The horror show that is Cineworld continues. Interim results out this morning illustrate the impact of cinema closures on the multiplex owner.
Group revenue more than halved to $712m for the six months to the end of June, down from $2.2bn for the same period last year. Underlying profits were even worse — down to $53m $758.6m last year.
The group, which in June abandoned a deal to buy rival operator Cineplex, said it remains in talks with creditors about securing a waiver on loans due in December and next June.
Briefly
There are also annual results out today from Smiths Group, the engineering group, which is spinning off its medical unit. Operating profits, excluding restructurings and writedowns, fell 11 per cent to £382m on revenues of £2.5bn, up 2 per cent. Total operating profit fell 23 per cent to £327m. The company said trading for the four months to end of August had stabilised at pre-Covid levels but it refused to offer any future guidance.
National Express said it was trading above its previous estimates. It said demand in the UK had been growing in recent weeks and in Spain revenues have grown back to 66 per cent of what they were last year. In the US, too, the business is recovering as schools reopen for the new year.
In a set of results complicated by a change in the reporting period, furniture retailer DFS reported a loss of more than £50m. Revenue sunk to £724.5m from £900m the year before. The group said it would focus investment on improving digital sales and improving its showrooms. But it said the current year has started “very strongly” with all showrooms now open and our digital channels continuing to grow.
There are also results from SIG, Go Ahead Group, GYG and CVS.
Job moves
Willie Walsh has taken a new job at a Dublin-based travel technology group just weeks after leaving British Airways’ owner International Airlines Group. He will become deputy chairman of CarTrawler, which was acquired by private equity group TowerBrook Capital Partners in May.
Carr’s, maker of the eponymous water biscuits, has announced that Hugh Pelham has been appointed to succeed Tim Davies as chief executive officer. Mr Pelham is currently CEO at Minova, a subsidiary of the Australian-listed multinational Orica.
Beyond the Square Mile
TikTok has asked a federal judge to prevent the Trump administration from blocking downloads of the video-sharing app starting on Sunday, as its parent company ByteDance nears a deadline for resolving the app’s future in the US. TikTok’s removal from app stores has been seen as an informal deadline for a proposed restructuring deal in which ByteDance, the Chinese owner of the video-sharing app, plans to hand a minority stake to Oracle and Walmart. ByteDance ByteDance has applied to the Chinese government for permission to export its technology, including the algorithms that power TikTok.
JPMorgan Chase is in advanced talks with US authorities to pay $1bn to settle allegations it manipulated metals and Treasuries markets using a technique known as spoofing, according to people familiar with the situation. The proposed settlement would allow the bank to avoid prosecution over the alleged activities, one of the people familiar with the situation told the Financial Times.
Creditors are giving up their historic right to have their loans paid back when a company is sold, in the latest example of their weakening power in an era of ultra-low interest rates. Private equity groups have been able to insert so-called portability language into loan documentation in recent deals, which would mean the debt transfers with the company to its new owner. The development makes it easier for private equity to sell their debt-laden companies but removes an important potential check on leverage in the financial system.
Essential comment before you go
Lombard
The longer working from home continues, the worse the damage will be to the City of London as a financial centre.
Andrew Hill
The crisis has offered a wealth of material for management academics who are more vulnerable than other scholars to the accusation that they live in ivory towers.
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