Member Info for HNS_77

Depends how you choose to define “bad” - compared to 2019 yes definitely in a “normal” year - as a share or a 6-7 times increase in box office revenue compared to 2021 looks like a pretty good recovery trajectory to me.

Definitely more curve balls thrown then I expected - I was betting on Covid leaving us and Box office reverting - war in Europe and losing a court case by such a huge margin were certainly not part of my investment considerations

In that recalculation some have sold up , others (like myself) have seen it as an opportunity to top up

As you say bonkers patience is the watchword here - that’s not to say it is easy - rather the opposite most days!

@ Metom - There hasn't been a date set for the appeal - if there is it isn't in the public domain as yet

@Bonkers - Good luck with Rolls - I was in RR and BP for over a year and cashed in a few weeks just before this terrible situation took hold in Ukraine with a respectable return hence I had some spare to top up - hopefully the decision pays off

Like yourself am hear for the long haul perhaps it will go slightly lower/perhaps not who know but to be honest a few pennies here or there hopefully won't matter in the long run

@Bonkers - Snap - just got my average down to 51 also today have been slowly averaging down from 62p after the Cineplex decision came out - keep telling myself that is it but at these prices seems too good to resist!

I am sure most of us open our trading accounts in despair and dread to see the negative red figures staring back us but here are a few other numbers to consider

increasing audience number flocking to the cinema for promo deals,
$$$ revenues increasing off the back of big film releases
Quarter on Quarter positive revenue reports from competitors and Cine showing that the cinema industry is in rude health and not systemic decline
The number of new sites and refurbs to generate even more revenue here and abroad
The low % chance that has been given for the damages being recoverable regardless of the outcome of the appeal

Not blinkered to the challenges but these are just some of the indicators of the fundamental progress being made and the quicker the doom and distraction of this awful period is behind us this will be reflected in the future share price - we hope!

What causes mental strain is largely (and sadly) self-inflicted - personally I think it is unwise to do a victory lap when we see large daily price rises like 8% from these levels as the disappointment is even more pronounced when it inevitably falls by an equal amount like we have seen over the last few days .

There is no free lunch here there - it is a volatile share and has both upside and downside risks , some of us (I think rightly) believe in the fundamentals of the business and that the risk isn't as high as some would try and scare us into believing - in the end it is for the business to prove it's worth through their results and progress against the challenges they face.

That is going to take a while.... hopefully those with patience and the stomach to see it through are rewarded.

The Times article I posted a link to when I started this thread suggested that a decision on the outcome of the appeal was expected in a couple of months and they quoted an anonymous source "close to the matter" or words to that effect.

Wellington interpreted that as meaning the decision to allow an appeal to go forward rather then a decision on the actual appeal itself but I have assumed given all the appeal and cross appeal papers that have been submitted that leave to appeal has already been granted - this is a much shorter timeline then what I had calculated based on previous appeals hence I was quite surprised they were speculating it could all be done and dusted in a 2 months.

Wolseley wins court case against Axa to payout against business interruption insurance

Let’s hope this news gives the insurers Regal a good scare to get the settlement cheque book out..

https://www.google.com/amp/s/amp.ft.com/content/33670656-4a18-4172-9a50-b3b18f3156d8

This article was posted last week - I missed it as I way away so you guys have may already discussed it - highly speculative but sounds like the appeal outcome might be closer then originally anticipated

“In December, Cineworld was ordered by the Ontario Superior Court to pay Toronto-based Cineplex damages of C$1.23 billion, a decision that the British group said it disagreed with and would appeal against. A decision on its appeal is thought to be “a couple of months away”, according to a source familiar with the situation.”

https://www.thetimes.co.uk/article/cineworld-agrees-deal-with-former-regal-shareholders-nvhrjt77q

Yes and funny how well it worked out for that previously convicted Toronto hedge fund down the road who timed their increased short position so perfectly - very lucky!

Thanks BlueBuxton - I am sure many will think I have gone full tin foil hat but the data doesn't lie....

"Canadian judicial appointments are among the most corrupt in the entire world. That's the opinion of the human rights watchdog group Global Integrity, at least, who gave the integrity of Canada's judicial appointments a pitiful 32 out of 100"

https://www.huffpost.com/archive/ca/entry/canada-judicial-appointments_b_5264567

@LPD - I have posted every legal comment on this and so far in relation to the damages assessment it is encouraging to see that the weight of legal views appear quite critical of the judgement in so far as they can be. The points you raise are the ones that appeared in the CW appeal and I have copied and pasted from the document

"On paying that price to Cineplex shareholders, Cineworld, through its wholly owned subsidiary, 1232743 B.C. Ltd would become the sole owner of Cineplex and could operate Cineplex to achieve, or not achieve synergies as it saw fit. Cineplex had no expectation of any post closing benefits of any sort, including synergies. "

"Had the transaction closed, Cineworld would have required Cineplex to incur $2.1 billion in acquisition financing
debt, as well as provide a further $3.5 billion guarantee for the debt of other entities in the Cineworld group. This debt was not uncertain and speculative as the Trial Judge held."

"It was an error in principle to assess damages as if the benefits of synergies would have been left stranded in the subsidiary so they could not be enjoyed by Cineworld and its stakeholders, but would only accrue to its wholly owned subsidiary, Cineplex."

The important takeaways from the article for me is where they state that

"Expectation damages must be proven with reasonable certainty, but synergistic benefits are often speculative and aspirational"

"Justice Conway did not discuss how likely anticipated synergies should be for consideration in substantial damages valuations."

Setting aside the contention in the article about whether an amalgamated company can even accrue synergies (other lawyer articles I have posted have highlighted that isn't traditionally the case) My reading of these comments are as close to saying the Judge decision did not demonstrate that there was reasonable certainty that the synergies would even be realised to the extent outlined so using them as a basis for expectation damages is flawed.

This thing about a termination fee has confused a lot of people. My recollection of the trial (which I followed very closely) was that Mr Desouza (CW laywer) said that Nisan Cohen (CW CFO) was mistaken in thinking there was a fee that existed in the event either party breached the contract and I recall the words he used was because "they were not legal scholars" . So that was coming from CW lawyers and what is echoed in this article from another set of Canadian lawyers

All I can suggest is that the conditions of termination in the agreement for the sums quoted do not apply in the case of a breach of the agreement in the way it was done otherwise we would not be having this discussion and the default position would be to pay the abort fee if it applied regardless of whether Cineplex felt they deserved more money. So the reality appears to be that whatever is in the agreement referencing a termination amount does not apply.

That appears to be the situation even though from what I recall from the trial evidence even Nisan (Cineworld CFO) thought there was one in the agreement

This is the first comment piece from a legal perspective I have seen post appeal - It is carefully worded but as with previous legal comment m doesn’t seem to be particularly supportive of the judges synergies damages award to Cineplex

https://www.nortonrosefulbright.com/en/knowledge/publications/7ee6f89b/expectation-damages-for-lost-synergies-a-closer-look-at-the-ontario-superior-courts

@ Bonkers - yes thanks correct - you might even say its 3 free hits as I understand it Regal are suing 3 separate insurers in a combined law suit - so it might be that one caves in and settles on their portion of the amount or perhaps one policy is weaker then another but yes this time it isn't one that can backfire spectacularly the way Cineplex did

They are also requesting a jury trial this time so will be interesting to see if they get that

The initial court meeting is scheduled 26/4/22 - from the wording on the LA courts website looks like an initial review of sorts rather then a trial start date

@Bonkers - well said - if people decide to sell for whatever reason they decide that is their business and I doubt anyone would give it any thought better or worse but don't know how anyone could look in the mirror if they sold being influenced off the back of (dis)information being peddled on here.

There is a identifiable crowd on here who I suspect have a big position in CINE relative to their personal resources and have done so on the basis that they want it to be a real transformative share i.e. they want to hit it out of the stadium and not content to accept a small gain when they believe it has potential to do really well - that makes it exciting but also vulnerable to those doubts and fears of failure. I expect that is why a fair few of us who were in didn't sell at 124p as the price target expectations are much higher and time horizon longer to see Cine recover.

Then we had Delta, Omicron and the court case outcome hit the SP into reverse and it is now slowly recovering again. yet at the same time we have had big positives like box office successes, less severe cases and big drop in Covid, same day streaming failed, improving results in the last update from CINE. No one has a crystal ball to say there wont be further bumps along the way

To any one having doubts or finding themselves swayed by this nonsense first ask why you invested in CINE in the first place and if the fundamentals about the company have changed in light of all what is being mentioned? - if the answer is no then this drop in share price is nothing but a topping up opportunity or to sit tight and be patient and let the business do its thing.

Good luck all!