Regal Cinemas’ Post-Bankruptcy Plan Revealed By CEO

Eduardo Acuna, CEO of Regal Cinemas owner Cineworld Group, says his movie theater chain is well-positioned for post-pandemic and post-bankruptcy growth amid Hollywood’s box office recovery.

“I think it’s a very pivotal moment in our history,” Acuna told The Hollywood Reporter in an interview on Wednesday via Zoom while seated in a giant 4DX auditorium opening at Regal Times Square in New York City, in time for Dune: Part Two to debut on his screens this weekend.

He pointed to the trio of shocks the Cineworld Group sustained due to theater shutdowns during the pandemic, entering and then exiting Chapter 11 bankruptcy protection in the U.S. and more recently the impact of the dual strikes on its supply of tentpole movies from key studio suppliers.

“It shows how much we believe in this industry,” Acuna said of investing in South Korean theater chain CJ CGV’s 4DX technology after Cineworld gained new owners, a reduced debt load and a new board and management team.

That’s after Cineworld got more than just a splash of water — typical of the 4DX theaters’ varied sensory effects for moviegoers — when its share price cratered at the height of the pandemic and under the weight of a $5 billion debt load, which prompted the corporate restructuring.

Cineworld filed for Chapter 11 bankruptcy protection in Sept. 2022 to restructure its overall debt burden. It then formally filed its reorganization plan in April 2023, which aimed to cut the firm’s debt by about $4.53 billion, mainly through lenders getting equity in the reorganized group in exchange for releasing their claims. The Chapter 11 filing followed Cineworld failing to find buyers for some or all of its exhibition assets. 

Today, the second-biggest movie cinema chain behind AMC Theatres looks well clear of that pandemic-era cliff, having greatly lightened its debt load as it rides Hollywood’s box office recovery. That’s in part by turbocharging the theatrical movie experience with premium moviegoing experiences like the 4DX auditorium in Manhattan opening this weekend.

“We believe customers want a differentiation and a reason to come out of their houses to see movies. So to me this feels really important, this shows how bullish we are for the industry and how we are ready to be better and grow bigger,” Acuna said. (The exec replaced former Cineworld CEO Moshe “Mooky” Greidinger under the company’s new ownership unveiled in July 2023.)

As the streaming era takes hold with consumers, exhibitors have fallen back on touting the exalted role of the communal movie experience that the multiplex has long offered. And the 4DX theater promises the combination of on-screen visuals with synchronized motion seats and other sensory effects like wind, rain, snow, fog and lightning.

Regal currently has 49 4DX theaters and another 52 Screenx auditoriums in the U.S. market. Acuna forecast Regal will invest in around another 50 4DX and Screenx theaters in future years. “We’re at a point where we came through some tough times, but we’re also ready to invest,” he added.

Besides Regal, CJ 4DPLEX has 62 4DX theaters and 29 ScreenX theaters with Cineworld and CCI across Europe and Israel. Don Savant, CEO and president of CJ 4DPLEX America, said the 4DX technology is also playing well in U.S. rural markets where Regal is dominant.

“We’re not just in LA, Chicago, San Francisco, New York … We’re really spread out,” Savant noted as he pointed to an average per-screen average of $937,000 per location across Regal’s 4DX screens.

But while back on its feet, Cineworld and the rest of the global exhibition sector is still down compared with the Hollywood box office of the pre-pandemic era. And comparisons to 2019’s record-breaking global box office are wide of the mark for Acuna.

“I don’t like to say we haven’t gone back to 2019, because 2019 is the reference everybody uses and it was a record-breaking year. You can’t do record-breaking years every year,” Savant told THR.

“I would argue our industry is on a clear path to growth and, even better, most companies are profitable. We at Regal have one of the healthiest balance sheets in the industry and we’re making money. We made money in 2023,” Acuna added.

With the film release calendar working out an uneven supply of movies to theaters in the wake of the dual strikes, Acuna did make some predictions for global box office this year and into 2025. “I see box office in 2024 being between $8 billion and $8.5 billion. I see 2025 rebounding to between $9 billion and $10 billion,” he predicted.

Despite the industry being adrift of pre-pandemic box office levels, Acuna said exhibitors had gotten better at maximizing profits, in part from great concession sales and higher ticket prices. “The industry is quite healthy right now. And we’re getting healthier, and as more movies come, we’re going to be even better,” he argued.

But as audiences return to theaters and chains raise ticket prices, Acuna said exhibitors had to get more agile about ticket pricing. “I’m not confident that we can continue raising prices and I would actually change this conversation to saying we need to be better understanding the right price,” he noted.

While insisting moviegoing was an affordable entertainment experience when compared to the cost of tickets for live concerts and sporting events, Acuna said inflation and the cost-of-living crisis in key global markets meant exhibitors weigh up how to reach cost-conscious consumers.

“We do need to look at pricing. There are some theaters where we may be able to get a little more pricing, but there are other complexes where a lower price may drive more attendance,” the CEO stated. “So exhibitors need to get smarter in understanding price elasticity for our customers, which is just plain economics, right?”