Cinema group Ster-Kinekor closed two of the nine cinemas it earmarked for closure earlier this year. Picture: iStock
In the latest development of Ster-Kinekor’s planned restructuring, the South African cinema giant says it has emerged from the process with fewer job cuts than anticipated.
It averted retrenching 236 employees and shutting nine cinemas as part of its overhaul. Instead, fewer than 60 jobs were cut and only two cinemas were closed.
According to the group’s CEO, Mark Sardi, exciting plans to diversify its offerings to draw audiences are currently underway.
Sardi said the softer blow to the business was due to successful talks with landlords and distributors about restructuring operations as well as other cost-cutting measures implemented.
In April, Ster-Kinekor announced that it has earmarked nine cinemas for closure while reviewing several others in Gauteng, KwaZulu-Natal and the Western Cape.
The country’s largest movie exhibitor cited factors such as a challenging economic environment, load shedding, financial constraints, and the impact of the Hollywood strikes which saw many movie releases being moved to 2025.
The company says the softer blow to the business is thanks to successful talks with landlords and distributors about restructuring operations as well as some cost-cutting measures implemented.
ALSO READ: Streaming killed the movie star? List of Ster-Kinekor cinemas set to close
Sardi told BusinessLIVE, that the company’s expansion into new products, services and markets would ensure sustainable income.
According to the CEO, Ster-Kinekor will embark on a mission to capitalise on its existing infrastructure and explore ways to repurpose it profitably into alternative spaces for e-gaming, coding and various other uses over the next 12 months.
“We are working with them [stakeholders] to look at things like taking certain screens and repurposing them for e-gaming, as an example, where kids can learn to code Monday through Thursday. They can play the Rolls-Royce version of PS5 and watch other kids compete against one another in that environment,” the CEO said.
“You come into a cinema and you walk down, and there is always a stage that you can see. So we are looking at music concerts… Taylor Swift’s The Eras Tour was phenomenal for us,”he added.
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According to BusinessTech, Ster-Kinekor entered business rescue in January 2021 due to the severe effects of the Covid-19 pandemic and lockdowns.
Although the company was profitable before the pandemic, despite competition from streaming services, cinema closures, seating limitations and curfews led to significant financial losses.
Additionally, video streaming services Netflix, Amazon and Disney have invested in direct-to-streaming blockbuster originals, with monthly subscriptions available at a fraction of the price of a movie ticket.
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