MARCUS CORP

Previous wording

Beginning on December 27, 2024, our fiscal year changed from a 52- or 53-week fiscal year ending on the last Thursday in December of each year to a fiscal year ending on December 31 of each year. Accordingly, effective for our fiscal year ending December 31, 2025, our quarterly results will be for three month periods ending March 31, June 30, September 30 and December 31 of each year.

Current wording

Beginning in fiscal 2025, our fiscal year changed to a fiscal year ending on December 31 of each year. Fiscal 2025 was a 370 operating day year beginning on December 27, 2024 and ending on December 31, 2025 (comprised of five operating days between December 27-31, 2024, plus 365 operating days in calendar year 2025). Accordingly, for our fiscal year ended December 31, 2025, our quarterly results were for three month periods ended March 31, June 30, September 30 and December 31.

Previous wording

For fiscal 2024 and prior periods, we reported our consolidated and individual segment results of operations on a 52- or 53-week fiscal year ending on the last Thursday in December, dividing our fiscal year into three 13-week quarters and a final quarter consisting of 13 or 14 weeks. Fiscal 2022 was a 52-week year, beginning on December 31, 2021 and ending on December 29, 2022. Fiscal 2023 was a 52-week year, beginning on December 30, 2022 and ending on December 28, 2023. Fiscal 2024 was a 52-week year, beginning on December 29, 2023 and ending on December 26, 2024.

Current wording

For fiscal 2024 and prior periods, we reported our consolidated and individual segment results of operations on a 52- or 53-week fiscal year ending on the last Thursday in December, dividing our fiscal year into three 13-week quarters and a final quarter consisting of 13 or 14 weeks. Fiscal 2024 was a 52-week year with 364 operating days, beginning on December 29, 2023 and ending on December 26, 2024. Fiscal 2023 was a 52-week year with 364 operating days, beginning on December 30, 2022 and ending on December 28, 2023.

Previous wording

Our first fiscal quarter typically produces the weakest operating results in our hotels and resorts division due primarily to the effects of reduced travel during the winter months. The quality of film product in any given quarter typically impacts the operating results in our theatre division. Our second and third fiscal quarters generally produce our strongest operating results because these periods coincide with the typical summer seasonality of the movie theatre industry and the summer strength of the lodging business. Due to the fact that the week between Christmas and New Year’s Eve is historically one of the strongest weeks of the year for our theatre division, the specific timing of the last Thursday in December impacts the results of our fiscal first and fourth quarters in that division. The first quarter of fiscal 2025 will include five days during the week between Christmas and New Year’s Eve, and will end on March 31, 2025 due to the change in our fiscal year discussed above.

Current wording

Our first fiscal quarter typically produces the weakest operating results in our hotels and resorts division due primarily to the effects of reduced travel during the winter months. The quality of film product in any given quarter typically impacts the operating results in our theatre division. Our second and third fiscal quarters generally produce our strongest operating results because these periods coincide with the typical summer seasonality of the movie theatre industry and the summer strength of the lodging business. Due to the fact that the week between Christmas and New Year’s Eve is historically one of the strongest weeks of the year for our theatre division, the specific timing of the last Thursday in December has historically impacted the results of our fiscal first and fourth quarters in that division. Due to the transition in our fiscal year during fiscal 2025 described above, the first quarter of fiscal 2025 included five days during the week between Christmas and New Year’s Eve, and the fourth quarter of fiscal 2025 included the entire week between Christmas and New Year’s Eve.

Previous wording

Our aggregate cash capital expenditures, acquisitions and net purchases of interests in, and contributions to, joint ventures were $83.3 million during fiscal 2024, compared to $38.8 million during fiscal 2023 and $36.8 million during fiscal 2022. We currently estimate that cash capital expenditures during fiscal 2025 will be in the $70 - $85 million range, with significant investments in our hotels division as discussed below. We will, however, continue to monitor our operating results and economic and industry conditions so that we may adjust our plans accordingly.

Current wording

Our aggregate cash capital expenditures, acquisitions and net purchases of interests in, and contributions to, joint ventures were $83.2 million during fiscal 2025, compared to $83.3 million during fiscal 2024 and $38.8 million during fiscal 2023. We currently estimate that cash capital expenditures during fiscal 2026 will be in the $50 - $55 million range, with significant investments in our hotels division now behind us as discussed below. We will, however, continue to monitor our operating results and economic and industry conditions so that we may adjust our plans accordingly.

Previous wording

•Maximize and leverage our current assets. We have invested approximately $389 million to further enhance the movie-going experience and amenities in new and existing theatres over the last ten years. These investments have included:

Current wording

•Maximize and leverage our current assets. We have invested approximately $340 million to further enhance the movie-going experience and amenities in new and existing theatres over the last ten years. These investments have included:

Previous wording

◦DreamLounger SM recliner seating additions. As of December 26, 2024, we offered all DreamLounger recliner seating in 67 theatres, representing approximately 86% of our company-owned theatres. Including our premium, large format (PLF) auditoriums with recliner seating, as of December 26, 2024, we offered our DreamLounger recliner seating in approximately 88% of our company-owned screens, a percentage we believe to be the highest among the largest theatre chains in the nation.

Current wording

◦DreamLounger SM recliner seating additions. As of December 31, 2025, we offered all DreamLounger recliner seating in 66 theatres, representing approximately 86% of our company-owned theatres. Including our premium, large format (PLF) auditoriums with recliner seating, as of December 31, 2025, we offered our DreamLounger recliner seating in approximately 88% of our company-owned screens, a percentage we believe to be the highest among the largest theatre chains in the nation.

Previous wording

◦Ultra Screen DLX®, Super Screen DLX® (DreamLounger eXperience) and ScreenX conversions. As of December 26, 2024, we had a total of 125 PLF screens at 65 of our theatre locations (31 Ultra Screen DLX auditoriums, one traditional Ultra Screen® auditorium, 89 Super Screen DLX auditoriums - a slightly smaller screen than an Ultra Screen but with the same DreamLounger seating and Dolby Atmos sound - and three IMAX® PLF screens). In fiscal 2023, we introduced our first ScreenX auditorium featuring 270-degree projection providing guests with an immersive viewing experience. As of December 26, 2024, we offered at least one PLF screen in approximately 83% of our company-owned theatres, once again a percentage we believe to be the highest percentage among the largest theatre chains in the nation. In addition, as of December 26, 2024 we offered more than one PLF screen in approximately 62% of our company-owned theatres, which we believe gives us significant operational flexibility to maximize revenue by showing more than one major film on PLF screens at a theatre, particularly during opening weekends for films and at peak times during the year. Our PLF screens generally have higher per-screen revenues and draw customers from a larger geographic region compared to our standard screens, and we charge a premium price to our guests for this experience.

Current wording

◦Ultra Screen DLX®, Super Screen DLX® (DreamLounger eXperience) and ScreenX conversions. As of December 31, 2025, we had a total of 126 PLF screens at 64 of our theatre locations (31 Ultra Screen DLX auditoriums, one traditional Ultra Screen® auditorium, 87 Super Screen DLX auditoriums - a slightly smaller screen than an Ultra Screen but with the same DreamLounger seating and Dolby Atmos sound - four ScreenX auditoriums, and three IMAX® PLF screens). In fiscal 2023, we introduced our first ScreenX auditorium featuring 270-degree projection providing guests with an immersive viewing experience, and we added three additional ScreenX auditoriums at additional theatres in fiscal 2025. As of December 31, 2025, we offered at least one PLF screen in approximately 83% of our company-owned theatres, once again a percentage we believe to be the highest percentage among the largest theatre chains in the nation. In addition, as of December 31, 2025 we offered more than one PLF screen in approximately 62% of our company-owned theatres, which we believe gives us significant operational flexibility to maximize revenue by showing more than one major film on PLF screens at a theatre, particularly during opening weekends for films and at peak times during the year. Our PLF screens generally have higher per-screen revenues and draw customers from a larger geographic region compared to our standard screens, and we charge a premium price to our guests for this experience.

Previous wording

◦Signature cocktail and dining concepts. We have continued to further enhance our food and beverage offerings within our existing theatres. We believe our 50-plus years of food and beverage experience in the hotel and restaurant businesses provides us with a unique advantage and expertise that we can leverage to further grow revenues in our theatres. As of December 26, 2024, we offered bars/full liquor service under the concepts Take Five Lounge, Take Five Expressand The Tavern at 49 theatres, representing approximately 63% of our company-owned theatres. As of December 26, 2024, we also offered one or more in-lobby dining concepts, including the pizza concept Zaffiro’s® Express and hamburger and other Americana fare concept Reel Sizzle, in 40 theatres, representing approximately 69% of our company-owned theatres (excluding our in-theatre dining theatres). In select locations without a

Current wording

◦Signature cocktail and dining concepts. We have continued to further enhance our food and beverage offerings within our existing theatres. We believe our 50-plus years of food and beverage experience in the hotel and restaurant businesses provides us with a unique advantage and expertise that we can leverage to further grow revenues in our theatres. As of December 31, 2025, we offered bars/full liquor service under the concepts Take Five Lounge, Take Five Expressand The Tavern at 48 theatres, representing approximately 62% of our company-owned theatres. In select locations without a Take Five Lounge outlet, we offer beer and wine at the Zaffiro’s Express outlet. As of December 31, 2025, we also offered one or more in-lobby dining concepts, including the pizza concept Zaffiro’s® Express and hamburger and other Americana fare concept Reel Sizzle, in 39 theatres, representing approximately 68% of our company-owned theatres (excluding our in-theatre dining theatres). We also operate three Zaffiro’s® Pizzeria and Bar full-service restaurants.

Previous wording

◦In-theatre dining concepts. As of December 26, 2024, we offered a complete menu of drinks and chef-prepared salads, sandwiches, entrées and desserts at 29 theatres, representing approximately 37% of our company-owned theatres, through two service models. At 21 theatres we offer in-theatre dining operating under the Bistro Plex® and Movie Tavern by Marcus brands. In addition, at 8 theatres operating under the Marcus Theatres brand, we offer the same complete menu available for order at the concession stand, bar, or our online/mobile app with food pickup at the concession stand.

Current wording

◦In-theatre dining concepts. As of December 31, 2025, we offered a complete menu of drinks and chef-prepared salads, sandwiches, entrées and desserts at 20 theatres, representing approximately 26% of our company-owned theatres, through two service models. At 14 theatres we offer in-theatre dining operating under the Bistro Plex® and Movie Tavern by Marcus brands with ordering at the bar, online, mobile app/web, and in select locations with servers, for food delivery to seats. In addition, at 6 theatres with in-theatre dining operating under the Movie Tavern by Marcus and Marcus Theatres brands, we also offer the same complete menu available to order at the concession stand in addition to ordering with online, mobile app/web for delivery to seats or pickup at the concession stand.

Previous wording

◦Expanding and evolving our food and beverage operations described above. We will continue to test new concepts and enhance our existing concepts in order to provide further options to our guests and increase our average concession/food and beverage revenues per person. Strategies may also include expanded sports programming, live bingo and other entertainment options in our signature bars. Additionally, we expect to continue refining the service model at our Movie Tavern locations to optimize the use of servers and/or add additional concessions stands and maximize our food and beverage revenues.

Current wording

◦Expanding and evolving our food and beverage operations described above. We will continue to test new concepts and enhance our existing concepts in order to provide further options to our guests and increase our average concession/food and beverage revenues per person. In fiscal 2025, we began testing new lobby concession stand queuing line configurations that integrate merchandise displays for grab-n-go candy, snacks, select food items and souvenir merchandise as part of the queuing line. We expect to expand the use of these queuing line merchandise displays to additional theatres in fiscal 2026. Strategies may also include expanded sports programming, live bingo and other entertainment options in our signature bars. Additionally, we expect to continue refining the service model at our Movie Tavern by Marcus locations to optimize the use of servers, mobile ordering, and/or add additional concession stands and maximize our food and beverage revenues. In fiscal 2025, we began testing QR code mobile food and beverage ordering for delivery to seats at select in-theatre dining locations. We expect to expand the number of locations with QR code mobile ordering, both for seat delivery and for concession stand order pickup, in fiscal 2026.

Previous wording

◦Evolving and investing in what we believe to be our best-in-class customer loyalty program called Magical Movie Rewards SM (“MMR”). We currently have approximately 6.5 million members enrolled in the program. Approximately 48% of all box office transactions and 41% of total transactions in our theatres during fiscal 2024 were completed by registered members of the loyalty program. We believe that this program contributes to increased movie-going frequency, more frequent visits to the concession stand, increased loyalty to Marcus Theatres and, ultimately, improved operating results. In fiscal 2025, we plan to make additional investments in technology that will provide further insights into loyalty data on customer preferences, habits and tendencies, facilitating more targeted and effective marketing efforts that are tailored to MMR members.

Current wording

◦Evolving and investing in what we believe to be our best-in-class customer loyalty program called Magical Movie Rewards SM (“MMR”). We currently have approximately 6.9 million members enrolled in the program. Approximately 50% of all box office transactions and 44% of total transactions in our theatres during fiscal 2025 were completed by registered members of the loyalty program. We believe that this program contributes to increased movie-going frequency, more frequent visits to the concession stand, increased loyalty to Marcus Theatres and, ultimately, improved operating results. In fiscal 2026, we plan to further enhance loyalty data insights on customer preferences, habits and tendencies, facilitating more targeted and effective marketing efforts that are tailored to MMR members.

Previous wording

◦Modernizing pricing strategies based upon consumer demand. We currently offer a number of very successful pricing promotions, including “Value Tuesday,” “Student Thursday” and a “Young-at-Heart” program for seniors on Friday afternoons. During fiscal 2024, we also introduced a $7 Everyday Matinee for seniors and children, offering a discounted $7 admission for showtimes before 4 p.m. We believe these promotions have increased movie going frequency and reached a customer who may have stopped going to the movies because of price, without adversely impacting the movie-going habits of our regular weekend customers. Conversely, we charge a higher ticket price for PLF screens and have implemented higher pricing on Friday and Saturday evenings during certain peak moviegoing times of the year. We expect to continue to optimize revenue management and implement additional pricing strategies based upon consumer demand.

Current wording

◦Modernizing pricing strategies based upon consumer demand. We currently offer a number of very successful pricing promotions, including “Value Tuesday,” “Student Thursday” and a “Young-at-Heart” program for seniors on Friday afternoons. During fiscal 2024, we also introduced an Everyday Matinee for seniors and children, offering a discounted admission for showtimes before 4 p.m. and have continued to make strategic price alterations to the program throughout fiscal 2025 to optimize revenue. We believe these promotions have increased movie going frequency and reached a customer who may have stopped going to the movies because of price, without adversely impacting the movie-going habits of our regular weekend customers. Conversely, we charge a higher ticket price for PLF screens and have implemented higher pricing on Friday and Saturday evenings during certain peak moviegoing times of the year. We expect to continue to optimize revenue management and implement additional pricing strategies based upon consumer demand.

Previous wording

◦Expanding the use of technology in all facets of our business. We continue to enhance our mobile ticketing capabilities, our downloadable Marcus Theatres mobile application and ourmarcustheatres.com website. We added food and beverage ordering capabilities to our mobile application at all of our theatres in fiscal 2020. In fiscal 2025 we plan to make additional investments in both our website and mobile app technology to further improve ease-of-use and the overall customer experience for both ticketing and food and beverage ordering. We have continued to install additional theatre-level technology, such as new ticketing and food ordering kiosks, new digital menu boards and concession advertising monitors. Each of these enhancements is designed to improve customer interactions, both at the theatre and through mobile platforms and other electronic devices, while enhancing add-on food and beverage sales opportunities through promotion and on-screen offers. We also believe that maximizing the use of these technology enhancements will improve labor productivity and efficiency.

Current wording

◦Delivering a best-in-class digital experience through a feature-rich app and website ensuring a frictionless customer journey. We continue to enhance our mobile ticketing capabilities, our downloadable Marcus Theatres mobile application and ourmarcustheatres.com website. Our mobile application offers food and beverage ordering capabilities at all of our theatres. In fiscal 2025, we launched a redesigned ticketing website, including enhancements to streamline the ticket ordering process for mobile users with digital wallet payment methods. In early fiscal 2026, we launched a redesigned marcustheatres.com website that improves the overall customer experience, and we plan to make additional investments in our website and mobile app technology to further improve ease-of-use for food and beverage ordering. We have continued to install additional theatre-level technology, such as new digital menu boards and concession advertising monitors. Each of these enhancements is designed to improve customer interactions, both at the theatre and through mobile platforms and other electronic devices, while enhancing add-on food and beverage sales opportunities through promotion and on-screen offers. We also believe that maximizing the use of these technology enhancements will improve labor productivity and efficiency.

Previous wording

◦Launching a subscription program that encourages more frequent movie-going. In fiscal 2024, we introduced Marcus Movie Club, replacing the previously piloted test programs, MovieFlex®and MovieFlex®+. For $9.99 per month or $109.89 annually, moviegoers who join Marcus Movie Club receive a credit to see any 2D movie each month with rollover of unused credits, a 20% discount on food and beverage, unlimited access to additional tickets for $9.99, and waived ticket surcharge fees. We plan to promote and grow this program in fiscal 2025, and we believe that the program will drive increased recurring moviegoing and loyalty to Marcus Theatres.

Current wording

◦Expanding Marcus Movie Club, our subscription program that encourages more frequent movie-going. In fiscal 2024, we introduced Marcus Movie Club. For $9.99 per month or a discounted annual membership, moviegoers who join Marcus Movie Club receive a credit to see any 2D movie each month with rollover of unused credits, a 20% discount on food and beverage, unlimited access to additional tickets for $9.99, waived ticket surcharge fees, and free Marcus Mystery Movies. We plan to promote and grow this program in fiscal 2026, and we believe that the program will drive increased recurring moviegoing over the long-term and increased loyalty to Marcus Theatres.

Previous wording

◦Developing promotions that feature and elevate movies beyond blockbuster films. In fiscal 2024, we debuted Marcus Mystery Movie, a promotion that on two Mondays each month gives customers the opportunity to attend a 7 p.m. screening of an upcoming movie before its official release date for a $5 ticket, while the movie title is not announced until showtime. The program highlights films of all genres and movie types including small and mid-size films, in addition to expected blockbuster releases. Based on our initial experience and customer feedback, we believe the Marcus Mystery Movie program generates additional attendance by bringing customers out to see films that they might not have otherwise chosen to see, yet find themselves enjoying, while building awareness of coming attractions during the preshow trailers.

Current wording

◦Developing promotions that feature and elevate movies beyond blockbuster films. In fiscal 2024, we debuted Marcus Mystery Movie, a promotion that on two Mondays each month gives customers the opportunity to attend a 7 p.m. screening of an upcoming movie before its official release date for a $5 ticket, while the movie title is not announced until showtime. The program highlights films of all genres and movie types including small and mid-size films, in addition to expected blockbuster releases. We continued to experience success with the Marcus Mystery Movie program in fiscal 2025, and we believe this program generates additional attendance by bringing customers out to see films that they might not have otherwise chosen to see, yet find themselves enjoying, while building awareness of coming attractions during the preshow trailers.

Previous wording

◦Expanding electronic passports with packaged film series. In fiscal 2023, we launched Marcus Passport, a program that allows customers to purchase a passport ticket with access to every movie that is playing as part of a Marcus Theatres film series, priced at a discount to purchasing tickets for each movie individually. Our film series showcase multiple movies that celebrate specific genres, holidays, franchises, filmmakers and more. The program launched in fiscal 2023 with a Best Picture Passport featuring the ten Academy Awards Best Picture nominees, followed by additional series throughout the year including winter and summer Kids Dream Passports each featuring twelve family films, Flashback Cinema Passport, Hunger Games Passport, The Chosen Passport, Disney Pixar Passport and a holiday Seasons’ Screening Passport. In fiscal 2024, we grew the program from 19 to 22 passport series, including a mix of newly released films, retro films, and a combination of newly released and retro films.

Current wording

◦Expanding electronic passports with packaged film series. In fiscal 2023, we launched Marcus Passport, a program that allows customers to purchase a passport ticket with access to every movie that is playing as part of a Marcus Theatres film series, priced at a discount to purchasing tickets for each movie individually. Our film series showcase multiple movies that celebrate specific genres, holidays, franchises, filmmakers and more. The program launched in fiscal 2023 with a Best Picture Passport featuring the ten Academy Awards Best Picture nominees, followed by additional series throughout the year including winter and summer Kids Dream Passports each featuring twelve family films, Flashback Cinema Passport, Hunger Games Passport, The Chosen Passport, Disney Pixar Passport and a holiday Seasons’ Screening Passport. In fiscal 2024, we grew the program from 19 to 22 passport series, including a mix of newly released films, retro films, and a combination of newly released and retro films. In fiscal 2025, we offered 20 passport series and we sold 6% more passports than we did in fiscal 2024. We expect to continue to leverage our Marcus Passport offerings in fiscal 2026 to promote and increase moviegoing.

Previous wording

◦Testing and subsequently implementing additional entertainment options within theatre auditoriums. Examples of initiatives may include sports bars for viewing live sports (possibly with online gambling where available), sports gaming, and interactive live bingo auditoriums. In fiscal 2022, we introduced a sports viewing auditorium, branded The Wall® in our theatre in Gurnee, Illinois as part of our initial test of this strategy. The Wall combines multi-screen sports viewing with our complete in-theatre dining food and beverage menu, providing customers a premium sports bar experience. We continue to evaluate potential expansion of similar sports viewing auditoriums in additional theatres and markets.

Current wording

◦Testing and subsequently implementing additional entertainment options within theatre auditoriums. Examples of initiatives may include sports bars for viewing live sports (possibly with online gambling where available), sports gaming, and interactive live bingo auditoriums. In fiscal 2022, we introduced a sports viewing auditorium branded The Wall® in our theatre in Gurnee, Illinois as part of our initial test of this strategy. The Wall combines multi-screen sports viewing with our complete in-theatre dining food and beverage menu, providing customers a premium sports bar experience. We have since enhanced our sports and events programming in our Take Five Lounges, and we continue to evaluate potential expansion of similar sports viewing auditoriums in additional theatres and markets.

Previous wording

◦Exploring new viewing experiences for our guests. For example, we currently offer a 4DX auditorium at one of our theatres. 4DX delivers an immersive multi-sensory cinematic experience, including synchronized motion seats and environmental effects such as water, wind, fog, scent and more, to enhance the action on screen. In fiscal 2023, we converted one of our existing auditoriums to a ScreenX auditorium. ScreenX is a panoramic film format that presents films with expanded, dual-sided, 270-degree screens projected on the walls in a theatre. In fiscal 2025, we plan to convert several additional screens to ScreenX and we will consider additional experiential offerings in the future.

Current wording

◦Exploring new viewing experiences for our guests. For example, we currently offer a 4DX auditorium at one of our theatres. 4DX delivers an immersive multi-sensory cinematic experience, including synchronized motion seats and environmental effects such as water, wind, fog, scent and more, to enhance the action on screen. In fiscal 2025, we converted three of our existing auditoriums to a ScreenX auditorium, and now currently offer ScreenX at four of our theatres. ScreenX is a panoramic film format that presents films with expanded, dual-sided, 270-degree screens projected on the walls in a theatre. In fiscal 2026, we plan to convert additional screens to ScreenX and we will consider additional experiential offerings in the future.

Previous wording

◦Exploring new content sources and deliveries to supplement existing mainstream movie content. The addition of digital technology throughout our circuit (we offer digital cinema projection on 100% of our screens) has provided us with additional opportunities to obtain non-motion picture programming from other new and existing content providers, including live and pre-recorded performances of the Metropolitan Opera, as well as sports, concerts and other events, at many of our locations. We offer weekday and weekend alternate programming at many of our theatres across our circuit. The special programming includes classic movies, faith-based content, live performances, comedy shows and children’s performances. We believe this type of programming is more impactful when presented on the big screen and provides an opportunity to continue to expand our audience base beyond traditional moviegoers. Our MMR program also gives us the ability to cost effectively promote non-traditional programming and special events, particularly during non-peak time periods.

Current wording

Metropolitan Opera, as well as sports, concerts and other events, at many of our locations. We offer weekday and weekend alternate programming at many of our theatres across our circuit. The special programming includes classic movies, faith-based content, live performances, comedy shows and children’s performances. We believe this type of programming is more impactful when presented on the big screen and provides an opportunity to continue to expand our audience base beyond traditional moviegoers. Our MMR program also gives us the ability to cost effectively promote non-traditional programming and special events, particularly during non-peak time periods.

Previous wording

The years following the COVID-19 pandemic have been challenging for all theatre operators. We will continue to evaluate the opportunities that these challenging situations create, and will consider potential acquisitions in the future. The movie theatre industry is very fragmented, with approximately 50% of United States screens owned by the three largest theatre circuits and the other 50% owned by an estimated 800 smaller operators, making it very difficult to predict when acquisition opportunities may arise. We do not believe that we are geographically constrained, and we believe that we may be able to add value to certain theatres through our various proprietary amenities and operating expertise.

Current wording

The industry recovery following the COVID-19 pandemic has been challenging for all theatre operators. We will continue to evaluate the opportunities that these challenging situations create, and will consider potential acquisitions in the future. The movie theatre industry is very fragmented, with approximately 50% of United States screens owned by the three largest theatre circuits and the other 50% owned by hundreds of smaller operators, making it very difficult to predict when acquisition opportunities may arise. We do not believe that we are geographically constrained, and we believe that we may be able to add value to certain theatres through our various proprietary amenities and operating expertise.

Previous wording

◦Sales, marketing and revenue management strategies designed to further increase our profitability. The priority will be to focus on capitalizing on strong group demand and improving business travel trends, maximizing revenue per available room, optimizing event space and growing ancillary revenues.

Current wording

◦Sales, marketing and revenue management strategies designed to further increase our profitability. The priority will be to focus on capitalizing on strong group and leisure demand, maximizing revenue per available room, optimizing event space and growing ancillary revenues.

Previous wording

•Portfolio management. We have invested approximately $230 million to further enhance our hotels and resorts portfolio over the last 10 years. These investments have included:

Current wording

•Portfolio management. We have invested approximately $261 million to further enhance our hotels and resorts portfolio over the last 10 years. These investments have included:

Previous wording

◦Hotel renovations. We regularly renovate and update our hotels and resorts. For example, at the Grand Geneva Resort & Spa we renovated the lobby in fiscal 2021, completed guest room renovations in fiscal 2023, completed a meeting space renovation project in fiscal 2024, and started construction on a new 10-hole golf short course late in fiscal 2024. At The Pfister Hotel, we completed a ballroom and meeting space renovation in fiscal 2023 and completed a guest room renovation project in fiscal 2024. Additionally, we began an approximately $40 million renovation at the Hilton Milwaukee in late fiscal 2024 that will include a transformation of 554 guest rooms, meeting and event spaces, and the hotel lobby, which is expected to be completed in fiscal 2025.

Current wording

◦Hotel renovations. We regularly renovate and update our hotels and resorts. For example, at the Grand Geneva Resort & Spa we renovated the lobby in fiscal 2021, completed guest room renovations in fiscal 2023, completed a meeting space renovation project in fiscal 2024, and completed construction of a new 11-hole golf short course in fiscal 2025 that will open in spring 2026. At The Pfister Hotel, we completed a ballroom and meeting space renovation in fiscal 2023 and completed a guest room renovation project in fiscal 2024. At Hilton Milwaukee, in fiscal 2025 we completed an over $40 million renovation that included the transformation of 554 guest rooms, meeting and event spaces, and the historic hotel lobby.

Previous wording

Our future plans for our hotels and resorts division also include continued reinvestment in our existing properties to maintain and enhance their value. We anticipate additional reinvestment during fiscal 2025 and fiscal 2026 at the Grand Geneva Resort & Spa, Hilton Milwaukee and AC Hotel Chicago. To maintain our existing hotels and resorts, we currently anticipate that our fiscal 2025 capital expenditures in this division will total approximately $50 - $60 million, with significant investment in the renovation at Hilton Milwaukee.

Current wording

Our future plans for our hotels and resorts division also include continued reinvestment in our existing properties to maintain and enhance their value. We anticipate some moderate reinvestments during fiscal 2026 and fiscal 2027 at Grand Geneva Resort & Spa, AC Hotel Chicago, and Saint Kate - The Arts Hotel. To maintain our existing hotels and resorts, we currently anticipate that our fiscal 2026 capital expenditures in this division will total approximately $25 - $30 million, with the significant reinvestment in the renovation at Hilton Milwaukee during fiscal 2025 now behind us.

Previous wording

We have been very opportunistic in our past hotel investments as we have, on many occasions, acquired assets at favorable terms and then improved the properties and operations to create value. Unlike our theatre assets where the majority of our return on investment comes from the annual cash flow generated by operations, a portion of the return on our hotel investments is derived from effective portfolio management, which includes determining the proper branding strategy for a given asset, the proper level of investment and upgrades and identifying an effective divestiture strategy for the asset when appropriate. As a result, we may periodically explore opportunities to monetize all or a portion of one or more owned hotels. In December 2022, we sold The Skirvin Hilton for $36.75 million. We have redeployed the sale proceeds, net of mortgage debt and land lease retirement, into other investment opportunities in our hotel business that we believe will provide more attractive investment returns.

Current wording

We have been very opportunistic in our past hotel investments as we have, on many occasions, acquired assets at favorable terms and then improved the properties and operations to create value. Unlike our theatre assets where the majority of our return on investment comes from the annual cash flow generated by operations, a portion of the return on our hotel investments is derived from effective portfolio management, which includes determining the proper branding strategy for a given asset, the proper level of investment and upgrades and identifying an effective divestiture strategy for the asset when appropriate. As a result, we may periodically explore opportunities to monetize all or a portion of one or more owned hotels. We will consider many factors as we actively review opportunities to execute this strategy, including income tax considerations, the ability to retain management, pricing and individual market considerations. We evaluate strategies for our hotels on an asset-by-asset basis. We have not set a specific goal for the number of hotels that may be considered for this strategy, nor have we set a specific timetable. It is possible that we may sell a particular hotel or hotels during fiscal 2026 or beyond if we determine that such action is in the best interest of our shareholders.

Previous wording

•Strategic growth. Transactional activity in the hotel industry has been limited during the last three years due to the pandemic and its lingering effects and the higher cost of debt capital for financing hotel acquisitions. Our hotels and resorts division expects to continue to seek opportunities to invest in new hotels and increase the number of rooms under management in the future. Growth opportunities that we may explore in the future include:

Current wording

•Strategic growth. Transactional activity in the hotel industry has been limited during the last several years due to lingering effects of the pandemic in certain markets and the higher cost of debt capital for financing hotel acquisitions. Our hotels and resorts division expects to continue to seek opportunities to invest in new hotels and increase the number of rooms under management in the future. Growth opportunities that we may explore in the future include:

Previous wording

•In addition to operational and growth strategies in our operating divisions, we will continue to seek additional opportunities to enhance shareholder value, including strategies related to our dividend policy and share repurchases. During fiscal 2024, we repurchased 0.7 million shares of our common stock for $9.7 million in the open market under our existing Board of Directors stock repurchase authorizations and continued our regular quarterly common stock cash dividend of $0.07 per share of common stock. In prior years, we have periodically paid special dividends.

Current wording

•In addition to operational and growth strategies in our operating divisions, we will continue to seek additional opportunities to enhance shareholder value, including strategies related to our dividend policy and share repurchases. During fiscal 2025, we repurchased 1.1 million shares of our common stock for $18.0 million in the open market under our existing Board of Directors stock repurchase authorizations. We increased our regular quarterly common stock cash dividend rate by 14% during the third quarter of fiscal 2025, increasing our quarterly cash dividend from $0.07 to $0.08 per share of common stock. In prior years, we have periodically paid special dividends.

Previous wording

•We will also continue to evaluate opportunities to sell real estate when appropriate, allowing us to benefit from the underlying value of our real estate assets. When possible, we will attempt to avail ourselves of the provisions of Internal Revenue Code §1031 related to tax-deferred like-kind exchange transactions. We are actively marketing a number of pieces of surplus real estate and other non-core real estate. During fiscal 2023, we sold one surplus land parcel and two former theatres generating total proceeds of $4.2 million. During fiscal 2024, we sold one former theatre generating total proceeds of $3.1 million. We believe we may receive total sales proceeds from real estate sales during the next fiscal year totaling approximately $2 - $3 million, depending upon demand for the real estate in question.

Current wording

•We will also continue to evaluate opportunities to sell real estate when appropriate, allowing us to benefit from the underlying value of our real estate assets. When possible, we will attempt to avail ourselves of the provisions of Internal Revenue Code §1031 related to tax-deferred like-kind exchange transactions. We are actively marketing a number of pieces of surplus real estate and other non-core real estate. During fiscal 2024, we sold one former theatre generating total proceeds of $3.1 million. During fiscal 2025, we acquired land for future development in connection with a like-kind exchange following the sale of three excess land parcels in 2024 and 2025 in which the income tax gains were deferred. We believe we may receive total sales proceeds from real estate sales during the next fiscal year totaling approximately $1 - $5 million, depending upon demand for the real estate in question.

Previous wording

The following table sets forth revenues, operating income, other income (expense), net earnings (loss) attributable to The Marcus Corporation and net earnings (loss) per diluted common share for the past three fiscal years (in millions, except for per share and percentage change data) :

Current wording

The following table sets forth revenues, operating income, other income (expense), net earnings (loss) and net earnings (loss) per diluted common share for the past three fiscal years (in millions, except for per share and percentage change data) :

Previous wording

Operating income decreased during fiscal 2024 compared to fiscal 2023, primarily due to a decrease in operating income from our theatre division and an increase in corporate operating losses, partially offset by increased operating income from our hotels and resorts division. Operating expenses from our corporate items, which include amounts not allocable to the business segments, increased during fiscal 2024 compared to fiscal 2023 due primarily to increased long-term incentive compensation expenses, professional fees related to convertible debt repurchase transactions and tax planning, and expenses related to the relocation of our corporate office.

Current wording

Operating income increased during fiscal 2025 compared to fiscal 2024, due to an increase in operating income from our theatre division, partially offset by decreased operating income from our hotels and resorts division and increased operating expenses from corporate items. Operating expenses from our corporate items, which include amounts not allocable to the business segments, increased during fiscal 2025 compared to fiscal 2024 due primarily to increased long-term incentive compensation expenses, director compensation, personnel and benefits cost inflation, and increased professional fees related to legal, tax planning, and information technology. The additional operating days in fiscal 2025 favorably impacted operating income by approximately $5.3 million.

Previous wording

Our operating income during fiscal 2024 was negatively impacted by impairment charges of approximately $6.8 million, or approximately $0.16 per diluted common share, related to four operating theatres, one operating theatre that we closed in early fiscal 2025, and one permanently closed theatre. Our operating income during fiscal 2023 was negatively impacted by impairment charges of approximately $1.1 million, or approximately $0.02 per diluted common share, primarily related to two permanently closed theatres and surplus real estate. Operating income during fiscal 2024 was also negatively impacted by $2.2 million, or $0.05 per diluted common share, related to settlement and legal expenses in connection with an equipment lease agreement impacted by the COVID-19 pandemic in our theatre division.

Current wording

Our operating income during fiscal 2025 was negatively impacted by impairment charges of approximately $5.2 million, or approximately $0.12 per diluted common share, related to eight operating theatres and one vacant parcel of land. Our operating income during fiscal 2024 was negatively impacted by impairment charges of approximately $6.8 million, or approximately $0.16 per diluted common share, primarily related to four operating theatres, one operating theatre that we closed in early fiscal 2025, and one permanently closed theatre. Operating income during fiscal 2024 was also negatively impacted by $2.2 million, or $0.05 per diluted common share, related to settlement and legal expenses in connection with an equipment lease agreement impacted by the COVID-19 pandemic in our theatre division.

Previous wording

Investment income was $2.2 million during fiscal 2024 compared to $2.4 million of investment income during fiscal 2023. Investment income (loss) includes interest earned on cash and cash equivalents, as well as increases/decreases in the value of marketable securities and increases in the cash surrender value of a life insurance policy. Investment income (loss) during fiscal 2025 may vary compared to fiscal 2024, primarily dependent upon changes in the value of marketable securities.

Current wording

Investment income was $0.9 million during fiscal 2025 compared to $2.2 million of investment income during fiscal 2024. Investment income includes interest earned on cash and cash equivalents, as well as increases/decreases in the value of marketable securities and increases in the cash surrender value of a life insurance policy. Investment income during fiscal 2026 may vary compared to fiscal 2025, primarily dependent upon changes in the value of marketable securities.

Previous wording

Interest expense totaled $11.0 million during fiscal 2024, a decrease of $1.7 million, or 13.7%, compared to interest expense of $12.7 million during fiscal 2023. The decrease in interest expense during fiscal 2024 was due primarily to $1.1 million of additional interest payable on our convertible notes during fiscal 2023 that did not recur, a decrease in noncash amortization of debt issuance costs, and lower borrowing levels during fiscal 2024, partially offset by an increase in our average interest rate, as discussed in the Liquidity section of this MD&A below. Interest expense during fiscal 2024 included approximately $1.1 million in noncash amortization of debt issuance costs. During fiscal 2025, we estimate that noncash amortization of debt issuance costs will be approximately $0.6 million, excluding the impact of any new debt issuance costs. We currently expect our total interest expense during fiscal 2025 to remain consistent with interest expense in fiscal 2024. Changes in our borrowing levels due to variations in our operating results, capital expenditures, acquisition opportunities (or the lack thereof) and asset sale proceeds, among other items, may impact, either favorably or unfavorably, our actual reported interest expense in future periods, as may changes in short-term interest rates.

Current wording

Interest expense totaled $11.5 million during fiscal 2025, an increase of $0.5 million, or 4.6%, compared to interest expense of $11.0 million during fiscal 2024. The increase in interest expense during fiscal 2025 was due primarily to increased borrowing levels and an increase in our average interest rate, partially offset by a decrease in noncash amortization of debt issuance costs. Interest expense during fiscal 2025 included approximately $0.6 million in noncash amortization of debt issuance costs. During fiscal 2026, we estimate that noncash amortization of debt issuance costs will be approximately $0.6 million, excluding the impact of any new debt issuance costs. We currently expect our total interest expense during fiscal 2026 to remain consistent with interest expense in fiscal 2025. Changes in our borrowing levels due to variations in our operating results, capital expenditures, acquisition opportunities (or the lack thereof) and asset sale proceeds, among other items, may impact, either favorably or unfavorably, our actual reported interest expense in future periods, as may changes in short-term interest rates.

Previous wording

We incurred other expense of $1.5 million during fiscal 2024, a decrease of approximately $0.3 million compared to other expense of $1.8 million during fiscal 2023. Other expense consists primarily of the non-service cost components of our periodic pension costs. Based upon information from an actuarial report for our pension plans, we expect other expense to be approximately $1.8 million during fiscal 2025.

Current wording

We earned other income of $2.8 million during fiscal 2025, an increase of approximately $4.4 million compared to other expense of $1.5 million during fiscal 2024. Other income was favorably impacted by a gain on a property insurance settlement of $4.5 million related to insured property damage at one theatre location during fiscal 2025. Other expense consists primarily of the non-service cost components of our periodic pension costs. Based upon information from an actuarial report for our pension plans, we expect other expense to be approximately $1.9 million during fiscal 2026.

Previous wording

We reported equity losses from two unconsolidated joint ventures of approximately $0.6 million during fiscal 2024, compared with equity losses from one unconsolidated joint venture of approximately $0.1 million during fiscal 2023. The equity losses in both years consist of our pro-rata share of losses from the Kimpton Hotel Monaco Pittsburgh in Pittsburgh, Pennsylvania, acquired in December 2021 and in which we have a 10% minority ownership interest. The equity losses in fiscal 2024 also include our pro-rata share of losses from The Lofton Hotel in Minneapolis, Minnesota, acquired in March 2024 and in which we have a 24.7% minority ownership interest.

Current wording

We reported equity losses from two unconsolidated joint ventures of approximately $0.6 million during fiscal 2025 and fiscal 2024. The equity losses in both years include our pro-rata share of losses from the Kimpton Hotel Monaco Pittsburgh in Pittsburgh, Pennsylvania, acquired in December 2021 and in which we have a 10% minority ownership interest. The equity losses in both years also include our pro-rata share of losses from The Lofton Hotel in Minneapolis, Minnesota, acquired in March 2024 and in which we have a 24.7% minority ownership interest.

Previous wording

Our fiscal 2023 income tax expense was favorably impacted by $0.8 million release of valuation allowances previously recorded against deferred tax assets for state net operating loss carryforwards (net of federal benefit), offset by $1.2 million of negative impact primarily from excess compensation subject to deduction limitations. Our fiscal 2023 effective income tax rate was 31.7%. The effective income tax rate was favorably impacted 3.8 percentage points due to the valuation allowance adjustment (net of federal benefit), and was negatively impacted 5.4 percentage points due to excess compensation deduction limitations. We currently anticipate that our fiscal 2025 effective income tax rate may be in the 26-30% range, excluding any potential further changes in federal or state income tax rates, valuation allowance adjustments or other one-time tax adjustments.

Current wording

We reported income tax benefit during fiscal 2025 of $4.0 million compared to income tax benefit of $2.4 million in fiscal 2024. Our fiscal 2025 income tax benefit was favorably impacted by a $7.6 million historic tax credit (net of valuation allowance) from the Hilton Milwaukee renovation and by a $0.4 million release of valuation allowances previously recorded against deferred tax assets for state net operating loss carryforwards (net of federal benefit), partially offset by $1.7 million of negative impact primarily from excess compensation subject to deduction limitations. Our fiscal 2025 effective income tax rate was (45.8)%. The effective income tax rate was favorably impacted 87.1 percentage points due to the historic tax credits (net of valuation allowance) and by 4.7 percentage points due to the valuation allowance adjustment (net of federal benefit), and was negatively impacted 19.6 percentage points due to excess compensation deduction limitations.

Previous wording

We reported income tax benefit during fiscal 2024 of $2.4 million compared to income tax expense of $6.9 million in fiscal 2023. Our fiscal 2024 income tax benefit was favorably impacted by a $6.1 million release of valuation allowances previously recorded against deferred tax assets for state net operating loss carryforwards (net of federal benefit), partially offset by $3.9 million of negative impact from nondeductible debt conversion expense resulting from the Convertible Notes Repurchases and related termination of the Capped Call Transactions (as described below), and $1.8 million of negative impact primarily from excess compensation subject to deduction limitations. Our fiscal 2024 effective income tax rate was 23.7%. The effective income tax rate was favorably impacted 60.0 percentage points due to the valuation allowance adjustment (net of federal benefit), and was negatively impacted 38.1 percentage points due to the Convertible Notes Repurchases and termination of the Capped Call Transactions, and 17.5 percentage points due to excess compensation deduction limitations.

Current wording

Our fiscal 2024 income tax benefit of $2.4 million was favorably impacted by a $6.1 million release of valuation allowances previously recorded against deferred tax assets for state net operating loss carryforwards (net of federal benefit), partially offset by $3.9 million of negative impact from nondeductible debt conversion expense resulting from the Convertible Notes Repurchases and related termination of the Capped Call Transactions (as described below), and $1.8 million of negative impact primarily from excess compensation subject to deduction limitations. Our fiscal 2024 effective income tax rate was 23.7%. The effective income tax rate was favorably impacted 60.0 percentage points due to the valuation allowance adjustment (net of federal benefit), and was negatively impacted 38.1 percentage points due to the Convertible Notes Repurchases and termination of the Capped Call Transactions, and 17.5 percentage points due to excess compensation deduction limitations. We currently anticipate that our fiscal 2026 effective income tax rate may be in the 26-30% range, excluding any potential further changes in federal or state income tax rates, valuation allowance adjustments or other one-time tax adjustments.

Previous wording

Weighted-average diluted shares outstanding was 31.9 million during fiscal 2024. Weighted-average diluted shares outstanding was 41.0 million during fiscal 2023, and included shares from the conversion of the convertible notes (which were repurchased and retired in fiscal 2024). All per share data in this MD&A is presented on a fully diluted basis, however, for periods when we report a net loss, common stock equivalents are excluded from the computation of diluted loss per share as their inclusion would have an anti-dilutive effect.

Current wording

Weighted-average diluted shares outstanding was 31.3 million during fiscal 2025, compared to 31.9 million weighted-average diluted shares outstanding during fiscal 2024. All per share data in this MD&A is presented on a fully diluted basis, however, for periods when we report a net loss, common stock equivalents are excluded from the computation of diluted loss per share as their inclusion would have an anti-dilutive effect.

Previous wording

Our oldest and historically most profitable division is our theatre division. The theatre division contributed 60.9% of our consolidated revenues and 54.5% of our consolidated operating income, excluding corporate items, during fiscal 2024, compared to 62.8% and 67.4%, respectively, during fiscal 2023 and 60.2% and 30.2%, respectively, during fiscal 2022. As of December 26, 2024, the theatre division operated theatres in Wisconsin, Illinois, Iowa, Minnesota, Missouri, Nebraska, North Dakota, Ohio, Arkansas, Colorado, Georgia, Kentucky, Louisiana, New York, Pennsylvania, Texas and

Current wording

Our oldest and historically most profitable division is our theatre division. The theatre division contributed 61.0% of our consolidated revenues and 67.1% of our consolidated operating income, excluding corporate items, during fiscal 2025, compared to 60.9% and 54.5%, respectively, during fiscal 2024 and 62.8% and 67.4%, respectively, during fiscal 2023. As of December 31, 2025, the theatre division operated theatres in Wisconsin, Illinois, Iowa, Minnesota, Missouri, Nebraska, North Dakota, Ohio, Arkansas, Colorado, Georgia, Kentucky, Louisiana, New York, Pennsylvania, Texas and Virginia, and a family entertainment center in Wisconsin. The following tables set forth revenues, operating income, operating margin, screens and theatre locations for the last three fiscal years:

Previous wording

Our theatre division revenues and operating income decreased during fiscal 2024 compared to fiscal 2023 primarily due to lower attendance in the first half of fiscal 2024 compared to the first half of fiscal 2023. The film slate during the first half of fiscal 2024 was negatively impacted by the content supply chain disruption from the shutdown of movie production during the WGA and SAG-AFTRA labor strikes in 2023, which contributed to a weaker slate of available films compared to the first half of fiscal 2023. Our operating income during fiscal 2024 was also negatively impacted by impairment charges of $6.8 million related to four operating theatres, one operating theatre that we closed in early fiscal 2025, and one permanently closed theatre, compared to impairment charges of $1.1 million during fiscal 2023 related to two permanently closed theatres and surplus real estate.

Current wording

The film slate during the first half of fiscal 2025 was significantly better, generating stronger box office performance compared to the first half of fiscal 2024, which was negatively impacted by the content supply chain disruption from the shutdown of movie production during the WGA and SAG-AFTRA labor strikes in 2023. Operating income during fiscal 2025 was favorably impacted by a $3.6 million decrease in depreciation and amortization expense and a $0.6 million decrease in rent expense compared to fiscal 2024, partially offset by increased labor, advertising, benefits, insurance, and other costs. Our operating income during fiscal 2025 was negatively impacted by impairment charges of $5.2 million related to eight operating theatres, and one vacant parcel of land, compared to impairment charges of $6.8 million during fiscal 2024 related to four operating theatres, one operating theatre that we closed in early fiscal 2025, and one permanently closed theatre. Operating income during fiscal 2024 was also negatively impacted by $2.2 million related to settlement and legal expenses in connection with an equipment lease agreement impacted by the COVID-19 pandemic.