New York – Britain’s Cineworld Group, the world’s second-largest cinema operator, has filed for creditor protection in the United States to allow it to continue operating while it works out a debt restructuring plan with creditors. The bankruptcy applies to businesses in the US, UK and Jersey. The company also operates in the Czech Republic through the Cinema City division.
Cinema operators are troubled by lower attendance. The covid-19 pandemic has also limited the offer of films in cinemas, mainly “blockbuster” films. In addition, Cineworld has a high debt. The firm took on debt in 2017 to finance part of its $3.6 billion (CZK 89.1 billion) purchase of Regal, and later to survive the pandemic. Its net debt, including leases, was $8.9 billion at the end of 2021. Without leasing obligations, then USD 4.84 billion. The company’s market value, according to Tuesday’s closing share price, is just £54 million (CZK 1.5 billion).
Cineworld operates more than 9,000 theaters in ten countries and has approximately 28,000 employees. According to its website, Cinema City in the Czech Republic operates 12 multiplexes and one megaplex in seven cities, namely in Prague, Brno, Liberec, Pardubice, Pilsen, Ústí nad Labem and Ostrava.
Speculations of bankruptcy appeared in the media as early as last month, and the company later confirmed that it was considering filing for protection from creditors in the US. Marketing manager Lenka Tichá stated at the time that multiplexes in the Czech Republic will function as before. “All matters related to the announcement that recently appeared in the media relate only to the internal financial affairs of the Cineworld Group and will not have any effect on the operation of our multiplexes or the visit of our customers,” said Tichá.
Britain USA film service by Cineworld