The cinema giant, led by CEO Mark Zoradi, has been hit hard by the novel coronavirus, just like other exhibitors.
Cinema giant Cinemark Holdings swung to a loss for the first quarter due to the initial financial hit from the novel coronavirus pandemic starting in mid-March.
The company, led by CEO Mark Zoradi, also said it plans to reopen its U.S. circuit in several phases starting on June 19. It didn't immediately detail any plans for the reopening of its cinemas in Latin America. Like other exhibitors, Cinemark had delayed its quarterly earnings report amid the virus crisis.
It posted a quarterly loss of $59.6 million, or 51 cents per share, compared with a profit of $32.7 million in the year-ago period, or 28 cents a share. Adjusted earnings before interest, taxes, depreciation and amortization, another profitability metric, fell to $66.2 million from $152.3. Revenue dropped 24 percent from $714.7 million to $543.6 million.
"As a direct result of the global COVID-19 pandemic, we were forced to close all of our theaters in the middle of March, which had a significant impact on our first-quarter results and continues to impact us today," said Zoradi. "We are looking forward to welcoming our guests and team members back to our theaters and are pleased to have now shifted our attention to domestic re-opening, which we plan to initiate in a multi-phased approach beginning June 19.”
He added: "Our heightened sight and sound technology, giant screens and shared communal auditoriums provide a deeply immersive entertainment experience, as well as a transcendent escape from reality, that simply cannot be replicated at home. After months of home-sheltering, I am optimistic that these unparalleled factors offer movie-goers a much-needed relief that bodes well for Cinemark, and our industry as a whole, as theaters re-launch.”
Zoradi in mid-April had predicted it would take up to four months for shuttered cinema screens to fully reopen as the COVID-19 crisis recedes, likely starting July 1. "A return to normalcy may span multiple months driven by staggered theater openings due to government limits, reduced operating hours, lingering social distancing and a ramp-up of consumer comfort with public gatherings," he said in a call with Wall Street analysts.
Cinemark last month laid off more than 17,500 domestic hourly theater employees, furloughed 50 percent of its headquarters corporate employees at 20 percent of salary and cut the salaries of its remaining employees by half.
Cinemark said Wednesday that for the first quarter ended March 31, U.S. admissions revenue fell 25 percent to $232.3 million and U.S. concession revenues dropped 23 percent to $152.8 million. U.S. attendance hit 27.9 million patrons, down 28 percent, while the average ticket price increased 4.4 percent to $8.33 and concession revenues per patron increased 6 percent to $5.48.
MKM Partners analyst Eric Handler said in a first reaction: "Since these numbers are now more than three months old and theaters have been closed since mid-March, we doubt investors are going to be paying much attention to these results. Instead, we believe investors will be more focused on management's forward-looking statements about the gradual reopening of its business."
