Cinema says the economic recovery won't begin until next year. Photo / Getty Images
The cinema sector has faced a sustained impact from the Covid-19 crisis, after a lengthy delay to reopen theatres, and uncertainty looms on its economic recovery.
New Zealand cinemas closed their doors at the end of March and most did not open until well into June, and while many sectors of the economy have bounced back after the lockdown, cinemas continue to face ongoing financial pressure.
Paul Wood, general manager of operations at cinema chain Hoyts, said the business was operating at significantly reduced trading levels compared to this time last year and ticket sales had not recovered to pre-Covid levels.
This was largely due to the delay of blockbuster movie releases coming from the major Hollywood studios.
Chinese-owned Hoyts, which operates 10 cinemas throughout the country, is not alone.
"The industry is looking at well under half of where we would normally expect to be this time of the year," Wood told the Herald.
Operating in the Covid environment post-lockdown had been "challenging" for the entire industry, but he was optimistic about the months ahead, he said.
"We aren't anywhere near normal numbers, but what we have seen - on the back of the school holidays - is a strong return to the cinema for the family product," he said, though despite this New Zealanders were generally frequenting cinemas less often after lockdown.
"I can't see us coming back to normal numbers until 2021.
"For the first couple of weeks, there was definitely a nice bump of people wanting to come back, then there was a small dip before the school holidays and it bumped back up with the school holidays, we are positive about that bump continuing to the end of the year."
The months through to Christmas would entail a "recovery phase", but Wood said he believed there would always be a place for cinemas in New Zealand.
Even before the pandemic, the cinema industry has faced a reduction in ticket sales bought about by the astronomical rise in streaming.
"The cinema has always been the preferred out of home [form] of entertainment, an opportunity for friends and family to get together, suspend reality, watch a movie and have some fun, and from that perspective, I do see cinemas having a strong future.
"It is obviously challenging at the moment but there are some great things coming up the end of this year, 2021 and 2022 ... I see cinema being in good health in the future - we just need to get through this period now."
Hoyts received an initial wage subsidy of $1,615,819 for 316 employees and a further $1.03m for 299 employees in the wage subsidy extension, according to the Ministry of Social Development wage subsidy search tool.
The chain closed its cinemas on March 25 and reopened on June 4 in Christchurch, and June 11 in Hamilton and Auckland under alert level 1.
Reduced visitation and lower ticket sales due to Covid-19 meant laying off staff in the months ahead was something Hoyts would have to consider, Wood said.
He did not know how many jobs would be lost, as it was "not at that stage yet".
Wood said there was an appetite for new film content - which had been the biggest challenge with limited releases coming out of Hollywood.
"At the moment it is definitely challenging, but the positivity of getting back to some sense of normality with a lot more releases, the long term feeling is very positive.
"Even with reduced content, people are still coming to the cinemas and enjoying the experience so that gives us a great sense of optimism that once we get a full slate of films we'll get back to the initial numbers that we used to have."
Event Cinemas NZ general manager, Carmen Switzer, said the New Zealand box office was trading at about 30 per cent of the same time prior year levels, in the school holidays - this was due to a lack of films being released because of the impact of Covid-19 globally.
"The global blockbuster release schedule is still forming and studios require a certain level of cinemas to be open globally to release. The industry had shifted to global day and date blockbuster releases some time ago.
"However, it was very pleasing to have Warner's decide to recognise that many markets outside of the US have opened and decide to release the Chris Nolan film 'Tenet' in international markets on August 27 and later in the US. We are hopeful that other major studios will follow this model as it makes sense."
Switzer anticipated the cinema industry in New Zealand would bounce back once the international film release schedule returned.
Kayleigh Hardie of independent North Shore cinema The Bridgeway said visitor numbers to the Northcote cinema were down about 30 per cent on the same time last year.
In June, the cinema had about 7700 through its doors, this was down from 11,400 on the same time last year.
"We were pleasantly surprised - we're doing a lot better than we thought we would."
Hardie said she expected a bit of a lull in visitors in the months ahead once the novelty of once again being able to visit the cinema had worn off.
Russel Crowe's thriller Unhinged opens for screening in cinemas today and other blockbusters such as Wonder Woman 1984 are on the slate for later this year.
But a string of big-budget films such as Tenet, Disney's Mulan, the latest instalment of James Bond, Black Widow, and A Quiet Place have already been delayed, and more international release delays are expected.
The regular release of blockbusters by the major studios had not yet returned, Wood said, and Hardie said more delays would come as the result of the United States and other markets still in the midst of the pandemic.
The major film studios have limited the number of releases as a large number of cinemas in the US and other markets still remain closed.
"Most people will be looking at 2021 as being able to release again," Hardie said.
"Initially releases were delayed due to lockdown, a lot were delayed until August through to November, but I think things are being questioned again - whether they will have to hold off again."
Wood of Hoyts said the Hollywood studios traditionally relied on a US opening weekend, but many were now rethinking this and open to the idea of releasing internationally before in the US due to the pandemic.
"For back to normal and regular releases we're probably looking 2021, I think there will be some impact [with delays] through to the end of the year," he said.
Subject to the pandemic dying off and new waves not reoccurring, the blockbuster release schedule could be back to normal by early 2021, he said.
Wood said New Zealand's "strong" local film industry "supplemented support" from the international blockbusters. There were a handful of Kiwi films coming out ahead of Christmas to support the local cinema industry, he said.
"There are six really positive, probably really good, Kiwi films coming out to support the cinema industry in New Zealand to try and make up for the lack of the bigger Hollywood releases that are coming it," he said.
"The focus now with Hollywood content not being as readily available, I think we'll be focusing on [local] films a lot more than we have in the past."
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