Cineworld has warned audience numbers have been weaker than expected and predicted they will stay low until November due to “limited” film releases.
The world’s second-largest cinema business said it is now assessing options to shore up its finances as a result.
The group, which also owns the Picturehouse chain in the UK and Regal Cinemas in the US, had pinned its hopes on releases such as Top Gun: Maverick , The Batman, and Thor : Love And Thunder to aid its recovery from the heavy impact of the pandemic.
However, in a statement the firm said: “Despite a gradual recovery of demand since reopening in April 2021, recent admission levels have been below expectations.
“These lower levels of admissions are due to a limited film slate that is anticipated to continue until November 2022 and are expected to negatively impact trading and the group’s liquidity position in the near term.”
Cineworld said it would continue with cost-saving plans but would also look at new options to improve its financial position. The business, which was saddled with £4bn of debt at the end of the last financial year, is in talks with stakeholders over potential funding or considering restructuring its balance sheet.
Liberum analyst James Wheatcroft said its heavy debt burden means a balance sheet restructuring would “likely leave little for existing Cineworld shareholders”.
Cineworld said: “The group’s business operations are expected to remain unaffected by these efforts and Cineworld expects to continue to meet its ongoing business counterparty obligations. Cineworld continues to welcome guests to its cinemas across its global markets as normal, without disruption.”
It comes after the business posted a narrowed loss of £429m in 2021, compared to a £2.2bn loss in 2020, as revenues were boosted by higher admissions. following the re-opening of theatres after Covid-19 lockdowns.
Cineworld has around 130 UK venues in locations such as London, Glasgow, Middlesbrough, Bolton, St Helens, Newcastle, Bristol, Newport, Birmingham, Hull and Plymouth, where it only opened in the city centre’s £53m Barcode development in late 2019.
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