Cineworld expands liquidity as it gears up for eventual reopening
By Josh White
Date: Thursday 28 May 2020
(Sharecast News) - Cineworld said on Thursday that its lenders have agreed to waive the leverage covenant on its credit facility for the June testing date, and increased its leverage covenant to 9.bx net-debt-to-EBITDA for the December testing date.
The FTSE 250 company said it had also agreed the terms of $110m (£89.73m) of additional liquidity, through an increase in its revolving credit facility.
In addition, it said it had secured credit committee approval to apply for an additional $45m through the Coronavirus Large Business Interruption Loan Scheme in the UK, and was expecting to shortly begin the process of accessing $25m through the US government CARES Act.
Cineworld said it expected that the additional liquidity, to the extent required, would provide it with sufficient headroom to support it even in the unlikely event that cinemas remained closed until the end of the year.
The firm said it was expecting government restrictions related to cinemas to be lifted in each of its territories by July.
Subject to that, and confirmation of the schedule for film releases, it said it was anticipating the reopening of all of its cinemas in July.
Cineworld said it had put in place procedures to ensure a "safe and enjoyable" cinema experience for its employees and customers.
"Cineworld is excited by the great movie line up to follow the reopening of cinemas, starting with the highly anticipated new Chris Nolan movie Tenet and immediately after that with Mulan, a new Disney adventure movie," the board said in its statement.
"Cineworld, as always, greatly believes in the theatrical experience and is fully committed to be the best place to watch a movie."
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