Dadi Cinema Group, China’s second-largest cinema chain, is looking to make deals to buy smaller rivals following a slump in the nation’s box-office sales.
Chief executive of Dadi Yu Xin predicts that the ticket sales decline will last two to three years, Bloomberg Markets reported.
“The timing for consolidation has finally arrived,” said Yu. “We will seize the timing and seek acquisition targets.”
However, she declined to identify any targets or give details about the scale or timing of deals that are being considered. Though, she is be betting on a long-term recovery in box-office growth after a few more years of slowing expansion.
Movie-ticket sales growth sagged to 3.7 per cent last year in China, in contrast to the annual gains averaging more than 35 per cent in the previous five years, fuelled by rising incomes, new screens and discounts offered by mobile ticket-buying apps.
Ticket sales rose about two per cent to $11.4bn (£9bn/€10.7bn) in the US last year, compared with $6.8bn for China, according to Box Office Mojo.
Yu said that Dadi, which operates most of its cinemas in smaller cities in China, might take loans and issue bonds to finance deals.
Last year, Dadi raised CNY1.1 bn (£128m/€151m/$160m) from issuing securities backed by future box-office takings from 80 of its cinemas.
Surging ticket sales in previous years led to a rise in investor interest. Prior to last year’s slump, the country had been forecast to overtake the US this year as the world’s largest movie exhibition market.
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