Proceeds will be used to pay off debts

Durrant Pate/ Contributor

All is set for Trinidad and Tobago based cinema company, CinemaOne TT$6-million Rights Issue, which opens tomorrow.

The company is issuing 1.6 million shares in the rights issue to existing shareholders, having gotten approval from shareholders and the regulatory authorities in which each shareholder will be entitled to purchase one share for every four shares held. This would translate to a price of around TT$3.75 which is just below the market price of TT$7.25. 

The rights issue is expected to successfully close this month. The capital raise by CinemaOne comes in wake of renewed confidence by the company following the removal of restrictions last year.

Three consecutive years of losses

The capital raised will be used to pay off debts incurring during the early COVID-19 era, in which the cinema company posted three consecutive years of losses. In November 2018 CinemaOne, was the first company to be listed on the T&T Stock Exchange’s Small and Medium Enterprise.

At that time CinemaOne offered an initial 3,088,373 shares but sold 1,444,168 at TT$10 per share. CinemaOne’s initial public offering therefore raised over $14 million but was under-subscribed by 53 per cent.

Data from the T&T Stock Exchange, shows that CinemaOne’s stock traded at a 52-week high of TT$8.20, and a 52-week low of TT$1.79. CinemaOne enjoyed a resurgence in moviegoing last year, following the full relaxation of all government imposed COVID-19 Safe Zone operating restrictions last April.

CinemaOne recorded a 388% increase in gross revenue to TT$10.1 million for the year ended September 30, 2022 when compared to the same period in 2021. The company’s net loss was constrained to TT$1.4 million last year.