In-theater advertising firm National CineMedia has swung to a second-quarter loss on sharply lower revenues as major cinema chains face an uncertain reopening amid the novel coronavirus pandemic.
The company recorded a net loss of $13.8 million, or 18 cents per share, against a year-earlier profit of $8.9 million, or 11 cent per share. Revenue for the quarter was $4 million, down 96 percent against a year-earlier $110.2 million, following the mid-March shuttering of theater circuits, which now face an uncertain reopening across the U.S.
“Almost all of these closures continued throughout the entirety of the company’s second quarter of 2020 and remain closed as of the date of this press release. Due to these closures, the company was unable to advertise in the theaters and did not generate any in-theater revenue during the three months ended June 25, 2020,” National Cinemedia reported on Monday.
The reopening of movie theaters has been complicated by the Hollywood studios’ release schedule being thrown into disarray by a recent surge in COVID-19 cases, pushing back such tentpoles as Disney’s Mulan and Warner Bros.’ Tenet.
National Cinemedia CEO Tom Lesinski in a statement said his company has sufficient liquidity to withstand prolonged closures of the local multiplex, but the same cannot be said of all the major circuits in which the company advertises.
“We believe that the exhibition industry has historically fared well during recessions, and management remains optimistic, though cannot guarantee, that the founding members and network affiliates will rebound and attendance figures will benefit from pent-up social demand as state and local restrictions and other social distancing orders subside and people seek togetherness with a return to normalcy,” National Cinemedia said in a statement.
