Financial News

  • 15 August 2014, 5:22

Cineworld Blames World Cup For UK Decline

Cineworld saw its profit drop by 16% in the first half of the year, as its UK business was hit by competition from the World Cup.

For the six months to the end of June, the cinema operator reported a pre-tax profit of 13.9m, down from 16.5m for the same period in 2013.

UK box office revenues fell by 0.5% as Britons chose to stay in to watch the World Cup games.

The company said admissions in Britain were 3.4% lower compared to the year before.

It comes as Cineworld's boss warned the World Cup is also likely to impact the next quarter.

Chief executive Moshe Greidinger said: "Trading in the opening weeks of Q3 2014, as expected, has been lower than the prior period due to the impact of the final stages of the World Cup and the phasing of film release dates."

The football competition hit the UK cinema industry as a whole, which suffered a 5.7% decline.

But despite its profit drop, Cineworld saw its revenue grow by 33% to 268.6m.

It was boosted by strong sales at Cinema City, the eastern European business it bought for more than 510m in February.

The group said films such as Guardians Of The Galaxy and The Hobbit: The Battle Of The Five Armies were the key titles that pulled audiences in.

Cineworld is the largest cinema operator in the UK and Ireland and has a market share of 27.9%.

Its ticket prices rose by 2.6% during the first six months to reach an average of 5.53.

Speaking of future growth plans Mr Greidinger said: "We have already identified significant further opportunities and we now expect to generate annualised synergies of 5m within the next three years."

He added: "Overall, the strength of the film line up in the second half, coupled with our solid first half performance, gives us confidence and we are on track with our plans for the year."

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