Covenant amendments and additional liquidity

RNS Number : 1438O

Cineworld Group plc

28 May 2020

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

28 May 2020

Cineworld Group plc ("Cineworld" or the "Group")

Covenant amendments and additional liquidity secured

Cineworld is pleased to announce that its lenders have agreed to waive the leverage covenant¹ in respect of its credit facility for the June 2020 testing date and has increased its leverage covenant¹ to 9.0x Net Debt to EBITDA for the December 2020 testing date.

The Group has also agreed the terms of $110m of additional liquidity through an increase in its revolving credit facility.  In addition, the Company has secured credit committee approval to apply for an additional $45m through the CLBILS loan scheme in the UK and expects shortly to commence a process to access $25m through the US government CARES Act.  Cineworld expects that this additional liquidity, to the extent required, will provide it with sufficient headroom to support the Group even in the unlikely event cinemas remain closed until the end of the year.

Cineworld currently anticipates that government restrictions related to cinemas will be lifted in each of its territories by July.  Subject to this and confirmation of the schedule for film releases, Cineworld anticipates the reopening of all of its cinemas in July. Cineworld has put in place procedures to ensure a safe and enjoyable cinema experience for its employees and customers.

Cineworld is excited by the great movie line up to follow the reopening of cinemas, starting with the highly anticipated new Chris Nolan movie Tenet and immediately after that with Mulan, a new Disney adventure movie.

Cineworld, as always, greatly believes in the theatrical experience and is fully committed to be the best place to watch a movie.

Note 1: The revolving credit facility has a leverage covenant triggered above 35% utilisation, tested at half year and full year on a trailing twelve-month basis.  The next covenant test has been waived, with the next test occurring on 31 December 2020. At 31 December 2020, the leverage covenant requires Net Debt to EBITDA of below 9.0x on a pre-IFRS 16 basis.  At 30 June 2021, the leverage covenant requires Net Debt to EBITDA of below 5.5x and reduces to 5.0x from 31 December 2021 onwards.

Contacts:

Israel Greidinger Nisan Cohen Manuela Van Dessel	[phone] [e-mail]
James Leviton Andy Parnis Rob Allen	[phone] [e-mail]

The person responsible for arranging the release of this announcement is Fiona Smith, Company Secretary.

Certain statements in this announcement are forward looking and so involve risk and uncertainty because they relate to events, and depend upon circumstances that will occur in the future and therefore results and developments can differ materially from those anticipated. The forward looking statements reflect knowledge and information available at the date of preparation of this announcement and the Group undertakes no obligation to update these forward-looking statements.  Nothing in this announcement should be construed as a profit forecast.

 

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