Following a poor financial performance in 2020 Wanda Film Holding Co. Ltd. - otherwise known as Wanda Cinemas - is looking to the buddy comedy "Detective Chinatown 3" to turn things around.
The film is leading ticket presales for the Lunar New Year with more than 300 million yuan ($46 million), according to local news reports.
Beijing-based Wanda Cinemas, a part of Dalian Wanda Group and China's biggest cinema company, projected it could lose between 6.15 billion yuan to 6.95 billion yuan ($1.08 billion) over its past year with 4 billion yuan to 4.5 billion yuan goodwill impaired.
This represents the largest loss among all domestic film companies in 2020 and extended the company's loss of 4.7 billion yuan in 2019.
Even though the cinema industry has been recovering since July following coronavirus measures and the lack of blockbusters, it will still take a while for the company to bounce back to its performance before the pandemic, Wanda Cinemas said.
Existing gathering restrictions require cinemas to keep attendance below 50%.
Among the 19 film companies that have disclosed 2020 financial performance to date five only reported profits. Beijing Enlight Media Co. Ltd. projected that it would have a net income of 230 million yuan to 300 million yuan for 2020 - mainly owing to the films such as "The Eight Hundred," "Legend of Deification," and "Nezha: Birth of the Demon Child."
Six more domestic movies will be released in time for the weeklong holiday screenings. Presale bookings hit 400 million yuan as of Saturday, according to e-ticket platform Maoyan Entertainment.
"The total box office of this Lunar New Year is expected to be around 5 billion yuan - below 5.9 billion from 2019," Shi Wenxue, a Beijing-based film critic and industry analyst, told local newspaper Global Times.
But other analysts estimated "Detective Chinatown 3" alone could rake in 4 billion yuan to 5 billion yuan. "Detective Chinatown 1" and "2" combined generated more than 4.3 billion yuan.
Initially planned for a 2020 Chinese Lunar New Year release, "Detective Chinatown 3" was postponed during the COVID-19 pandemic while more than 600 Wanda Cinema locations were closed for nearly half of 2020.
China's box office in 2020 was $3.13 billion - down 68% from 64.27 billion yuan in 2019 and the same as all of 2013.
Wanda Cinemas, however, remains optimistic about its future and said the company had seen losses "turning into profits over the fourth quarter of 2020."
Analysts said its confidence stemmed from its expansion as smaller cinemas hit by the pandemic had chosen to seek shelter under big brands.
Up to 370 new cinemas signed with Wanda Cinemas last year. As of January, its cinema market share increased to 14.17% from 10.74% at the same time last year, Maoyan data shows.
Wanda Cinemas raised up to 2.93 billion yuan in a private placement in November - 2 billion yuan of which will be used for new projects, according to a statement last year.
Meanwhile, 162 new cinemas under the Wanda Cinemas brand are expected to be built within the next two years in first-tier cities including Beijing, Shanghai and Guangzhou.