Cineplex Inc. Announces Deferral of Filing First Quarter Financial Statements
TORONTO, May 7, 2020 /CNW/ - (TSX: CGX) – Cineplex Inc. ("Cineplex" or the Company) today announced that as a result of its continued focus on managing the business in response to the ongoing COVID-19 pandemic, the Company will delay the filing of its interim financial statements and related management discussion and analysis for the three month period ended March 31, 2020. Originally due by May 15, 2020, the Company will rely on the blanket relief provided by the Canadian Securities Administrators (the "CSA"), which provides for up to a 45-day extension for periodic filings normally required to be made by reporting issuers on or before June 1, 2020, and will report its first quarter results no later than June 29, 2020.
The following material business developments of Cineplex have occurred since February 12, 2020, being the date Cineplex filed its financial results for the three months and year ended December 31, 2019:
- On February 18, 2020, Cineplex announced that the Ontario Superior Court of Justice (Commercial List) granted a final order approving its previously-announced plan of arrangement in connection with the proposed transaction in which an indirect wholly-owned subsidiary of Cineworld Group plc (LSE: CINE) agreed to acquire all of the issued and outstanding common shares of Cineplex for $34 per share in cash (the "Transaction").
- On March 16, 2020, Cineplex announced that in response to growing global concerns around the spread of COVID‐19 and various Canadian government directives, it would be temporarily closing its network of theatres and location‐based entertainment venues across Canada starting March 16, 2020, through to April 2, 2020.
- On March 16, 2020, Cineplex also provided an update on the Transaction, indicating that closing of the Transaction remains subject to the satisfaction or waiver of certain conditions to closing that have not yet been satisfied, including the receipt of Investment Canada Act approvals, the representations and warranties of the parties remaining true and correct (subject to certain materiality qualifiers), the parties having fulfilled or complied in all material respects with each of their covenants contained in the arrangement agreement in connection with the Transaction, and as at the date of closing of the Transaction, Cineplex shall have no more than $725 million outstanding under its credit agreement, subject to certain exclusions.
- On April 1, 2020, Cineplex announced that in response to applicable government directives and the latest guidance from Canadian public health authorities pertaining to COVID-19, the closure of its network of theatres and location-based entertainment venues across Canada would remain in effect beyond April 2, 2020 and that the re-opening of such locations would be reassessed as further guidance is provided by Canadian public health authorities and applicable government authorities.
In reference to the Transaction, the parties are continuing to advance the process to obtain the approvals required under the Investment Canada Act. The period for the review of the Transaction has been extended through to June 1, 2020 with the expectation that further extensions may be warranted under section 22(1) of the Investment Canada Act in light of the current environment. Cineworld has advised Cineplex that it remains committed to closing the Transaction on or prior to the outside date of June 30, 2020 (the "Outside Date"). However, there can be no assurance that the conditions to closing the Transaction will be satisfied by the Outside Date.
Cineplex expects the ongoing COVID-19 pandemic and events and circumstances resulting from the pandemic to have a material negative impact on its business, financial condition and results of operations for at least the first half of 2020. This impact cannot be quantified at this time because of the significant uncertainty associated with the ultimate extent, duration and severity of the pandemic itself, and with the government restrictions and other factors associated with or resulting from that pandemic, many of which are beyond Cineplex's control. Cineplex continues to actively monitor all aspects of its business and operations in order to minimize the impact of COVID-19 on its operations wherever possible.
In connection with utilizing the blanket relief provided by the CSA, Cineplex confirms that its management and other insiders are subject to an insider trading black-out policy that reflects the principles in Section 9 of National Policy 11-207 – Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions.
About Cineplex
Cineplex (TSX:CGX) is a top-tier Canadian brand that operates in the Film Entertainment and Content, Amusement and Leisure, and Media sectors. A leading entertainment and media company, Cineplex welcomes millions of guests annually through its circuit of theatres and location based entertainment venues across the country. In addition to being Canada's largest and most innovative film exhibitor, Cineplex also operates successful businesses in digital commerce (CineplexStore.com), food service, alternative programming (Cineplex Events), cinema media (Cineplex Media), digital place-based media (Cineplex Digital Media) and amusement solutions (Player One Amusement Group). Additionally, Cineplex operates Canada's favourite destination for 'Eats & Entertainment' (The Rec Room) and entertainment complexes specially designed for teens and families (Playdium). Cineplex is a joint venture partner in SCENE, Canada's largest entertainment loyalty program.
Caution Regarding Forward-Looking Statements
Certain information included in this news release contains forward-looking statements within the meaning of applicable securities laws, including expectations of management with respect to the anticipated filing date of Cineplex's first quarter financial statements and related MD&A. The words "may," "will," "could," "should," "would," "suspect," "outlook," "believe," "plan," "anticipate," "estimate," "expect," "intend," "forecast," "objective" and "continue" (or the negative thereof), and words and expressions of similar import, are intended to identify forward-looking statements.
By their very nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond Cineplex's control. The forward-looking statements contained in this news release are based on certain key expectations and assumptions made by Cineplex.
Forward-looking statements are subject to various risks and uncertainties which could cause actual results and experience to differ materially from the anticipated results or expectations expressed in this news release. The key risks and uncertainties include, but are not limited to: the COVID-19 outbreak and the responses of governments and the public to the outbreak (including declining theatre attendance and mandated government shut downs of theatres); general global economic, market and business conditions; governmental and regulatory requirements and actions by governmental authorities; relationships with employees, customers, business partners and competitors; and diversion of management time on the Transaction. There are also risks that are inherent in the nature of the Transaction, including failure to satisfy the conditions to the completion of the Transaction and failure to obtain any required regulatory approvals (or to do so in a timely manner). The anticipated timeline for completion of the Transaction may change for a number of reasons, including the inability to secure necessary regulatory approvals in the time assumed or the need for additional time to satisfy the conditions to the completion of the Transaction. As a result of the foregoing, readers are cautioned not to place undue reliance on the forward-looking statements contained in this news release.
Cineplex does not undertake to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable Canadian securities law. When reviewing Cineplex's forward-looking statements, readers should carefully consider the foregoing factors and other uncertainties and potential events. A comprehensive discussion of other risks that impact Cineplex can also be found in Cineplex's public filings which are available under Cineplex's profile on SEDAR at www.sedar.com.
SOURCE Cineplex
Media Relations contact: Sarah Van Lange, Executive Director, Communications, [email protected], 416-323-6728; Investor Relations contact: Melissa Pressacco, Senior Manager, Communications and Investor Relations, [email protected], 416-323-6606
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