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Kids out in force (including mine) this evening , trick or treating with parents in tow and generally having a lovely time - what does this have to do with Cine? - not much other than it’s clear people have decided to give covid the middle finger and have gone back to doing things they have missed and enjoy ..one of which happens to be going to the cinema!

Neesons sent these through for those that want or watch worth keeping in case they forget to update the court website like last time

Nov 1: https://youtu.be/upT-7PHX38o
Nov 2: https://youtu.be/h-NKtWtkfh8
Nov 3: https://youtu.be/AQ4KCih8BUY

Obviously with the caveat that none of this affects the largest base of business for Cine i.e. the US but since we are discussing the UK.

Based on the data that is freely available via .gov I cannot see how a lockdown would make any sense given the profile of cases. The data for England (they don't provide age data across UK) is currently showing that 45% of cases are under 19s and in the upper ages of that group suspect that most have not been vaccinated based on the poor uptake of 12+ . In other words it seems to show that were vaccinated the virus is being held and its only in those who haven't where we see cases increasing and in some cases leading to breakthroughs where a vaccinated adult is living with an unvaccinated kid who gets Covid

The smallest group is thankfully the most vulnerable i.e. the over 60s account for 11% and given the high level of vaccination and growing numbers of boosters in that group most (if unfortunate to catch it) will have minimal complications. Again this is the highest population with complications and who we were trying to protect in the first set of lockdowns to protect the NHS from being over run

The middle age group I would suspect contains predominately unvaccinated people cannot see how that is politically or economically sensible to punish the country largely due to people refused a vaccine that would have reduced their chances of getting ill in the first place

Age Band % of cases
00_04 2%
05_09 9%
10_14 23%
15_19 10%
20_24 3%
25_29 4%
30_34 5%
35_39 6%
40_44 8%
45_49 8%
50_54 6%
55_59 5%
60_64 4%
65_69 3%
70_74 2%
75_79 1%
80_84 1%
85_89 0%
90+ 0%

Certainly is a strange time to be a Cine shareholder! Rapidly improving box office numbers but uncertainty around the court case decision is making for this annoying and hopefully temporary predicament we find ourselves in right now. Yahoo is showing 1.5m shares traded today which is way below normal volume not to mention when sp shot back up to the 80s.

A coherent and well fought case that ended with a strong final expert witness that hopefully leaves a lasting impression of a flailing and unsuccessful CP team talking about bus drivers and penny saved is a penny earned showed how difficult it was for CP defence to make a coherent argument in cross examination regarding the deviation on past practice and damages calculation

I have even more confidence in Mooky and co in how they have run Cine during the pandemic and has given a real insight into the difficulties and pressures faced keeping the business focused on remaining afloat while contending with this ongoing dispute

As strong as I believe the case is for CW and cannot conceive of a judgement in favour of CP I am still nervous of the outcome given how things sometimes get turned on their heads and interpretations don’t always go in the direction that seems obvious on the surface.

That said I remain confident that even in that event it rules against - those large damages sums were shown to be based on flawed logic and baseless assumptions

Glad to be of service all - this is what our community is about - sharing useful information :)

I contacted neesons the link to view is here

http://youtu.be/BgRep1KQA5U

Having considered this further if the judge was minded to look at CW perspective the CP lawyer response to the testimony could put CP in a very negative position - essentially he appeared to be saying "yes so what if there was extra debt squirreled away due to the way CP managed their payables it wasn't specifically mentioned in the agreement so its tough luck on CW to manage that liability post closing"

This goes against the spirit and intent of the $725m debt ceiling and almost reveals the calculating and devious way CP went about trying to hid this liability on a technicality of where it was sitting - when added to deviation from ordinary course to achieve this should make it even clearer

Just to inject some further optimism thr aspect of KPMGs work that I think is critical is in dismissing the wrongheaded approach CP have used to assess damages - hopefully the next guys is much stronger in that whatever the judgment in the case that these amounts are frivolous and wishful which itself should reflect poorly on CP

***failed attempts I should say

@smalltrader I agree with that and CW wouldn’t have put him up to talk down our case quite the opposite but he crumbled when challenged and of course expect the judge will read his report in full to reach her decision rather then rely on his nervous testimony - in the end the facts speak for themselves and No amount of CP female lawyer constructing fantasy narratives with evidence that doesn’t exist will prove the case - so I will look to the positives Nisan did an amazing job under a very long scrutiny and attempts to tie him up in knots

@Moneypit in my opinion this witness was the equivalent of that player who messes up in a penalty shoot out - he did not defend the conclusions of his report effectively and was guided by CP lawyers which is why I think he was a waste of time for us.

One example was when the CP lawyer said that the report said that the agreement specified conditions and anything else was he buyers risk and because payables were not specifically mentioned that it can’t count . Yet in his report he made it clear that all liabilities eg the total cost of the transaction is higher then what it would have been and that isn’t acceptable which is why the 725m debt ceiling was in the agreement in the first place - he could have argued more strongly that placing debt in different places doesn’t stop it being a liability for the buyer and at least putting up a fight like the CP “impartial “ expert witness did

Perhaps I am missing something and I hope the reason CW lawyers did not ask any further questions is because it wasn’t as bad as it seemed to me

I don’t actually think this guys weak testimony tips the case in CPs favour but he should have done much better to hammer home the fact that there are clear terms on which CP would have breached by expecting CW to take on liabilities and risk that put it above the agreed tolerance yet he didn’t even defend that - just fluffed it and said yea yes yes to get out of the chair - quite pathetic and hope the next guy is stronger

I was disappointed with KPMG was led by the nose and didn’t defend any of his conclusion and analysis in his report - CP lawyers had a field day with him and I hope he doesn’t undo all the good work of Nisan and co

I happen to be in the “older” category that Bond skews to and amongst work colleagues the only person in my age group who had watched on the opening weekend - feedback from quite a few was people are waiting until initial crowds die down - not pretending this is in anyway scientific or fully representative but does seem sensible that there are more in older groups wary of covid would hold back and go when cinemas a bit quieter perhaps which will draw out the box office over a longer period

@Smalltrader I have been following the case everyday this week I haven’t commented for two reasons 1) most of my views and observations seem to be in line with what others have said like yourself and mountainous 2) It’s been hard to take it seriously for the amateur dramatics on display from the lawyer in cross of Mooky to make up for substance to any of the evidence presented .

What did I learn today?

That shareholders were panicking about the deal and agitating for CW to get out of the CP acquisition yet not a single email text where any of the CW team were saying the same which is what I was worried might have existed.

Completing or not completing had no material impact on Cineworlds overall position and requirement to secure additional liquidity

If anything it’s even clearer they were actually up for completing the deal but it was obvious to anyone with a calculator that CP were breaching the debt ceiling so the deal was dead in the water and that was simply the commercial reality of the situation hence the other discussions going on in parallel.

I am pleased our main 3 witnesses are almost done and hopefully can wrap this up quickly - until the judgement drops with hopefully a positive outcome for CW I see this will continue to hold the sp from realising the potential from the box office recovery we are seeing

And the Oscar goes too…the cineplex lawyer for over dramatising minor points to make them seem more controversial then they actually were!

I am sure cineplex investors watching will be thinking some real punches were landed but really lots of heat and very little light

Good performance from mooky and the Cineworld legal team

there is so much to say about the various weaknesses in the Cineplex case but specifically in relation to the Queensway deal which is being discussed - isn't it odd that Cineplex chose to pay for an expert witness to provide a commentary and rebuttal of the KPMG report who a) had no experience in Real Estate Valuation whereas KPMG did and b) That the expert himself admitted that had he been approached at the time the Queensway deal was being discussed he would not have been qualified to offer his service to do this c) He conceded that there was a clear match between the proposal from JLL and KPMG in how they were looking to approach unlocking value for the client in relation to negotiating the deal -

Personally I think it is secondary what the quality of the deal was as consent was really the issue here but that they couldnt even get a credible company with a relevant track record to provide evidence on this for them itself speaks volumes

https://www.ontariocourts.ca/scj/cineplex-v-cineworld/

We all have our weird and wonderful theories about what is keeping the SP down so here is mine. Many have played down the significant of the court case but to me this represents the biggest drag on the share aside from Covid imho. From data I have seen just under 25% of shares are owned by private retail , institutional/public company ownership is 56%. Contrast this to AMC which has 75% of its shares owned by the general public!

I am convinced these organisations will be waiting for a resolution of the court case before they increase or take a position in Cine - unlike private investors they dont have the luxury of just taking a punt - I assume they will have to justify their decisions around risk and particularly if they are going to take sizeable positions - it is that shift that will make the difference to the trajectory of the share price assuming all other things being clear in terms of trading conditions which looks very likely with Covid dropping/new treatments/vaccine levels etc

Once this hurdle has been overcome the industry has proven its resilience and attraction to customers and in some ways Covid may have been of benefit long term by making the industry up it's game and in showing that in actual fact this slow death of cinema narrative that was being pushed towards favouring streaming platforms was overblown even before Covid and actually people are as enthusiastic as ever to pay a premium for a cinematic experience.