Member Info for RS2002

Moola, LSE0086 is rambling to himself - three posts in succession, answering his own question.

Everyone else closed their short at 17p and he's left here holding the baby with his open.

The fact market cap is so low is your answer; a placing is not viable. There will need to be deferals and loan agreements.
Lenders will have two choices:

1. Write it all off - no one wins and they will feel the pinch
2. Accept this is a profit making business for the past 10 years and yes, Covid has impacted it. Agree more generous terms and request a larger or all of the profit on box office revenue/sales/concessions next year

The best thing to do, LSE is have a stiff upper lip.

Tell yourself, you decided to short this because you saw it tanking. Stick to that now.

The same way investors will stick to their long term holding.

Where will it go?

It could either way.

Good luck to you.

Probably best if you put a provisional timeline on that £3 as 2022-2023, Sammy.

For now, this should find its way back up once we hear more on the debt convenants that Mooky has said he fully expects to receive.

With Pfizer set to share their Phase 3 trials and the White House BLOCKING additional steps to approve for FDA sign-off, no one is going to be interested in what China and Russia have to offer.

America will be steam rolling ahead in the next month with their own vaccine programme.

Trump has already requested all 50 states have a distribution centre setup and ready for this month, ahead of the US elections.

The market is already taking positions and anticipating news this week or the next.

Source: https://www.firstpost.com/world/donald-trump-says-covid-19-vaccine-to-be-ready-for-mass-distribution-in-us-by-october-condradicts-cdc-head-8823181.html

When you consider that at the current rate, there is a blockbuster every 2 weeks in 2021, it's no wonder Batman was pushed to 2022. There is just too much content in the next year.

Great for moviegoers and both cinema chains and independent cinemas.

*amongst its peers

I don't see that @ casper.

Both AMC Enterainment and Cineworld would have agreed to defer rent all-together.

This is about settling the interest on debt/loans; the suggestion of deferring that to next year, when revenue generation resumes, could see terms agreed to maintain the suspension of a dividend and attribute all profits to the lenders for their flexibility.

This would see out the survival of the company and support it on the road to recovery.

Again, Cineworld is not a lone straggler amongst within leisure and hospitality.

Agree, Ian - given the slate for 2021, lenders could negotitate to retrieve all profits to settle deferred debt. This means a suspended dividend but something that is very palletable for shareholders. This could be re-instated in 2023 for example once Cinewolrd are back on their feet and out of the covid crisis; much like the rest of hospitality and leisure.

Johnht our resident Bollywood movie lover, cited earlier that S&P analysts are predicting box office to recover to 80-85% of 2019 levels, in 2021. This is something many investors would bite their arm off, for.

With a market cap of just $388m, I don't see dilution on the cards.

The share price is just too low.

This will require engagement with lenders and Mooky (CEO) has already suggested they are supportive of this.

I fully expect this share price to respond AHEAD of that news, knowing CIneworld....

The same, Laidback I'm also invested in Tullow. It would be great to see it go to hights of 38p again!

I agree, Ian and given historic low interest rates, appreciating risk assessment, lenders stand to make money once the recovery takes place into 2021.

Check out the investor page on Cineworld on H1 and read up on the analyst updates (be mindful they call out the grade on debt securities which does implicate lenders and their appetite). At the moment, debt is the major hurdle and at the moment conversations are ongoing with advisors. The group has suspended operations to preserve cash flow because studios have delayed content (not cancelled it or pushed to PVOD).

The thing is, if there was no risk this would be significantly higher than it is. Those who have invested and hopefully averaged down are banking on a recovery play.

No one has a crystal ball but we await updates from the CEO, Mooky who's family has 90 years of cinema under their belt.

Good luck and DYOR.

Source: https://www.cineworldplc.com/sites/cineworld-plc/files/reports-presentation/2020/interim-results-presentation-2020.PDF

The fact that all exhibitions are facing difficulty should provide a little comfort that Cineworld is NOT alone in this battle.
The reasoning for their hibernation is being more logical by the day and this will mean lenders need to consider, if in the worst case, they allowed Cineworld to default, who would take over? No rival would entertain expansion at this time.

Lenders and advisors need to consider this carefully, as the current market capital is $348.55M; at 100% of shares, there isn't even enough here.

The sensible approach is to work with the lenders to defer interest and negotiate terms, which Mooky has suggested so far.

Tullow, like Cineworld are all about their debt at the moment. If oil dips below $40 for a sutainted time, they will breach a 3.5x leverage covenant due December 2020 and June 2021.

If you have the risk appetite, take a look.

Ensure your portfolio is balance so you can afford to enter into high risk plays.

I quote 2019 because it was a period pre-covid and can be compared to 2018. We have been through this same scenario before.

2018 U.K. admissions 177m
2019 U.K. admissions 176m

Since 2010, the U.K. box office has grown by 27% over the decade. 2018 operated with streaming and PVOD, yet it didn’t steal box office away.

Source: https://variety.com/2020/film/global/uk-cinema-admissions-cinema-first-2019-1203469103/

This is a recovery play, and like other players in hospitality and leisure will recover in due course.

Every cinema is facing a struggle. What is the play for lenders and backers? See them all default, despite demonstrating a decade of positive returns and passing all debt covenant tests?

Odeon is now closing up, opening weekends only.

Vue is closing a third of cinemas.

Amc is facing 6 months of liquidity before the taps run dry.

Hospitality and leisure is impacted by covid. This is not ground breaking news.

This share is a recovery play and high risk. It will not afford overnight wealth, that said I do wish guitarman would have pumped £200k in this and walked with Investroid when he exit, only with £148k profit.

Anyway I type this whilst at the gym.

Trump being discharged at 2330 BST. Should be pair I’ve got markets, tomorrow.

Johnht’s presence is a comfort. It tells the investor that he has invested so much time here, he and/or his paymasters are worried about their position. It’s a show of losing confidence. This share is incredibly volatile. If they weren’t they would not employ him to spam this BB so much.

Take comfort that he is not out to personally insult anyone, he is motivated by greed alone. Smile and ride the Cineworld rollercoaster.

-1p

Too soon?

Can I join this circle jerk but remain a spectator?