Member Info for Hexam

Hi Allkap - I think there are several reasons but one is that the biggest film in the second half of 2021 in the UK was No Time to Die (just pipping No Way Home) which was far more popular in the UK than the US. Also, even No Way Home was relatively more popular in the UK compared to the US than the biggest film of 2022 (Top Gun: Maverick).

Overall the UK Box Office hasn't done so well in the first half of 2022 compared with the second half of last year compared to the US.

Hi AllKap

On your first question the B.O. increase you refer to is only for the US (+Canada) and the US revenue actually went up by $70m - an increase of 7% which is slightly higher than the 6% increase in B.O. However, UK+Ire and ROW revenues fell compared to the second half of 2021 (by just over $30m each) and this is what is dragging back the total revenue.

On the second question the direct costs are up by $100m which is about half the difference and the rest is a combination of things including technical items like impairments (a $50m worsening).

No Jeff it says: “It is expected that any de-leveraging transaction will result in very significant dilution or elimination of existing equity interests in the Group”

Agree Wolf but the wording before was looser and open to different interpretations (and was on this board) but now they’ve tightened it up so it is not ambiguous at all.

I agree Jeff but many on this board have argued the opposite because of the way it was worded before. They can’t anymore as the wording is now crystal clear - but I suspect they still will.

And it’s a gamble that may well pay off. I hope so as I’m well underwater still despite averaging down. I’m just not encouraged by anything in the report and the warnings from the company are very clear.

The market cap is so low because the market feels that as gambles go it is a long shot. But long shots do win sometimes so here’s hoping!

Have you even looked at the report? There’s ramping and there’s ramping. Yours should come with a warning. Irresponsible.

No it didn’t mention ‘elimination’ before. Also it is not now talking about potential de-leveraging now but that it is seeking to implement one.

Sadly I think your hopes will be dashed. The results are grim - but at least they were already known. The warning for shareholders though of any deleveraging transaction is even more stark than it was as it now not only mentions ‘very significant dilution’ but also possible ‘elimination of existing equity interests’.

Still, the market moves in mysterious ways so who knows?

Yes it was pre confirmation but post petition.

It is interesting but doesn’t seem to apply to the CP claim as that relates to events before the petition date unlike this example.

"It all depends how much of the underlying profits are made by regal"

Wolf - In the years before Covid the US part of the business made $288m PBT (2018) and $122m (2019) which suggests Regal on its own is an attractive proposition (for both these years they reported a small loss for UK&Ire).

With CP sniffing around there are even more ways this can now play out. Whether any deal for Regal will be better or worse though for existing shareholders than the other options is very hard to say as it depends, like they all do, on the terms agreed.

Toptuf - Agree with you, and Patience and Poor, it’s a blow to CP and leaves them scrambling around, and is good news for CINE.

Then apologies toptuf. When you said the case is not on hold that is what I thought you meant. The case is on hold as per court docs.

‘Who said the case was being dropped completely?’

I thought that was what toptuf and Eddie were suggesting? If they weren’t then I apologise to them but regardless, as I said, it has only been delayed.

‘has a timeframe been given?’

I’m not sure if it was by the court but CINE have stated that they expect to exit Ch11 in the first quarter of next year (RNS).

I agree it may end up stopping it completely but that is only conjecture - it is not what the judge decided.

Read court docket 412 that explains that the Chapter 11 automatically stays legal proceedings but that CP had objected to this and wanted it to still go ahead (docket 218) but in 412 CW argued back the other way.

The judge has now ruled that the ‘stay’ (i.e. delay) remains in place and this is what the reports refer to - I cannot see any mention of the case being dropped completely?

@patiencebringsit is not making it up. The court case is now on hold until CINE exits Chapter 11.

What are you thinking? That it has been halted permanently? Now THAT is making things up. Judge has no authority to do that.

Not convinced that there is any 'declining customer spend issue'. As they state:

"Store transaction numbers grew 9.4% on a LFL basis, marginally offset by a 3.1% reduction in average basket value ("ABV") reflecting a return to more normalised shopping habits following lockdown restrictions. Whilst ABV is down in the period, it is still materially ahead of pre-Covid levels at +23.1% vs HY20."

Nothing alarming in this that I can see or in the results generally and whilst they may not be stellar by any means they seem quite pleasing all told. A half-year adjusted PBT of £10.8m with an mcap of around £160m suggests decent value to me especially if they can kick on from here. Time will tell.

The RoW refinancing is separate from the $1bn restructuring that the judge has initially refused.

So as you say Stanley the September expected outflow of nearly $600m (nearly half of which is to deal with the RoW debt) uses up a lot of the $785m so I agree October looks tight especially at the beginning of the month due to the rents you mention.

However, hopefully they've been more cautious than with their previous projections and there are no nasty surprises - in any event I can't imagine they would be left to simply run out of cash this early in the proceedings.

A couple of things to note is that I believe a further $150m is available as an early doc refers to "an additional draw of up to $150 million available upon entry of the Final Order". Also the financial projections are currently being reworked as part of the plan to be submitted by the end of October. This should include benefits from rent and other cost savings as well as any other updates so that hopefully things won't look quite as tight as they do in the initial figures (though they will presumably also include the 20% interest).