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Cineworld eyes US listing to bolster pandemic-strained finances

Cinema chain reports $576m first-half pretax loss, expects release window to stabilise

Cineworld on Parnell Street in Dublin. Photograph: Cyril Byrne

Thu Aug 12 2021 - 09:53

Cineworld said on Thursday it was considering a plan to list its shares on Wall Street or partially float its movie chain Regal as it seeks to shore up its finances, at a time when it is burning through millions of dollars every month.

Laying out the rationale in its first-half results, Cineworld said the US markets were the largest and most liquid in the world and include a large number of publicly-listed cinema companies. Its shares jumped 6 per cent in early trading on the news.

Cineworld, the world's second-largest cinema chain after AMC, has got the lion's share of its revenue from the United States since its purchase of Regal in 2018.

The company, saddled with net debt of $8.44 billion as of the end of June, said cash burn was $271 million in the first half of the year, averaging at about $45 million (€38 million) a month. Losses narrowed to $576.4 million from $1.64 billion last year.

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Cineworld had to close almost all its cinemas at one point last year, leaving thousands of people out of work, as it took drastic measures to preserve cash to get through the crisis.

All its cinemas were open as of June, with the US and the UK having eased pandemic restrictions as vaccinations picked up pace. That in turn saw the release of multiple high-profile movies, which had been repeatedly delayed as studios waited for theatres to reopen.

Cineworld boss Mooky Greidinger told Reuters that ticket sales were currently running at more than 50 per cent of pre-crisis levels.

AMC, one of the “meme stocks” at the centre of a boom in small-time investing this year, posted a huge quarterly loss earlier this week, saying ticket sales were running at less than a third of pre-pandemic levels in the second quarter.

People returned to cinemas to watch movies such as Marvel's Black Widow, Paramount thriller A Quiet Place 2 and horror flick The Conjuring: the Devil Made Me Do It after being stuck at home for months.

However, concerns over new variants of the coronavirus and an accelerated shift by studios to release movies simultaneously on streaming platforms and in theatres are still a cause for concern.

Cineworld said it was expecting the window for movie releases in theatres to stabilise to somewhere between 20 and 60 days by next year, but subject to each film’s potential. – Reuters

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