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Cineworld revenues recovering amid 'excellent' film slate
15th Nov 2021 07:51
(Sharecast News) - Cineworld said on Monday that box office and concession revenues in October were at 90% of pre-Covid levels as "an excellent slate of films" drove a recovery.
In an update on trading for the four months to the end of October, the company said that since reopening in April, performance and attendances have grown steadily. Customer demand has been particularly strong in a number of its markets, in some cases even above the levels seen in 2019, it said.
In October, revenues in the US were at 80% of pre-pandemic levels, while Rest of World revenues were at 84%. The performance in the UK and Ireland was particularly strong, with revenues at 127% of pre-Covid levels.
The performance was driven by films such as Black Widow, No Time to Die and Dune, among others. Cineworld also pointed out there are still major blockbusters set to be released this year, such as the Ghostbusters: Afterlife, Encanto, Spider-Man: No Way Home, The King's Man, Sing 2 and The Matrix Resurrections, which it expects to perform "very well subject to there being no deterioration in the COVID-19 situation".
Chief executive officer Mooky Greidinger said: "We are thrilled to see audiences returning in significant numbers. Our partnerships with the studios are as strong as ever and with the incredible movie slate to come, there are real grounds for optimism in our industry.
"I would especially highlight the great performances we saw from our newly refurbished cinemas in the US. These new cinemas clearly support our strategy to enhance the cinema experience for all our customers."
At 0925 GMT, the shares were up 13% at 71.12p.
Russ Mould, investment director at AJ Bell, said: "James Bond has come to the rescue of Cineworld, helping its UK and Irish cinemas in October to beat box office and concession revenue levels seen in the same month two years earlier, before the pandemic struck.
"No Time To Die has encouraged people to try the cinema again, although the master spy was unable to crack the code for similar success in the US and other Cineworld territories where October's takings didn't surpass the comparative period two years earlier.
"Nonetheless, the direction of travel for Cineworld's revenue on a group basis is positive with the percentage of sales versus the same period in 2019 increasing month-on-month since July.
"The success of a cinema is highly dependent on the quality of the film slate and there have been some big-name productions helping to get punters through the doors, including Dune and Venom. The release schedule looks fairly promising for the months ahead, so barring a new flare-up of Covid cases and renewed lockdown measures cinemas look like they are in a better place."
Mould said the one thing missing from Cineworld's update was the profit figure. "We know the company has been trying to strip out costs, but it also has inflationary pressures and oodles of debt that needs repaying.
"Now is not the time to push through big ticket price hikes. Not only are family finances under pressure from higher energy, fuel and food bills, but cinema operators also need to use cheaper prices as a way of attracting anyone still on the fence about wanting to spend two hours in a confined space with a load of strangers."
In an update on trading for the four months to the end of October, the company said that since reopening in April, performance and attendances have grown steadily. Customer demand has been particularly strong in a number of its markets, in some cases even above the levels seen in 2019, it said.
In October, revenues in the US were at 80% of pre-pandemic levels, while Rest of World revenues were at 84%. The performance in the UK and Ireland was particularly strong, with revenues at 127% of pre-Covid levels.
The performance was driven by films such as Black Widow, No Time to Die and Dune, among others. Cineworld also pointed out there are still major blockbusters set to be released this year, such as the Ghostbusters: Afterlife, Encanto, Spider-Man: No Way Home, The King's Man, Sing 2 and The Matrix Resurrections, which it expects to perform "very well subject to there being no deterioration in the COVID-19 situation".
Chief executive officer Mooky Greidinger said: "We are thrilled to see audiences returning in significant numbers. Our partnerships with the studios are as strong as ever and with the incredible movie slate to come, there are real grounds for optimism in our industry.
"I would especially highlight the great performances we saw from our newly refurbished cinemas in the US. These new cinemas clearly support our strategy to enhance the cinema experience for all our customers."
At 0925 GMT, the shares were up 13% at 71.12p.
Russ Mould, investment director at AJ Bell, said: "James Bond has come to the rescue of Cineworld, helping its UK and Irish cinemas in October to beat box office and concession revenue levels seen in the same month two years earlier, before the pandemic struck.
"No Time To Die has encouraged people to try the cinema again, although the master spy was unable to crack the code for similar success in the US and other Cineworld territories where October's takings didn't surpass the comparative period two years earlier.
"Nonetheless, the direction of travel for Cineworld's revenue on a group basis is positive with the percentage of sales versus the same period in 2019 increasing month-on-month since July.
"The success of a cinema is highly dependent on the quality of the film slate and there have been some big-name productions helping to get punters through the doors, including Dune and Venom. The release schedule looks fairly promising for the months ahead, so barring a new flare-up of Covid cases and renewed lockdown measures cinemas look like they are in a better place."
Mould said the one thing missing from Cineworld's update was the profit figure. "We know the company has been trying to strip out costs, but it also has inflationary pressures and oodles of debt that needs repaying.
"Now is not the time to push through big ticket price hikes. Not only are family finances under pressure from higher energy, fuel and food bills, but cinema operators also need to use cheaper prices as a way of attracting anyone still on the fence about wanting to spend two hours in a confined space with a load of strangers."