Imax’s massive China operations are forecasting a rebound into profit after previously losing money due to the COVID-19 outbreak.

The separately-listed Imax China company is forecasting net profits of $19-20 million for the six months to June 2021. That compares with losses of $35 million in the first half of 2020, when cinemas in mainland China and Hong Kong were mostly closed.

The information was contained in a positive profit alert notice filed by Imax China on Monday to the Hong Kong Stock Exchange.

Mainland Chinese cinemas began to reopen in July 2020 and most were allowed to operate with 75% capacity from late September. Since then, Chinese box office has tracked closely to 2019 levels, and the Lunar New Year period in mainland China was the biggest grossing of all time.

Imax China said that its recovery reflected three things: box office revenue of approximately $133 million and maintenance revenue due to the reopening of IMAX theaters in Chinese mainland since July 2020; an increase in theater system installations during the first half of 2021 compared to the corresponding period of 2020; and a greater than $2 million reversal of provisions taken against trade and financing receivables.

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The company expects to publish its audited half-year results by the end of this month.

In 2019, the company posted adjusted profits of $24.9 million on revenues of $59.3 million.

The China operations are now significantly larger than those in North America. As of March this year, Imax China oversaw 260 IMAX-branded cinemas operated variously on sales models, revenue sharing bases, or hybrid terms. That compares with 138 in North America.