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Good news. The "selected US cities" part is important. It shows a willingness by cinemas in the US to stagger their openings across states whilst some of the harder hit states continue their lockdowns.

Anyone who got in at 22 p was quite fortunate to pick that particular bottom. It was a for one day only offer. The next day the share price went up 150% to 54 p.

lol. The markets moving. rip is in!

Build it and they will come. Look at the evidence coming out out markets that have re-opened such as Asia and Sweden.

"The recent success of Peninsula, a Korean-language film that debuted in South Korea on July 15 and made more than $20m in the box office, caught the attention of executives in Los Angeles." Financial Times, 24th July

"Some executives have also been following the strong performance of the Oscar-winning Little Women in Denmark, where it happened to be released after lockdown, almost half a year after it was rolled out in the rest of the world." Financial Times, 24th July

People will turn up if it's open and there's something worth watching on. I'm off down to Cineworld Wakefield or Leeds on Friday if it re-opens. I'm not concerned about COVID as long as there's some basic social distancing and hygiene measures implemented.

Some fair points triumph. Things have certainly been getting pretty heated on here. It’s understandable given the money that people (Including myself) have got on the line. Personally, I’m not saying that CINE is a sure thing or guaranteed to survive. What I’m saying is that in my opinion, on the balance of probabilities, I expect the business to weather the storm and bounce back resulting in a multi bagger. I can see the risk but based on what I know I’m comfortable with it for now.

Best of luck laidback. Definitely think there's good potential of a multi bag here if the company is able to weather the storm.

Yeah. That seems like it could potentially be a smart move for a company like Amazon or Netflix.

Also from Cineworld website - when you click on a movie:

“ We don't currently have any screenings that match your selection Please change your selection to see our other screenings.”

“A full list of film times from Friday onwards will appear on Tuesday.”

Sounds like booking may be online on Tuesday.

I can’t see cancelled dividend driving the price down any further. Surely that was already priced in months ago because it was obvious there wasn’t going to be any dividends for some time due to the dire situation.

Cash call I also can’t see happening because they’ve already said they’ve got enough liquidity to see them through until next year, so how would they justify it.

The biggest threat to the price in my opinion is further dicking around by the studios on release dates or a further deterioration of the situation in the USA or European countries like Spain. An all out second wave could be disastrous.

In my opinion it is anybodies guess what is going to happen next week. If I had any confidence it was going to continue falling I’d open a short position to try and recoup some of my losses from last week. As far as I’m concerned it might get driven down further or it might bounce straight back. There’s certainly some potentially good news in the pipeline regarding Tenet and UK reopening next week.

It may well get shorted down to 20/30p and then get ridden all the way back up again when some good news breaks. I saw it happen over at Aston Martin who have their own debt problems a couple of months ago. I had a smallish position there and watched the stock get hammered all the way down to sub 30 p. I got fed up and closed my position and put my money in something else. Sure enough, a few days later it went off like a rocket and I missed out. A similar scenario could play out here. Patience is often important in this game.

@indepth - Been having another look at the lease liabilities and trying to get my head around what you're saying. Think it is a difficult one to be able to fully understand unless you are a professional corporate accountant. However, my take on it is that this IRFS business means that you are able to reclassify parts of your lease liabilities as rights of use assets and lease interest. I can't see why that indicates that they may have fudged it, but simply reclassified based on the new accounting practices.

I think really in terms of this share price, the above is probably irrelevant. What basically matters is whether they are going to be able to successfully re-open in the US and get the numbers in over the next couple of months. That's the gamble here. From what I've been reading it sounds like there has been pretty good uptake on re-opening in China and Europe, which is promising. My personal opinion is that if they are open and blockbusters are showing, people will go. Let's see what happens in the next couple of weeks.

Where do you think the 2 bn of lease liabilities went indepth? Is it not possible that they reduced costs by renegotiating leases and closed unprofitable venues?

I've been going through the accounts and the latest Fitch Ratings report this weekend and what I have found particularly interesting is the operating profit and finance costs.

The debt burden excluding the lease liabilities is 4.156 bn. In 2019, the operating profit was 725 m and the finance costs 542 m. The net profit came in at 180 m. If you consider that the maturity date on the majority of the loans is 2025, then if the business can weather the storm and bounce back next year then it has the potential to become a money machine in a few years time once the loans have been repaid. If you genuinely believe in the business and are super long on it as an investor, then assuming the company survives Coronavirus, you may well be greatly rewarded.

Regarding the last quote:

"The increase in liquidity modestly eases Cineworld's financial risks and provides an additional nine-to-10 month cash-burn capacity based on Fitch's estimates. This adds to the five-to-six months of liquidity that Cineworld retained when cinemas closed in mid-to-late-March."

Is my interpretation correct that Fitch believe Cineworld have 6 months of cash burn liquidity taking us from March to September 2020, then an additional 10 months of cash burn liquidity taking us from September 2020 to July 2021? If that is the case then Cineworld are in a far more robust position to weather this storm than what I previously thought. They're likely to be making money again in the next 2 months.

Amount Type Maturity Rating Status
------------
1.930 bn USD Term Loan Feb 2027 B Rated Cancelled
2.720 bn USD Term Loan Feb 2025 B Rated Outstanding
0.215 bn USD Term Loan Feb 2025 B Rated Outstanding
0.648 bn USD Term Loan Sep 2026 B Rated Outstanding
0.573 bn USD Revolving Credit Feb 2023 B Rated Outstanding
------------
4.156 bn USD

Estimated Cash Burn: 35 m to 40 m USD per month

"Cineworld's scale and cash-generative business model are supportive of a rapid recovery if cinema attendance levels return to normal."

"Lockdowns in the US, UK and Europe have necessitated the closure of Cineworld's cinemas. Our base case forecasts negative cash flow of about USD35 million-USD40 million per month while its cinemas remain closed."

"The increase in liquidity modestly eases Cineworld's financial risks and provides an additional nine-to-10 month cash-burn capacity based on Fitch's estimates. This adds to the five-to-six months of liquidity that Cineworld retained when cinemas closed in mid-to-late-March."

As of 31st December 2019, current assets are reported as 0.449 bn and current liabilities 1.490 bn.

0.449 / 1.490 = 0.301

You did well to get out prior to yesterdays bloodbath Investroid. I was expecting a bad day, but I didn't for one moment think it would be as bad as that. I agree with your analysis. If Tenet releases towards the end of August then all is not lost and things can potentially get back on track again.

It isn't just Variety who is reporting this, the Financial Times also ran a piece on this on Thursday that indicated Hollywood was beginning to change its thinking and become more flexible on release dates. They have apparently seen some very encouraging results from cinemas that recently reopened in Asia and Europe and are now starting to think in terms of staggered releases of blockbusters around the world. This is the right strategy in my opinion, in fact the only current sensible strategy.

"Hollywood is preparing to tear up its playbook for releasing billion-dollar blockbusters, as the pandemic forces big movie studios such as Disney and Warner Bros to lean more heavily on cinemas outside the US."

"After repeatedly postponing the release of Tenet, a $200m-budget thriller directed by Christopher Nolan that would have been the first big post-lockdown release, Warner Bros is now privately committing to a late-August debut in markets that are ready, according to people familiar with the matter."

Cineworld is not the only cinema chain with debt and cash flow problems. AMC for one are also in trouble. Ultimately, I do not believe that studios will allow cinemas to go out of business by indefinitely delaying their releases. This is because as others have rightly pointed out previously, the studios need the cinemas to showcase their movies. Yes, there has been an increase in consumption of VOD content over recent years, but this is not a replacement for the unique social experience of cinema. Nor is it likely to generate as much cash as the box office does.

Proxima?

pmsl

I was following CARD and it did go from 30 p to 50 p shortly before re-opening. It has tracked back down a bit more recently though. The problem here is that although it is a positive that the UK should be re-opening on 31st July, there is so much uncertainty hanging over the US and America accounts for around 75% of CINE business. Its also this US uncertainty that is causing the studios to delay the blockbusters that are essential to the cinemas. We need some good news to start coming out of the US for this to take off again.

Thanks, put. Makes sense. I was just having a look at it and it went from +2.83% to -21.43% in the blink of an eye. Good to know correlation between the two stocks is limited.