Cineworld: Cinema chain ‘prepares to file for bankruptcy within weeks’
Shares dived by two-thirds within minutes of reports by the Wall Street Journal
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Cineworld shares have plummeted after reports the cinema chain is preparing to file for bankruptcy “within weeks”.
Shares dived by two-thirds within minutes of reports by the Wall Street Journalthat the world’s second biggest cinema business has hired lawyers from Kirkland and Ellis, as well as consultants from AlixPartners, to advise the bankruptcy process.
Cineworld has declined to comment. The reports cast uncertainty over the future of thousands of workers at its 127 UK cinemas. Cineworld employs around 28,000 workers globally, with operations in 10 countries.
Philippa Childs, head of entertainment and media union Bectu, said: “This is very worrying news, not least for the UK’s Cineworld and Picturehouse workforce who have already been through a tumultuous time during the pandemic. The UK’s cinema industry suffered an incredible blow due to Covid-19 and this latest news will be very unsettling for cinema workers.
“We will do everything we can to support our members during this challenging time and will be looking to Cineworld to mitigate the impact of any bankruptcy arrangements on its employees.”
The reports comes two days after Cineworld said it is assessing options to shore up its finances after it blamed a “limited” film slate for weak audience numbers in recent months.
The company, which also owns the Picturehouse chain in the UK and Regal Cinemas in the US, had pinned its hopes on releases such as Top Gun: Maverick, The Batman and Thor: Love and Thunder to aid its recovery from the heavy impact of the pandemic.
However, the firm told the London Stock Exchange on Wednesday: “Despite a gradual recovery of demand since reopening in April 2021, recent admission levels have been below expectations. These lower levels of admissions are due to a limited film slate that is anticipated to continue until November 2022 and are expected to negatively impact trading and the group’s liquidity position in the near term.”
The business, which was saddled with $4.8bn (£4bn) of debt at the end of the last financial year, said it was considering restructuring its balance sheet to protect its future.
At the height of the pandemic, Cineworld temporarily shut its UK cinemas and placed 5,500 workers on furlough.