Cineworld stated that it is in discussions with important parties, including lenders. Following any filing, it anticipates business as usual and says it will “ultimately continue its business over the longer term with no significant impact upon its personnel.”
One of the biggest theatre chains in the world, Cineworld Group PLC, announced on Monday that it is thinking about seeking Chapter 11 bankruptcy protection in the U.S. and taking similar steps elsewhere.
The British company, which operates in 10 nations and owns Regal Cinemas in the United States, said bankruptcy is one option it is considering to help preserve a company that has had trouble recovering from the effects of COVID-19 restrictions.
Cineworld stated that it is in discussions with important parties, including lenders. Following any filing, it anticipates business as usual and says it plans to “ultimately continue its company over the longer term with no significant impact upon its personnel.” Approximately 28,000 people work there, according to the business website.
After The Wall Street Journal reported that the company was ready to file for bankruptcy within weeks, company shares fell 58% on Friday.
Cineworld, which operates 9,189 screens over 751 locations, announced on Monday that it is currently assessing its options for improving cash flow and, potentially, restructuring.
The corporation reported a $565.8 million loss after taxes and a debt of $4.8 million in March, claiming that the COVID-19 closures in the first quarter of last year had a negative impact. It also suffered from abandoning its acquisition of Canadian movie theatre giant Cineplex Inc. in 2020. The British firm had violated its agreements, and an Ontario court agreed with Cineplex and awarded 1.23 billion Canadian dollars ($947.5 million) in damages. A draw has been Cineworld.
Despite the difficulties, Cineworld claims that the lingering demand for big-screen movie viewing boosted its financial performance at the conclusion of the previous year. Additionally, it anticipated that films like “Top Gun: Maverick,” “Jurassic World: Dominion,” and others will aid in its “continued significantly rebounding.”
Before the opening bell in New York, shares of two significant cinema chains with U.S. roots, AMC and Cinemark, also decreased.