Cineworld Group PLC (LON:CNE) reported a 7% increase in revenue for the past 10 months, boosted by its expansion and the release of blockbuster hits ‘Dunkirk’, ‘Despicable Me 3’ and ‘It’.
However, shares fell 1.42% to 659.50p in morning trading as analysts noted that box office revenue slowed in both the UK and overseas.
READ: Cineworld shares flick higher as blockbusters lift half-year results
UK box office revenue rose 6% at actual exchange rates, easing back from the 12% gain reported in the first half, though this was ahead of the market’s 2% growth.
Overseas box office revenue grew 8% at actual exchange rates after rising 14% in the first half, the company said in its trading update.
Total revenue for the period from 1 January to 19 November increased 7% for the group at constant currencies, with the UK up 6% and the international arm up 7%. Retail revenue grew 9%, including a 7% in the UK and a 13% rise overseas.
In the second half, the company opened seven sites with a total of 83 screens, including three in the UK, two in Poland, one in Romania and one in the Czech Republic. It brings the total number of new site openings during the year to nine, on top of the 16 screens gained through the acquisition of Empire Newcastle.
Numis leaves rating on 'hold'
Films slated for the remainder of the year include recently released ‘Paddington 2’, ‘Justice League’, followed by ‘Pitch Perfect 3’ and ‘Jumanji: Welcome to the Jungle’ along with ‘Star Wars: The Last Jedi’ in December.
“Based on the expected strength of the film slate for the final six weeks, our full year outlook remains unchanged,” Cineworld said.
Numis said the company's share price volatility since summer, has been a result of a weak film slate (admissions down 20% between August and October) and concerns regarding the shortening of the film release window.
The broker said "recent trading has been relatively soft" but this was widely anticipated given the poor second half film slate. It left its rating at 'hold' and target price at 750p.