Cineworld under pressure as box office sales slow

Cineworld revenues grew 10 percent, but shares took a fall on Thursday.

Cineworld (LON:CINE) reported a 7 percent increase in revenue for the past 10 months, amid the release of several highly anticipated blockbusters.

Family favorites such as Despicable Me 3, the critically acclaimed Dunkirk and the upcoming release of Star Wars helped boost revenue across the period.

Nevertheless, shares in the cinema company dipped, as investors noted a marked slowdown in box office sales as consumers increasingly turned to streaming services.

Cineworld said: “Growth continues to be driven by the expansion of our estate, the improved results from the ongoing refurbishment programme and the continuing roll-out of our premium formats.”

Revenues across UK box offices grew 6 percent, dipping from the 12 percent gain reported in the first half, which nonetheless proved ahead of the market’s 2 percent growth.

Moreover, overseas box office revenue rose 8 percent at actual exchange rates, after an initial growth of 14 percent during the first half.

Total group revenue for the period from the beginning of January to mid-November increased 7 percent at constant currencies. Specifically, its UK arm grew 6 percent alongside a up 7 percent for its international business.

Retail revenue rose 9 percent, 7 percent in the UK and a recorded 13 percent rise overseas, respectively.

Cineworld opened a total of seven new cinemas in the second half of this year, including three in the UK, with a total of 83 screens.

Additionally, it unveiled six new 4DX screens, bringing its total to 34.

4DX screen technology combines motion seats and special effects including wind, fog, lightning, bubbles, water, rain and scents, in both 2D and 3D formats for a fully immersive entertainment expeirence.

Overall, full-year guidance remains the same as a result of a strong series of upcoming releases across the Christmas period, such as Pitch Perfect 3 and Star Wars: The Last Jedi.

Shares in the company are currently trading marginally downwards at 1.64 percent as of 11.34AM (GMT).