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Cineworld to reopen all cinemas by July

John David Washington
John David Washington

Cineworld has vowed to open all its cinemas in July as lockdown restrictions are eased, sending shares soaring by almost a quarter.

The FTSE 250 company expects government restrictions on cinemas to be lifted by July in the 10 countries where it operates. Cineworld has 787 sites in the UK, Ireland, US , Israel and several countries in Eastern Europe.

It has also secured $110m (£100m) of extra cash by increasing the amount it can borrow from lenders.

The firm said this will give it enough cash to survive even if cinemas are shut for the rest of the year - which it considers very unlikely.

When the pandemic gathered pace in March, the world's second-largest cinema operator warned Covid-19 could threaten its survival by putting agreements with creditors at risk.

Shares soared 23pc to 95p on the update, but the stock is still trading at about half its pre-crisis level.

The cinema experience is expected to change significantly when theatres reopen due, with empty seats in between groups of viewers to ensure social distancing.

Cineworld said it has put procedures in place to ensure a "safe and enjoyable cinema experience" for employees and customers.

It is thought these measures will include an updated booking system to allow family groups to sit together. Film times could also be staggered to prevent crowds gathering in lobbies.

UK-based rival Vue announced similar measures earlier this month.

Analysts at Citi said: "The target for the opening of cinemas in July is consistent with wider market expectations, although at this stage it is unclear how strong the demand will be.

"If we look at data from other markets where cinemas have reopened [such as] South Korea, certainly in the first few weeks of opening, demand was still very soft and not dissimilar to the levels seen during lock-down."

Cineworld said it is hopeful viewers will be attracted by a blockbuster line-up which includes new Christopher Nolan movie Tenet and Disney adventure Mulan.

In April, Cineworld said it would follow Odeon owner AMC in refusing to screen Universal Pictures titles, after the studio released Trolls World Tour online during the pandemic and said it would continue to make new movies available to stream when cinemas reopen.