Cineworld pinches hopes for more blockbusters in 2022 as debt mounts

FILE PHOTO: People enter a Cineworld cinema, near Manchester, following the outbreak of the coronavirus disease (COVID-19).
FILE PHOTO: A Cineworld cinema near Manchester, Britain October 4, 2020. REUTERS/Phil Noble

March 17, 2022

By Yadarisa Shabong and Pushkala Aripaka

(Reuters) – Cineworld on Thursday said it was confident that a bigger slate of films in 2022 would help the British cinema chain recover from a two-year hiatus, although mounting debt remained a challenge.

Cineworld, the world’s second-largest cinema chain with over 9,000 screens worldwide, said its 2021 losses narrowed to $708 million from about $3 billion in 2020, due in part to the Marvel superhero blockbuster “Spider-Man: No Way Home”.

This year she’s betting on sequels like James Cameron’s Avatar 2 and Tom Cruise in Top Gun: Maverick, as well as several Marvel movies.

But any film delays and further COVID-19 restrictions that could affect ticket sales pose a risk to its ability to repay loans due in June and early 2023, Cineworld said.

Net debt was $8.9 billion at the end of December, up about $600 million from 2020. Refinitiv data showed that its credit score had dropped to 1, the lowest on a scale out of 100, meaning it would most likely become insolvent in the next year.

Cineworld’s setbacks include a potential multimillion-dollar fine in a dispute with Canadian company Cineplex and late payments to disgruntled former shareholders of its US chain Regal.

Cineworld has warned that it would not have sufficient liquidity to pay the C$1.23 billion (US$971 million) in damages sought by Cineplex if its appeal to the court is unsuccessful.

It is now seeking new sources of liquidity after raising over $425 million last year, it said Thursday.

Cineworld, which operates in 10 countries including the United States and the United Kingdom, admitted 95 million admissions in 2021, a 75% increase from 2020 but well below the 275 million pre-pandemic viewers.

($1 = 1.2669 Canadian Dollars)

(Reporting by Pushkala Aripaka and Yadarisa Shabong in Bengaluru; Editing by Subhranshu Sahu) Cineworld pinches hopes for more blockbusters in 2022 as debt mounts


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