAX China did no t have any repurchases during the three and six months ended June 30, 2023.

During the three months ended September 30, 2024, IMAX China did no t have any repurchases of common shares.

During the nine months ended September 30, 2024, IMAX China repurchased 119,900 common shares, at an average price of HKD 7.43 per share ($ 0.95 per share) for a total of HKD 0.9 million ($ 0.1 million).

IMAX China did no t have any repurchases during the three and nine months ended September 30, 2023.

The change in the non-controlling interest attributable to IMAX China as a result of common shares repurchased is recorded as a reduction to Non-Controlling Interests in the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Shareholders’ Equity.

2 unchanged sentences

The following table reconciles the denominator of the basic and diluted weighted average share computations:

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands) 2024 2023 2024 2023

9 unchanged sentences

54,089 55,535 53,628 55,261

For the three and six months ended June 30, 2024, the calculation of diluted weighted average shares outstanding excludes 3,118,725 and 3,716,606 shares, respectively (2023 — 2,868,749 and 3,379,371 shares, respectively) that are issuable upon the vesting or exercise of share-based compensation including:

(i) 355,337 and 664,720 RSUs, respectively (2023 — 23,122 and 10,765 RSUs, respectively), (ii) 42,848 and 331,346 PSUs, respectively (2023 — 32,806 PSUs, respectively) and (iii) 2,720,540 stock options, respectively (2023 — 2,812,821 and 3,335,800 stock options, respectively), as the effect would be anti-dilutive.

The calculation of diluted weighted average shares outstanding for the three and six months ended June 30, 2024 and 2023 also excludes any shares potentially issuable upon the conversion of the Convertible Notes as the average market price of the Company’s common shares during the period of time they were outstanding was less than the conversion price of the Convertible Notes.

For the three and nine months ended September 30, 2024, the calculation of diluted weighted average shares outstanding excludes 2,192,874 and 2,769,499 shares, respectively (2023 — 3,395,488 and 3,398,228 shares, respectively) that are issuable upon the vesting or exercise of share-based compensation including:

(i) nil and 10,798 RSUs, respectively (2023 — 29,702 and 32,442 RSUs, respectively), (ii) nil and 42,848 PSUs, respectively (2023 — 36,364 PSUs, respectively) and (iii) 2,192,874 and 2,715,853 stock options, respectively (2023 — 3,329,422 stock options, respectively), as the effect would be anti-dilutive.

The calculation of diluted weighted average shares outstanding for the three and nine months ended September 30, 2024 and 2023 also excludes any shares potentially issuable upon the conversion of the Convertible Notes as the average market price of the Company’s common shares during the period of time they were outstanding was less than the conversion price of the Convertible Notes.

Statutory Surplus Reserve

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Disaggregated Information About Revenue

The following tables summarize the Company’s Revenues by reportable segment and revenue stream type for the three and six months ended June 30, 2024 and 2023:

Three Months Ended June 30, 2024

The following tables summarize the Company’s Revenues by reportable segment and revenue stream type for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended September 30, 2024

(In thousands of U.S.

21 unchanged sentences

Total $ 26,305 $ 46,891 $ 16,122 $ 2,134 $ 91,452

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In thousands of U.S.

21 unchanged sentences

Total $ 54,629 $ 149,428 $ 48,766 $ 6,713 $ 259,536

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

(In thousands of U.S.

21 unchanged sentences

Total $ 18,273 $ 60,250 $ 23,008 $ 2,365 $ 103,896

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

(In thousands of U.S.

16 unchanged sentences

Total $ 65,455 $ 154,244 $ 62,612 $ 6,510 $ 288,821

For the three and six months ended June 30, 2024, revenues earned from Technology Sales include variable consideration of $ 7.7 million and $ 9.4 million, respectively (2023 — $ 11.8 million and $ 17.3 million, respectively).

For the three and nine months ended September 30, 2024, revenues earned from Technology Sales include variable consideration of $ 8.2 million and $ 17.6 million, respectively (2023 — $ 4.0 million and $ 21.3 million, respectively).

Variable consideration revenues represent an estimate of the contingent fees that may become due if certain annual minimum box office receipt thresholds are exceeded and are recorded as revenue in the period when the sale is recognized and may be adjusted in future periods based on actual results and changes in estimates over the term of the system agreement.

For the three and six months ended June 30, 2024, revenues earned from leasing arrangements total $ 13.3 million and $ 32.5 million, respectively (2023 — $ 20.4 million and $ 42.8 million, respectively), including $ 13.9 million and $ 32.5 million, respectively, in Revenues ― Technology Rentals (2023 — $ 19.5 million and $ 39.6 million, respectively), and a reversal of $ 0.7 million in the three months ended June 30, 2024 due to an amending agreement, and $ nil for the six months ended June 30, 2024 respectively, in Revenues ― Technology Sales (2023 — $ 0.9 million and $ 3.2 million, respectively).

For the three and nine months ended September 30, 2024, revenues earned from leasing arrangements total $ 15.9 million and $ 48.4 million, respectively (2023 — $ 22.8 million and $ 65.6 million, respectively), including $ 16.0 million and $ 48.5 million, respectively, in Revenues ― Technology Rentals (2023 — $ 23.0 million and $ 62.6 million, respectively), and a reversal of $ 0.1 million in the three and nine months ended September 30, 2024, respectively, in Revenues ― Technology Sales (2023 — revenues of $ 0.2 million and $ 3.4 million, respectively).

Deferred Revenue

2 unchanged sentences

Payments, upon renewal each year, are either prepaid or made in arrears and can vary in frequency from monthly to annually.

As of June 30, 2024, $ 20.4 million of consideration has been deferred in relation to outstanding maintenance services to be provided on existing maintenance contracts (December 31, 2023 — $ 22.8 million).

As of September 30, 2024, $ 17.9 million of consideration has been deferred in relation to outstanding maintenance services to be provided on existing maintenance contracts (December 31, 2023 — $ 22.8 million).

Maintenance revenue is recognized evenly over the contract term which coincides with the period over which maintenance services are provided.

4 unchanged sentences

Recognition dates are variable and depend on numerous factors, including some outside of the Company’s control.

During the three and six months ended June 30, 2024, $ 12.1 million and $ 24.2 million of revenue, respectively, was recognized from the $ 67.1 million balance of deferred revenue as of December 31, 2023.

During the three and six months ended June 30, 2023, $ 23.7 million and $ 41.0 million of revenue, respectively, was recognized from the $ 70.9 million balance of deferred revenue as of December 31, 2022.

During the three and nine months ended September 30, 2024, $ 11.5 million and $ 35.7 million of revenue, respectively, was recognized from the $ 67.1 million balance of deferred revenue as of December 31, 2023.

During the three and nine months ended September 30, 2023, $ 18.3 million and $ 59.3 million of revenue, respectively, was recognized from the $ 70.9 million balance of deferred revenue as of December 31, 2022.

Segment Reporting

The Company’s Chief Executive Officer (“CEO”) is its Chief Operating Decision Maker (“CODM”), as such term is defined under U.S.

The Company’s Chief Executive Officer (“CEO”) is its CODM, as such term is defined under U.S.

The CODM assesses segment performance based on segment revenues and segment gross margins.

7 unchanged sentences

Inter-segment profits are eliminated upon consolidation, as well as for the disclosures below.

The following table presents the Company’s revenue and gross margin by reportable segment for the three months ended June 30, 2024 and 2023:

The following table presents the Company’s revenue and gross margin by reportable segment for the three months ended September 30, 2024 and 2023:

(In thousands of U.S.

9 unchanged sentences

Total $ 91,452 $ 103,896 $ 51,019 $ 62,715

(1) The Company’s largest customer represents 14 % of total Revenues for the three months ended June 30, 2024 (2023 — 11 %).

No single customer comprises more than 10% of the Company’s total Accounts Receivable as of June 30, 2024 and December 31, 2023.

(1) The Company’s largest customer represents 13 % of total Revenues for the three months ended September 30, 2024 (2023 — 11 %).

No single customer comprises more than 10% of the Company’s total Accounts Receivable as of September 30, 2024 and December 31, 2023.

(2) All Other includes the results from the Company's streaming and consumer technology business, as well as other ancillary activities.

The following table presents the Company’s revenue and gross margin by reportable segment for the six months ended June 30, 2024 and 2023:

The following table presents the Company’s revenue and gross margin by reportable segment for the nine months ended September 30, 2024 and 2023:

(In thousands of U.S.

8 unchanged sentences

Total $ 259,536 $ 288,821 $ 141,835 $ 170,653

(1) The Company’s largest customer represents 13 % of total Revenues for the six months ended June 30, 2024 (2023 — 8 %).

No single customer comprises more than 10% of the Company’s total Accounts Receivable as of June 30, 2024 and December 31,2023.

(1) The Company’s largest customer represents 11 % of total Revenues for the nine months ended September 30, 2024 (2023 — 8 %).

No single customer comprises more than 10% of the Company’s total Accounts Receivable as of September 30, 2024 and December 31, 2023.

(2) All Other includes the results from the Company's streaming and consumer technology business, as well as other ancillary activities.

3 unchanged sentences

IMAX Film Remastering and distribution revenue is generated through contractual relationships with studios and other third parties that may not be in the same geographical location as the IMAX Systems that exhibit the remastered films.

The following table summarizes the Company’s revenues by geographic area for the three and six months ended June 30, 2024 and 2023:

Three Months Ended Six Months Ended

June 30, June 30,

The following table summarizes the Company’s revenues by geographic area for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands of U.S.

2 unchanged sentences

Greater China 21,324 28,297 65,527 73,975

Western Europe 10,508 15,955 24,699 26,607

Asia (excluding Greater China)

16,930 18,042 35,643 44,649

Western Europe 3,741 13,849 28,440 43,827

Canada 1,687 4,387 7,254 15,685

2 unchanged sentences

Total $ 91,452 $ 103,896 $ 259,536 $ 288,821

The United States, Greater China (which includes the mainland of the People’s Republic of China, Hong Kong, Macau, and Taiwan), Western Europe and Asia (excluding Greater China) each comprise greater than 10 % of the Company’s total revenues for the three and six months ended June 30, 2024 and 2023.

respectively.

12 unchanged sentences

Gelfond under the SERP is fixed at $ 20.3 million.

As of June 30, 2024, the Company’s projected benefit obligation under the SERP is $ 18.6 million (December 31, 2023 — $ 18.2 million).

For the three and six months ended June 30, 2024, the Company recorded interest costs of $ 0.2 million and $ 0.4 million, respectively, (2023 — $ 0.2 million and $ 0.4 million, respectively) related to the SERP.

As of September 30, 2024, the Company’s projected benefit obligation under the SERP is $ 18.8 million (December 31, 2023 — $ 18.2 million).

For the three and nine months ended September 30, 2024, the Company recorded interest costs of $ 0.2 million and $ 0.6 million, respectively, (2023 — $ 0.2 million and $ 0.6 million, respectively) related to the SERP.

The Company expects to recognize additional interest costs of $ 0.2 million related to the SERP during the remainder of 2024.

3 unchanged sentences

The Company makes contributions to these plans on behalf of employees in an amount up to 5 % of their base salary subject to certain prescribed maximums.

During the three and six months ended June 30, 2024, the Company contributed and recorded expense of $ 0.5 million and $ 0.9 million, respectively, (2023 — $ 0.3 million and $ 0.6 million, respectively) to its Canadian defined contribution plan and $ 0.2 million and $ 0.5 million, respectively, (2023 — $ 0.2 million and $ 0.5 million, respectively) to its defined contribution employee plan under Section 401(k) of the U.S.

During the three and nine months ended September 30, 2024, the Company contributed and recorded expense of $ 0.2 million and $ 1.1 million, respectively, (2023 — $ 0.3 million and $ 0.9 million, respectively) to its Canadian defined contribution plan and $ 0.2 million and $ 0.7 million, respectively, (2023 — $ 0.2 million and $ 0.7 million, respectively) to its defined contribution employee plan under Section 401(k) of the U.S.

Internal Revenue Code.

7 unchanged sentences

Wechsler retired from the Company’s Board of Directors on June 9, 2021, and the Company is providing him with Medicare supplemental coverage or its cash equivalent.

As of June 30, 2024, the Company’s postretirement benefits obligation under this plan is $ 0.5 million (December 31, 2023 — $ 0.5 million).

For the three and six months ended June 30, 2024, the Company has recorded an expense of less than $ 0.1 million, respectively (2023 — less than $ 0.1 million, respectively) related to this plan.

As of September 30, 2024, the Company’s postretirement benefits obligation under this plan is $ 0.5 million (December 31, 2023 — $ 0.5 million).

For the three and nine months ended September 30, 2024, the Company has recorded an expense of less than $ 0.1 million, respectively (2023 — less than $ 0.1 million, respectively) related to this plan.

Postretirement Benefits – Canadian Employees

1 unchanged sentence

The Company will provide eligible participants, upon retirement, with health and welfare benefits.

As of June 30, 2024, the Company’s postretirement benefits obligation under this plan is $ 0.8 million (December 31, 2023 — $ 1.0 million).

For the three and six months ended June 30, 2024, the Company has recorded expense of less than $ 0.1 million and less than $ 0.1 million, respectively, (2023 — less than $ 0.1 million and $ 0.1 million, respectively) related to this plan.

As of September 30, 2024, the Company’s postretirement benefits obligation under this plan is $ 0.8 million (December 31, 2023 — $ 1.0 million).

For the three and nine months ended September 30, 2024, the Company has recorded expense of less than $ 0.1 million, respectively, (2023 — less than $ 0.1 million and $ 0.1 million, respectively) related to this plan.

Deferred Compensation Benefit Plan

2 unchanged sentences

In 2018, the executive incurred a separation from service from the Company, and as such, the Retirement Plan benefits became fully vested as of December 31, 2018.

As of June 30, 2024, the benefit obligation related to the Retirement Plan was $ 4.2 million (December 31, 2023 — $ 4.1 million) and is recorded on the Company’s Condensed Consolidated Balance Sheets within Accrued and Other Liabilities.

As of September 30, 2024, the benefit obligation related to the Retirement Plan was $ 4.2 million (December 31, 2023 — $ 4.1 million) and is recorded on the Company’s Condensed Consolidated Balance Sheets within Accrued and Other Liabilities.

As the Retirement Plan is fully vested, the benefit obligation is measured at the present value of the benefits expected to be paid in the future with the accretion of interest recognized in the Condensed Consolidated Statements of Operations within Retirement Benefits Non-Service Expense.

The Retirement Plan is funded by an investment in company-owned life insurance (“COLI”), which is recorded at its fair value on the Company’s Condensed Consolidated Balance Sheets within Prepaid Expenses.

As of June 30, 2024, fair value of the COLI asset was $ 3.6 million (December 31, 2023 — $ 3.5 million).

As of September 30, 2024, fair value of the COLI asset was $ 3.6 million (December 31, 2023 — $ 3.5 million).

Gains and losses resulting from changes in the cash surrender value of the COLI asset are recognized in the Condensed Consolidated Statements of Operations within Realized and Unrealized Investment Gains.

2 unchanged sentences

The Company’s cash is invested with various major financial institutions.

The Company’s $ 91.6 million balance of cash and cash equivalents as of June 30, 2024 (December 31, 2023 — $ 76.2 million) includes $ 83.0 million in cash held outside of Canada (December 31, 2023 — $ 68.5 million), of which $ 44.0 million was held in the PRC (December 31, 2023 — $ 30.0 million).

The Company’s $ 104.5 million balance of cash and cash equivalents as of September 30, 2024 (December 31, 2023 — $ 76.2 million) includes $ 90.8 million in cash held outside of Canada (December 31, 2023 — $ 68.5 million), of which $ 49.9 million was held in the PRC (December 31, 2023 — $ 30.0 million).

Fair Value Measurements

1 unchanged sentence

Including these instruments, the Company’s financial instruments consist of the following:

As of June 30, 2024

As of September 30, 2024

As of December 31, 2023

41 unchanged sentences

The Company has entered into a series of foreign currency forward contracts to manage the risks associated with the volatility of foreign currencies.

Certain of these foreign currency forward contracts met the criteria required for hedge accounting under the Derivatives and Hedging Topic of the FASB ASC at inception, and continue to meet hedge effectiveness tests as of June 30, 2024 (the “Foreign Currency Hedges”), with settlement dates throughout 2024 and 2025.

Certain of these foreign currency forward contracts met the criteria required for hedge accounting under the Derivatives and Hedging Topic of the FASB ASC at inception, and continue to meet hedge effectiveness tests as of September 30, 2024 (the “Foreign Currency Hedges”), with settlement dates throughout 2024 and 2025.

Foreign currency derivatives are recognized and measured in the Condensed Consolidated Balance Sheets at fair value.

3 unchanged sentences

Any ineffective portion is recognized immediately in the Condensed Consolidated Statements of Operations.

The notional value of foreign currency cash flow hedging instruments that qualify for hedge accounting as of June 30, 2024 was $ 39.4 million (December 31, 2023 — $ 40.6 million).

The notional value of foreign currency cash flow hedging instruments that qualify for hedge accounting as of September 30, 2024 was $ 31.8 million (December 31, 2023 — $ 40.6 million).

The following tabular disclosures reflect the impact that derivative instruments and hedging activities have on the Company’s Condensed Consolidated Financial Statements:

Notional value of derivatives in foreign exchange contracts:

June 30, December 31,

September 30, December 31,

(In thousands of U.S.

3 unchanged sentences

Fair value of derivatives in foreign exchange contracts:

June 30, December 31,

September 30, December 31,

(In thousands of U.S.

4 unchanged sentences

( 88 ) ( 27 )

$ ( 385 ) $ 819

Derivatives in foreign currency hedging relationships are as follows:

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands of U.S.

1 unchanged sentence

Foreign exchange contracts — Forwards

Derivative (Loss) Gain

Derivative Gain (Loss)

Recognized in OCI

1 unchanged sentence

$ 337 $ ( 1,048 ) $ ( 944 ) $ ( 226 )

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

(In thousands of U.S.

7 unchanged sentences

$ ( 162 ) $ ( 174 ) $ ( 240 ) $ ( 636 )

The Company’s estimated net amount of the existing loss as of June 30, 2024 is $ 0.4 million, which is expected to be reclassified to the Condensed Consolidated Statements of Operations within the next twelve months.

The Company’s estimated net amount of the existing gain as of September 30, 2024 is $ 0.1 million, which is expected to be reclassified to the Condensed Consolidated Statements of Operations within the next twelve months.

Investments in Equity Securities

The Company held an investment in the preferred shares of enterprises which meets the criteria for classification as an equity security carried at historical cost, net of impairment charges.

The carrying value of the equity security investment was $ 1.0 million as of June 30, 2024 (December 31, 2023 — $ 1.0 million) and is recorded within Other Assets in the Condensed Consolidated Balance Sheets.

The carrying value of the equity security investment was $ 1.0 million as of September 30, 2024 (December 31, 2023 — $ 1.0 million) and is recorded within Other Assets in the Condensed Consolidated Balance Sheets.

Non-Controlling Interests

2 unchanged sentences

IMAX China remains a consolidated subsidiary of the Company.

As of June 30, 2024, the balance of the Company’s non-controlling interest in IMAX China is $ 75.1 million (December 31, 2023 — $ 71.8 million).

For the three and six months ended June 30, 2024, the net income attributable to the non-controlling interest in IMAX China is $ 1.5 million and $ 3.6 million, respectively (2023 — $ 1.3 million and $ 3.9 million, respectively).

As of September 30, 2024, the balance of the Company’s non-controlling interest in IMAX China is $ 77.7 million (December 31, 2023 — $ 71.8 million).

For the three and nine months ended September 30, 2024, the net income attributable to the non-controlling interest in IMAX China is $ 1.4 million and $ 5.1 million, respectively (2023 — $ 3.1 million and $ 7.0 million, respectively).

Other Non-Controlling Interest

2 unchanged sentences

The Company has contributed $ 9.0 million to the Original Film Fund since 2014, and has reached its maximum contribution.

As of June 30, 2024, the Original Film Fund has invested $ 22.3 million toward the development of original films.

As of September 30, 2024, the Original Film Fund has invested $ 22.3 million toward the development of original films.

The related production, financing and distribution agreement includes put and call rights relating to change of control of the rights, title and interest in the co-financed pictures.

Non-Controlling Interest in Temporary Equity

The following table summarizes the movement of the non-controlling interest in temporary equity related to the Original Film Fund for the six months ended June 30, 2024 and 2023:

The following table summarizes the movement of the non-controlling interest in temporary equity related to the Original Film Fund for the nine months ended September 30, 2024 and 2023:

September 30,

(In thousands of U.S.

Beginning balance

Net (loss) income

Net income (loss)

Ending balance

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements