Good day, and welcome to the IMAX Corporation Second Quarter 2021 Earnings Conference call. Today's conference is being recorded. At this time, all lines are on mute. There will be a Q&A session after prepared comments. At this time, I would like to turn the conference over to Mr. Brett Harriss, Head of Investor Relations. Please go ahead, sir. Thank you, and good afternoon, everybody. Thank you for joining us today on today's Second Quarter Earnings Conference call. On the call today, to review the financial results, are Rich Gelfond, Chief Executive Officer, and Joe Sparacio, our Interim Chief Financial Officer. Megan Colligan, President of IMAX Entertainment, and Rob Lister, Chief Legal Officer, are also joining us today. Today's conference call is being webcast in its entirety on our website. A replay of the webcast will be made available shortly after the call. In addition, the full text of our Second Quarter Earnings Press Release and the slide presentation have been posted on the Investor Relations section of our website. At the conclusion of this call, our historical Excel model will be posted to the website as well. I'd like to remind you of the following information regarding forward-looking statements. Today's call, as well as the accompanying slide deck, may include statements that are forward-looking in that they pertain to future results or outcomes. These forward-looking statements are subject to risks and uncertainties that could cause our actual future results to occur or occurrences to differ. Please refer to our SEC filings for a more detailed discussion of some of the factors that could affect our future results and outcomes. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information, future events, or otherwise. During today's call, references may be made to certain non-GAAP financial measures. Discussion of management's use of these measures and the definition of these measures, as well as a reconciliation to non-GAAP financial measures, including Adjusted Net Loss, Adjusted EPS, and Adjusted EBITDA as defined by our credit facility, are contained in this morning's press release and our earnings materials, which are available on the Investor Relations page of our website at IMAX.com. With that, let me now turn the call over to Mr. Richard Gelfond. Rich. Thanks, Brett, and good afternoon, everyone. Thank you all for joining us today. With theaters reopening, audiences returning, and the pipeline of Hollywood blockbusters steadily growing from a trickle to a flood, the global box office continues to show encouraging signs of improvement. Indeed, we believe IMAX is leading the global recovery of the film industry, uniquely positioned to benefit immediately from the upcoming acceleration of Hollywood blockbuster releases and poised to take market share as the world reopens. Our results for the second quarter clearly demonstrate this. The company delivered its best gross margins and Adjusted EPS of the pandemic era, despite a Hollywood slate only slightly better than prior quarters, demonstrating again the high-margin nature of our asset-light licensing business. We delivered our third consecutive quarter of positive EBITDA. Our global network earned $109 million in box office, surpassing initial projections thanks to better-than-expected domestic performance for our second consecutive $100 million-plus box office quarter. We've already eclipsed our total 2020 box office for local language films, and we easily drove year-over-year quarterly growth in revenue, gross margins, and EBITDA, demonstrating how far we've come since the second quarter of 2020, the first quarter we felt the full brunt of the pandemic. We are confident these positive trends will not only continue but accelerate with a full slate of exclusive theatrical releases later this year. We've wielded our unique advantages to effectively manage through COVID. We built the only global out-of-home platform for blockbuster entertainment with a diversified footprint across 85 countries and territories worldwide. We have a flexible asset-light business model, and we are an in-demand global brand beloved by audiences worldwide, critical to filmmakers and studios, and ripe for new business opportunities, including our IMAX Enhanced Home Entertainment initiative. Even in a world of shifting windows and evolving distribution models, an IMAX release is a window unto itself, proven to draw moviegoers to the theaters, drive premium revenue, and launch event films into the ecosystem. Now, with COVID finally receding in many key markets, we're beginning to see the industry stabilize and establish stronger forward momentum than at any other time during the pandemic. As a result, we see an opportunity for IMAX to further expand and diversify our global network, grow and diversify our content portfolio, and lean into the increased blockbusterization of the movie business. Today, I'd like to provide a strategic update on the reopening and future of our global network, signs of strong audience demand for the IMAX experience, why IMAX is well-positioned as windows and distribution models evolve, and finally, our fast-accelerating content pipeline. But first, let's look at the current state of our network. The IMAX Global Network is now 90% open, higher than at any time in the pandemic era. The domestic network is about 95% open and operating at about 90% capacity. And internationally, excluding China, our theaters are about 80% open and at around 67% capacity. In China, our theaters are virtually 100% open. Continue to open more theaters and see capacity limitations ease with availability in the domestic and international markets already up over the launch of Black Widow earlier this month. We've installed nearly 100 systems to our network and signed 80 during the pandemic as exhibitors look to IMAX to reinvigorate their businesses with a differentiated premium offering. We continue to add premier flagship locations around the world, locations that offer significant box office potential and further enhance the prestige of our brand. This month, we opened our first-ever theater in Cannes, France, and a brand-new state-of-the-art multiplex digital art gallery and event space on the Mediterranean. The theater is already drawing interest as a screening location from the many international events hosted in Cannes, most significantly including the Cannes Film Festival. We're currently installing our biggest IMAX screen in the world in Leonberg, Germany. Measuring at 22 meters high and wider than a Boeing 737, we needed a 17,000-seat hockey arena in Ontario to unfurl and paint the screen before shipping it across the Atlantic. IMAX theaters will be featured in several of the iconic Los Angeles cinemas that have recently transferred ownership, including The Grove and The Americana, which AMC will reopen next month, and Sherman Oaks, which has already reopened with Regal. Both AMC and Regal continue to look for opportunities in the marketplace at IMAX theaters in newly acquired marquee locations. We continue to see considerable room for growth around the world. The IMAX Global Network currently stands at just under 1,600 theaters worldwide with a backlog of 419 theaters. We see a total addressable market of 3,300 theaters driven by the many international markets around the world where moviegoers are clamoring for our unrivaled experience. Not only are theaters reopening, audience demand is remarkably strong, and we expect it to continue to grow as COVID recedes and more moviegoers regain their comfort level returning to theaters. Perhaps the most encouraging trend of the second quarter is the domestic box office, which continues to demonstrate the same pent-up demand for blockbusters that we've seen in Asia and the Middle East. New tentpole releases continue to pass every big test at the box office. Despite a day-and-date release on HBO Max, Godzilla vs. Kong has delivered more than $100 million at the domestic box office and $460 million globally, including $37 million in IMAX so far. A Quiet Place Part II, the first exclusive theatrical blockbuster release of the summer season, vastly exceeded expectations, delivering an opening on par with what was expected pre-COVID, despite significant capacity limitations in place at the time. F9 has also performed up to pre-pandemic levels thanks to a bold global rollout designed to maximize the exclusive theatrical window. Most recently, Black Widow opened to $158 million worldwide, giving IMAX its best opening for a Hollywood film and its best domestic opening weekend box office indexing and per-screen hour average during the pandemic era. As we've said, the recovery of the box office will be a gradual, incremental process, a faucet, not a light switch, but it's clear that we're headed in the right direction. Additionally, many of the studios that have experimented with hybrid release strategies are recommitting to exclusive theatrical releases for blockbusters, coalescing around a 45-day window for most tentpoles. This benefits IMAX as it enhances the event nature of an exclusive theatrical release and further increases IMAX's role as curator of blockbusters. Given that films generally only play in our network for one or two weeks at most, we are well-positioned to take advantage of that compressed demand. Studios and filmmakers are clamoring to secure and make the most of their IMAX window, whether it's shooting with our cameras, including IMAX Exclusive Expanded Aspect Ratio, or creating exclusive events like the preview that Universal screened for Jurassic World: Dominion before F9, or the exclusive Dune preview we hosted in select locations last week. All of this helps drive demand and ultimately market share for the IMAX experience. Also, the experimentation we've seen among studios in the past year, along with movie releases from pure-play streaming companies, has underscored the irreplaceable role of a theatrical release in launching and growing franchise property, the kind of IP that is driving the entire ecosystem right now. For all its value, streaming has yet to create a blockbuster film franchise and all the downstream revenue a franchise film creates. At the end of the day, there is still no event in entertainment that commands the attention of culture like a global theatrical blockbuster release, and IMAX is at the vanguard of these culture-defining moments. So the table is set for a strong rebound at the box office with one outstanding exception: a steady supply of big, bankable blockbuster films. Certainly, the global box office has demonstrated that it is ready for business with the films that have held their release dates during the summer season. But the summer season has still been lighter on blockbuster releases than we'd hoped. The studios take a conservative approach to pushing many tentpole releases into the fall of 2021 or 2022. Right now, the only real issue holding the box office back from a faster rebound is supply. That is changing, though, as the Hollywood content pipeline is accelerating with strong slate ahead. When Marvel's Shang-Chi releases on September 3rd, that kicks off a cadence of major blockbuster releases roughly every two weeks, including Venom, Bond, Dune, Eternals, Top Gun: Maverick, Spider-Man, and The Matrix. The pipeline, as we've said, is remarkable. For instance, in the second quarter, the only global blockbusters we had with exclusive theatrical releases were F9 and A Quiet Place Part II. Compare that with Q2 of 2022, which is absolutely stacked with franchise films, including The New Thor, Mission: Impossible, John Wick, Transformers, Jurassic World, Disney's Lightyear, and Brad Pitt's actioner Bullet Train. Even beyond Hollywood, the IMAX content portfolio emerges from the pandemic stronger and more diversified, given the way we leaned into local language production during COVID and strengthened our brand in key institutional markets. As I mentioned, in 2021, we've already surpassed our total 2020 box office for local language films, and we expect to top our record-breaking 2019 local language box office by the end of the third quarter. The critical Chinese market is also demonstrating pent-up demand for Hollywood blockbusters, with F9 proving that when a global blockbuster franchise receives an exclusive theatrical release, the Chinese market will embrace it as we've seen it do in the past. So the table is set for a strong rebound for the global film industry. The reopening of theaters is accelerating. Audiences are coming back in big numbers, and the flow of blockbuster content into theaters this fall and beyond is unprecedented. As we demonstrated in the second quarter, as blockbusters return to theaters, our numbers will improve markedly. The IMAX Experience has been in strong, growing demand around the world, and we are strengthening our position as one of the world's premier entertainment experiences. We look forward to building on our unique privileged position in the entertainment ecosystem, driving new opportunities for growth and creating value for our shareholders. Thanks again to all of you for joining us today. Please continue to do everything you can to stay safe and healthy. With that, I'll turn it over to Joe Sparacio. Thanks, Rich, and good afternoon, everyone. As Rich mentioned, we posted another quarter of significantly improved performance as our network continues to reopen in the U.S. and across the world. Operating results continue to improve, which serves to highlight our superior business model. As a reminder, we are a global asset-light licensing business with a low-cost base and high incremental margins. This quarter serves as a preview for what is to come as Hollywood films return in earnest to our quickly reopening global network. We ended the quarter with $214 million in cash and $241 million of debt. $115 million of cash was held at IMAX China and $99 million at IMAX Corp. In the quarter, we paid down the balance of our credit facility, leaving the full $300 million undrawn, which, when combined with our cash on hand and undrawn component of our IMAX China Working Capital Facility, gives us approximately $530 million of available liquidity. As I discussed the second quarter, please remember year-over-year results reflect the almost complete closure of our network in the second quarter of 2020. Second quarter 2021 revenues increased to $51 million from $9 million in 2020. Adjusted EBITDA increased to $8.7 million versus an EBITDA loss of $18.5 million in the year-ago period, and Adjusted EPS loss improved to $0.12 from $0.44 in comparison to the year-ago period. IMAX Technology Network revenue increased $19.7 million in the second quarter from essentially nil in Q2 of 2020. The reopening of the company's network, particularly in Asia and the U.S., drove box office of $109 million versus $3 million in Q2 of 2020. Gross margins for this business were $8.7 million, which increased from a loss of $6.5 million in Q2 2020, largely due to higher box office-driven revenue and the operating leverage inherent in the business model. IMAX Technology Sales and Maintenance revenue for the second quarter increased $28.7 million from $4.6 million due to higher sales and STL revenue as installation of new systems increased and an increase in maintenance revenue commensurate with the reopening of the network. This quarter, we installed 15 new IMAX systems, nine of which were sales or STLs, two of which were hybrids. We installed three IMAX systems in Q2 of last year. Installation activity increased both year-over-year and sequentially, demonstrating continued IMAX system demand from our exhibition partners. Gross margins for this business increased to $16.1 million, representing a 56.1% margin commensurate with the higher revenue levels. SG&A, excluding stock-based compensation, declined 4% to $22.4 million in the quarter as compared to $23.3 million in the comparable period last year. The reduction in SG&A included an increase in costs allocated out of SG&A and into inventory and cost of goods sold of $4 million, partially offset by a $1.5 million decrease in various COVID-19 wage-related programs. In the second quarter, we spent $1.8 million on capital expenditures, including $900,000 invested in equipment for joint revenue-sharing theaters. We believe our second quarter results represent another milestone in the company's emergence from the pandemic. Strong box office in the U.S. and parts of Europe demonstrate the same signs of pent-up demand we continue to see in China. Increased revenue is driving profitability improvement, highlighting our superior high-margin asset-light business model. We have a strong balance sheet with substantial liquidity. Finally, we remain excited for the strong slate of IMAX-friendly titles set to be released later this year. With that, I will turn the call over to the operator for Q&A. Thank you. If you'd like to ask a question, please signal by pressing star one on your telephone keypad, and if you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, press star one to ask a question. We'll pause for just a moment to allow everyone an opportunity to signal for questions, and we will go first to Eric Handler of MKM Partners. Thank you very much and good afternoon. Rich, I wonder maybe you could give a little peek into how your installations might look for the back half of this year, or at least maybe for the third quarter, wondering what kind of visibility you have there? And I've got a follow-up question. Yeah. I mean, Eric, I don't think we're doing it. We made a policy during the pandemic not to do that because it's so unpredictable and it's so territory to territory. But as you saw last year, we were surprisingly active in installations, even though the world wasn't open up. And I think there'll be activity at the second half of the year. And as you know, we're usually back-loaded in these things, but I'm just not going to be specific until we know where it's safe and what the course of the virus is. Understood. And then wondered if you could talk about you're obviously seeing good local language turnout for films in China. How are you sort of going to be implementing similar policies in other countries and where you see some opportunities in the back half of this year? Yeah. I mean, I've been surprised by how robust some of these markets are in IMAX. In China this weekend, we released a movie called White Snake, and we did 9% of the box office, and it was a fairly successful film in China. So I'm continually surprised. And I think over time, you'll see these local language films keep edging up until they eventually have the same kind of indexing that the Hollywood films are. But it is a strategic initiative of ours, and we're working closely in different markets. Megan, do you want to give some specific examples? Sure. In Japan, we've set two records over the pandemic era with two films that have broken records. We have a five-picture deal with Toho, so we're continuing to work very closely with that company to be not just releasing their films, but also having them shoot their films using the IMAX-certified camera program. So really leaning into the technology and looking to continue to align closely on our production. Also in Korea, we've had some success with local language products. The great thing too, when a movie does break out, like we saw with Demon Slayer, those films are able then to be exported out of, say, Japan, where it was a record-setting film, and are able to be distributed in the United States, in Europe, in Korea. There's a market for them outside of Japan. So it's been a very successful program for us. Great. Thank you very much. We'll go to our next question from Alexia Quadrani of JP Morgan. Hi. Thank you. Thanks very much. I just have two questions, if I may. The first one, Rich, I'm wondering if you have some sort of view on how much the fact that Black Widow opened sort of day and date with PVOD, how much that may have cannibalized your potential revenue or even keep it general and talk about the box office in general? I'm not sure if you have any more insight than we do, but I thought you might. And then secondly, I'm just curious, wouldn't we, going forward in kind of the new world post-COVID, wouldn't IMAX just sort of continue to kind of index better as a percentage of the total box office, given in this new kind of streaming-heavy world, moviegoers are clearly leaning into kind of more experimental kind of experience kind of movies? I mean, clearly a positive for you, but I'm wondering if you have a sense of how much what we've seen in numbers is it a notable positive? So on your first question, Alexia, there's really no question in my mind that the combination of PVOD and a lot of piracy and people haven't really talked about that much, but clearly there was a lot of piracy that accounted for the cannibalization significantly affected the box office at the end of the day. It's hard to quantify it, but some statistics I find interesting are that F9, which used a more traditional distribution model, grossed about $700 million, will gross around $700 million worldwide at the end of its run, and Black Widow will gross around $350 million. So again, are they comparable movies? I thought Black Widow was a great movie. So when I think about it, I have no doubt a lot of money was left on the table, but I can't perfectly say what it is. In terms of post-COVID, I do think that we will continue to index better. And in fact, in countries that have emerged faster than North America, we've seen us have a bigger percentage of the box office. I just referenced China and the 9% a few minutes ago for local language films. We've been having a higher indexing. And I think what you're also going to see is there's going to be more and more blockbusters because I think the studios are going to take their more lower-cost releases and put those direct to streaming, but the kind of movies that IMAX does will concentrate around the theatrical releases. And I think since that's IMAX's sweet spot, I would expect us to continue to have pretty good indexing numbers. Thank you. And we'll move to our next question from Eric Wold of B. Riley Securities. Thank you. Good afternoon. A couple of questions. One, I want to try to follow up on the first question from Eric. I know you're not giving system install visibility. I'm not trying to push the aggregating numbers in general, but just kind of what is the mindset from exhibitors in general around the world? Obviously, they had plans to get stuff installed in 2020 and 2021 going into the pandemic based on their schedules. Those got disrupted, and now we're starting to reopen. Is kind of everything that was in the backlog kind of shifted out by some period of time just as a placeholder? Are they kind of saying to you, "Look, we're ready to go as soon as possible once we have the green light"? Kind of what's their mindset in terms of wanting to get those installed that was on the backlog previously? So I think the mindset's pretty good, Eric, as you know. And again, I don't remember exactly the numbers in 2020, but we had something like around 70 installs and close to the same number of signings in 2020. And that was when everything was shut down. And in fact, what we've done is we've gone back and we've tried to work with the exhibitors and plan out where they're at with the backlog. And we've taken virtually nothing out of the backlog. We reaffirmed their desire to be in the IMAX business, and we're in negotiations now about how that rolls out. I would say a lot of the rollout is going to be in countries that are open and healthy now, so places or healthier like Asia. And in places like Europe and North America, they're committed to it, but I think we have to work with them on seeing what the right schedule is. But again, as I said to Eric's question before, I think the cadence will be similar to last year with it being back and loaded. One quick follow-up on that. I didn't want to say one quarter, obviously, does not make a trend, but I know you talked about the cadence expecting to kind of get back to where it was. I mean, Q2, the nine system sales of the installs were equal to what you did in 2018 and 2019 in those years' second quarter. So is that kind of—I don't want to read too much into one quarter, but is that kind of an indication that things are kind of hopefully getting back kind of where they were in terms of the install patterns? Eric, I'm going to refer to your statement that you can't draw a trend from one quarter either way, and I would just say there's so many factors now. Places just opening up, people refurbishing, which some of them did even during the pandemic, so I wouldn't generalize about it. Okay. And then just final question. As things start getting back to normal, both within IMAX and in the industry, how should we think about operating expense trends kind of over the coming quarters and year or so? And kind of as we get back to hopefully normal situation, what does IMAX's kind of operating expense level look like versus where it was pre-COVID? Are there inherent savings still baked in, or is it going to get back to where it was? So Eric, we're trying to track with our expenses the reopening of the network and the introduction of movies. So the biggest issue now, as I said in my prepared remarks, is there just weren't a lot of movies being released. So as you see more movies released, you'll start to see some of the expenses ramp up, obviously, because you need maintenance people out there and you need to track that. On the other hand, we were very SG&A focused before this happened. As you know, over the last several years, we've had very little growth in our OPEX. So we're going to be as vigilant as possible during that period of time and where we don't have to ramp up prematurely. We're going to, again, I used the word cadence before, but we're going to try to time the cadence of our expenditures to the cadence of our revenues as we reopen. Helpful. Thank you. We'll go next to Steven Frankel with Colliers. Good afternoon, Richard. First of all, on the local titles in China, where are you in infusing more IMAX DNA as their production values improve? The IMAX-certified camera program has been incredibly successful, not just domestically, but internationally. I talked about it earlier as we've incorporated it in our Japanese operation and Korean operation. It's also been something we have been employing in our Chinese productions. We had several movies over Chinese New Year, and it's something that we're actively talking to filmmakers and productions for. We really do focus as the Chinese calendar allows for. Chinese New Year becomes a very big moment of focusing some of the biggest productions, and those films are the ones that we're really aiming for for some of the films we'd like to be involved in for films that shoot with our cameras, and those are the ones that we're targeting. And certainly, films that come out over the summer, those are kind of the two big seasonal pieces of business. And we're in conversation all year long. We're very active. We have people on the ground that are having those conversations and continuing to kind of educate the film community around what it means to shoot with our cameras. It is a very specific process, and it is something that requires production work and specific work, both pre and post-production, that we work very closely with the filmmakers to do to give that level of effort to the film. So you should expect anywhere from three to five films a year in China to be shot with our cameras. Great. Thank you. And then because I don't want Joe to feel left out, there was a meaningful sequential step up in R&D this quarter. Is that just kind of getting back, getting people re-engaged, staffing up, or is there some new initiative that might be ramping up that this is the beginning of a new spending pace for R&D? No, I think it's just getting back to some semblance of normalcy. I mean, as you saw from the note on SG&A, the amounts allocated to inventory and cost of goods are starting to get back somewhat to normalcy. So that's just a new thing that happened. Okay. Great. Thank you. We'll move to our next question from Mike Hickey of Benchmark Company. Hey, Rich, Joe, Brett, thanks for taking my questions. Glad it's on the quarter. Welcome back, Joe. Nice to hear your voice again. Shocked. Anyway, curious on the Delta variant. Hard to know if it's having an impact yet or not. Just sort of curious your view if you're seeing any sort of change in attendance trends as the infection seems to be picking up momentum. Also wondering if the reissue of masks in LA has caused any attendance headwinds and a couple of follow-ups. So it's too early to say, Mike, in terms of whether it's having an impact. I personally don't think it's going to because I think among the vaccinated people, there's not a lot of reticence to go to theaters. And we've seen no indication of it. And by the way, let's go to Asia again, which we like to talk about a lot. The resurgence in box office there was all with an unvaccinated population. China had set records for Chinese New Year with very little vaccination. And what Megan was talking about in Japan, we have the two biggest movies in the history of Japan and the two biggest IMAX movies in Japan with Demon Slayer and Shin Evangelion. So I just don't think there's likely to be a high correlation there. Obviously, unless it gets much more out of control than it is now, and there's no evidence of that. But I really don't think at the present that that's a significant game changer. Thank you. The other question, you mentioned sort of that outlier success in regions like China and Japan sort of in the pandemic era. We haven't exactly seen that. We haven't seen that in North America. So when you sort of think about the box office recovery here in the U.S., which is obviously an important reason for you, how do you sort of balance the factors in terms of what's it going to take, you think, to really have that breakout film? Or why are we still sort of working the right direction, but not that sort of outlier performance we saw in Japan and China? Is it sort of still the virus influence? Is it windows? Is it slate? Just sort of curious your thoughts on that. Yes, yes, yes. Pretty simple answer, Mike, is that distributors who were releasing movies in Asia, the two biggest of all time in Japan, and China the record Chinese box office by 30%, the content distributors there released movies under their traditional models. And there really hasn't been a big global release with a theatrical window. I think you're going to start to see that coming in the coming months with things like Venom and Shang-Chi, and then you'll get into Bond, and you'll get into Top Gun and a lot of other things. The releases in the United States, the studios have been extremely conservative about moving dates. Then they tried, I think partly in response to the pandemic, but partly in response to their own mixed agendas to push day and date. I think it's pretty clear that that hasn't delivered the same kind of box office or return as the alternative. I think when you look ahead and you look at virtually every studio has a 45-day window for next year. Others are experimenting around it a little bit. I think once you have good content, day and day releases with marketing campaigns, you'll see the same thing. I think people in North America have the same mental and physical attitudes as they do in the rest of the world. Yeah. Last question, just to sort of follow up to your answer there. Obviously, you've been in the industry now for a long time. I can remember, Rich, just sort of gut instincts here because there's so much noise to sort of unpack. But just sort of your sort of view on the day and day from Disney when they think about international piracy and the importance of the theatrical window. When we sort of get into 2022, call it, do you think they'll sort of continue on this path, or do you think there's enough evidence that they'll sort of submit that 45-day window at the behest of the industry point? So I don't know what their window will be, but I know that every studio has sort of seen the same data that Disney has seen, obviously related to that studio. And I think what Disney did was experiment during the pandemic, which is what they said they were going to do. And I remember Bob Chapek saying, I think one of the investor days, when times are normal, he thinks theatrical is really important, and he thinks theatrical exclusivity is important. And I think when he looks at his data and the pandemic is in the rearview mirror, he's going to come to the conclusion everyone else does, which is the way to maximize value is to have a theatrical window. And in a way, Mike, I don't want to get carried away, but it's not that complicated. You used to sell on the same property five times. Now you're selling it once, and you're bringing forward some revenues, maybe some windows when you're selling it. But I don't think there are proof points yet that that's a better model. And I think there's lots of smart people, and I think they'll come to the same conclusion. Awesome. Thanks, guys. Thanks a lot. We'll go next to Jim Goss of Barrington Research. Thanks. Recognizing that IMAX does have some clear advantages in terms of demographic service and blockbuster availability, but I'm wondering, Rich, if you have any concerns that the overall theatrical exhibition business would be pressured in a way that would lead to more consolidation that could have repercussions for IMAX, maybe particularly for North America, but perhaps in other markets as well. So Jim, the fact is that 85% of our box office is concentrated in the top 20% of theaters. It doesn't really affect me very much because if there's consolidation, nobody's going to close the top 20% of theaters. And in fact, during my prepared remarks, I mentioned the ArcLight and the fact that some of those theaters were bought by AMC and some of them were bought by Regal, actually in order to our benefit because the location, even though the chain went away, the theaters, which were high performers, were great additions to our biggest clients in the world, and they were smart enough to put in IMAX theaters. So I think consolidation among the top end of screens is probably good for us. I think the elimination screens at the bottom end pretty much has no effect because nobody puts an IMAX theater in the bottom 20% screen. Okay. Thanks. Great response. Another question. I'm wondering about the trend of the number of films receiving DMR treatment, especially since you have a lot of indigenous products. Are you getting more granular in your approach to content around the globe, and does that give you a lot more flexibility and potential to take advantage of your screens? I mean, I think we've talked a lot about local language. We were forced to during the pandemic. So I think there definitely is more availability than we've had before. So the same kind of trend exists in big movies. We get a high percentage of our box office from a relatively small number of movies. So I think during those quieter periods, when you have access to more content, whether it's international or whether it's domestic, it should help our per-screen averages and should help our overall performance. Okay. One last thing in terms of the construction issue that had been brought up earlier. Is there any trend in terms of, I know you tended to focus on hybrid projects somewhere between joint revenue sharing and sales-type lease agreements. Are you skewing in one direction or another right now with whatever incremental theaters you are creating? Jim, as you know, there weren't a lot of signings in the first half of the year, and that's typical. I mean, we had some, but not a lot. So I don't think it's enough to draw a conclusion on a trend. But our team is out there talking to lots of potential partners over the world, and I don't think there's been a change in approach from the partners' point of view. Okay. Thanks very much. Thanks, Jim. At this time, I'd like to turn the call back to Rich for any additional closing comments. Thank you, operator. I mean, all I'd like to say is that the last three quarters, we've had positive EBITDA. It continues to reinforce the fact that we have an asset-light model. When it gets turned on, for us, a lot of it goes straight to the bottom line. We don't have leases. We have almost virtually no net debt. We're in very good shape financially. And you could see how the beginning of the comeback to domestic has translated right to the bottom line. And we think as the world continues to come back, that IMAX's financial results will reflect that. And we get more confident as the year goes on in terms of the pace of the recovery. So thank you very much, operator. Ladies and gentlemen, this concludes today's call. Thank you for your participation. You may now disconnect.