Cinemas in crisis: A future of uncertainties

Cinemas have resorted to selling merchandise and their snacks to keep afloat, while some liquidate resulting in job losses


LOCAL cinemas have to trim down up to 20,000 workers to keep afloat, while waiting for the government’s green light to reopen.

The industry has now shut for more than 150 days following the government’s decision to implement the current Movement Control Order (MCO).

For the past few months, cinemas, categorised under the First Close Last to Open businesses, have resorted to selling merchandise and their snacks to keep afloat, while some had to undergo voluntary liquidation resulting in job losses.

Cinemas are most likely allowed to be reopened in Phase 4 of the National Recovery Plan (NRP), which would most likely take place next year, and even that hinges on the number of Covid-19 cases.

Golden Screen Cinemas Sdn Bhd (GSC) CEO Koh Mei Lee said the local cinema industry is currently facing a crisis.

“Since the start of the pandemic in March 2020, cinemas have now been shuttered for close to a year. In 2020, the industry incurred losses of up to RM500 million and a 90% drop in revenue year-on-year,” she explained.

Koh expects the same this year.

Despite the NRP, she has no hope on when they can reopen, but the Covid-19 vaccines have brought some form of hope.

With the current discussions from the government regarding the relaxation of standard operating procedures (SOP) for fully-vaccinated individuals, she hopes that cinemas can be back in action alongside shopping malls, dine-ins, sports and other social activities.

“As cinemas depend primarily on exhibition and have no alternatives for screening movies digitally, we’ve suffered great losses from the extended closures.

“Although cinemas have been doing cost-cutting measures and careful cashflow management, the prolonged closure has depleted all cash reserves and exhausted all bank facilities.”

MCAT Box Office Sdn Bhd (MBO Cinemas), Malaysia’s third-largest exhibition chain, had to undergo voluntary liquidation, which resulted in many job cuts.

Koh warns that if the lockdown prolongs, more cinemas will face closures.

“More than 20,000 Malaysians in the industry are at risk of job losses if the cinema industry collapses.”

Therefore, Koh hopes that cinemas will be allowed to reopen for vaccinated customers.

“Statistically, there have been no infections or clusters associated with cinemas. This is because of the stringent SOPs in place, including social-distanced seating in halls.”

She also hopes for the government to give some concessions through screen subsidies or entertainment tax waivers to help with the industry’s recovery.

GSC is also a member of the Malaysian Association of Film Exhibitors.

A few weeks ago, the Film Directors Association of Malaysia also appealed to the National Film Development Corp Malaysia to submit proposals to the Ministry of Health and the National Security Council by the end of July to relax their SOP requirements.

This is to enable production companies in the green zones —Perlis, Penang, Perak, Pahang, Kelantan, Terengganu and Sabah — to operate so that the industry workers get back their source of income.

There are currently more than 10,000 creative workers in the film industry, including freelancers who do not have any source of income, Employees’ Provident Fund savings nor the protection offered by the Social Security Organisation.