Cineplex Beats Dull Slate for a Small Operating Profit

In a plus for a dull Q3 slate, Canadian cinema giant, Cineplex, has managed a small third quarter profit despite a Box Office that has been lackluster indeed. Even more encouragingly for the wider exhibition industry, it appears to be purely off the back of renewed theater attendance. Brandon Blake, entertainment attorney with Blake & Wang P.A, takes a closer look.

Solid Profit

While still modest, a $30.85M profit in the exhibition industry is nothing to sneeze at currently, and looks decidedly better than the $33.5M loss of the same time last year. This also represents a profit rise of 35.7% to cap at $339.9M. We likewise see an improvement in the Box Office takings, up 32.5% on last year for a total of $124.8M.

Unsurprisingly, much of this stems from July and the runaway performance of Top Gun: Maverick, which helped the July Box Office reach 85% of the same month pre-pandemic. It’s certainly an impressive performance overall, given how both holiday content and the Box Office overall fell away after July.

Streamer Onboarding

We’ve also seen a move to streamer-exhibition partnerships in the last few months, from traditional and non-traditional studios. This falls in line with the overall trend to better takings from joining theatrical-streaming releases rather than one or the other. We’ve even seen Netflix opt to send its Oscar hopeful, Glass Onion: A Knives Out Mystery, to a limited streaming release. Speaking specifically for Netflix, it may also be a growing recognition of the fact that theatrical releases help push the demand for their streaming titles by broadening the awareness of the general public to the titles. 

On top of their overall buoyancy on the good news, we specifically saw Cineplex go as far as to predict this blend of streaming with theatrical will continue as a trend. With the shortened theatrical window now the norm, it should prove a win both ways- greater exposure and revenue for streamers, with increased product and more robust slates for screeners. Cineplex are currently in talks with Apple and Amazon, among others, for limited theatrical streaming releases too. We’ve also seen Warner Bros. Discovery CEO David Zaslav commit to theatrical releases for their content slate this year. 

It’s certainly a splash of good news for Cineplex individually, too, as they seek to recoup their outstanding judgment against Regal’s owner, Cineworld, for a tanked merger deal as Cineworld enters bankruptcy proceedings.

While there’s still a way to go before the theatrical market meets the coveted 2019 benchmarks the pandemic tanked, it’s yet another piece of solid news for the wider theatrical industry. Despite the limited Fall slate they faced, we’ve still seen a noted upswing in theatrical and Box Office performance this year, and it should continue with some more blockbusters coming online in time for the year-end period. So much for the naysayers who, barely a year ago, were proclaiming theatrical releases dead in the water.