Cineworld is set to file for bankruptcy, according to reports, as its shares plummet in price.
The company has cinemas at Hengrove Leisure Park, at Dolphin Square in Weston-super-Mare and Yate as part of its portfolio of 128 in the UK and Ireland, plus 751 around the globe.
Wall Street Journal reports that the group is preparing to file for bankruptcy as it struggles to rebuild attendance from pandemic lows, citing people familiar with the matter.
The group has so far declined to comment.
It comes two days after Cineworld said it was exploring options to shore up its finances after weak audience numbers in recent months.
Following the reports of bankruptcy, Cineworld Group’s shares plunged 79% to £2 a share on the London Stock Exchange, as of 1.50pm on Friday (19 August).
It has told the LSE on Wednesday: “Despite a gradual recovery of demand since reopening in April 2021, recent admission levels have been below expectations.
“These lower levels of admissions are due to a limited film slate that is anticipated to continue until November 2022 and are expected to negatively impact trading and the group’s liquidity position in the near term.”
The business was saddled with 4.8 billion dollars (£4 billion) of debt at the end of the last financial year.
Liberum analyst James Wheatcroft said its heavy debt burden means a balance sheet restructuring will “likely leave little for existing Cineworld shareholders”.
The company was founded in 1995 by Steve Weiner and opened its first cinema in Stevenage, Hertfordshire in July 1996.