Cineworld, the second largest cinema group in the world by screens, said that a weaker line up of films in the first half of the year prompted a drop in admissions, as it looks to entice viewers away from home streaming channels.
The FTSE 250 company, which added more than 7,000 screens to its portfolio after it bought US chain Regal for $3.6bn last year, said that admissions fell 15 per cent to 136m in the six months to June. On a reported basis, which strips out the impact of the Regal acquisition, admissions increased 10 per cent.
Revenues for the period, accounting for the Regal addition, fell 11 per cent to $2.1bn, just behind consensus forecasts of $2.2bn. Profit before tax fell 13 per cent to $139.7m.
Sequels, which have so often provided a boost to cinema admissions in recent years, disappointed in the first of the year with films such as Men in Black: International and Lego Movie 2 failing to draw audiences in significant numbers.
Mooky Greidinger, chief executive of Cineworld, said that he expected a better film slate in the second half.
“Very strong admissions for The Lion King demonstrated the ongoing popularity of the theatrical business around the globe, while Avengers: Endgame was the highest grossing movie of all time. Still to come are It Chapter Two, Joker, Frozen 2, and one of the most anticipated movies in recent years, Star Wars: The Rise of Skywalker,” he said.
Analysts have said that a refurbishment programme, intended to update around 150 of Regal’s cinemas, would be a key driver for growth in the group.
Cineworld said that the plans for refurbishments were “progressing well” and that it had six sites underway and 60 more in the pipeline.
As the popularity of streaming channels such as Netflix and Amazon Prime have increased, cinemas have looked to improve experiences for customers watching on the big screen. Cineworld has been opening more technologically-enhanced screens including 4D and those that have multiple projectors in order to offer 270 degree panorama. It opened 14 of the latter during the first half.
In July Cineworld paid a special dividend of 20.27 cents per share.