After-tax losses at pandemic-struck Cineworld Dublin widened to €2.67 million in 2021, with the auditors of the company behind the multiplex cinema on Parnell Street saying they were unable to express an opinion on its financial statements due to “material uncertainties” at its parent group.
Cineworld, the world’s second-biggest cinema chain, filed for Chapter 11 bankruptcy protection in the US last September.
In accounts just filed at the Companies Office for Adelphi-Carlton Limited, the company behind the sole Cineworld in the Republic, the directors state its net liabilities had swelled to almost €12.3 million as of the end of 2021, up from €9.6 million a year earlier, and that the results for 2022 “have not shown significant improvements”.
While the performance of the 17-screen cinema is expected to gradually return to pre-pandemic levels, “this is anticipated to take a number of years”, with monthly cash flows not expected to return to pre-Covid levels until 2024.
Parties’ general election manifestos struggle to make the figures add up
On his return to Web Summit, the often outspoken chief executive Paddy Cosgrave is now an epitome of caution
Surviving a shake-up: is restructuring ever good for staff?
The Irish Times Business Person of the Month: Dalton Philips, Greencore
The company expects to be cash negative in the next three reporting periods and “is therefore reliant on financial and other support from its ultimate parent entity Cineworld Group plc in order to meet its obligations”.
Has the Central Bank let down Irish mortgage holders?
Brendan Burgess joins the podcast to explain his critique of Central Bank policy on mortgage interest rates. It comes after Central Bank governor Gabriel Makhlouf told an Oireachtas committee that Irish banks should increase interest rates to reflect increases applied by the European Central Bank. Plus: Cliff Taylor and Eoin Burke-Kennedy look at the latest economic trends.
The accounts were prepared on a going concern basis, in line with the relevant accounting standards, the directors said. But they added that they recognised that the “uncertainties” surrounding its parent group “may cast significant doubt on the company’s ability to continue as a going concern and therefore that the company may be unable to realise its assets and discharge its liabilities in the normal course of business.”
The company’s auditing firm, PwC, said it had been “unable to form a conclusion on the appropriateness of the going concern basis of preparation of the financial statements” due to the ongoing US bankruptcy proceedings as well as legal fallout in Canada from Cineworld’s scrapped acquisition of Toronto-headquartered Cineplex.
Although Adelphi-Carlton Limited swung from an operating loss of about €945,000 in 2020 to an operating profit of almost €692,000 in 2021 and its pretax losses also narrowed, higher finance costs meant its net loss of €2.67 million deepened from a figure of €2.42 million the previous year.
The company’s revenue in 2021, when the site was open from mid-June onwards subject to restrictions, climbed to €3.8 million. This was up 72 per cent from revenue of €2.2 million in 2020, when it was closed for the majority of the year, but is still way down on the €10.7 million recorded in 2019.
Ticket sales accounted for €2.8 million of the 2021 total, up from €1.5 million, in a year when the Irish box office was led by the much-delayed release of the latest James Bond film, No Time to Die, followed by Spider-Man: No Way Home. Food and drink sales generated most of the rest of its turnover.
Cineworld Group indicated last month that it was seeking out prospective buyers for all of its assets, warning shareholders that there was “no guarantee of any recovery” in their financial interests as a result of its restructuring.
