Beleaguered Cineworld says ticket sales haven’t rebounded fast enough despite surge in big-budget films
- Attendance increased 487% to reach 82.8 million in the first six months of 2022
- Movie operators face massive competition from streaming platforms.
- Cineworld Group filed for Chapter 11 bankruptcy in the US earlier this month
Cineworld Group says ticket sales have not recovered as quickly as expected despite the lifting of Covid-related restrictions.
The struggling cinema chain said demand in its biggest market, the US, had a slow start to the year due to the emergence of Omicron variants and a shortage of major new blockbusters.
As lockdowns have been lifted, attendance has increased significantly, rising 487% to 82.8 million in the first six months of 2022, but still almost 40% below pre-pandemic numbers It was something.
Recovery: Cineworld ticket sales surged 487% to 82.8 million in the first six months of 2022, but were still nearly 40% below pre-pandemic sales volumes
Cineworld now warns that it expects total attendance to fall below 2019 levels over the next two years.
Film operators have struggled over the past few years with audience shortages and forced shutdowns, as well as increasing competition from popular streaming platforms such as Netflix and Amazon Prime.
Cinemaworld’s financial pressures have been exacerbated by its £2.7 billion acquisition of debt-laden American chain Regal Entertainment in 2017, making it the world’s second-largest cinema chain.
Big-budget sequels like The Batman, Top Gun: Maverick, and Doctor Strange in the Multiverse of Madness delivered much-needed revenue boosts.
As a result, revenue increased 417% to over $1.5 billion and after-tax loss decreased 43% to $293.8 million.
However, the weaker-than-expected recovery in demand caused the company to lose an additional $144.9 million in cash, lowering its near-term and medium-term outlook.
Three weeks ago, the company filed for bankruptcy in the United States to embarked on a restructuring, slashing a large amount of debt and accessing short-term liquidity.
Alicia Kornasiewicz, Chairman of Cineworld Group, said:
“This has prompted us to begin the restructuring process of Chapter 11 in the United States, which will help us build a more effective business and strengthen our capital structure to better position Cineworld for the future. The purpose is that.”
The London-listed company posted strong results in the final quarter following the winter releases of numerous blockbusters, including Black Adam, superhero movie Black Panther: Wakanda Forever, and adventure epic Avatar: Way of Water. I expect it to go up.
However, eToro analyst Adam Vettese said that given the cost-of-living crisis and competition from streaming services, Cineworld’s “might likely come to an end.”
He added: “The pandemic has been nothing more than a major stimulus for consumers who have long begun to change their habits of consuming movies. It looks like it’s spinning.
Shares of Cineworldgroup Friday closed 5.6% lower at 2.93p. Since early 2022, its value has plummeted by about 90%.
https://www.dailymail.co.uk/money/markets/article-11265747/Cineworld-says-ticket-sales-failed-recover-fast-enough.html?ns_mchannel=rss&ns_campaign=1490&ito=1490 Cineworld says ticket sales failed to recover quickly enough