Lights! Camera! Action!
The long drought of IPOs in the media sector seems to be approaching an end, with Cinema City International, a multiplex operator, selecting an underwriter and filing an issuance prospectus with the Securities and Exchange Commission (KPWiG) in time for a float in the fall.
"We are entering the Warsaw bourse because Poland is our most important market," says Moshe Greindinger, managing director of Cinema City, which owns 50 multiplexes boasting a total number of more than 350 screens in this country as well as in Israel, the Czech Republic, Hungary and Bulgaria. And what's more, the firm plans to double the number of screens it has here by the end of 2006.
At the same time as being only the third company in the sector listed on the Warsaw Stock Exchange (WSE), Cinema City would also be the third foreign firm on the exchange, if Ivax, a U.S. drug maker, succeeds in its stock swap offer for Polfa Kutno.
According to press reports, Cinema City International, an Israeli firm incorporated in the Netherlands and formerly known as ITIT, hopes to raise more than zł.100 million in one of the largest stock issues this year.
Greindinger says that the firm has enough funds at its disposal to finance expansion, but an IPO would help speed up the program. He also adds that Cinema City's investment plans envisage capital spending to the tune of between zł.271.8-317.2 million (€60-70 million) in Central and Eastern Europe this year alone, with, Greindinger says, about three-quarters of this money being spent in Poland.
The company's plans to invest heavily in this country are based on predictions that rising incomes and increasingly Westernized behavior patterns will mean large increases in the frequency that Poles go to the cinema. But while last year Poles made only 31 million visits to the movies, making an average of 0.7 visits per person per year - less than a third of the average level in Western Europe - Greindinger predicts this is bound to change and is banking on investors being keen to benefit from the trend.
But some market insiders are skeptical, saying that cinema attendance figures have been stagnant since peaking in 2000. While Greindinger says the company has had a good H1 this year, as increased attendance allowed it to cut losses compared to last year's zł.9.3 million ($2.6 million) on revenues of zł.173.8 million ($48.4 million), analysts say that there is little sign of a sustainable increase in attendance numbers.
Furthermore, average spending per cinema-goer is about a tenth of that found in the old EU, and unless this changes, critics say, Cinema City has little chance of seeing its investment pay off in the near future.
In addition to cinemas, the firm's other Polish subsidiaries include a media house specializing in cinema advertising, a film-distribution company, entertainment centers and a shopping malls network. Between them, these firms brought in some 37 percent of Cinema City International's total revenues last year.
"We are entering the Warsaw bourse because Poland is our most important market," says Moshe Greindinger, managing director of Cinema City, which owns 50 multiplexes boasting a total number of more than 350 screens in this country as well as in Israel, the Czech Republic, Hungary and Bulgaria. And what's more, the firm plans to double the number of screens it has here by the end of 2006.
At the same time as being only the third company in the sector listed on the Warsaw Stock Exchange (WSE), Cinema City would also be the third foreign firm on the exchange, if Ivax, a U.S. drug maker, succeeds in its stock swap offer for Polfa Kutno.
According to press reports, Cinema City International, an Israeli firm incorporated in the Netherlands and formerly known as ITIT, hopes to raise more than zł.100 million in one of the largest stock issues this year.
Greindinger says that the firm has enough funds at its disposal to finance expansion, but an IPO would help speed up the program. He also adds that Cinema City's investment plans envisage capital spending to the tune of between zł.271.8-317.2 million (€60-70 million) in Central and Eastern Europe this year alone, with, Greindinger says, about three-quarters of this money being spent in Poland.
The company's plans to invest heavily in this country are based on predictions that rising incomes and increasingly Westernized behavior patterns will mean large increases in the frequency that Poles go to the cinema. But while last year Poles made only 31 million visits to the movies, making an average of 0.7 visits per person per year - less than a third of the average level in Western Europe - Greindinger predicts this is bound to change and is banking on investors being keen to benefit from the trend.
But some market insiders are skeptical, saying that cinema attendance figures have been stagnant since peaking in 2000. While Greindinger says the company has had a good H1 this year, as increased attendance allowed it to cut losses compared to last year's zł.9.3 million ($2.6 million) on revenues of zł.173.8 million ($48.4 million), analysts say that there is little sign of a sustainable increase in attendance numbers.
Furthermore, average spending per cinema-goer is about a tenth of that found in the old EU, and unless this changes, critics say, Cinema City has little chance of seeing its investment pay off in the near future.
In addition to cinemas, the firm's other Polish subsidiaries include a media house specializing in cinema advertising, a film-distribution company, entertainment centers and a shopping malls network. Between them, these firms brought in some 37 percent of Cinema City International's total revenues last year.
