Reprinted from The Hollywood Reporter by Georg Szalai on March 27, 2021.
Exhibition giant and Regal owner Cineworld Group on Thursday reported lower 2020 financials, including its first-ever full-year loss, due to the coronavirus pandemic, which left cinemas in many parts of the world closed for large parts of the year.
The UK-based company also said it has secured binding commitments for $213 million in additional cash via a bond to boost its financial flexibility “in the event of continued disruption as a result of COVID-19.” The funding and an expected $200 million US CARES Act tax refund “will provide the group with a liquidity runway to year-end in the event that cinemas remain closed,” it said, but it also warned of continued challenges and questions marks caused by the pandemic.
A year ago, Cineworld, the second-largest cinema chain in the world behind AMC Theatres, drew up possible downside scenarios for the coronavirus, including on that included “a risk of breaching the group’s financial covenants, unless a waiver agreement is reached with the required majority of lenders.” This could “cast significant doubt about the group’s ability to continue as a going concern,” a phrase meaning it could go out of business. …