Specialist
Former C-level executive at Odeon Cinemas Group Ltd
Agenda
- Attendance expectations and pricing outlook in light of content pipeline
- Implications of theatrical window shortening for sales
- Estate restructuring across Cineworld (LON: CINE), Odeon and Vue
- OPEX and CAPEX outlook post-coronavirus
Questions
1.
What are your 2021 estimates for the UK box office revenues? What are your best-, base- and worst-case scenarios and the assumptions behind these estimates?
2.
How strong is the 2022 content pipeline and what is the outlook there?
3.
You mentioned that 2023 will be a normal year. By that, do you mean a full recovery to 2019 levels?
4.
Do you think box office revenues will ever get back to pre-coronavirus levels?
5.
Is cinema attendance expected to be in line with box office revenues? What would be the attendance expectation in 2021 vs 2019, and then moving through to 2022-23?
6.
What are your initial estimates around EBITDA break-even levels?
7.
I know that Cineworld talks about 50-55% EBITDA break-even at a global level. Without giving too much away, do you think that’s representative of the UK level as well?
8.
A couple of days ago, Disney released some news around an exclusive window of basically 45-days for blockbuster films, 30-days for smaller releases. How do you think this is likely to play out? We’ve heard from Disney now, but what is the approach likely to be from a studio post-coronavirus for blockbusters and then for smaller releases?
9.
If we take half of the theatrical window, so 45-days, as you say, can this be considered a win-win for exhibitors and studios?
10.
You mentioned there are some statistics around 80% of revenue being made in the first 2.5 weeks. What does this mean for a 45-day window? How might this impact revenue?
11.
You mentioned attendance being capped at 80%. Is part of that because there is a shift towards customers streaming films at home? What do you think about that as a potential risk? Could you expand on whether there is revenue risk? Why is attendance capped at 80%?
12.
You mentioned that there might be a plateauing of 80% attendance but that there won’t be a revenue impact of the theatrical window. Is that implying there will be 80% attendance on a 45-day theatrical window but there’ll be no revenue impact? If so, how will those revenues be recouped from lower attendance levels?
13.
How do you expect formats such as the Imax or other premium experiences to trend in being more competitive with streaming?
14.
What are your thoughts more broadly on the revenue recovery vs 2019? It seems like you’re relatively positive in the long term. How are you expecting revenue to trend vs 2019 levels over the next 2-3 years?
15.
Could you discuss the pricing trends across operators? We have heard from AMC, at a global level, that it might increase prices. It appears that Cineworld is being a bit more cautious with its approach.
16.
What can we expect across competitors around challenging admission levels for films and the opportunities in non-film revenue growth? Who do you think is best placed to capitalise on this shift and the trends more broadly in the sector?
17.
There was some growth from brands such as Everyman, these smaller formats with slightly higher price points and more premium seating options. What risk does that present to the larger chains such as Vue, Cineworld or Odeon?
18.
Cineworld, Odeon and Vue have a number of sites across the UK. What might we expect regarding closures or repositionings to match the new demand of film admissions?
19.
If we assume that revenues plateau at this 80% mark, what does that mean for profitability, given the restructuring regarding the cost base? How much margin degradation could that lead to?
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