One of the largest movie theater chains is in trouble

By Dan Lawrence | published

You’d be forgiven for thinking that the blockbuster post-pandemic resurgence meant all cinema chains had gotten away with Covid scot-free. However, even as big films like Spider-Man: No Way Home, The Batman, and Top Gun: Maverick fill theaters, the biggest theater chains are in trouble. Deadline reports that Cineworld, the owner of Regal Cinemas, the world’s second-largest cinema chain, is filing for bankruptcy.

Deadline obtained a report from The Wall Street Journal confirming the Cineworld/Regal bankruptcy, saying the London-based company has engaged in discussions with law firm Kirkland & Ellis LLP and adviser AlixPartners to discuss how to proceed. With franchise blockbusters returning to the silver screen, moviegoers seem to be returning to cinemas in good numbers, news that a chain as big as Cineworld is in such dire straits shows that the movie world is still at a standstill. The road to recovery.

Regal owner Cineworld’s plan to file for bankruptcy comes after admissions rates were not as high as the company had hoped after reopening last spring. “Despite a gradual improvement in demand following the reopening in April 2021, recent enrollment levels have remained below expectations,” the company said. “These lower enrollments are due to the limited film slate which is expected to continue till November 2022 and is expected to negatively impact the business and liquidity position of the group in the near term.” In short, like the big hits Top Gun: Maverick and Doctor Strange in the Multiverse of Madness, Showing the aforementioned signs of a blockbuster revival, there still aren’t enough tentpole movies to pull in audiences. Those films show that while the audience’s appetite for cinema is still strong, there is not enough content to consume in theatres. Due to the delayed filming due to the covid pandemic. Meanwhile, streaming services, though not without their own problems like Netflix’s declining subscriber numbers, continue to release a consistent slate of content.

Cineworld has 751 cinemas in 10 countries, including Regal Cinemas. Regal operates in 42 US states, along with American Samoa, the District of Columbia, Guam, and Saipan, and the Cineworld subsidiary has more than 6,000 screens in 505 theaters, contributing significantly to Cineworld’s global operations. The Hollywood Reporter notes that Cineworld Group’s net debt stood at a dangerous $5 billion last July and that the chain has yet to fully recover from a bankruptcy filing for Regal owner Cineworld. The most troubling consequence of this action will be the threat it poses to the livelihoods of countless employees who help operate theater chain sites around the world.

On the heels of the sad news that Regal’s owners Cineworld is filing for bankruptcy, CNBC reports that the company’s stock price has dropped 60%. The fallout of this news and how it affects rival chains remains to be seen and hopefully, rival cinemas will survive the rest of the release schedule in 2022 to prosper from full schedules in 2023 and beyond. After all, while streaming has taken a bigger place in the movie landscape, cinemas are still the backbone of the movie industry. Theaters support an enormous number of employees not only in theater chains, but also in film studios. In the absence of theatres, film companies also suffer. Hopefully, something can be done to save Regal.

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