Brian Jahra Chairman For CinemaONE Limited Has Released The Following Summary Report Of Their Audited Financial Statements For The Year Ended September 30th, 2023 (Summary)
The global cinema exhibition sector and CinemaONE continued the trajectory of rebounding from the three previous years of the adverse impact of Covid-19. In fact, Financial Year (FY) 2023 marked the first full year of operations in which CinemaONE benefited from the absence of Government mandated operational constraints in the interest of public health and safety.
Coupled with the lifting of the Covid-19 burden in FY 2023 were the major movie studio releases of true blockbuster content such as Disney’s Avatar (US $2.3B), Universal Pictures’ Super Mario Brothers (US $1.4B) and Warner Brothers’ cultural phenomenon Barbie (US $1.4B). Audiences flocked to both Barbie and Universal Pictures’ Oppenheimer (US $.9B) during the summer months, which propelled the global box office to a single month of July tally of US $4.5B, which was actually 17% higher than the pre Covid-19 three year average.
However, the summer euphoria was quickly muted by the effect of the Hollywood writers and actors strikes, with the latter not being fully resolved until earlier this December, a delay of almost 5 months. The Hollywood strikes not only shut down production, but also curtailed the capacity of key talent to promote their content, adversely affecting the tail end of FY 2023 for CinemaONE.
Financial Performance
In the context of a noteworthy recovery year, CinemaONE managed to open two new locations; namely Gulf City Mall, San Fernando and Price Plaza, Chaguanas, almost doubling CinemaONE’s screen count. The consolidated results of the Group, which now includes CINE Central Limited as a new subsidiary, did greatly assist in offsetting the operational variance of the flagship One Woodbrook Place, Port of Spain operations which narrowed the pre-Covid-19 revenue variance to a -22% gap below the pre-Covid-19 three year average on a “same store basis”, due mostly to the slow recovery of advertising and sponsorship.
Overall, the Group’s consolidated results further improved as follows: Gross Revenue increased by 77% to TT $17.9M (FY 2022: TT $10.1M). Gross Profit increased by 92% to TT $10.8M (FY 2022: TT $5.6M) and the Group returned to an Operating Profit through an improvement of 188% to TT $ 1.9M (FY 2022: TT -$.02M). The Group further narrowed the Net Loss by 69% to TT-$.6M (FY 2022: -$1.4M).
Following a successful Equity Rights Issue of TT $6.0M and consummation of debt financing from Republic Bank Limited in the amount of TT $5.7M, the Group established CINECentral and invested TT $9.9M in Property Plant and Equipment to open new cinema facilities, bringing diversity and economies of scale.
Future Outlook
The global box office is projected by industry analytics provider Gower Street to close calendar year 2023 at US $33.4B, representing 29% growth over 2022 but still -20% below the pre-Covid19 three year average of US $41.6B. CinemaONE expects a similar trend to be partially offset by the Group’s expansion to three major metropolitan areas in Trinidad. However, a lagged impact of the newly finalized Hollywood strikes should be prudently expected to trigger a regression in recovery momentum in FY 2024 as key movie titles have been postponed by approximately the same 4-5 month period of the strikes, some just outside of the Group’s FY 2024 year end, or into 2025.
Despite the above and other macroeconomic headwinds, FY 2023 demonstrated that audiences still relish the movie magic and that cinemas and studios continue to deliver global cultural impact and shareholder value. The Group thus maintains its pragmatic optimism for the big screen cinematic experience.
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