With the summer blockbuster movie season coming to an end, movie theater investors are well aware that a seasonal slowdown in ticket sales is inevitable. However, this past weekend’s numbers were the lowest on record for the U.S. movie industry since 2001, and analysts believe Labor Day weekend will offer little relief.
According to boxofficemojo.com, the top 12 grossing movies generated only $49.8 million in domestic revenue this past weekend, down 50.5 percent from a year ago. FBR Capital Markets analyst Barton Crockett says a pair of unrelated events likely weighed on box office numbers.
“Hurricane Harvey in Texas played a role this weekend, along with a popular pay-per-view Mayweather-McGregor fight,” Crockett writes in a note to investors.
The movie industry is also to blame for the lack of compelling films playing this weekend, a phenomenon that will likely spill over to the upcoming holiday weekend as well.
“Next weekend, we go from thin to vacuous, with no new wide releases,” Crockett says.
FBR is expecting U.S. box office revenue for Labor Day weekend to drop 59 percent year-over-year to just $39.4 million. If those projections are correct, it would represent the worst four-day Labor Day weekend for the U.S. movie industry in more than 30 years.
FBR is projecting that U.S. domestic box office revenue for the third quarter will decline 20.5 percent overall compared to 12 percent growth in Q3 of 2016.
There’s no question movie theater investors are feeling the pain of a weak year at the box office. In 2017, the stocks of Cinemark Holdings (CNK), Regal Entertainment (RCG) and AMC Entertainment Holdings (AMC) are down 13, 27 and 60 percent, respectively.
Looking ahead to Labor Day weekend, FBR is projecting a Lions Gate Entertainment Corp. (LGF.A, LGF.B) movie “The Hitman’s Bodyguard” will once again be the top U.S. title with a lackluster $7.1 million in domestic box office sales. Last year, top-performing horror film “Don’t Breathe” generated $19.7 million over Labor Day weekend.
The U.S. movie industry has…
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