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Exhibition giant and Regal owner Cineworld Group said Friday that it turned cash flow positive in the fourth quarter thanks to improved revenue and cost controls and touted nearing pre-coronavirus pandemic revenue levels in December, helped by the likes of the newest Spider-Man movie.
The cinema group, led by CEO Moshe “Mooky” Greidinger, also confirmed that it served its notice of appeal of an Ontario court decision against it over abandoning the planned acquisition of Canada’s Cineplex. The court had ordered it to pay Can$1.23 billion ($957 million) in damages to Cineplex.
The U.K.-based company, the second-largest cinema chain in the world behind AMC Theatres, had in late 2021 highlighted that it generated positive cash flow in October, calling this “an important milestone in the company’s recovery” from the pandemic. Given the company’s high debt load, generating positive cash flow is a particular focus for management.
Cineworld on Friday reiterated a previous comment that its box office and concession revenue for October 2021 amounted to 90 percent of the figure for the same month in the pre-coronavirus pandemic year 2019, up from the 60 percent reached in September, 54 percent in August and 50 percent in July.
And it added that in December, it reached 88 percent of December 2019 revenue on a constant currency basis, compared to 2019, after its performance had weakened in November to 56 percent. In the U.S., December revenue even hit 91 percent of the same month’s revenue in 2019, compared with 89 percent in the U.K. and Ireland, as well as 72 percent in its “rest of the world” segment.
It also lauded positive revenue trends, along with continued challenges. “This recovery has been driven by an excellent slate of movies, including record-breaking Spider-Man: No Way Home, Shang-Chi and the Legend of the Ten Rings, Venom, Black Widow, Dune, Free Guy, Eternals and No Time to Die,” the company said. In its rest of the world unit, “November and December’s performance was impacted by government restrictions due to the COVID-19 situation,” it noted. After all, the Omicron variant of the coronavirus led to renewed cinema closures in various markets around the world.
“Performance and attendances have steadily grown,” Cineworld summarized the overall trends. “Changes in the film slate for November, mainly due to Top Gun: Maverick moving to May 2022, impacted the gradual recovery seen since reopening. December was particularly strong, supported by the success of Spider-Man: No Way Home across all territories, becoming the first film to gross more than $1.5 billion at the box office since the onset of the COVID-19 pandemic,” it added.
“We are pleased to see continued strong demand amongst audiences for cinema experiences, supported by a slate of high-quality and high-performing movies,” said Greidinger. “This demonstrates that fans are continuing to choose the unrivalled theatrical experience. We have seen recovery in theater attendances across our geographies, which generated a positive cash flow performance for the fourth quarter.”
He added: “Spider-Man: No Way Home has shown the importance for studios of cinematic releases. Whilst there are challenges ahead, we are excited to welcome customers to our cinemas to enjoy the highly anticipated slate of movies throughout 2022.”
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