Cineworld is doing everything it can to get people through the door, including discounts on memberships, drinks promotions, and a message of reassurance that the staff are trying to keep people safe and that its cinemas are clean.
“Yet you can’t get over fact that the film slate will always be the primary attraction and there currently isn’t the pulling factor,” according to Russ Mould from AJ Bell.
“Tenet had all the explosions and tension you want in a blockbuster film, but plot confusion meant mixed word of mouth and so ticket sales have underwhelmed. Disney’s Mulan has gone straight to streaming and another potential family favourite, Wonder Woman 1984, has been delayed until Christmas.
“In the hours since Cineworld signed off its trading update, two more big name films, West Side Story and Black Widow, have been pushed back to 2021. Ultimately there isn’t anything out now or coming very soon that will really make people want to take the risk of sitting in a room with a load of strangers for two hours. If the new James Bond film No Time To Die gets pulled from its November release date then the cinema industry is really in trouble.
“Cineworld must contend with the growing risk that governments in its operating countries could strengthen restrictions on social gathering. That would dampen the chances for getting people in front of the big screen and make film studios more nervous about releasing big films at a sensitive time.
“Cineworld says this situation would ultimately have a negative impact on its financial performance and likely require the need to raise additional liquidity. That’s a dangerous situation given it is already up to its eyeballs in debt. Shareholders have been supportive to date but at some point, they might have to question whether they’re simply throwing money away.
“Management says current trading is encouraging but that’s off a base where expectations are rock bottom. Cineworld is walking a very long tightrope with the winds picking up that could knock it and the cinema industry down.”