(Sharecast News) - Everyman Media Group updated the market on its half-year of trading on Friday, confirming a complete loss of its revenue streams from the middle of March until 4 July as cinemas across the UK were ordered to close amid the Covid-19 pandemic.
The AIM-traded firm said it had made a "strong start" to the year, delivering revenue growth of 47% in the first two months.
In March, several contingency plans were formed, and reportedly implemented "swiftly".
An equity raise of £17.5m took place, which the board said secured a strong balance sheet position, supported by its available credit facilities.
The company's banking partners had been supportive, the directors said, with appropriate changes to the covenants on its credit facility, meaning the group would remain within its banking covenants in the second half and beyond.
"During the period of closure all but 18 staff were furloughed, and further government support was received in terms of rates relief and the Retail, Hospitality and Leisure Business Grant," the Everyman board said in its statement.
"In addition, the reduction of VAT from 20% to 5% on admissions and certain food and beverage items will benefit the business in the second half."
Property costs were the second largest overhead in the business, the board said, with Everyman working with all of its landlords through the period to agree variations to the lease agreements.
Concessions had been agreed on more than half of its estate, with further discussions ongoing.
The group said it had also worked with landlords on delaying certain new sites and, in a few cases, exiting existing agreements for lease, resulting in a pipeline for 2021-2022 of eight new venues, compared with the 11 previously expected.
Those actions had "significantly reduced" the group's future capital commitments.
The company said it would incur exceptional costs from exiting some of the agreements, but the directors said they believed that, in the current climate, a prudent approach to new openings was in the firm's best interests.
"Everyman is pleased to report that since 4 July, following the introduction of new Covid-19 operating, social distancing and cleaning protocols, there has been a phased re-opening of venues with 17 currently trading," the board said.
"Customer feedback has been overwhelmingly positive in these venues and admissions are at encouraging levels given the scarcity of new content currently.
"The remaining venues will be opening in phases with all venues planned to be open by 21 August."
In addition, a new venue on the Kings Road in Chelsea opened on 25 July, with a further new venue in Lincoln due to open on 21 August.
Everyman said that, while current trading had inevitably been soft with no major releases, "encouraging" numbers of customers were returning.
That, it said, validated the strength of the business model, which was "well positioned" to take advantage as the sector recovered.
The group said it had a strong balance sheet to support its activities during what was expected to be a restricted trading period in the second half.
Everyman said it was intending to publish its interim results for the 26 weeks ended 2 July on 30 September.
At 0934 BST, shares in Everyman Media Group were up 1.23% at 85.03p.
DIRECTOR DEALINGS: Ocado Non-Exec Rausing buys GBP26 million worth