Speaking at the JPMorgan Global Technology, Media and Communications Conference on Wednesday, Cinemark Holdings (NYSE:CNK) President and CEO Sean Gamble said the firm has seen improvements in some of the cost pressures on the expense side.
Gamble explained that Cinemark was previously facing cost pressures due to the "really tight labor market" and that it had faced "a more challenging supply chain environment where things were disrupted in the flow of goods."
While "that has certainly improved," the Cinemark CEO told JPMorgan he noted that the firm is "clearly still contending with this higher inflationary environment that still is persisting."
"Even though they're improved, we're still seeing a slight uptick from where we were prior to the pandemic," said Gamble, pointing to wage inflation, utilities, and various categories within food and beverage.
In order to combat the slight uptick, Cinemark is leaning into different productivity initiatives to try to improve margins. However, he added that the cinema chain is still dealing with a shortage of people going back to work, although it "has normalized" when it comes to the level of staff they need.
Later in the session, Gamble told listeners that the company's goal is to return its margins to 20% or higher, even if it finds itself with a depressed level of attendance relative to pre-pandemic levels.
Even so, Cinemark is "dealing with some of these more near-term cost pressures," which Gamble stated, "create a little bit of a headwind."