The Cineworld (LON: CINE) share price tanked 58% at the market’s open after the cinema operator confirmed it was to temporarily close all UK and US cinemas from 8 October.
The closure will see 536 Regal branded cinemas in the US close alongside 127 Cineworld and Picturehouse theatres in the UK.
Confirming reports from the weekend, CINE pointed towards studios being reluctant to release new blockbuster films which in turn means that cinemas do not have enough incentive to attract customers against COVID-19.
Some 45,000 staff will be impacted by the closures of the cinemas as the chain confirmed that its priorities continue to be on cash preservation, cost reduction and safety of its customers.
Commenting on the temporary closures was Mooky Greidinger, CEO of Cineworld who empahsised that the company did all it could before deciding to close theaters:
“We are especially grateful for and proud of the hard work our employees put in to adapt our theatres to the new protocols and cannot underscore enough how difficult this decision was, Cineworld will continue to monitor the situation closely and will communicate any future plans to resume operations in these markets at the appropriate time, when key markets have more concrete guidance on their reopening status and, in turn, studios are able to bring their pipeline of major releases back to the big screen.”
The share price of Cineworld is currently trading at 17p and is showing extreme volatility during early trading.