U.K. Exhibitor Cineworld Posts Higher First-Half Financials
Average ticket prices rose, but admissions dropped at the movie theater giant, which said the Summer Olympics had less of an impact than feared.
LONDON - U.K. movie theater giant Cineworld Group on Thursday reported improved financials for the first half of the year.
The largest cinema operator in the U.K. also said that the negative impact of the Summer Olympics on moviegoing wasn't as major as originally feared and emphasized it is on track to report full-year results in line with expectations.
Cineworld reported first-half revenue growth of 1.1 percent to £165.4 million ($260 million) driven by a 4 percent increase in box office receipts to £118.6 million ($186 million).
The group's average ticket price grew by 4.9 percent to £5.15 ($8.08), but admissions dropped 0.8 percent.
The box office gain came thanks to "the phenomenal success" of Avengers Assemble, "good film performances from Men in Black 3, The Hunger Games and Prometheus, as well as a number of mid-range films, which produced better than expected performances," the company said.
Operating profit jumped 21.5 percent to £15.8 million ($24.8 million), while earnings before interest, taxes, depreciation and amortization rose 2.3 percent.
"Once again our results show that cinema is a resilient investment in challenging economic times," Cineworld CEO Stephen Wiener said. "Film releases at the start to the second half of 2012 have performed in line with expectations and we remain confident of delivering growth in line with full-year market expectations."
Recent titles include The Amazing Spiderman, Ice Age 4, The Dark Knight Rises and Ted. "The fourth quarter will bring an exciting line up of releases with titles such as Twilight Saga: Breaking Dawn Part 2, the next Bond film Skyfall and The Hobbit," the CEO said.
In a Sky News interview, Wiener was asked about the Olympics' impact. "It wasn't as bad as we originally thought it would be," he said, adding that the Summer Games' final weekend had the biggest effect. But since the end of the Olympics, people are "rushing out to see movies" again, he said.
In an earnings statement, Wiener also said that "the performance of 3D has been stabilizing over the last 12 months." There were 15 film releases in 3D during the first half of 2012, compared with 17 last year. They accounted for approximately 15 percent of Cineworld's admissions for the first half, down from 17 percent in the opening half of 2011.
"Film studios are becoming increasingly adept in discerning the genre and target audience of 3D films," Wiener said. "The quality of 3D film product remains absolutely critical. There are expected to be around 18 3D film releases in the second half, compared with 20 3D films in the same period last year."