National CineMedia, the movie theater advertising company that reaches 63% of the nation's top 50 markets, IPO'd this week with shares debuting at the top of their predicted range (around $21), raising $798 million.
According to a recently ammended S-1 filing, the company did about $145 million for the nine months ending on Sept 28, 2006, which puts it roughly in the neighborhood of PRN's Wal-Mart TV network in terms of advertising-derived sales for a digital signage network. Of course, they managed to spend more than that, about $156 million, during the same time period, so the company isn't wildly profitable right now.
Still, I think NCMI is in a good position to take advantage of the rapid growth rate of the out-of-home advertising market. The NCMI network features 13,990 screens and 1,722 high definition monitors in 1,110 theaters, 93% of which are operated by its founding members Regal, AMC and Cinemark. Because of its roots in the theater business, the company has long-term, exclusive agreements with its founding members, giving it a monopoly at the three largest US movie theater chains. About 85% of its screens are digital and capable of being remotely updated via satellite. Currently 75% and 30% of its national and local/regional ad time is utilized, respectively.
Tags: NCMI, National CineMedia, out-of-home advertising, digital signage
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