Regal Cinemas Parent Company—Cineworld Group—Files Chapter 11

Cineworld Group is the second largest movie theatre chain in the world, although many people may not know who they are. Perhaps identifying the British company—who operates in nearly a dozen countries—as the owner of Regal Cinemas may help breed a bit of familiarity.

Despite their size, even Cineworld was not impervious to the complications of the pandemic. The persistent global health crisis forced many businesses to close, disproportionately affecting industries where maximum occupancy is essential to the revenue stream. With this type of impact, Cineworld Group, alone, lost $2.7 billion in 2020, and then another $566 million in 2021.

But even a big entity—one that owns at least 500 movie houses in the United States—faces difficulties, building up $4.8 billion in [net] debt, before factoring in other liabilities. This has led to Cineworld announcing, this week, it has filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the Southern District of Texas. They hope the effort will help to shed their debt and establish a new foundation that could lead to more financial balance and stability and, hopefully, provide better leverage as the cinema industry attempts to move forward from the pandemic.

Indeed, as Cineworld CEO Mooky Greidinger confides: “We have an incredible team across Cineworld laser-focused on evolving our business to thrive during the comeback of the cinema industry. The pandemic was an incredibly difficult time for our business, with the enforced closure of cinemas and huge disruption to film schedules that has led us to this point.”’

Filing for bankruptcy, Greidinger assures, is actually part of the company’s continuous efforts to fortify their financial position. Furthermore, he insists, they will pursue a “de-leveraging strategy” to develop a more stable capital structure.

Greidinger goes on to detail how this effort will allow them to continue to strategize how they can deliver “the most immersive cinema experiences for our guests through the latest and most cutting-edge formats and enhancements to our flagship theatres.” He concludes: “Our goal remains to further accelerate our strategy so we can grow our position as the ‘Best Place to Watch a Movie.’”