Shares of cinema operator Cineworld Group plc (LON: CINE) edged 6.5% higher after the company announced that it had reached an agreement to reopen its Regal theatres in the US starting April 2, 2021.
The cinema operator said that a limited number of its US Regal theatres would reopen on April 2 to show the ‘Godzilla vs Kong’ movie before reopening all its theatres on April 16 to coincide with the release of the Mortal Kombat movie.
Cineworld also announced that it had signed a multi-year deal with Warner Bros. Pictures Group to showcase its movies at their opening in all its US theatres in exchange for a 45-day window of theatrical exclusivity.
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The company’s UK cinemas are set to reopen in May as the British government’s current guidelines are set to allow indoor socialising and hospitality as from May 17. However, the company did not provide a specific date for the UK reopening.
Cineworld has agreed to a 31-day exclusivity period for its UK cinemas before Warner Bros. can make its movies available for streaming. The new deal guarantees that Cineworld will have a significant advantage once it reopens its US and UK movie theatres.
The company’s shares later gave up all their gains and headed into negative territory as sellers stepped in and extended yesterday’s decline. The pullback is warranted given that Cineworld shares have been rising for the past few months.
“We have long-awaited this moment when we can welcome audiences back to our Regal theatres and restore our essential role within the communities we serve,” said Cineworld’s CEO, Mooky Greidinger.
“With capacity restrictions expanding to 50 per cent or more across most US states, we will be able to operate profitably in our biggest markets. We will also be monitoring developments closely in the UK and across Europe as we set to gradually reopen across the world in line with local government guidance.”
Cineworld share price.
Cineworld shares edged 6.51% higher to trade at 118.55p, rising from Monday’s closing price of 111.30p.