CJ CGV, South Korea’s leading exhibitor, is undergoing a major restructure that has already seen around 80 employees leave the company.
As the local film industry continues to face prolonged stagnation as a result of declining ticket sales and the rise of streaming, the cinema operator confirmed that it had implemented a voluntary retirement programme in response to ongoing business challenges.
The scheme was offered to deputy managers and higher-level employees who had been with the company for at least seven years and was taken up by around 80 staff members, who received at least 100% of their monthly base salary, depending on tenure.
It marks CJ CGV’s first voluntary retirement programme since February 2021 during the Covid-19 pandemic.
This also comes two months after Jung Jong-min took the helm as CEO of CJ CGV, the exhibition arm of South Korean entertainment conglomerate CJ ENM.
As the recovery of the industry remains increasingly uncertain, the cinema operator CJ CGV said it aims to improve profitability by securing unique content and leveraging its exclusive specialty theatres. These enhanced cinemas include 4DX, created by subsidiary CJ 4DPlex, which includes motion-activated seats and weather effects, and SCREENX, which uses three sides of a theatre to project images.
It follows the decision to close underperforming theatres such as CGV Songpa in Seoul and CGV Yeonsu Station in Incheon, which will shutter on March 23.
The restructure sends a clear signal about the challenges facing the Korean exhibition industry.
Total box office in 2024 dropped 5.6% year-on-year to $818m (KRW1.19tn) while admissions dipped 1.6% to 123.13 million, according to the Korean Film Council.
The situation is not much different for competitors Lotte Cinema and Megabox, leading to speculation that they may also undergo significant restructuring, although both have denied plans for such a move.
Lotte Cultureworks, which operates Lotte Cinema, previously conducted voluntary retirement programs in 2020, 2021, and 2023 due to financial difficulties exacerbated by the pandemic.
Meanwhile, Megabox is aiming to increase audience engagement with the introduction of exclusive screenings and re-releases. This month, its Mega Only strand will feature exclusive screenings of eight titles including Wolfman, Taeyeon Concert – The Tense and The Ministry Of Ungentlemanly Warfare. The exhibitor said the move “seeks to differentiate” its offering in the market.
This week, it has also launched an unconventional marketing campaign titled “Nap in the Theatre”, which invites customers to use cinemas as relaxation spaces.
From March 17-21, office workers and students will be invited to purchase tickets for just KRW1,000 ($0.69) during lunchtime and enjoy two hours of relaxation in recliner seats. Megabox stated that the campaign is to promote the reopening of its Gangnam branch, which has transformed all 492 seats across seven screening halls into full recliner seating.
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