(Original article appeared in La Presse in French, it has been translated below into English using Google Translate}
Struck by the crisis of the new coronavirus, Cirque du Soleil is still working to put in place the financial solutions that will allow it to emerge from its forced quarantine while tying up the logistics of resuming its tour of shows everywhere in the world. Because there will be life after the crisis, insists its CEO, Daniel Lamarre.
As we know, Cirque du Soleil was struck down by the COVID-19 pandemic. The company, which simultaneously had 44 shows worldwide, was forced to cancel all of its activities and lay off 95% of its workforce, or nearly 5,000 people.
“It was quite a colossal operation. We had to repatriate more than 2,000 of our employees on tour in around thirty cities in each of their countries of origin. We had to dismantle our marquees and store 483 trailer trucks of equipment, ”says Daniel Lamarre.
For the past two weeks, there have been many speculations about the financial insecurity of Cirque du Soleil to face the crisis that has beset it. When a company loses almost all of its revenues overnight, there is reason to worry about what happens next, especially when these revenues amount to more than US $ 1 billion.
And the concerns are amplified all the more since Cirque du Soleil is currently accumulating a considerable debt, of the order of a billion dollars, due to significant investments of more than 500 million that have been made over the past two years to acquisitions and the creation of new shows.
Daniel Lamarre admits at the outset that the Cirque is facing major challenges and that it will have to maneuver extremely tightly over the next few months to emerge from the crisis, but he is sorry for the aura of fatalism with which we portray its financial and operational situation.
“Yes, we have liquidity problems, yes, we are working to find solutions with our partners and the governments, but we are in combat mode. We are not waiting for the miracle solution and we are not looking for subsidies to get by, we are working to put the company back on its feet so that it is ready as soon as the situation allows, “launches the CEO of Cirque.
ENCOURAGING NEWS
It is to break the atmosphere of torpor that hovers over the company long revered for its immense creativity that Daniel Lamarre wanted to testify.
From an operational point of view, the Cirque du Soleil management team is working tirelessly to prepare for the post-crisis period. We review all the logistics of the tours which are planned two years in advance. Certain shows will have to be given priority, just as we plan to bet more on certain key markets, such as those of London, Los Angeles, New York or Sydney.
“We are in constant discussion with our partners. With MGM in Las Vegas or with Disney. As soon as the situation allows, we will relaunch our shows and our tours, one at a time. Our producers in Korea and Indonesia are already calling us to resume the shows.” – Daniel Lamarre, CEO of Cirque du Soleil
That said, Cirque will need cash to orchestrate the gradual reactivation of its activities. Its CEO estimates that it will cost from 100 to 200 million US to ensure the transition to full operationality of its activities.
“Our shareholders TPG, Fosun and Caisse de depot will participate in this recovery and we are negotiating with Investissement Québec to have loans guaranteed. There are still details to be clarified, ”says Daniel Lamarre.
If these details become inextricable, the CEO still does not rule out the possibility that Cirque du Soleil will place itself under the protection of bankruptcy law, an extreme solution which he obviously does not favor.
Could Guy Laliberté, founder of Cirque who has just sold the remaining 10% share he held in the business to the Caisse de depot, could have been involved and helped save the business that he created? It would be a fair return, right?
“These are his personal decisions, he has his own plans, I focus on the decisions we can make. We are fortunate to have a solid shareholder, the Caisse de depot, who believes in the business, ”replies Daniel Lamarre.
“People forget that before the crisis broke out, Cirque du Soleil was very profitable despite the large investments that we have made in recent years. It is estimated that the return to profitability is achievable within two years.”
According to Daniel Lamarre, the wheel will start to turn again as soon as Cirque begins presenting a first show and cash will start to flow again.
“Last Friday, we put on our site extracts of three of our shows which generated in 24 hours 7 million views and 6.7 million additional views on Facebook and YouTube. It gives you an idea of ??the strength of the Cirque du Soleil brand, ”illustrates Daniel Lamarre.
Cirque is not dead and the fight has only just begun, according to its CEO, because there will be life after the crisis.
{ SOURCE: Jean-Pilippe Décarie, La Presse+ }
