PVR INOX Ltd, the merged entity of India’s top two multiplex operators, reported a quarterly loss of 3.33 billion rupees ($40.72 million) on Monday. The loss was primarily attributed to one-time impairment charges and expenses related to the planned shutdown of some cinemas. The company announced an accelerated depreciation charge of 105.8 million rupees for 50 loss-making cinemas that it plans to close over the next six months.
The COVID-19 pandemic has significantly impacted cinema operators in India as lockdowns forced people to stay at home, leading to increased popularity of streaming services among movie enthusiasts. In response, PVR and Inox decided to merge to mitigate the challenges posed by the pandemic. PVR INOX aims to open 150-175 more screens in the fiscal year 2024.
Additionally, PVR INOX incurred an impairment charge of 108.2 million rupees related to a suspended project in a Bengaluru mall. This is the first time PVR INOX is reporting financial results after the completion of the merger. In the previous year, PVR had reported a loss of 1.05 billion rupees when the two companies were operating separately.
Despite some volatility in box office performance in recent months, PVR INOX expressed confidence that the trend will stabilize over the next two to three quarters. The company generated revenue of 11.43 billion rupees in the quarter, while total expenses amounted to 13.64 billion rupees.
Among the films that attracted customers during the quarter was Bollywood hit “Pathaan,” while Hollywood films like “Ant-man and The Wasp – Quantamania” and “John Wick-4” had a decent performance, according to the company. Average ticket prices decreased to 239 rupees from 244 rupees in the previous quarter, and the average food and beverage spend per patron declined from 133 rupees to 119 rupees.
Shares of PVR INOX closed 1.2% higher on Monday ahead of the release of the financial results. The company remains optimistic about the recovery of the cinema industry in the coming quarters as the situation stabilizes and more people return to theaters.
