The financial struggles of a British cinema group are raising concerns about the future of the traditional movie-theater model in the new streaming world. Six theaters in the Empire chain were shuttered on Friday, with eight more that seem to be imperiled. The six were located in smaller towns throughout England, including Bishop’s Stortford, Catterick Garrison, Sunderland, Swindon, Walthamstow and Wigan. Before the closings, Empire had 437 employees throughout England and Scotland, with films being shown on 129 screens, including IMAX and IMPACT ones.
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The abrupt closures came without warning to employees, who learned their jobs had been lost on Friday via notices posted on the windows. After their dismissal, the employees of the Bishop’s Stortford venue penned an emotional letter to management in which they said in part: “Since it first opened in 2006, the cinema has been a staple of the Bishop’s Stortford community. We are saddened by its closure and the effects it will have on our town. As a team, we have lost not only our livelihoods but our workplace family- and that is what hurts the most.
Despite the redundancies, Empire’s gift cards, ticket e-codes, and guest passes would remain valid, and advance ticket sales at the eight sites would be refunded, said company officials.
Empire Cinemas got its start in 2005 in the wake of the Odeon/UCI and Cineworld/UGC mergers, following antitrust rulings that opened the way for new competitors.
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Last week,
Justin Ribbons, the CEO of Empire Cinemas Group CEO, described the company’s move in these words: “As a consequence of COVID-19, we found ourselves in a position where we were mandated by Government to close down our cinema chain in its entirety for protracted periods in 2020 and 2021, leaving us with a high fixed cost base and no income.”
Ribbons also blamed Empire’s woes on shifts in consumer behavior: “Cinema attendance levels have not yet returned to pre-COVID-19 levels and the operating environment remains extremely challenging, with extraordinary levels of utility costs and rates, and persistently high levels of inflation leading to increased costs and a squeeze on discretionary spending by consumers which has inevitably created profitability issues for the group. The decision to appoint administrators has not been taken lightly but will give us the best chance to protect the viable parts of the business and secure as many jobs as possible.”