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I can't take it anymore! The world's second largest theater operator files for bankruptcy, Cineworld: It has received about $785 million in "first day" relief to support operations The epidemic has hit the film and television industry hard, and the world's second largest theater operator has filed for bankruptcy. CCTV Finance reported that on September 7, local time, Cineworld filed for bankruptcy protection in a Texas court, due to the slow recovery of moviegoers and extremely tight company funds. Cineworld warned last month that more than a year later since cinemas reopened in April 2021, attendance is still lower than expected. Earlier on August 19, CCTV Finance quoted the Wall Street Journal as reporting that Cineworld would file for bankruptcy in the next few weeks. Affected by this news, the share price of Cineworld in the London market, England, fell by more than 81%. As of the latest close, Cineworld shares are still lower, down 7.94% in a single day. Cineworld hopes to complete the bankruptcy reorganization by the first quarter of 2023, stressing that the theater business will not be affected during the period. Cineworld said on Friday that it had received court approval for "day one" relief from the U.S. Bankruptcy Court, allowing the company to immediately draw about $785 million from a $1.94 billion line of credit to support operations. Cineworld said it expects to emerge from Chapter 11 bankruptcy protection in the first quarter of 2023 and intends to pay full wages to all suppliers and regular wages to employees in the process. Cineworld expects the restructuring will significantly reduce debt and improve balance sheet and liquidity positions. The company said any deleveraging deal would result in significant dilution of its existing stake, but filing for bankruptcy and reorganization is not expected to result in a suspension of its shares. In addition, Cineworld added that the group companies received commitments of $1.94 billion from existing lenders, and Cineworld is expected to operate its global operations and theaters as usual throughout the process. According to the data, Cineworld is the second largest theater operator in the world after AMC, with revenue of $4.37 billion in 2019 and more than 5,500 employees. Headquartered in London, England, the company was established in 1995 and listed on the London Stock Exchange in 2007, making it the first listed cinema company in the UK. Cineworld is popular with audiences in the UK and the US for its high cost-effectiveness, and a membership card costs around £19 a month for unlimited viewing. Cineworld merged Cinema City Group, the largest theater operator in Central and Eastern Europe in 2014, and acquired Regal Cinemas, the second largest theater chain in the United States, for US$3.6 billion in December 2017. Although it has contributed most of the profits since then, it also brought huge debt. In December 2019, Cineworld proposed to acquire the Canadian cinema chain brand Cineplex for 2.8 billion Canadian dollars, but then the new crown pneumonia outbreak broke out, the acquisition failed, and it also compensated 1.24 billion Canadian dollars in liquidated damages. Cineworld’s net debt stood at $8.9 billion at the end of 2021, and Cineworld’s shares have fallen about 90% this year. Looking back at the country, recently, the new crown epidemic has bloomed in many places across the country, and some theaters have faced closure due to the spread of the epidemic. A theater practitioner said that the epidemic came: the store was closed; the epidemic improved: the store opened, and there were no films to put on. It is difficult to wait until the middle of 2022, the blockbuster is long overdue, and it is difficult to save the market. On the evening of August 28, Wanda Films, the leading domestic cinema chain, disclosed its 2022 semi-annual report. In the first half of 2022, Wanda Films achieved operating income of 4.938 billion yuan, a year-on-year decrease of 29.79%; the net profit attributable to shareholders of listed companies was 581 million yuan, compared with 639 million yuan in the same period last year. In the first half of this year, the main products or services of Wanda Films include theatrical film screening, sales of merchandise, advertising, production and distribution of films and TV series, and game distribution. Among them, the movie viewing income still accounted for the "largest", at 2.978 billion yuan, accounting for 60.31% of the operating income, an increase of 2.87 percentage points compared with the same period of the previous year. According to the semi-annual report, affected by the epidemic in the first half of the year, about 410 of Wanda Films’ domestic theaters closed at the same time, accounting for 51% of its domestic theaters; the average single store was closed for about 42 days, and its theaters were distributed in the first and second tiers. Cities were more severely affected, resulting in a larger drop in Wanda's movie box office revenue. In fact, similar industry collapses have already been staged. In March 2021, Hong Kong's cinema chain UA Cinema, including 6 cinemas and 1 cinema, announced the closure of the entire line. In the same May, due to the impact of the new crown pneumonia epidemic, MBO, the third largest cinema chain in Malaysia, recently announced through its official website that it officially ended its business. Comprehensive article content: CCTV News, The Paper, 21st Century Business Report, etc. Editor in charge: Zhang Qianyao Proofreading: Zhao Yan |