Company Also Reports March 2023 Box Office and Provides an Update on its Claim Against Cineworld

TORONTO, April 11, 2023 /CNW/ – (TSX: CGX) – Today, Cineplex Inc. (“Cineplex” or the “Company”) reported its highest ever April box office for the first ten days of the month, reaching over $30 million in box office revenues, compared to $14 million in 2019 for the same period. The blockbuster performance of The Super Mario Bros. Movie this past weekend, which generated $204.6 million at the domestic box office over its 5-day weekend and set a record for an animated title in its opening weekend, was a key driver to our box office success.

Cineplex welcomed 1.1 million guests over the three-day Easter holiday weekend, making it the busiest weekend so far in 2023. This weekend also saw Amazon’s theatrical release, Air, delivering strong attendance among adults. While The Super Mario Bros. Movie enjoyed a healthy percentage of Cineplex’s box office, other titles including John Wick: Chapter 4, Dungeons & Dragons: Honor Among Thieves, and Air brought meaningful contributions to Cineplex’s overall box office results. In addition, Avatar: The Way of Water continues to have strong legs, now in its 17^th weekend, and representing Cineplex’s 10^th highest grossing title.

This past weekend marked another significant milestone for the CineClub subscription program as it reached 100,000 members. Launched in August 2021, the entertainment subscription program is the first of its kind in Canada and has been successful in increasing and driving frequency in attendance. The steady and consistent growth in CineClub’s membership is another indication of consumer demand for movie-going.

“The success of these record-breaking results demonstrates a point you’ve heard me say in the past – when there is compelling content, consumer enthusiasm for theatrical moviegoing is as strong as ever. The success of The Super Mario Bros. Movie is just another example of strong consumer demand for seeing great films on the big screen,” said Ellis Jacob, CEO & President, Cineplex. “As we move forward, we are encouraged about the steady flow of content, including the commitment streamers are making to theatrical. We are excited about the strong results we are witnessing in April as it reflects a healthy box office across an expansive range of films and genres. We look forward to many more highly anticipated films set to hit the big screen over the next few months including Guardians of the Galaxy Vol. 3, Fast X, The Little Mermaid, Spider-man: Across the Spider-Verse, Indiana Jones 5 and the Dial of Destiny, Mission: Impossible 7 Dead Reckoning Part One, Oppenheimer, Barbie, and many more,” Jacob concluded.

March 2023 Box Office:

In the month of March, Cineplex reported box office revenues of $41 million, which amounts to 65 per cent of box office revenues generated during the same month in 2019. This followed encouraging results in January and February, where in each month the Company’s box office reached 88 per cent of 2019 levels for the same month, leading to aggregate quarterly results of $123 million or 79 per cent of 2019.

The top three leading film performances during March included John Wick: Chapter 4, Creed III, and Scream VI, all generating more domestic box office revenues in their opening weekend than any previous version in their respective franchises in the pre-pandemic periods, clearly demonstrating strong consumer demand. These three titles represented a combined 45 per cent of Cineplex’s total box office for the month.

While these films performed well, March 2019 is a tough comparative period as it included Captain Marvel which opened in early March and generated over $150 million at the domestic box office in its opening weekend and over $425 million during its full run.

Cineworld Update:

On April 2, 2023, Cineworld Group plc (“Cineworld”) entered into a restructuring agreement, with some of its lenders, regarding key terms of a proposed Cineworld restructuring transaction pursuant to Cineworld’s U.S. Chapter 11 bankruptcy proceedings (the “Cineworld Bankruptcy Proceedings”), and on April 11, 2023, Cineworld filed its proposed chapter 11 plan of reorganization (the “Cineworld Chapter 11 Plan”) in connection therewith. The proposed restructuring transaction contemplates holders of general unsecured claims (“GUC”), which includes Cineplex’s claim arising from its judgment against Cineworld of approximately $1.24 billion CDN, to the extent such claims are allowed claims in the Cineworld Bankruptcy Proceedings, receiving, in aggregate, (i) $10 million in cash and (ii) interests in a litigation trust representing a right to recovery with respect to amounts relating to certain class actions against credit card issuers (collectively, the “Recovery Pool”). The allocation of the Recovery Pool among general unsecured creditors has not yet been determined. While at this time the expected distribution amount in respect of Cineplex’s claim is not known, Cineplex does not anticipate that its recovery will be material.  Given the uncertainty to date as to any potential recovery in respect of Cineplex’s claim, no amount has been accrued as a receivable in Cineplex’s financial statements.

The Cineworld Chapter 11 Plan remains subject to creditor approval and court approval.  If the Cineworld Chapter 11 Plan receives the requisite creditor and court approvals and is implemented, the Cineworld Chapter 11 Plan will be binding on all affected parties, and Cineplex’s only entitlement in respect of its judgment against Cineworld will be to its allocated portion of the distributions from the GUC Recovery Pool.   

Additional information in respect of the Cineworld Bankruptcy Proceedings, including copies of the Cineworld restructuring agreement and the Chapter 11 Plan, can be found at the Kroll website in respect of the Cineworld Bankruptcy Proceedings at: https://cases.ra.kroll.com/cineworld/.

About Cineplex

Cineplex (TSX:CGX) is a top-tier Canadian brand that operates in the Film Entertainment and Content, Amusement and Leisure, and Media sectors. Cineplex offers a unique escape from the everyday to millions of guests through its circuit of over 170 movie theatres and location-based entertainment venues. In addition to being Canada’s largest and most innovative film exhibitor, the company operates Canada’s favourite destination for ‘Eats & Entertainment’ (The Rec Room), complexes specially designed for teens and families (Playdium), and a newly launched entertainment concept that brings movies, amusement gaming, dining, and live performances together under one roof (Cineplex Junxion). It also operates successful businesses in digital commerce (CineplexStore.com), alternative programming (Cineplex Events), motion picture distribution (Cineplex Pictures), cinema media (Cineplex Media), digital place-based media (Cineplex Digital Media) and amusement solutions (Player One Amusement Group). Providing even more value for its guests, Cineplex is a partner in Scene+, Canada’s largest entertainment and lifestyle loyalty program.

Proudly recognized as having one of the country’s Most Admired Corporate Cultures, Cineplex employs over 10,000 people in its offices and venues across Canada and the United States. To learn more, visit Cineplex.com.

Caution Regarding Forward-Looking Statements

Certain information included in this news release contains forward-looking statements within the meaning of applicable securities laws. These forward-looking statements include, among others, statements with respect to Cineplex’s objectives, goals and strategies to achieve those objectives and goals, as well as statements with respect to Cineplex’s beliefs, plans, objectives, expectations, anticipations, estimates and intentions. The words “may”, “will”, “could”, “should”, “would”, “suspect”, “outlook”, “believe”, “plan”, “anticipate”, “estimate”, “expect”, “intend”, “forecast”, “objective” and “continue” (or the negative thereof), and words and expressions of similar import, are intended to identify forward-looking statements.

By their very nature, forward-looking statements involve inherent risks and uncertainties, including those described in Cineplex’s Annual Information Form (“AIF”) and its MD&A for the year ended December 31, 2022 ( “MD&A”). These risks and uncertainties, both general and specific, give rise to the possibility that predictions, forecasts, projections and other forward-looking statements will not be achieved. Certain material factors or assumptions are applied in making forward-looking statements and actual results may differ materially from those expressed or implied in such statements. Cineplex cautions readers not to place undue reliance on these statements, as a number of important factors, many of which are beyond Cineplex’s control, could cause actual results to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates and intentions expressed in such forward-looking statements. Cineplex’s expectations with respect to liquidity and capital expenditures, including its ability to meet its ongoing capital, operating and other obligations, and anticipated needs for, and sources of, funds; Cineplex’s ability to execute cost-cutting and revenue enhancement initiatives; and risks generally encountered in the relevant industry, competition, customer, legal, taxation and accounting matters. The foregoing list of factors that may affect future results is not exhaustive. When reviewing Cineplex’s forward-looking statements, readers should carefully consider the foregoing factors and other uncertainties and potential events, including possible consequences of COVID-19, its variants or other pandemics. Additional information about factors that may cause actual results to differ materially from expectations and about material factors or assumptions applied in making forward-looking statements may be found in the “Risks and Uncertainties” section of Cineplex’s MD&A.

Cineplex does not undertake to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable Canadian securities law. Additionally, we undertake no obligation to comment on analyses, expectations or statements made by third parties in respect of Cineplex, its financial or operating results or its securities. All forward-looking statements in this news release are made as of the date hereof and are qualified by these cautionary statements. Additional information, including Cineplex’s AIF and MD&A, can be found on SEDAR at www.sedar.com.

SOURCE Cineplex

For further information: Investor Relations: Mahsa Rejali, Vice President, Corporate Development and Investor Relations, [email protected]; Media Relations: Judy Lung, Director, Communications, [email protected]