Cineplex faces another quarterly loss as movie theatres slowly reopened across Canada

TORONTO —
Projectors began lighting up the big screens at many Cineplex Inc. movie theatres over the spring, but Canada’s biggest cinema chain still faced another quarter of deep losses.

The impact of theatre closures from the COVID-19 pandemic and moviegoers still cautious to return to multiplexes continued to wreak havoc on the company’s financial results in the second quarter as it lost $103.7 million.

Cineplex also introduced a ticket price increase across the country, which chief executive Ellis Jacob told The Canadian Press was “about three per cent, on average.”

That would amount to nearly 50 cents extra for a regular ticket at one of the Toronto locations, though Jacob points out the price could be less substantial in other parts of the country. It could also be more for premium tickets, such as Imax or VIP theatre screenings.

The decision was made to “kind of offset operating costs – all of the costs have gone up,” Jacob said of operating in the pandemic.

“It was basically early spring that we started to look at it because we were looking at costs and we were looking at where things stood and we haven’t taken a price increase for a while.”

Cineplex’s loss amounted to $1.64 per diluted share for the quarter ended June 30 compared with a loss of $98.9 million or $1.56 per diluted share a year ago.

Total revenue was $64.9 million, up from $22 million in the same quarter last year.

Box-office sales accounted for $12.5 million of revenue compared with a nominal amount a year ago when the company had just six theatres open in Alberta in June 2020.

Food service revenues, which incorporates results from concession sales and food delivery orders, rose to nearly $13.3 million from almost $3.3 million a year ago.

Ticket sales were dominated by “F9: The Fast Saga,” even though it opened less than a week before the quarter ended, while “A Quiet Place Part II” also proved popular. About 1.1 million patrons showed up in the period, though the number was front loaded to the first week of reopening.

Cineplex’s media revenue rose to $9.4 million compared with $8.1 million in the same quarter last year, while amusement revenue increased to $22.2 million, up from $3.7 million. Other revenue increased to $7.6 million from $7.1 million a year ago.

Running a business in the pandemic has been a challenge for every sector, but movie theatres have been hit especially hard with nationwide closures and major Hollywood titles jumping ship to debut on streaming platforms or digital rental services.

Cineplex started the quarter with just 38 theatres open across the Canada and wrapped the three-month period with 86 in operation as health officials pulled back on mandatory closures and eased capacity restrictions in some regions.

Ontario and Manitoba did not see any ticket sales in the quarter as they remained closed until mid-July, when Jacob said all of the company’s theatres were open.

This report by The Canadian Press was first published Aug. 12, 2021.