Cineworld reveals record $2.3 billion loss and raises more debt as chiefs insist pandemic recovery is in sight

Cineworld chiefs today insisted recovery is in sight as the embattled cinema giant revealed a record $2.3billion (£1.7 billion) operating loss for 2020, and looked to raise even more debt.

The UK’s biggest film outlet, which operates under the Cineworld, Picturehouse and Regal brands, said in its full year results statement on Thursday that revenues slumped by 80% to $852 million (£621 million) last year, while net debt rose to $8.3 billion (£6.1 billion) - up $600 million (£438 million) on end 2019.

Pre-Covid the company - which made a $725 million (£531 million) operating profit in 2019 - had expanded quickly under bosses Mooky and Israel Greidinger, amassing a huge debt pile that has grown as pandemic closures saw the firm take on losses and raise new financing.

Cineworld has tapped multiple hedge funds, raising around £560 million in liquidity in November on top of a £190 million loan secured last June. Today the company said it has secured, and is seeking shareholder approval on, a $213 million (£155 million) convertible bond maturing in 2025.

Cineworld deputy chief executive, Israel Greidinger, told the Standard: “At the end of the day, the most important thing is the cash flow of the company.

“Together with the money we have just raised [the $213 million], we have enough cash to take the company through even difficult scenarios with cinemas not opening until the end of the year - and we have announced we are opening. We are well geared for the months in front of us.”

He said repaying the debt is “doable”, adding: “Our target is to reduce this debt, we don’t think that long term it is sustainable to pick a company with such a big debt. We believe we can do it... The important thing is that the average [debt] interest [rate] of the whole company is around 5%, which is very reasonable.”

The US market represents around 75% of business for the London-headquartered chain, which operates 793 venues worldwide and has around 5,500 UK staff.

Cineworld plans “a soft reopening” of US screens next week at around 60% capacity, with UK cinemas set to open on May 17.

Greidinger said: “We are focusing on 2022 as back to being a regular year, and hopefully better than 2019.”