Cineworld, the UK parent company of Regal Cinemas, confirmed on Monday that the debt-ridden company was consider bankruptcy in the United States as one of many “strategic options to both obtain additional liquidity and potentially restructure its balance sheet”.
The second largest movie theater chain in the world, response to a published report in Friday’s Wall Street Journal, said it remains “in discussions with many of its key stakeholders, including its secured lenders and their legal and financial advisors.” The company also stressed that its theaters “are open as usual and continue to welcome guests.”
Last Wednesday, the company announced it was in the midst of a liquidity crunch exacerbated by what it called weaker-than-expected ticket sales in recent months due to limited new studio content. .
Cineworld’s share price fell by more than half last Wednesday. Shares have since cratered from £20.80 at market close on Tuesday to £2.99 in early trading on Monday on the London Stock Exchange.
Regal Cinemas has been hit hard by the pandemic, losing $3 billion in 2020 and nearly $710 million pre-tax in 2021. Through the end of May this year, only 28 movies debuted in wide release compared to 42 films over the same period in 2019.
While the year-to-date US box office ($5.12 billion) is up 176% from a pandemic-starved 2021, ticket sales are still nearly 32% behind the 2019 record and 36% behind 2018 in the same period. Even blockbusters like “Top Gun: Maverick” weren’t enough to improve exhibitor sales.