There may be hope for movie theaters yet after Regal Cinemas parent Cineworld Group(OTC:CNNW.F) said it is experiencing “many shows that were sold out,” albeit in accordance with social distancing guidelines.
CEO Mooky Greidinger told CNBC’s Closing Bell this morning that “people really missed the cinemas and wanted to go back into the big screen.”
Image source: Getty Images.
An intimate setting
The industry was devastated when the coronavirus pandemic closed theaters for five months. Cinemark Holdings(NYSE:CNK) recently announced that to have enough cash to stay afloat it needed to issue $400 million worth of debt that could be converted into stock, adding to the $3.1 billion of debt it already carries.
AMC Entertainment Holdings(NYSE:AMC), the world’s biggest theater operator, nearly went bankrupt before working out an agreement with its lenders. And it recently agreed to narrow the window of exclusivity for Universal Pictures movies to just 17 days in exchange for a cut of the profits when the movies are released to streaming platforms.
The theater operators have been counting on Hollywood to lift them out of the trash bin, but studios have been postponing the release of potential blockbusters until conditions are more stable. Although there are a few big-budget movies out, like Unhinged and Tenet, which will open in the U.S. on Sept. 3, theaters are running many older films, and AMC recently reopened its theaters with $0.15 movie tickets to attract moviegoers. So Cineworld’s results are encouraging.
The caveat is that AMC, Cinemark, and Cineworld have agreed to abide by 30% to 50% seating capacity limitations, meaning a “sold out” show can range from just a dozen people to 100 or so.
Cineworld operates around 800 theaters globally and 550 in the U.S. About 190 of its Regal Cinemas have reopened here.