Exhibition giant Cineworld, which acquired U.S. chain Regal Cinemas in 2018 for $3.6B, reported a decrease in half-year results this morning out of London. An anticipated drop, it hasn’t diminished CEO and veteran exhibitor Mooky Greidinger’s bright outlook for the second semester while he’s also bullish on the uptake of nascent subscription program, Regal Unlimited, which launched in the U.S. less than two weeks ago. “The welcome we got from customers in the first 10 days was beyond what we expected,” he said.
The initial subscription rate is “over the business plan that we had,” Greidinger noted, telling me, “I think there is a lot of satisfaction from the price, the tiers.” There are three levels of subscription based on theater location, so how much you pay a month depends on where your neighborhood theater is. Plus, the more you pay, the more access you have to purchase tickets at other Regal multiplexes.
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Greidinger did not share numbers in these early days, and said a decision on whether to divulge them later down the road will be made at another stage. “We don’t share subscriber numbers in Europe as a general policy. I’m not sure what we are going to do in the U.S., probably not, but we’ll see.”
Cineworld based Regal Unlimited on its success with its UK program and Greidinger said he sees it as “a long-run game.” But, he allowed, “I can carefully estimate it is not going to be less successful than in the UK. Usually, Americans go to cinemas more than in England.”
The CEO further pointed to the need for sustainability. Referring to what he called “the disaster of MoviePass,” he said, “They spent their $600M or $700M and they’re not there anymore. You need to be very careful with these tools.”
For Greidinger, “All along we are saying this has been about the sustainability of the plan and keeping close to us the movie lovers who really want to go to the cinema.”
Have there been any complaints? “There are always remarks, we ask them to commit for 12 months so there are those that will be trying to commit for three months. It’s part of the process, but we didn’t get any pushback except normal remarks, nothing out of the ordinary.”
Regarding a global decrease of 11.1% in first-half revenues which Cineworld attributed to the timing of major film releases versus 2018, Greidinger reiterated that it was to be expected. “The first six months were slow compared to last year and the second six months will be the other way around.”
Cineworld does not provide forecasts, but Greidinger is “confident we are going to be in line with expectations” with July and August already strong and a host of big titles ahead. He notes that the effect of Avengers: Endgame in the first half was not so impactful compared to 2018 because there was also an Avengers movie that crossed $2B last year. “It’s not like we came after a year with no Avengers into a year with an Avengers.” Last year’s first semester was also boosted by Black Panther, Jurassic World: Fallen Kingdom — and the January overflow of 2017’s Star Wars: The Last Jedi, Greidinger noted.
For those who fret over 2020 in comparison, Greidinger offers, “The year will start with the remaining box office of Star Wars: The Rise Of Skywalker which is probably $250M-$300M just in the U.S. in January… You can’t worry too much about this. Overflow into 2020 will be very significant.”
Beyond that, Greidinger says, “I think 2020 looks very, very promising. There is a very wide range of movies.” Citing the highly-anticipated March arrival of Bond 25 in the UK in particular, he added the franchise is “the biggest proof that sequels are sustainable if you do good movies.”
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