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Cinema closures could see global box offices lose $10bn

More than $10bn could be lost by box offices across the world as cinemas are forced to remain closed for a further two months due to Covid-19, according to UK-based data outfit Gower Street Analytics.

The report indicates 2020 is down by $4.7bn from a three-year Q1 average of $10.6bn, a 45% fall.

China has seen its box office tumble by 88% in the first three months of the year, down $2.2bn, while international revenues (without China) have fallen by 30%.

China understandably accounts for the biggest portion of the deficit having closed down nearly two months prior to most of the rest of the world and just ahead of one of its two most lucrative box office weeks, the Chinese New Year holiday. Gower Street said domestic (UK) and international markets are likely to see losses get worse before they get better.

As cinema closures extend further, major releases are being shifted to later in the year, from James Bond feature No Time To Die and superhero sequel Wonder Woman 1984 to Tom Cruise’s Top Gun: Maverick.

Gower Street estimates that displaced and currently unset titles have a collective domestic box office value of around $950m. This is down from $1.56bn a week ago due to the clarity brought by re-dating. However, it now estimates the collective box office for titles reset to 2021, or that have abandoned theatrical ambitions, have a domestic value of around $1.82bn.

Dimitrios Mitsinikos, co-founder and chief executive of Gower Street, told Screen: “We are quickly approaching a situation where the second half of the year will be packed with films. It is something we typically see in Italy every September and October, where distributors typically don’t release big films during the summer, and results in the cannibalisation of prime blockbuster titles. We could see that on a global scale later this year.

“It’s important to remember that some producers may need to get their money back at quickly as possible because they have loans to repay,” he said. “In order to serve that, the studios may decide to take a hit and release films on days they know for sure are not going to be optimal for these titles.

“Studios will also want to get most of their money back from cinemas within the year because they don’t want to have spent their marketing money in 2020 and only get the revenue back in 2022. I think this will be an issue that will affect their decisions.”