The cinema chain’s financial woes first surfaced in early February, when it revealed that it had received letters of demands from the landlords of its movie theatres at Century Square and Causeway Point for about S$2.7 million owed in rent and other costs.
At the time, Mr Melvin Ang, founder and executive chairman of mm2 Asia, said talks on a repayment schedule with both landlords were underway. In an exclusive interview with CNA, he also expressed optimism about the cinema industry, citing a strong slate of upcoming Hollywood releases expected to draw moviegoers back.
But later that month, Cathay Cineplexes announced the closure of its West Mall cinema, the same day its lease at the Bukit Batok shopping complex expired.
On Mar 27, it also shuttered its Jem outlet after receiving a notice of termination from the landlord to discontinue the lease.
The cinema business’ ongoing struggles have taken a toll on the finances of its parent company. On May 19, mm2 Asia requested an extension to file its FY2025 financial results, annual report and other documents.
In an application made known via a bourse filing, the company cited reasons such as demands from landlords placing “significant pressure” on its resources, which in turn delayed the closing of its books and timeline for audit completion.
It also faced difficulties making timely audit fee payments as the claims made by the landlords on bankers’ guarantees, which added up to about S$2 million, “required urgent settlement within a short period, creating unforeseen cash demands”, mm2 Asia said.
The firm also disclosed then that the sum owed to various landlords for its cinema outlets had ballooned to about S$10.26 million, with around S$3.07 million backed by corporate guarantees issued by the company.
“These liabilities arose primarily from the closure of loss-making branches during the post-pandemic recovery period and the continued cash flow constraints affecting the cinema business,” mm2 Asia said in the May 19 bourse filing.
