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Cineworld plans for July opening, stock jumps by a quarter

Mohit Oberoi
Author: Mohit Oberoi

Last Updated: May 28, 2020

Cineworld, the world’s second-largest cinema chain, said it has secured new funding from its lenders and is hoping to reopen all of its sites in July.

The chain, with 787 sites across 10 countries, has secured a waiver on loan covenant and it has agreed $110m of extra liquidity through an increase in its revolving credit facility, it said in a trading update on Thursday.

It has also secured credit committee approval to apply for an additional $45m through the Coronavirus Large Business Interruption Loan Scheme in the UK.

Cineworld, which had a $3.5bn net debt pile as at 31 December, saw its entire 9,500 screens close due to the coronavirus crisis and lockdowns by the end of March.

“Cineworld currently anticipates that government restrictions related to cinemas will be lifted in each of its territories by July,” the group said in its update. It added it would introduce new procedures to ensure the safety of customers and staff.   The groups’ stock was 24% higher at 95.7p on Thursday afternoon in London.

The chain, which also owns the Regal and Picture House brands, said two of the big films slated for release in the summer are the new Chris Nolan movie Tenet and Mulan, a new Disney adventure movie.

Rival Vue also plans to reopen its cinemas in July with social distancing norms.

Cineworld, that largest chain behind AMC Theaters, has 546 sites are in the US, which accounted for 73% of Cineworld’s revenues last year. It has 128 sites in the UK and Ireland, accounting for 15% of its revenues in 2019.

Regal is Cineworld’s biggest brand with 546 sites and 7,178 screens. Cineworld and CinemaCity hold the joint second place with 102 sites each. Yes Planet and Picture House are Cineworld’s other two brands.

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Mohit Oberoi

Mohit Oberoi is a freelance finance writer based in India. he has completed his MBA with finance as majors and also holds a CFA charter. He has over 13 years of experience in financial markets. He has been writing extensively on global markets for the last six years and has written over 6,500 articles. He mainly covers metals, electric vehicles, asset managers, and other macroeconomic news. He also loves writing on personal finance and topics related to valuation.

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