The future of Regal Cinemas is looking pretty grim. Cineworld Group, the exhibition giant and parent company to Regal, reported a loss of a whopping $1.6 billion in the first half of 2020, with “no certainty” as to what impact the pandemic could have on the company in the future. With a major chain like Regal on its knees, it doesn’t bode well for the theater exhibition business, as studios become increasingly reluctant to release any more major titles this year.
In a conversation with investors (via The Hollywood Reporter), CEO Moshe Greidinger revealed that Cineworld took an after-tax loss of $1.58 billion over the past six months. But Greidinger expressed some hope that, with theaters beginning to reopen and only a few major markets like Los Angeles and New York still closed, the worst is behind them. But the CEO wouldn’t make any guarantees, noting that there is “no certainty” about the Regal Cinemas future amid the ongoing coronavirus (COVID-19) pandemic.
“There can be no certainty as to the future impact of COVID-19 on the group,” 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.”
Greidinger said theater reopenings show that “people are missing the cinema,” even though Tenet, Warner Bros.’ major tentpole that was expected to “save” cinemas, underperformed domestically and might have even hurt theaters, which were forced to operate at a loss. But Cineworld, which is the second-largest cinema chain in the world after AMC Theaters, is chugging with 561 out of its 778 locations reopened as of this week, with 200 theaters in the U.S. (mostly in California and New York) still closed.
But we’re already seeing Hollywood studios pushing their major releases from 2020 to 2021, like Disney’s Black Widow and West Side Story, and Universal’s Candyman. THR reports that Cineworld expects the next big release to be No Time to Die in mid-November, but the new James Bond film is as of now the only major release still slotted for that month apart from Pixar’s Soul, and will likely vacate it soon. Can theaters like Regal Cinemas survive going forward? Cineworld, which earlier this year had warned that it might go out of business if it didn’t negotiate new terms with lenders, seems optimistic it can secure more money if theaters are forced to close again.
“The expectation of the directors is that waivers will be obtained based on the current status of the negotiations with the group’s lenders and therefore the interim financial statements have been prepared on a going concern basis,” Greidinger explained.
Essentially, Cineworld assures that if it needs more money, it will get it. Looking at the sparse 2020 fall schedule, it will probably need that money soon.
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