Major Cineplex issue assigned "A" rating
TRIS Rating has affirmed the company and senior unsecured debenture ratings of Major Cineplex Group PLC (MAJOR) at "A-" with "stable" outlook, reflecting the company's leading position in the Thai movie exhibition industry, the sites of its properties whi
These strengths are partially offset by Major’s exposure to uncontrollable factors, such as the number of films released, film popularity, the risk of increasing competition from the proliferation of entertainment alternatives, and film piracy.
The “stable” outlook reflects the expectation that Major will maintain its leading market position in the movie exhibition industry and sustain a satisfactory performance. The expansion abroad will enhance its market base and alleviate concentration risk. The greater cash flow diversification will support its credit profile. Any further investments or dividend payments should not adversely affect the company’s financial strength and liquidity.
Major is the largest movie exhibitor in Thailand, with approximately 70 per cent market share in terms of first-week box office sales. Its five principal lines of business are cinema exhibition, bowling and karaoke, advertising media, space rental and services, and movie content. The cinema exhibition and the advertising segments have been the key contributors to Major’s total revenue.
In the first nine months of 2014, the cinema exhibition segment comprised 67 per cent of total revenue, while the advertising media segment and the movie content segment made up 13 per cent and 9 per cent , respectively. The two remaining segments each contributed around 6 per cent of total revenue.
Major reported Bt7,711 million in revenue in 2013, an 11 per cent increase from the previous year. The growth was mainly due to the strong box office performance of both Thai and Hollywood films, added by the continuing growth in advertising sales and concession sales.
