EXCLUSIVE: Cineworld Group, the world’s second biggest exhibition chain, today announced plans to temporarily close its Regal movie theaters in the U.S. and its Cineworld and Picturehouse sites in the UK as coronavirus wreaks havoc with the industry. Cineworld CEO Mooky Greidinger tells Deadline the decision primarily came down to New York Governor Andrew Cuomo’s “inflexibility” in allowing cinemas to reopen, which in turn has led Hollywood studios to recoil; and is also a means to increase liquidity.
Greidinger doesn’t fault the studios, which have been switching up release dates on a weekly basis, leaving a virtually tentpole-deserted calendar for the rest of the year amid the COVID pandemic. Rather, the major factor for the veteran exhibitor is that the studios “don’t see movement in New York.”
Word initially spread over the weekend that Cineworld was mulling the closure of its cinemas, but Greidinger tells Deadline it was just one of a few options which was only firmed up on Sunday. A solution was made urgent when MGM on Friday said it was taking James Bond movie No Time To Die out of November and into Easter 2021.
In our chat below, Greidinger talks more about how the decision was made, what Cineworld’s eventual reopening plans may be, whether he’s looking to offload cinemas or entertain takeover offers, increasing liquidity and what the situation is surrounding his employees.
DEADLINE: The decision to close cinemas in the U.S. and UK can’t have been an easy one to make, what was the main reason?
MOOKY GREIDINGER: It is not an easy situation, but we will get through this and I think it is the right decision. I believe that people should understand that cinemas all over the world, and for sure in the U.S., are in a way closing down in view of Governor Cuomo’s inflexibility. The Governor allows in-restaurant dining, bowling alleys, casinos and others, but he will not allow cinemas.
Cinemas have taken huge steps and made a big investment in creating ‘CinemaSafe’ protocols and we can clearly say after operating the cinemas for over two months, that we are offering a safe environment for our customers.
DEADLINE: Have you spoken to the government there? What is their rationale?
GREIDINGER: There is no rationale. We received messages like “cinema is not essential” and we fail to understand why other indoor activities are essential, but cinema excluded.
Other than that, we never received a real explanation as to why New York, which had great success in the war against COVID in general, does not allow us to come back like it’s been done all over the world.
Cinemas have been open all over the world and in the U.S. for over two months now and there have been no COVID cases up to now, thankfully. The safety precautions in cinemas are very good and they are very effective. We have a lot of busy shows in Central Europe with the local product, but there is no doubt after what happened with Tenet, the studios will not release movies without New York.
DEADLINE: Were you considering closures already before the Bond film moved?
GREIDINGER: No. But it’s not fair to put the whole thing of the closure on Bond — Bond was just the last straw.
As you know, the cost of running the cinemas without movies is very high, but we said internally that we would hold for the coming six weeks (until Bond) and keep the business open for our customers and for our employees. But when the Bond decision arrived, a decision that followed numerous delays of other movies, we had to change the direction, close the cinemas and wait for a situation where the studios will be able to present a solid release schedule. The main thing blocking the studios is that they don’t see movement in New York — and in some other places — but New York is kind of the symbol. Even California is already 50% open.
DEADLINE: And what about reopening? Do you have any timetable?
GREIDINGER: The minute we will have a clear picture of the lineup of the studios, we will be ready to open — whether it’s in a month’s time or two months’ time or longer, I cannot guess. I hope it will be sooner rather than later, but we need to have a solid lineup of releases and this will again have to do mainly with the main territories led by New York
DEADLINE: So let’s say Wonder Woman 1984 stays at Christmas as expected, you would open for that?
GREIDINGER: For sure, but we need to have a clear lineup of movies after that. It cannot be one movie only. It needs to be a situation that the studios are saying, “It is safe enough to go back and this is our release schedule.” The COVID situation needs to stabilize and we need to have a clear schedule of movies ahead.
DEADLINE: Do you expect more release date changes this year?
GREIDINGER: Some maybe will change because we closed and some maybe because there were already going to change.
DEADLINE: Are you planning on shedding any leases or closing anything permanently in the U.S.?
GREIDINGER: We don’t have any plans to close anything permanently.
DEADLINE: What about selling anything in the U.S. or UK?
GREIDINGER: We have no plans to sell, we have no plans to close. To the contrary, our plan is to keep the company strong. The main reason of the closure is to increase liquidity. We cannot be in a situation that it costs us more to be open than to be closed.
DEADLINE: What is the cost implication of closing?
GREIDINGER: There of course will be some costs involved in the closure, but at the end of the day, liquidity will go up.
DEADLINE: What other kinds of liquidity options are you seeking?
GREIDINGER: There are all kinds of facilities that we can generate money from and we are looking at several options. Everything is open and we need to always be in a situation where we have enough liquidity in advance and then we will be able to proceed.
DEADLINE: Are you fielding any takeover offers?
GREIDINGER: I haven’t heard one word in this direction. I’m not telling you it may not happen, you never know, but we haven’t heard one word on this. The only thing we are dealing with now is to be able to reopen the cinemas as soon as possible.
DEADLINE: Would you consider partnering with a studio?
GREIDINGER: At this stage, our only focus is reopening the cinemas. If there were to be any offers, we’ll always look at it, but nothing is on the table.
DEADLINE: Will you ever budge on the windows?
GREIDINGER: I think the issue of the window is the least of my worries at this stage. I always have said that there might be some changes, but for sure it is not going to be any day-and-date or things like that. It’s really something that we don’t need to deal with at this stage, let’s go back and open the cinemas and then we’ll see where we are.
DEADLINE: Do you think other exhibitors will follow your example in closing any time soon?
GREIDINGER: I think no one is in a different situation than we are, but everyone is taking their own decisions.
DEADLINE: And you’re staying open in your other markets?
GREIDINGER: At this stage yes, as long as we have product. The advantage in Central Europe is that we have local product — currently.
The reason in the UK is that the U.S. and UK products are very similar. We show here and there foreign movies, but on a very low scale. So if in Poland, a Polish movie can keep us open, or if in Hungary, a big Hungarian movie can keep us open, it’s one thing. But in the U.S. and the UK, what we call local product is Hollywood product. Without movies, it simply isn’t feasible to operate.
DEADLINE: In Central Europe, do you have enough product to keep going?
GREIDINGER: We are analyzing it. It is for sure not clear and it varies from country to country. A Polish movie is not something that we show in Romania and a Hungarian movie is not something we show in Bulgaria, so it will go country by country.
DEADLINE: What will happen to your employees during this time?
GREIDINGER: It varies from country to country, but most of the employees will go on furlough or unpaid leave. I think the situation is relatively clear. We are doing it with really a heavy heart, but there is not much that can be done except to be patient and to hope that things will change as early as possible. My main concern is the employees, but on the other hand, with no goods, you cannot keep the shop open.
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