Okay. Good afternoon, everybody. This is Max Herrnstein. I'm the Chairman of Morgan Stanley's Global Media and Communications Investment Banking Practice. I think we should have a great session for you today. I'm honored to be sitting for a half hour with Rich Gelfond. Rich is the CEO of IMAX. And as I'm sure those of you viewing this know, that Rich and IMAX have really been embedded in the center of the global media ecosystem for decades now. Rich is one of the most astute observers of the space, above and beyond shepherding IMAX. The company's reporting tomorrow. So I'm not going to ask any questions that Rich and his team will deal with directly tomorrow, details of Q4, etc. But we will get into a range of issues around the opening of the economy, what that means for the movie business, and obviously implications for IMAX, etc. So that, I should say, for those of you who are interested in asking questions, please do feel free to send those along, and we'll see if we can get to some of them. I guess, Rich, what I'd like to start with is maybe you just provide a quick overview of where the company sits in the ecosystem, and then we'll get into some more specific issues on the reopening of the economy. Sure. Thanks, Max, and thanks for having us come to this event. We're sorry we're not in San Francisco this year, but maybe next year. IMAX is a global entertainment technology provider. People sometimes confuse us with exhibitors, but we're not. We license IMAX technology to exhibitors on a worldwide footprint. We're in 82 countries. We have over 1,500 IMAX theaters around the world. Our business model is pretty much we charge a royalty from both the studios and from the exhibitors. So for those of you who aren't familiar, when you think it through, we get roughly $0.18-$0.20 of every $1 spent at an IMAX theater coming to us from one of those two revenue streams. Our largest markets are China and the United States. We have 750 theaters in China, about 400 in the United States, by way of perspective. We're also involved in the distribution and the production of movies to some extent, so movies shown in IMAX theaters are either shot with IMAX cameras, and in those cases, we work closely with filmmakers and typically some of the leading filmmakers in the world, like Chris Nolan, J.J. Abrams, most of the blockbuster movies, so we're involved this year in Top Gun, Bond, Fast and Furious, Black Widow, all those movies, and so we're basically a global technology provider in the exhibition space. Okay, Rich, thanks. Why don't we pivot to the opening of the economy? I would note on your third quarter call in October, you talked a lot about some of the results you've had out of Asia. I think I noted a third of your business approximately is in Asia. So maybe an update of what you see reopening globally, reopening in the States. Why don't you go through that in whatever order you'd like to? Sure. So China has been pretty much open since last summer. And towards the fourth quarter of last year, it's really resumed to kind of its normal state for us. So last December was up. This December of 2020 was up 28% from 2019. Chinese New Year just finished in the last couple of weeks. Our opening weekend, we were up 45% from our record of 2019 Chinese New Year. So in a way, I said we're returning to its normal state. That's kind of a surprise, Max, because in China, as in the rest of the world, we play local films as well as Hollywood films. And of course, as you know and most of your audience knows, there haven't been a lot of Hollywood films released in the last year. So we're generating those kinds of numbers just on local language content. The rest of Asia has come back very strong as well. Japan, 15 of our top 20 theaters in 2020 were in Japan, including our largest theater in the world. There was a movie in Japan called Demon Slayer that was subject to 75% capacity limitations of local Japanese film, and that became the largest grossing Japanese film ever and largest grossing IMAX film ever in Japan. It beat films like Avengers and Avatar and big Hollywood kinds of films. Asia has been open, and it's more or less back and will do better once Hollywood films open. North America obviously has struggled. We opened it months ago with Tenet, and Tenet did pretty well on a global basis. In North America, the results lagged. People weren't as comfortable going back to theaters as they were in other parts of the world. And as you know, a lot of the films were either delayed or they were put on alternative platforms. Now, the good news is that IMAX is in the blockbuster business, and almost every blockbuster was delayed. So some of the films I mentioned before, like Bond and Fast and Furious, but also Dune and Maverick, Top Gun sequel, like Mission Impossible, virtually all of the big blockbusters were postponed to later dates. So we're starting to feel much better about North America in the last few weeks. Biden said yesterday, I'm sure you saw, that he expects to have enough vaccines for every adult by the end of May. There's some polling data, which you can read, which for the first time shows that over 50% of Americans responding said they were ready to go back to the movies. What made reopening in China successful was they didn't just turn it on like a switch. They made it like a faucet. So a lot of the U.S. has been open for smaller movies. Just this weekend, a small movie called Tom and Jerry did $14 million, which was kind of a good sign but it wasn't reviewed as highly as everybody had hoped. But so there's signs people are coming back without blockbuster movies. And I think if you look at, and again, you asked a question about ecosystem. So IMAX is in the middle of the worldwide entertainment ecosystem. So there isn't a week goes by that I don't talk to the CEOs of the major theater chains or high-ranking people at the studios or creative people. And there's definitely, you can sense a momentum towards a reopening. The next question you'd ask me about North America is, when's that date going to be? I can tell you that I feel very good that it's going to be over the summer. So like Maverick, the Top Gun movie, I think it's going to do big numbers in the United States. I feel pretty good. It's not going to be tomorrow. So it's going to be somewhere in the middle. I'm hoping for May or June, and I think there are signs there that that could happen. Europe still remains kind of the biggest question mark, and that's because the vaccination rollout in Europe, other than in the U.K., has gone relatively slowly. So, and again, I think given the slate that there is for this year, big blockbuster has IMAX's name on it. Whenever it reopens, I think we're going to come out and do pretty well. Rich, one point to push on a bit is on China. I think I heard you say that your performance over the Chinese New Year was 45% better, not than necessarily last year, but your best year ever. And that's in spite of the fact you say the U.S.-based studios, it's not that product as much, it's local. Do you see a secular trend in China, Japan perhaps, looking to more local content? Does IMAX play well with that content? Are you going to be able to replicate the success you've had with U.S. filmmakers, with Chinese, Japanese, European, etc.? What are your thoughts on that? So I think it's way too premature and misleading to call it a trend. I mean, there are no U.S. movies. So yes, when you have no movies and you have local movies, it's pretty easy to see the local ones outperforming. But I think we don't know what the trend is until the U.S. ones open. Some of the U.S. films came out, but they were released simultaneously, either on streaming or PVOD, and given the piracy issues in China, I think those definitely affected the box office. I also think that the Chinese and global box office, to some extent, on Hollywood films depend on a Hollywood release. So it depends on red carpets, talk shows, publicity, what you and I would call buzz and others would call hype coming out of the box. And we haven't seen any movies do that, have that around them yet. So my own hunch is no. I think there's so much pent-up demand for going to the movies. So I think the big U.S. movies will continue to do well. And again, IMAX is such a unique kind of experience. We saw with the local films that not only did the whole industry come back, but we came back in a bigger way because people were saying, "Look, if I want to get off my couch and do something different and I've been cooped up like the Roaring '20s, I'm going to spend a little extra money and I'm going to see it in IMAX." So my hunch is that when Hollywood movies come out on a global basis, they will do consistent with what they did before. And I think IMAX has some other things going for it. Okay, great. Thank you. Switching gears a bit, there's been a ton of news flow out of the media companies in terms of the direct-to-consumer strategy. Obviously, you've talked before about HBO Max, Warner Bros. I think since your last quarterly call, we've seen another Disney Investor Day where the company talked about the theatrical window versus the direct-to-consumer window, Paramount Plus just last week. The ViacomCBS team had an Investor Day there. I think that product's out in the market this week. Any thoughts on the relationship with the studio partners as they transition to a direct-to-consumer strategy? So this might sound a little bit naive, and I apologize for that, Max, but I think the fact that the window situation has clarified itself is good for the whole industry and particularly good for IMAX because before the pandemic, there were all kinds of swirling stories. There are going to be no windows. There are going to be short windows. There's going to be this. And I think that was an overhang on the industry. And I think since then, we've heard Paramount say there's going to be a 45-day window. We've heard Universal say, for my kind of movies, blockbusters, not smaller movies, there'll be a 30 to 45-day window. We've heard Disney say that the windows are going to vary with the type of release it is. But in general, blockbusters, they're going to keep long windows. I think we've heard Sony say they're huge supporters of the theatrical window. So, and I do think no one's really talked about this yet, Max, but I think we're going to see some of the pure streaming companies, the Apples and the Netflixes and the Amazons. I think they're going to change their release patterns because the movies aren't going to be 90 days like they used to be. They'll be somewhere in that 45-day period. And I think you're going to see them start to put their movies on theatrical platforms, driven somewhat by talent, which wants to publicize and also driven by economics. Because in fact, once a movie has a theatrical release, it gains much more stature, prestige, what I talked about a few minutes ago, the premiere, the talk shows, all that. So I think the streamers will find that they could get some of that benefit through a theatrical release. So in general, I think the clarity is good. For IMAX, I think there are a number of additional positive benefits. One is we only play films for two weeks, occasionally three weeks. So I think a window in terms of what's been talked about doesn't really affect us that much in terms of competition. The second thing is if you go on IMAX, you're paying a price premium. So you're not the kind of consumer that's going to say, "I'll wait a month and a half and get it for free." You're an avid moviegoer, and that inspires you to go to the experience rather than being able to get it on streaming. And maybe this is a little more subtle, but I think it's a really important point. I think if you want to create an event around your movie for your streaming service, the best way to do that is with an IMAX release. And no one on this call will remember this, but Avatar was promoted heavily in IMAX. And at the time, it was the biggest movie of all time. And it got so much publicity out of its IMAX run. And IMAX did $230 million on, I think, like 100 theaters at that time. And even one of the Mission movies was released early in IMAX, and it became the big Ghost Protocol, and it became the biggest Mission movie. And I think the filmmakers and the studios get that. And I've got to tell you, with all these changes in windows, we've had more calls in the last few weeks about what more can we do in IMAX? How do we promote it more in IMAX? So I think it's going to be a net benefit for us. Yeah, and I want to acknowledge that question is exactly. I've received a few questions along the lines of, given how important Netflix is in the movie as opposed to just television ecosystem, their points of view. So your point being, look, it's the first-run theatrical window just can be great marketing and a profit engine for streamers as much as the studios. So that. I think, Max, just to add to that, Max, I think if you look at the results from the Golden Globes this week, I mean, viewership was down 65%. I mean, that was through no fault of anyone because the country was closed. That was like the Golden Globe TV Awards. It wasn't the movie awards. And people weren't really excited about stars and movies. And while I watch streaming and I like a lot of things about it, especially the episodic series, it's not a medium to watch big blockbuster movies. And I think every indicator has said that. Right, right. And the windows vary by market. We all talk about the 90-day story, but that's a U.S. phenomenon. And I think in Asia, you have some 30-day windows you've been dealing with in the past. So maybe talk about how it does vary across some of your major markets. Yeah, it's interesting. At one extreme, and I'll probably get this wrong, but I think France, the window, China regulates it. And I think it's something like 30 days, like you said. I think in Europe, it depends on the kind of property. So there are different ones for PVOD and streaming, but a lot of them run out six months. And I think as this still sorts itself out, obviously France is an issue because the PVOD releases and the streaming releases haven't been able to be released in France, period. So even though we're through a lot of this in the United States and a lot of it is evolving, I think globally adds some additional complexity. Also, when you look at China, U.S. streaming services can't get into China. So how that plays into it, I think people in their minds are trying to simplify it and look at a one-size-fits-all solution. But as your good question points out, it's a lot more complicated. And just a reminder, two-thirds of the box office is outside of the United States. So while what's happened in the United States is, I think, starting to become very clear, I think internationally, if it's the same result, that will be fine. But I think it's more likely to be a more favorable result for exhibition. Okay, great. Let me switch gears from relationship on the studio side, your studio partners to your theatrical partners. Obviously, it's been a very difficult year. It is a different business model, as you point out, but they are an important partner of yours. Maybe talk a little bit about how you've worked with your theatrical partners over the last year, your sense of the health of those partners, including financially. Obviously AMC Cinemas has been in the news quite a bit lately and taken advantage of what's been going on with their share price. But talk a little bit about that, then we'll dig into the theatrical side of it. So again, you have to do it a little bit by part of the world, Max. So China, it was short enough, the closure, where there were no significant financial difficulties in China, and they've opened up now. Chinese New Year is about 10% of the year for them. It was a record by a third for China. So that's all in pretty good shape. In the U.S., the major exhibitors all recapitalized along the way. And I think under any foreseeable circumstance, they'll be fine. They have enough money to make it through, depending on the exhibitor, the third quarter, the first quarter, early first quarter next year. AMC was always kind of our biggest concern, mostly because they had significant debt load, significant interest costs, number of theaters. But that was never an existential threat to IMAX because IMAX's box office, about 85% of our box office comes from the top 20% of the screens in the U.S. So even if there were theater closures, we're never really concerned that the theaters we were in were the ones that would be closed. And you have to take your hat off to Adam Aron. I mean, the guy was so persistent. He hung in there. And I consider him a pretty good friend. And at times, I said to Adam, "What's the end game here? Where is this going to happen?" And he positioned himself so well and he kept going along. And then he caught a break with the whole GameStop phenomenon. But real life is also based on positioning yourself in the right place at the right time. He had the authorizations and he had the shares. My perception now is he's in pretty good shape. Absolutely. Well, after 11 months of pretty bad luck, I don't think anybody will begrudge a month or a couple of weeks of good luck in his case. Now, I don't want to kind of jump too far ahead before you deal with this on tomorrow, but we are getting an audience question up. On On the theatrical side, a key part of the growth story in your business is adding new screens to the network. Without taking thunder away from your call tomorrow, any general kind of concept of you continue to ramp up on the backlog and adding screens? So as you say, we'll deliver the results tomorrow. But for the year, considering we were in a pandemic, we had a decent amount of signings and we had a decent amount of installs. And as a matter of fact, when I was going through with one of my board members earlier, not just tomorrow, saying, "People can't believe we opened new theaters and we signed new theaters." And some of the signings we announced during the year, 20-theater deal, other things that went on. And if you think about it, while people were closed to the public, they were installing new IMAX theaters and signing for more. So it was encouraging. And I do think, Max, if you look at the macro issues we talked about before, the fact that so many more of the movies are blockbusters. Five years ago, 30% of the box office was 30 films. Now 50% of the box office is blockbuster films, the top 30 films. I think that's a trend with streaming that you'll see continuing. The move to blockbusters, the move to premium entertainment, the fact that bigger TVs and everything in the home, if you leave the home, you're going to want something more and something different than you can get streaming or however you're watching it in your home. The fact that IMAX has opened so well and the markets that have opened, I think it bodes well for signings going forward. Now, I don't think it's going to be an exact science that the day the theater opens, people have been challenged. They're going to run around and say, "How can I sign up for 25 IMAX theaters today?" So there might be a time lag, but I do think there's going to be a lot of good conversations. Rich, related to that, how do you look at the competitive environment of other folks providing your type of product to theaters? I know there have been times competitors have tried to come into the business with a competitive product. How do you see your competitive positioning, the competitive moat that you have with product and with brand? I think you also say the relationships you have with artists. But talk a little bit about your competitive positioning. Yeah. So when you look at the per-screen averages of IMAX versus any perceived premium theater, I don't even acknowledge that they're competitors, Max. You're really testing me on this one, but I'll say perceived competitors. The per-screen averages are so much lower. So the best in general, I'm not saying there aren't one-off theaters that do well. But in general, when people are looking at going into IMAX, or let's say putting up their own private label, the numbers work so well to do an IMAX theater that they could afford to pay us, and they take home more money than if they did it in their own homegrown version. And if you look at our B2B customers, our theatrical partners, in any given year, 80% of our signings are from people already in the IMAX business. So those are people who have experienced it, understand it. In terms of filmmakers, as you know, we work closely with the filmmakers. So when we take a movie and we convert it to IMAX, we'll work with the filmmaker, and they'll be there working on the dials and figuring out how it looks like. We have our unique aspect ratio. We have our own cameras out there that we work with. We have great relationships with the studios built up over years. They understand that if they release it in IMAX, they make more money, even though they pay us a fee because they get a much higher incremental ticket price. So when you go through the whole business model, it's compelling. Most of these private label theaters are just regular projectors on a much bigger screen, and as any kid who's ever played with a Xerox knows, when you blow something up, the image looks worse. The trick with IMAX is when you blow something up, the image actually looks better and more immersive. So the public understands that, and I'm not that concerned. I guess I couldn't stop this answer without mentioning the brand. I mean, when you do brand studies around IMAX, in China, we register with the highest entertainment properties in the world, right at the top of where they are. And almost in any country where we are, our brand really resonates extremely high. And I think that that's obviously an important moat. Right. Great. Thanks. Just a call out to the audience. Please do continue to email in questions. We have a few minutes left here. Rich, I have two quick topics I want to fit in before the end. One is on any new products that you'd like to call out. I've heard you talk about the IMAX Enhanced product and kind of partnering with television manufacturers globally. And then we'll have a quick question at the end on the business model and the cash flow. But maybe on the product side, anything you'd like to talk about? We've talked about our IMAX Enhanced, as you said, Max, which basically is a way that we up-res images for in-home viewing. Some of our large partners, there are Sony on both the hardware side and the film side, Paramount on the film side, Tencent, TCL. Basically, when you go on your device in the home, the image looks better in IMAX Enhanced. During the pandemic, we made some progress in that area. I think in due course, there'll be more to talk about there. We have a product called IMAX Live, which is our ability to stream live content into IMAX theaters. I think there are opportunities there for things like music, esports, premieres, different things of that genre. We're working on a couple of other things, which hopefully we can talk about in the not too distant future. Great. I'm going to let the audience ask the final question, Rich. And on the business model, I'm sure you'll talk about it tomorrow, so we won't get into that. But hopefully, tomorrow will be one of the last calls where you and your compatriots have to stop talking about COVID and hoarding cash flow. You're an asset-like model, so I think you're in great position that way. But from the audience, the question is, do you think your business is going to be substantially different one year from now? There's probably a COVID question embedded in that, but just a business model. And we'll end with that one. Yeah, I do think it'll be different, Max. I think tying it to your last question, I think we'll make a little progress on some of the things we're doing in home. I'm pretty confident that we've, during the pandemic, made some steps, which will look good in terms of our out-of-home theater network, the entire network. I think that some of the things we talked about during this presentation, I think the shorter windows will help us because the studios and the talent will want us more. I think we'll be even more desirable than we were. I think the consumers will want us more, which happened in Asia because I think you're holed up on a couch with your family for a year. And you have, let's say, a 60-inch TV set, and it's time you could go out. I think you're not going to say, "Oh my God, let's go see it on the smallest screen in the multiplex to save a dollar," so I think there's going to be a lot of pent-up demand to see it in IMAX, and I think in general, it's a cliché. I've read it many times. J.J. Abrams said it recently. I do think the reason the Roaring '20s had a lot to do with the Spanish flu pandemic, and if my life is any such an example, my wife and I just got vaccinated, and we've begun to enjoy some of the simple pleasures of life more, and I think that's going to be a momentum at our backs. Congratulations on that, by the way. On that note of optimism, Alyssa, I think we're at 4:00 P.M. Rich, thank you very much. I really appreciate you joining. Thank you to the audience for listening in. Thanks, everybody. Thanks, Max. Appreciate it.