The head of Cineplex told investors at the company’s webcast annual meeting that executives are ready to “make the necessary changes required” to push through the next six to 12 months.
He says that could include reducing lease costs and making further reductions to payroll expenses.
Jacob offered the reassurance to investors only three days after Ontario’s revised COVID-19 restrictions led Cineplex to temporarily close 22 of its 68 Ontario theatres for nearly a month on less than a day’s notice.
The sudden government decision, which affected key markets in Toronto, Ottawa and Peel Region, was a blow to Cineplex’s plan to host the annual meeting in-person at one of its Toronto theatres, a symbolic gesture of confidence in its business model.
Revised provincial regulations also forced Cineplex to close two theatres in Moncton, N.B. on Friday, and another 17 in Quebec earlier this month.
Jacob said despite tighter restrictions that may suggest otherwise, Cineplex has had zero cases of COVID-19 traced back to its operations since reopening in the summer.
“We are definitely disappointed with the government’s decision to close our theatres, particularly because we know how hard our local theatre teams have worked since our reopening to keep movie lovers safe across the province and the country,” Jacob said.
“We feel that these forced closures, given our proven track record are excessive, and do not consider our team’s efforts.”
Cineplex has endured a constantly changing Hollywood release schedule that’s seen major studios push many of the year’s most anticipated titles into 2021, including most recently the James Bond film “No Time to Die.”
Those delays have left a major dent in the company’s stock price, which tumbled nearly 30 per cent after the Bond announcement on Friday.
Cineplex is also dealing with the fallout of U.K. movie exhibitor Cineworld Group PLC walking away on June 12 from a $2.8 billion deal to buy the company. The Canadian company has filed a lawsuit against its former suitor over the failed deal that it expects will begin court proceedings in September 2021.
Cineplex shares were down 11 cents, or nearly 2.5 per cent, at $4.52 near midday after falling as much as seven per cent earlier in the session on the Toronto Stock Exchange.
This report by The Canadian Press was first published October 13, 2020.
© 2020 The Canadian Press