Cineworld gets Spider-Man boost but still caught in Covid's web

(Alliance News) - Cineworld Group PLC was cash flow positive in its fourth quarter, the London-based picture house operator said on Friday, though Covid-19 measures hit its international arm.

Cineworld said December group box office and concession revenue was at 88% of 2019, the last period pre-pandemic.

Cineworld said it saw "an excellent slate" of films, fronted by comic book hero titles Spider-Man: No Way Home, Shang-Chi and the Legend of the Ten Rings and Black Widow. There was also the latest James Bond film, No Time to Die.

"As a result of this improvement in revenue and the cost measures implemented, the group generated positive cash flow in Q4 2021," the FTSE 250 listing said.

Analysts at Peel Hunt commented: "Given the lumpy nature of the release schedule, the way cinemagoing demand has been pent up, and the impact of Omicron, it will take time to establish new trend levels of demand. However, 4Q21 was reported to be cash flow positive and, although no detail was given this is encouraging."

US revenue was 91% of pre-virus levels in December, while in the UK & Ireland, it stood at 89%. In the rest of the world segment, revenue was only at 72% of pre-Covid times in December.

Cineworld cautioned: "In ROW, November and December's performance was impacted by government restrictions due to the Covid-19 situation."

Looking to 2022, Cineworld noted the upcoming releases of a new Batman film, the sequel to the first Black Panther title, as well as the latest Mission: Impossible movie.

AJ Bell analyst Russ Mould commented: "Premature obituaries for the cinema industry have been printed before and it has proved a highly resilient medium through wars, economic depressions and even the birth of home videos in the 1980s."

Cineworld shares were 3.2% higher at 40.02 pence each in London on Friday afternoon.

By Eric Cunha; ericcunha@alliancenews.com

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