September 24, 2020
With a business model on involuntary lockdown since mid-March due to the coronavirus pandemic, Cineworld Group Plc, the London-based parent of U.S. theatrical chain Regal Cinema, reported a $1.58 billion pre-tax loss for the fiscal half-year, ended June 30. The chain reported a profit of $117.4 million during the previous-year period.
Revenue fell to $712.4 million, down 66% from $2.1 billion the same period last year. Ticket sales fell 65% to 47.5 million, from 136 million.
CEO Mooky Greidinger said the impact of COVID-19 on the company’s business and the wider leisure industry has been substantial. He said the company has raised $360.8 million of liquidity to support the operations going forward.
“During this unprecedented time, our priority has been the safety and health of our customers and employees, while at the same time preserving cash and protecting our balance sheet,” Greidinger said in a statement. “Our mitigating actions included reducing and deferring costs where possible; making use of government support schemes for our employees; partially delaying capital investments; and suspending our dividend.”
Greidinger said Warner Bros.’ thriller Tenet from director Christopher Nolan has shown promise returning consumers to theaters. The movie has generated more than $250 million at the global box office, including topping $30 million in the U.S. — despite most screens in California and New York remaining shutdown.
“There can be no certainty as to the future impact of COVID-19 on [Cineworld],” Greidinger said. “If governments were to strengthen restrictions on social gathering, which may therefore oblige us to close our estate again or further push back movie releases, it would have a negative impact on our financial performance and likely require the need to raise additional liquidity.”