Cineplex Inc. plummeted 29% up to a record low on Monday after Metro-Goldwyn-Mayer delayed the release of James Bond movie ‘No Time to Die’ until April.
The decline followed other theater stocks, including Cineworld Group Plc, which agreed to purchase Toronto-based Cineplex for C$34 a share year that is last strolled away from the deal in June. Cineplex closed at C$4.75 after suffering its biggest drop that is one-day March 16, when the chain first closed locations to limit the spread of Covid-19. The venues started reopening through the summer, as government-imposed lockdowns eased.
The dominoes keep dropping and materially jeopardizing the effort of film theaters to monetize a reopening that started this summer, but hasn’t had much to offer audiences in terms of new releases,” National Bank Financial analyst Adam Shine stated in an Oct. 4 note in which he downgraded Cineplex to a hold-equivalent rating from buy“With each film postponement.
A Cineplex bond that is convertible in 2025 additionally tumbled Monday, falling 10% to trade at 89 cents on the dollar. The company closed the C$316 million ($238 million) convertible issue in July as part of a liquidity plan to survive the pandemic.
Cineplex has struggled as film releases have now been delayed
A wave that is second of virus in cities including Toronto and Ottawa prompted Ontario’s government to tighten restrictions again on Friday, imposing brand new rules on restaurants, gyms and event facilities. Theaters are maybe not suffering from the latest measures, though they already are running under capacity restrictions. Toronto-based Cineplex stated it doesn’t have any plans that are current close theaters. Cineplex Inc. plummeted 29% up to a record low on Monday.
“we are staying the program and will proudly continue providing a safe, comfortable and welcoming movie-going environment for Canadians,” Cineplex spokeswoman Sarah Van Lange said in an emailed statement while we are always reviewing and refining our working plans.