Markets
CNK

Cinemark Revenue All but Evaporates, but Still Beats on Earnings

Theater owner Cinemark Holdings (NYSE: CNK) reported the coronavirus pandemic obliterated its second-quarter revenue, which plummeted 99% to just $9 million. But its loss of $170 million for the quarter, or $1.45 per share, actually beat Wall Street's forecast for a loss of $1.59 per share.

Cinemark's theaters have been closed since March 17. It has delayed their reopening several times, most recently in July, when it postponed the date once more after movie studios announced they were pushing back the releases of certain big-budget films.

Theater sign with pandemic safety protocols listed

Image source: Getty Images.

Take any seat you want

Virtually all of the revenue Cinemark generated in the quarter came from the amortization of screen advertising advances. It did open five theaters in late June as a test run for new safety protocols it is initiating when the chain fully reopens, and there does seem to be latent demand since it had 13,000 moviegoers attend these screenings from its library.

Cinemark generated $37,000 in admission revenue, suggesting the tickets were steeply discounted, but also $57,000 in concession revenue. The concession stand typically generates about 35% of total revenue.

The new reopening date is set for Aug. 21, but even if that happens, attendance may still be thin. Warner Bros. has delayed the release of Tenet, the Christopher Nolan spy movie that had also been scheduled to debut on Aug. 21 but is now being pushed back again. And Disney has removed the live-action remake of Mulan from its release calendar.

Other potential blockbusters including Wonder Woman 1984, A Quiet Place 2, and Top Gun 2 are now scheduled for even later release, some not until October, others not till next year.

Cinemark's financial performance is not likely to be much better than this quarter for some time to come.

10 stocks we like better than Cinemark Holdings
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Cinemark Holdings wasn't one of them! That's right -- they think these 10 stocks are even better buys.

See the 10 stocks

 

*Stock Advisor returns as of June 2, 2020

 

Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Walt Disney and recommends the following options: long January 2021 $60 calls on Walt Disney and short October 2020 $125 calls on Walt Disney. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

CNK DIS

Latest Markets Videos

The Motley Fool

Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

Learn More