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Cinema giant Cinemark Holdings reported a widened $208 million loss for the first quarter of 2021 due to the coronavirus pandemic after a year-ago loss of nearly $60 million.
“The company’s financial results continue to be impacted by the COVID-19 pandemic,” said the exhibitor, led by CEO Mark Zoradi. As of March 31, it had 301 domestic and 78 international venues open. The company has a particularly strong presence in Latin America.
In mid-March, Cinemark reopened its cinemas in the greater Los Angeles area with enhanced cleaning and safety protocols. Revenue for the first quarter fell to $114.4 million, compared with $543.6 million in the January-to-March period of 2020, which included the first COVID-related lockdowns in various parts of the world.
Zoradi said in Friday’s earnings update: “Over a year has passed since COVID-19 prompted the shutdown of our global circuit, and today I am pleased to report that we are now actively on the road to recovery.”
He added: “We are highly optimistic about theatrical exhibition’s resurgence in the U.S. over the coming months on account of a range of factors, including the rapid pace of the vaccine rollout, improving consumer sentiment about returning to movie theaters, recent box office successes and confirmation of consistent product supply. On a global basis, we remain confident that, like the U.S., other countries will quickly recover as lockdowns reign in the virus and vaccines are more widely disseminated.”
Zoradi had on the last earnings call predicted a return to a “normalized” domestic theatrical market in 2022.
MKM Partners analyst Eric Handler, who has a “neutral” rating on Cinemark, in his report previewing the latest results wrote: “As a broad-based box office re-opening moves closer to becoming a reality, Cinemark remains well-positioned to reemerge from the pandemic in a solid financial position. Furthermore, with management vigilantly focused on continued efforts to streamline expenses and improve productivity, there is optimism a return to normalized revenue and margin levels can be achieved in 2022 or 2023.”
Later Friday, Cinemark announced that it had reached new theatrical exhibition deals with Warner Bros., Disney, Paramount, Sony and Universal. While specifics weren’t revealed, Cinemark said the deals “secure a consistent supply of content and demonstrate a shared commitment to offering consumers the ultimate movie-viewing experience, with compelling content exhibited within the theatrical environment.”
“Cinemark is thrilled to have reached new agreements with our major studio partners, and we are eager to continue providing movie fans an immersive, larger-than-life cinematic environment to see major upcoming films, ranging from the biggest blockbusters to specialty fare to family-friendly content,” Zoradi added in a statement. “In our ongoing efforts to maximize attendance and box office during the pandemic and beyond, our goal is to provide the widest range of content with terms that are in the best long-term interests of Cinemark, our studio partners and moviegoers. We are pleased with these recent developments and are confident we are taking positive steps toward reigniting theatrical exhibition and evolving the industry for a post-pandemic landscape.”
May 7, 5:39 a.m. This story has been updated to note Cinemark’s new deal with the major movie studios.
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