Village Roadshow Ltd (VRL) acknowledges its cinemas and theme parks may be forced to close, citing international precedents.
The company told investors today it was making contingency plans if that happens as it reported theme park attendances have slumped due to COVID-19 and curbs on international travel.
The postponement of Hollywood releases Mulan, Fast & Furious 9, A Quiet Place II, Peter Rabbit 2: The Runaway and No Time to Die would have a significant impact on the exhibition division’s earnings, it said.
As IF reported, Palace Cinemas closed indefinitely yesterday and other chains have reduced capacity and staggered seating.
The top 20 titles’ BO takings fell to an all-time low in the week ending yesterday, grossing $6.9 million. This weekend will be even worse with only one new wide release, Roadshow’s The Current War.
The period drama about the face-off between irascible inventor Thomas Edison (Benedict Cumberbatch) and genteel industrialist George Westinghouse (Michael Shannon) was shot in 2017, was caught up in the collapse of the Weinstein Co., opened in US cinemas last October and ended up making a lousy $US5.9 million.
The outlook for cinemas is bleak. Transmission Films has just pulled its upcoming releases including I Am Woman, The Very Excellent Mr Dundee and Hope Gap, and at least some other indie distributors are likely to follow.
The latest Hollywood title to shift is Warner Bros’ In the Heights, which was slated for June 25.
VRL said it is taking decisive action to mitigate the significant adverse impact of COVID-19 on its businesses and is in discussions with industry groups and government at federal, state and local levels to develop “action plans and support.”
It flagged a series of cost-saving initiatives including cutting senior executives’ salaries, eliminating bonuses and asking all employees to take leave to reduce employee costs.
While the company said it continues to assist private equity companies Pacific Equity Partners (PEP) and BGH Capital with their due diligence processes after both lodged bids, it offered no guidance.
PEP’s bid last December valued the company at almost $1 billion. However analysts believe a takeover is now highly unlikely given the stock market crash and economic outlook.