Ster-Kinekor enters voluntary business rescue due to COVID-19 restrictions

In a statement on Friday evening, the company said the business rescue was aimed at facilitating the rehabilitation of the company.

Picture: Ster-Kinekor Facebook page.

JOHANNESBURG - Movie outlet Ster-Kinekor has been placed under voluntary business rescue.

In a statement on Friday evening, the company said the business rescue was aimed at facilitating the rehabilitation of the company.

It said up until February 2020, Ster-Kinekor welcomed millions of movie goers every year to their cinemas.

But due to various factors brought on by the COVID-19 pandemic, Ster-Kinekor has been trading at a loss, as the company continues to incur costs.

“As a result of the COVID-19 pandemic and the consequent economic lockdown instituted by the South African government at the end of March 2020, all cinemas were required to shut down, and only permitted to reopen under strict conditions as from the end of August 2020.

"Since then, the company has been operating under various forms of restriction, including curfews and mandatory limits to the number of guests per auditorium,” the statement read.

It also said the continued lack of content for the next four to five months meant that the business was heading for further operational and cash flow challenges.

“The board is of the view that the safe harbour that business rescue provides, in terms of providing a legal moratorium, will assist the business to return to profitability, once operating restrictions have been lifted, when international film distributions start to flow again.”

However, cinemas will remain open to the public.

Acting CEO Motheo Matsau said: ““For our customers, it is important to note that our cinemas remain open for business. All cinemas have instituted strict COVID-19 protocols, which mean temperature checks and hand sanitising on arrival and inside the auditoria and mask wearing as appropriate. Every two seats are kept vacant for social distancing.”

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