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Cineworld - Acquires five cinemas for £94m

October 2016

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • CINE
  • Price:
  • 585p
As a consumer stock you might expect Cineworld to have been pummelled after Brexit but the shares have bounced to hit an all-time high of 618p. This was helped by the acquisition of five cinemas for £94m, including the plum nine screen Empire Leicester Square multiplex.Half the consideration is funded in debt and the other half by 8.2m new shares. In total the acquisition has brought in 64 screens and generated £9m EBITDA in 12 months ended 31 March, albeit that doesn’t include additional screens opened part-way in the period. The deal will be marginally eps enhancing in 2016 and “materially” eps enhancing in FY ’17 including synergies.Since then Cineworld released interims showing turnover ...

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