Cineworld plans 40 new sites as it reports strong annual results

Cineworld Group plc has posted strong results for the year ended 31 December 2016, and plans to open 40 new multiplexes creating 1,000 jobs over four years.

The cinema giant saw total revenue of £797.8m, an increase of 13.0% on a statutory basis, and 8.7 % on a constant currency basis.

Overall admissions increased by 7.2%, whilst average ticket pricing remained broadly flat on a constant currency basis at £4.99, giving an overall increase in total box office revenues of 7.0%. Spend per person increased by 5.1% to £1.90 resulting in retail revenue growth of 12.6%. Other revenues increased by 9.8%.

The results for the UK & Ireland include the two cinema chain brands in the UK, Cineworld and Picturehouse, and for the first time also include the five Empire cinemas acquired on 11 August 2016.

Box office revenue represented 65.6% (2015: 66.9%) of total revenues for the UK & Ireland. Admissions in the year increased by 1.8% and combined with an increase in the average ticket price of 2.1% this resulted in revenue growth of 3.9%. This is a pleasing result as admissions in the UK & Ireland cinema industry as a whole were down 2.1% during the same period (source: UK Cinema Association).

In 2016, in the UK, the top three films grossed £149.4m (Star Wars: Rogue One - £50.7m, Fantastic Beasts and Where To Find Them - £50.6m and Bridget Jones's Baby - £48.1m) compared to the top three films in 2015 which grossed £245.4m (Spectre - £93.8m, Star Wars: The Force Awakens - £87.3m, and Jurassic World - £64.3m).

The average ticket price achieved in the UK & Ireland grew by 2.0% to £6.25 (2015: £6.13). The increase in average ticket price was in part due to price rises during the period, but is mainly reflective of the continued expansion and popularity of premium offerings.

Food and drink sales are the second most important source of revenue and represented 23.8% (2015: 23.1%) of total revenues for the UK & Ireland. Total retail revenues in the UK and Ireland were £117.5m (2015: £107.2m) increasing by 9.6%.

Tony Bloom, Chairman of Cineworld plc said, 'I am pleased to report that 2016 was another gratifying year for the Cineworld Group and its shareholders as we achieved an important milestone - over 100 million people came through our doors to watch a movie. I would have found this inconceivable when we first started the Company with just one multiplex in Stevenage in 1996!

'The growth in admissions and EBITDA enabled the Board to declare an increased final dividend of 13.8p per share, making a total of 19.0p for the year. Pleasingly, the dividend has now been increased in seven of the past 10 years since the Company was listed.

'The future looks bright and I look forward to 2017 with confidence. There is a strong film release programme planned for the year, we have an excellent estate which will continue to grow (with a further 13 cinemas due to open), and a number of major refurbishments are planned.

'Importantly we have a strong Balance Sheet and can undertake our strategic objectives without financial strain. We are at the forefront of providing the latest technology to our customers and most of all we have an outstanding management team with extensive experience who are continually focussed on ensuring that Cineworld is always 'The Best Place to Watch a Movie!'

Mooky Greidinger, CEO of Cineworld Group plc, said, '2016 was another record year for Cineworld. The results were driven by a focus on costs and operating efficiencies and the expansion of the estate.

'The Group progressed well with our strategy, we opened eight new sites, split equally between the UK and the ROW, acquired five Empire cinemas, completed nine great refurbishments, six in the UK and three in the ROW, and introduced five new IMAX screens and thirteen 4DX screens.

'All of this was accompanied by our professional team who provided a high level of customer service to deliver our vision of being 'The Best Place to Watch a Movie!'

'Our revenues grew by 13.0% and EBITDA by 13.2% and we were successful in maintaining our margins, which enabled an increase in the dividend for the year. We look forward to 2017 with confidence in our business, our plans for further expansion and refurbishment and the exciting film release schedule.'