The cost-containment measures put in place by Cineplex in recent months will provide it with enough runway to navigate the latter stages of the pandemic and the ensuing recovery period, according to CEO Ellis Jacob.

The theatre exhibition chain on Thursday reported Q1 revenue of $41.4 million, down 85.4% from $282.8 million in the same quarter a year ago.

Across the country, the majority of its theatres remained closed in Q1 (Dec. 31, 2020 to March 31, 2021), meaning attendance was down 96% to 415,000 this quarter, compared to 10.7 million a year ago. Over the same time frame, box office revenue fell by 96.6% to $3.8 million, from $111 million the year prior.

Despite challenging and unpredictable external factors, Jacob said Cineplex is continuing to focus on factors within its control as it looks to “bulletproof the company during an unprecedented time.”

While Cineplex said its average monthly cash burn was $26.9 million in Q1, “key liquidity actions” – including $57 million for the completed sale-leaseback of its Toronto head office and $250 million in the form of Second Lien Secured Notes – will help it weather the third wave of the pandemic and set it up to “capitalize on the pent-up demand for social experiences” when provinces reopen.

Jacob added that the strength of the U.S. vaccine program has given Hollywood studios confidence that they can start scheduling the release of backlogged titles – many of which have been delayed for up to a year – including The Suicide Squad, The Boss Baby: Family Business, No Time to Die, Top Gun: Maverick and Spider-Man: No Way Home. The box-office performances of countries such as China, Japan and Australia has provided further encouragement that the Canadian market will bounce back strongly once theatres reopen, added Jacob.

And while an accelerated shift to streaming has been a byproduct of the pandemic, Jacob is bullish on the prospects of the bricks-and-mortar cinema business as theatres across the world prepare to welcome back guests.

“Studios are continuing to focus and solidify the exhibitor experience. And yes, windows will change, but I don’t think the actual releasing of films [will stop] happening in theatres. They will continue to be the engine that drives the train. There may be some modifications, but I don’t think streaming is going to be replacing the experience one gets in a movie theatre – and that’s from all the big studios I’ve spoken with over the last couple of days,” he said.

Elsewhere, Jacob said Cineplex’s lawsuit against Cineworld Group is ongoing and the formal legal proceeding is expected to commence in September. Cineplex is seeking more than $2.18 billion in damages after Cineworld’s proposed $2.8-billion acquisition of Cineplex fell apart. Cineworld, which is the world’s second-largest cinema exhibitor and owner of U.S. theatre chain Regal Cinemas, has said it intends to “vigorously defend” the claims, and has filed a counterclaim of its own.