Late on Monday Dec. 19th, 2011 the Hollywood Reporter broke the story that "on the heels of the box office's third weak weekend in a row, Regal Entertainment shares fell 9 percent [in that day's trading]."
This one day's drop wouldn't be news on its own - but Carmike Cinemas stock price also tumbled - almost 5 percent on the day - and Cinemark had a bad day too.
Why all the doom and gloom? Is it just a panicked response to one bad weekend?
No.
With just 13 days left in 2011, year-to-date box office is down around four percent.
And this year-to-year trend of lower box office is the result of an (even more troubling?) drop in attendance (actual butts in the seats) that started in 2006 - Since 2006, the actual number of tickets sold (not the box office gross - which includes significant increases to ticket prices for 3D etc.) has declined every year - except 2009 when Avatar brought people back to the theaters (apparently only temporarily).
So the sudden drop in the value of movie theater chains on Dec. 19th, 2011 was both a response to a long-term trend and a short-term problem with weak holiday film openings. According to the Hollywood Reporter: "The box office has been weak for several weeks, and the most recent weekend was considered the third dud in a row, with Sherlock Holmes: A Game of Shadows and Alvin and the Chipmunks: Chipwrecked underperforming compared to their debuts. All-in-all, the weekend was down 14 percent compared to last year."
No comments:
Post a Comment