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The Prime Minister says that "thanks to this country's collective effort" adding to the lockdown rules, the "key indicators are heading in the right direction".
PM: Markets and car showrooms to open from 1 June
PM Boris Johnson says: "Today I want to give the retail sector notice of our intention to reopen shops so they too can get ready." He says the government intends for outdoor markets and car show rooms to open from 1 June.
He adds: "From 15 June, we intend to allow all other non-essential retail... to reopen."
Also hospital admissions in decline..
Prof Doyle says 0.25% is the average proportion of the population who had virus between 4-7 May. In any week recently, 61,000 might have been infected.
The R value - rate of infection - is between 0.7 and 1.
Some 3.5 million tests have been done in total. Around 73,000 completed on average daily.
The number admissions on 23 May was 595 - a considerable decline. We now have 12% on mechanical ventilation, Prof Doyle says. She calls the figures "good news".
Thankfully we only have 17% of the cinemas in the UK. The rest of the world is opening up nicely now.
Not sure Cineworld comes under non essential shop. At the moment Cinemas are lumped in with Pubs and last to open, ridiculous given all of Europe is opening mid June for Tenet etc. Hopefully Johnson come lately will get up to speed.
More likely to see a drop as that's at least a 2 week delay from what were expecting. Definitely the cautious approach
Open from 15th June - 80p this week possible
Hello all. We keep coming back to the amazing situation Cineworld and other cinemas will be in once they open. Social distancing and the capacity they work on in will not be affected much. I’m amazed as many others are that they make a good profit on those numbers. People might be a little hesitant to start but it won’t take long before they are flooding though the doors again. They will be top of the list compared to other activities that will struggle with social distancing. On top of that people will not be jumping on planes anytime soon so the UK tourist industry could flourish this summer. Cinemas will be a big part of that.
Cineworld will resume slowly at first, with staggered seating and online bookings. As we know, cinemas can operate at a profit when 30% of seats are bought. This isn't going to be a problem. People, I know that are annual ticket holders are counting down the days to the reopening. Ok, some people, may want assurances, that they are in safe environment, which is fair enough, but given time, reputation and covid-19 cases ease over time, the seats will become more full.
By looking how other countries will be doing this remains to be seen. (Modelling).
And even having an extra few weeks of a film being shown won't make a difference to a full house, if there ever has been one!
I'm heavily invested in this, and maybe a slight ramper lol. But for a 3-5 year investment, this will return some good profit.
All my opinion, and some factual that I have read up recently.
To be fair, I haven’t seen many cinemas packed out for quite some time but they still manage to make a healthy profit. It’s for this reason that I genuinely think Cine could apply social distancing measure / restrictions on access and still come out with a healthy margin. Plus, it’s not even the ‘experience’ of the film itself, the cinema is an easy way of getting out of the house for the evening. Cinemas could do very soon once they’re open as many bars and restaurants will struggle with the social distancing restrictions, so people will likely flock to cinemas when they would have usually gone to a bar.
Either way, the likelihood of doubling your money within 12 months (or less) if you bought in at these prices is very high.
The chances of huge blockbusters going straight to Netflix or the like isn't likely to happen, even with social distancing in place in cinemas. There are several reasons for this but a few I can think of include:
1. Cinema is the pinacle of the movie entertainment experience. It simply cannot be replicated at home, period. I have an LG C9 OLED TV with a Q90R Dolby Atmos sound system and I would never give up a cinema experience to watch movies on my setup first. There is no comparison.
2. Streaming has so many disadvantages to consider alongside the advantages. You have to consider network bandwidth, video and sound compression issues, and finaly quality issues of home entertainment equipment. 4K isn't even ubiquous in homes yet. TVs are owned on average for 5-10 years per household. I certainly wouldn't want to watch a huge space opera like Interstellar or Avatar 2 for instance at home! The latter I want on IMAX 3D!
3. Studios make a killing through the big screen experiences as the cinema is the start of the value chain. It goes Cinema, Streaming, DvDs. Why cut out one big source of revenue to just two when you can have all three? By bypassing a theatrical release and going straight to a rental option, studios risk losing out on the combined revenue of having a theatrical release and a secondary digital rental window. Avengers Endgame made $2.8 Billion at the box office alone. Avatar 2 will likely beat it. Sure Trolls made $100m for Disney but how likely are Disney to replicate that with other releases. Also, its very likely that the numbers were helped by the fact everyone is stuck at home and have nothing better to do than stream stuff! It won't always be that way as lockdowns ease around the world.
4. Cinema viewership was increasing year on year for the last 4 years upto 2019, regardless of the popularity of streaming.
5. I remember reading somewhere that cinemas have on average a 15%-20% occupancy rate. It's very easy to make social distancing work with that.
6. Previous pandemics have shown that our love of theatre/cinema will never die.
Do I think social distancing will be damaging for cinema? - No.
Social distancing in cinemas when the average occupancy rate if 15-20% anyway shouldn't be difficult at all.
Plus social distancing is making other forms of entertainment less appealing. Holidays for instance are less attractive. Who wants to travel when your hotel spa and swimming pool is closed, when the buffet is closed. When the risk of illness or disease abroad is a a real risk. I think domestic enterainment such as the small pleasures of an amazing movie on the big screen are more attractive as a result. It's relatively cheap, relatively safe escapism and I for one cannot wait to watch Tenet as soon as the big screens are bag in business in a few weeks time.
It's a difficult one - great cinemas, very popular, loads of people on twitter saying how much they miss the place, nice popcorn, great evening out, reasonable prices...
Unfortunately can't do anything about social distancing. And nobody knows how long it'll go on for - weeks, months or years. I would have thought restrictions will almost certainly mean lower numbers - admissions, revenue, etc. Unless cinemas are somehow able to get the same amount of business through the door by getting people to visit on days and times they wouldn't normally. Which may be difficult once people go back to work and school. The way I see it, it's not just got to work financially for the cinemas, its also got to work financially for the movie studios. And I do worry others might follow Universal - loyalty is important but at the end of the day businesses are all about money and doing what's right for them, sadly loyalty doesn't always come into it. I'm confident we'll reopen and confident plenty of people will be wanting to come back. But i do think social distancing has the potential to be damaging unless the company can navigate around it without seeing any significant fall in the numbers that matter. We'll see how it pans out anyway. I'm just holding for now, not adding.
Hi GS. Yeah this was on the 5th May I think? The share price dropped to 52.80 that day and then went to 60 the next day. It’s not been that low since. Im sure they will come to some agreement on this. Perhaps we’ll get an update this week regarding moving forward? Quite scary if there is no agreement Though!
I guess you’ve been mulling this over for a while then? What are your thoughts now, bail, reduce your holding, average down?
nightyard, yeah looks like everything is going to plan. He said there would be more updates this week.
Hi Jai, imo it's really upto Cineworld (and AMC) to get back on friendly terms with Universal and come to some sort of agreement. It probably will happen, after all both sides need one another. But right now it seems like neither side are willing to compromise. Social distancing makes normal business difficult and now more than ever is not the time to be at odds with the biggest movie studio in the world. Yes they started it and in many ways I don't blame the response of Cineworld and AMC. But with all that's going on regards the virus, the challenges of reopening and making it work financially with social distancing in place, not to mention the planned acquisition of Cineplex.. it's really a time for companies and their partners to come together and support eachother, not be at odds. The way I see it, there will be no shortage of customers when we reopen. The issue is social distancing and how it'll affect the numbers - and most importantly, how movie studios might react to those numbers going forwards.
Aside from the media's witch hunt of Dominic Cummings, today's briefing included Boris saying step 2 of the lockdown lifting will be happening as planned.
Hi Squid. Interesting way of looking at it, thanks. I guess my thoughts are that the trickier times for Cineworld are when a new blockbuster movie comes out. So instead of the cinemas being packed to the rafters at the beginning they will have to space the areas out and that will mean more showings going on for extra days/weeks so everyone has a chance to see it in the cinema. In some ways that might be more favourable for some people, not banging elbows with their neighbours, smaller food and entry queues etc. We know cinemas work on about 22% capacity overall so I see more people coming in the off peak times, weeks after a big movie is released, so these will become busier because of the restrictions in place when the movie is released. If they have pre bookings only they also have more of an idea how many people will be coming so they can prepare more accurately with staff too, possible cutting down on over staffing when the cinemas are emptier? I’ve sat in the cinema with 20 people watching a bond movie before, I personally prefer the quieter times. So basically the same amount of bums on seats but spread out over longer periods rather than mad rushes at the start and emptier seats a week or 2 later.
Anyone else got thoughts on this?
Corona update about to start. Not been watching much lately but Interested to see what is said about numbers and where this is going.
A very calm week with a low of 54.88 and a high of 62.20 so around 13% if you could have got in on those prices. So realistically you could have made 10%, not bad in a week I guess.
Be interesting to see if the swings reduce this week.
dreamachine, it is a positive that the number of cases are falling fast. The spat with Universal isn't such a positive however. And Disney also appear to be going a similar way with "the rise of sky walker" being released to Disney+ home streaming service - and it appears they are considering doing the same with other releases as well. The trouble is these are the biggest film studios in the world with some of the biggest movie franchises of all time - Jurassic Park, the Star Wars trilogy etc. We can only hope both sides settle their differences and come to some sort of agreement, but it's difficult to see that happening anytime soon due to social distancing which will mean restrictions on the number of people allowed in at any one time - Universal will go where the money is and the huge success of Troll World Tour on home streaming appears to have shown them its a more profitable route in their eyes than releasing the movies in cinemas with reduced capacity due to social distancing. What we need is for social distancing to get phased out and to go back to business as usual. But I don't think there's any chance of that happening anytime soon. The other concern is what if other movie studios follow? Movies cost millions to make and promote and at the end of the day these film studios rely on big audiences at the cinema to make it worth their while financially. With social distancing the only way we're going to get anywhere near the same audience figures as we were used to before the pandemic is if each cinema is packed to the max on every screening at all times of the day and evening. And packed to the max with social distancing will of course equate to significantly less people allowed in the cinema at any one time. I think this is what caused Universal to go the way they have and the obvious concern is if other movie studios feel social distancing is affecting audience figures they too might decide there's more money to be made via home streaming? And where does that leave cinema then? There's no question cinema remains hugely popular, no question an awful lot of people are missing Cineworld hugely and can't wait for reopening, and there's no question home viewing is vastly inferior to the big screen. The market for Cinema is still very much there imo. But the nagging issue that doesn't go away is social distancing which means far fewer people allowed in at any one time. And far fewer people generate far less revenue - unless each cinema can fill every screening to the max allowed and potentially make up the audience figures and additional revenue that way. My interpretation is the potential effects of social distancing on audience figures and revenue clearly is a major concern for movie studios such as Universal and it appears, Disney - and unless Cinema can make it work financially with little or no drop in revenue from where we were before the crisis, the concern is other film studios may follow. I'm hopeful all will turn out okay, totally c
All very positive prospects going forward!
Another interesting article, it seems both Netflix and Amazon still see value in cinema chains
Very tempting I’m sure. As time goes on the closer we are to opening. We could start to heading towards the 70s this week.
In fact just contemplating buying further next week, as the opportunities from all this chaos don't come around very often - I do have a wide ranging portfolio to spread my risk, but awfully tempting to wade in alot alot heavier with CINE, as right now, imo they have the greatest upside opportunity compared to the rest of my portfolio which is now very much recovery based
Good write up cheers. Great work with WMH dream. I guess you are bringing some of those profits here?
Im sure we are going to see some nice rises here over the next few weeks.
Thanks for sharing - yes if you look at the fundamentals, CINE has been caned, with the pandemic, but cinemas will be with us always, so it will come back once easing kicks in and folks can get back out there. This will rebound strongly. For this reason, I am heavily invested at what has been an incredible sp. I saw exactly the same with WMH, heavily caned stock, but fundamentals looked good, when combined with the relaxation of staff and property costs - WMH has bounced back very nicely and pleased i backed it, so now just waiting for this bounce, which it most certainly will
This article is worth a quick read
No Sam it was on the bbc. I’ll check the other one out though.
End of next week will be end of the month, which is key milestone with start June next stage of easing, assuming all conditions met. From the daily data, all figures are dropping and there is a clear downward trend, so expect the next easing to materialise. This all builds confidence for the next stage of easing, so I'd expect next week's sp to break 60 and then trade in a higher range, then start to climb if the trajectory of new infections continues fall as it has, and as we get closer to July.