• by Wayne Friedman , March 4, 2022

While the movie industry continues to make a slow comeback, the in-theater advertising business is having some trouble keeping pace.

“Advertising will continue to lag the box office recovery until we have additional confirmation of strengthening moviegoing demand this spring,” says Wold. WarnerMedia’s upcoming film, “The Batman” -- which opens this weekend -- will offer up a key indicator for revenue growth, he adds.

Still, he notes that advertising remains on pace, as per management comments, with upfront ad commitments running at 75% of pre-pandemic 2019 levels.

Local and regional advertising lags behind the market overall, he says, and the company has restructured efforts around a handful of large companies in key industries.

“While that provides a strong level of visibility into revenues for 2022,” says Wold, “the recovery in scatter advertising demand remains the main wild card.”

Wold says National CineMedia's first-party data is an “underappreciated” part of the company’s story. “As advertisers shift dollars away from linear programming and look to target key demographics, the ability to provide moviegoing habits and trends to advertisers and combine that with a digital offering will skew CPMs higher.”

The company was able to reverse pandemic-period net losses into a small net income of $8 million in the period. For the full-year 2020 it posted total net losses of $48.7 million.

National CineMedia's stock was down nearly 10% in to $2.65 in early Friday trading.