Cineworld and Duke of York’s owner could file for bankruptcy within weeks

Cineworld shares have plummeted as concerns grow that it will file for bankruptcy “within weeks”.

The chain has cinemas in Brighton, Crawley, Chichester and Eastbourne. It also owns Picturehouse cinemas which runs Duke of York’s in Preston Road, Brighton, and its younger sister the Duke's at Komedia, in Gardner Street. It is unclear what the future holds for these.

On Friday, shares in Cineworld Group PLC dived by two thirds within minutes of reports by the Wall Street Journal that it had hired lawyers from Kirkland and Ellis and consultants from AlixPartners to advise on the bankruptcy process.

Cineworld at Brighton Marina

Cineworld declined to comment on Friday when the news broke but has since said that “all cinemas are open” on social media.

It said: “All of our Cineworld cinemas are open for business as usual, and we continue to welcome Cineworld Unlimited members and all of our customers, across the UK and Ireland. 

“We remain committed to being the best place to watch a movie.”

The reports cast uncertainty over the future of thousands of workers at its 127 UK cinemas.

Cineworld employs around 28,000 workers globally, with operations in ten countries.

Duke of York's Picturehouse in Preston Road

Philippa Childs, head of entertainment and media union Bectu, said: “This is very worrying news, not least for the UK’s Cineworld and Picturehouse workforce who have already been through a tumultuous time during the pandemic.

“The UK’s cinema industry suffered an incredible blow due to Covid-19 and this latest news will be very unsettling for cinema workers.

“We will do everything we can to support our members during this challenging time and will be looking to Cineworld to mitigate the impact of any bankruptcy arrangements on its employees.”

It came two days after Cineworld said it was assessing options to shore up its finances after it blamed a “limited” film slate for weak audience numbers in recent months.

The company, which also owns Regal Cinemas in the US, had pinned its hopes on releases such as Top Gun: Maverick, The Batman and Thor: Love And Thunder to aid its recovery from the heavy impact of the pandemic.

However, it told the London Stock Exchange on Wednesday: “Despite a gradual recovery of demand since reopening in April 2021, recent admission levels have been below expectations.

“These lower levels of admissions are due to a limited film slate that is anticipated to continue until November 2022 and are expected to negatively impact trading and the group’s liquidity position in the near term.”

The business, which was saddled with 4.8 billion dollars (£4 billion) of debt at the end of the last financial year, said it was considering restructuring its balance sheet to protect its future.

At the height of the pandemic, Cineworld temporarily shut its UK cinemas and placed 5,500 workers on furlough.

The Duke of York’s Picturehouse was contacted for comment.