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Bond boost helps Cineworld top 2019 sales in UK for first time since pandemic hit

·2-min read
 (ES Composite)
(ES Composite)

Cinema has had a turbulent year but James Bond has indeed come to the rescue of one of the sector’s biggest chains.

Screen giant Cineworld said on Monday that UK and Ireland sales in October soared 27% above those seen in October 2019.

Over the past two months studios finally began to release long-awaited films, and ticket sales for Daniel Craig’s final outing as 007 have boomed since its release.

Other major movies turbo-charging operators’ revenues include Denis Villeneuve’s Dune and Marvel movie Venom.

CEO Mooky Greidinger said: “We are thrilled to see audiences returning in significant numbers. Our partnerships with the studios are as strong as ever and with the incredible movie slate to come, there are real grounds for optimism in our industry.”

Further blockbusters set for a pre-Christmas release include Spider-Man: No Way Home, Top Gun: Maverick, The Matrix Resurrections and Ghostbusters: Afterlife.

The robust revenue performance comes despite concerns over shortening cinema exclusivity windows. Dune was released for streaming in the US after just a few weeks in cinemas only.

Cineworld also owns the Picturehouse and the US’ Regal chains, and the US represents around 75% of its market.

The FTSE 250 chain today said its US revenues were still 20% down on 2019 levels in October, with overall group sales 10% down.

Cineworld revealed an eye-watering $3 billion 2020 loss in March. In August it reported an operating loss of nearly $209 million for the six months to July, and said it had amassed an $8.4 billion net debt pile.

The chain has sought bail-outs from multiple investors of around £1 billion since the pandemic hit -including raising around £560 million in liquidity in November 2020 when it came close to collapse.

But today the company revealed that recovering ticket sales combined with cost-savings measures saw it return to generating positive cash flow in October.

Paul Rudd a Mr. Gary Grooberson in Ghostbusters afterlife
Paul Rudd a Mr. Gary Grooberson in Ghostbusters afterlife

It was the first time the firm had returned to the black since Covid hit, and bosses called it “an important milestone in the company’s recovery”.

Cineworld said its revenue performance for the four months to October 31 “has been underpinned by discipline on costs where the company has been focused on streamlining operations wherever possible”, despite “some inflationary cost increases”.

Like other leisure firms, the chain will be facing increasing wage bills and utilities costs.

Jefferies’ James Wheatcroft said Cineworld’s sales growth trends reported this morning “significantly undermine the debate around cinema’s consumer relevance post-pandemic”.

Tom Cruise returns as Capt. Pete
Tom Cruise returns as Capt. Pete

In a note entitled “roll out the red carpet”, he pointed out that Cineworld’s main markets - the US, UK and Israel - are countries with high vaccination rates, making severe restrictions being re-implemented this winter less likely.

He said: “With operating and financial leverage, plus encouraging box office trends, Cineworld is well-placed to capitalise on the consumer return to cinemas.”

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