Shares of Cineworld Group plc (LON: CINE) today surged 17% ahead of the company’s H1 2020 earning results set for release tomorrow.
The cinema operator is expected to report a huge loss as compared to last year due to the coronavirus lockdown measures, which saw theatres closed for several months in order to combat the spread of the virus.
However, investors expect the company to report strong figures for the second quarter, which saw it reopen many of its theatres across the globe attracting a huge number of customers.
Cineworld’s CEO Mooky Greidinger said that many of its shows have been sold out since reopening its theatres as moviegoers trooped back, which should be good for the company’s bottom line.
The fact that cinemas have to implement social distancing measures means that even at full capacity they can only accommodate 60% of their previous capacity, hence, they are not generating as much revenue as they did in the past.
The lack of major blockbuster movie premiers will also have a negative impact on Cineworld’s earnings.
The cinema chain is expected to report a loss, but if today’s rally is anything to go by, it appears investors are bullish regarding tomorrow’s earnings report.
Cineworld share price
Cineworld shares today surged 17% to trade at 51.60p having rallied from Tuesday’s closing price of 44.09p.