Cineworld, the world’s second largest movie theater business, has decided to suspend payments of dividends to its stockholders. The freeze on payments applies to the 2019 fourth quarter dividend of 4.25c per share and upcoming 2020 quarterly dividends.
In addition, the executive directors have “voluntarily agreed to defer payment of their full salaries and any bonuses to which they are entitled,” according to a company statement. The non-executive directors will defer their fees.
The moves were taken in response to the evolving impact of the COVID-19 pandemic on its business, which has included the closure of the group’s entire estate of 787 movie theaters in 10 countries.
In its statement, the company added: “With very few exceptions, the good relationships we have built up over the years have been supportive and understanding of our efforts and, together with us, our industry partners look forward to the time when we shall again be able to open our doors and provide entertainment and pleasure to our customers.”
Cineworld owns theaters in the U.S., where it owns the Regal Entertainment Group, the U.K., Ireland, Poland, the Czech Republic, Slovakia, Hungary, Bulgaria, Romania and Israel. It owns 787 sites with 9,500 screens, and employs 37,482 staff.
The company reported revenue totaling $4.37 billion last year, of which 73% came from the U.S., 15% from the U.K., and 12% from the rest of the world. Its EBITDA last year was $1.033 billion.