Yahoo News Movie Theater Advertiser National CineMedia Q2 Sales Sink 96% — A Preview Of Exhibition Woe
National CineMedia isn’t a movie chain but it’s the nation’s largest cinema advertising network and it saw revenue plunge by more than 96% last quarter as theaters were shuttered for the entire period, a steep dip that’s likely to be repeated as exhibitors report earnings starting tomorrow with Cinemark and Marcus.
AMC Entertainment reports Thursday. Earlier today, ratings agency S&P downgraded the nation’s largest exhibitor after it concluded a restructuring that involved a distressed debt exchange but could keep it going until spring even in the worst case scenario.
More from Deadline
AMC Networks CEO Josh Sapan Talks 'Walking Dead' Production Restart, Upfront Ad Outlook
Cinemark Has $525M In Cash, Sees 2021 As "Transition Year" With "Normalized" Box Office In 2022
National CineMedia swung to a net loss of $13.8 million, or $0.18 a share, compared to net income of $8.9 million, or $0.11, the year earlier. Total revenue plunged 96.4% to $4 million from $110.2 million. Operating losses of $23.8 million compared with a profit of $37.7 million for the second quarter of 2019.
The company is hosting a conference call at 5 pm ET to discuss its numbers and outlook as best it can.
It said it has continued to work to preserve cash and ensure sufficient liquidity to endure the pandemic, even if prolonged, including temporary furloughs or pay cuts for all employees. It has suspended all non-essential operating and capital expenditures and worked with landlords, vendors, and other business partners to manage, defer or abate costs.
As of June 25, it had $249.9 million of cash, cash equivalents and investments.
It said the exhibition industry “has historically fared well during recessions, and management remains optimistic, though cannot guarantee, that the founding members and network affiliates will rebound and attendance figures will benefit from pent-up social demand as state and local restrictions and other social distancing orders subside and people seek togetherness with a return to normalcy.”
However, the ultimate impact of COVID, it noted, will be dictated by the virus’ “currently unknowable duration and the effect on the overall economy and the advertising market and of responsive governmental regulations, including mandated business closures which could recur after the initial reopening causing subsequent closure periods, social distancing and theater capacity restrictions.”
It cautioned that the business could also be affected by post COVID-19 changes in consumer behavior “such as the movie audience’s willingness to return to the movie theaters and the impacts of social distancing, face mask requirements and other measures on the movie going experience, or further reductions to the customary theatrical release window.”
Best of Deadline
Coronavirus: Movies That Have Halted Or Delayed Production Amid Outbreak
Hong Kong Filmart Postponed Due To Coronavirus Fears; Event Moves Two Weeks Before Toronto
Sign up for Deadline's Newsletter. For the latest news, follow us on Facebook, Twitter, and Instagram.
