I would now like to hand the conference over to Ms. Jane Hastings, CEO. Please go ahead.
Good morning, everyone, thanks for dialing in. With me today, I have Greg Dean, Director of Finance, David Stone, Company Secretary, and Mathew Duff, Director of Commercial. We'll move through this at a top-line level to enable much time for questions at the end. Okay, on the summary. It's clear that the pandemic has driven our revenue down by AUD 466 million, and we've had a very strong response to mitigate that EBITDA loss to AUD 31 million. Globally, our industries have been impacted in hotels, cinemas, and ski resorts, and we're pleased that EVT markets have performed better. Only 56% of global cinemas were open, and given that blockbuster films have a day-and-date release, that delayed most of those releases. Global box office is down 73%, and our markets performed better than that.
International and state border closures fallen occupancy in key hotel markets up to 64%. Our hotels performed well relative to their competitive sets. Thredbo, whilst operating at 50% capacity and having a not so good ski season, EBITDA only reduced by 16.7% due to the success of the initiatives that we put in place. We have had a very strong focus on active cost management and have materially reduced the cash burn to mitigate the impact. We had around about an AUD 20 million a month EBITDA loss in the earlier COVID period, March to June. We reduced that to AUD 5 million per month in the six-month period. The active cost management's achieved just over AUD 100 million in cost reduction and AUD 155 million since COVID commenced. We have a strong balance sheet and are confident to manage through the current pandemic trajectory.
The pandemic has impacted our revenue by circa AUD 800 million, and we have done well to offset those declines, and net debt has increased by only 10%. Our debt facilities of AUD 750 million, with the majority around AUD 650 million maturing in 2023. We've made really strong progress on our future growth initiatives despite our focus on COVID. We're on track to exceed a record year of hotel network expansion, and I'll talk a little bit more about the Independent Collection by EVT, which we've recently launched. Our Future strategy is delivering increased spend per customer walking through the door, and I'll talk also a little bit more about Cinebuzz On Demand trial that we have launched. The Thredbo growth initiatives are on track, and we were really pleased with the summer performance in mountain biking, and for the first time, January was EBITDA positive.
We're confident in the growth from our core property plans, and we'll talk more about those later. We've made the decision to divest some non-core properties to unlock potential proceeds of before tax, around AUD 250 million over the next two years. Our outlook is positive. Our recovery is subject to the timing of the progress of the vaccination programs in key markets, not just our own markets, but also the U.S.A. Our unaudited result for January 2021 shows that Entertainment Australia, hotels and resorts, and Thredbo were EBITDA positive. We know that significant uncertainty remains, but we're targeting an improved H2 to H1 for the entertainment and hotels and Thredbo businesses. For Thredbo, we are expecting the result to be favorable on the prior comparable half. In Germany, we believe based on current government updates, will open late April, early May.
Based on the current market data, our estimated recovery, and by recovery, I am saying more normalized trading, for cinemas would be in 2021, 2022, Thredbo 2021, 2022, and hotels financial year 2022, 2023, considering that international travel is unlikely to resume in the 2021 year. Subject to trading conditions, the board desires to resume dividend payments from the 2022 financial year. The next couple of charts, our aim is to put some transparency around the cost work that has been undertaken in order to mitigate the impact. AUD 466 million revenue decline in the first half, AUD 142 million saving directly related to revenue reduction. Wage subsidies of AUD 48 million. It is important to note that around half of the wage subsidies were straight pass-through to employees. AUD 101 million active cost management.
Active cost management includes areas such as external supplier negotiations, rent abatements, the impact of our new variable operating models, extremely strict cost control on all other expense areas, voluntary salary reductions by senior management. All of that is captured within active cost management. Since the pandemic commenced, AUD 800 million, just over, reduced revenue, and wage subsidies have contributed around AUD 86 million. Once again, around half of that is passed straight through to the employee.
AUD 155 million of cost management, which we're really pleased with. We believe that the actions that we've taken have really set up a good platform for us to perform even better when the market normalizes. H1 results review. Group trading revenue was AUD 294 million, down AUD 466 million, excluding the government subsidies. We felt that the prior half year is less relevant as a useful comparison, given the material pandemic restrictions on trading.
What we've done here in the graph to the left is we've tried to provide more insight into trading performance during the COVID period. We're giving you a view of the initial COVID period performance, the four months March to June 2020, versus the most recent COVID impacted period, the six months July to December. As you can see, in the first four months of COVID, we lost around AUD 76 million in EBITDA, which equates to circa AUD 20 million per month. In the period July to December, we lost AUD 31 million, which is an improved position of around AUD 5 million EBITDA loss per month. The monthly average variance column outlines the improvement by division. We hope you find this useful. It is important to note that Germany did show improvement, but not as much as Australia and New Zealand entertainment businesses.
This is primarily due to less government subsidies during this period, we'll talk a little bit more about those later. The third wave of COVID in Europe, which resulted in the German market entering a lockdown, with cinemas closing at the beginning of November. It's also important to note that the first half results exclude around AUD 13 million of rent abatements that have been agreed but not yet formally signed. Whilst it was a period of transformation to reduce cash burn, we made good progress on our future growth initiatives, which I've touched on. All the work we've done will really put us in a great place to rebound when government restrictions lift.
Regarding the debt levels, we're currently at a net debt level of AUD 452 million. We have drawn debt of AUD 533. We have facility headroom of approximately AUD 216 million. I think the active cost management that Jane's referenced has really come to fruition in our debt levels. We're very careful to maintain conservative debt levels. We're doing everything we can to do that. Debt went up 10%. We drew down AUD 45 million over the course of the six months, so we think it was a good result and reflects that active cost management process that we're going through.
Moving to hotels and resorts. We were very pleased that the underlying EBITDA was positive, excluding government subsidies every month from September 2020. There was a significant improvement in the initial COVID impact period in terms of EBITDA loss of AUD 2.5 million to the six-month period, a profit of AUD 11.3 million. Really strong active cost management. The half year result was assisted by government subsidies, which contributed around 15.5% of revenue, and to a lesser extent, quarantine business, which was only around 8.8% of our revenue in that period. We do believe the new operating models are sustainable and will continue to deliver margin improvement in the recovery period. We are seeing that the lockdowns, there is a start-stop mode in the domestic market at this point in time.
We are seeing that the lockdowns and border closures have an immediate impact, but we're agile and the market recovers quickly. A few examples with the Victorian lockdowns. Just pre-border closing initially, hotels were averaging around 31% occupancy and AUD 132 average daily rate. During, that dropped away, the occupancy and rate. Post, coming straight out of that, four weeks post the reopening of the borders, hotels averaged around 45% occupancy and AUD 141 average daily rate. That was in the period pre the Northern Beaches recent outbreak, and we'll assess that again in the next couple of weeks. Auckland is another good example of that. Pre the border closing, occupancy was in the mid-40%s. Post, it bounced out to around 57% occupancy and a AUD 151 average daily rate. It is a stop-start at the moment, and that's why our business needs to be agile to adjust.
We are seeing the rebound coming back a little bit faster each time. We're on track to achieve a record portfolio growth with five new hotel opened. Rydges Gold Coast Airport has recently opened, QT Auckland, Rydges Formosa Golf Resort, The Oval Adelaide, and Tank Stream Sydney. The new brand Independent Collection, again, I'll talk about that a little bit more in a moment to provide some background. Key statistics. I think the most interesting thing here is that each of our brands is performing in a relatively similar way in terms of recovery. We're not seeing Rydges or QT, one or the other outperforming each other. They're kind of recovering in a similar way. The decline in the Rydges occupancy during that period is primarily related to the Victorian lockdown, and the same applies to QT in terms of average room rate with the Victorian lockdown.
We're really pleased to be launching our first Atura in the New Zealand market. Actually launched last week. It was previously The Thorndon Hotel and Management Agreement, and that's the first of that brand in the market. In terms of overall occupancy levels, we've seen them improve. April was around 18%. It's hard to even say that. June was 28.7%. December was around 55.3%. There is improvement. All of our brands have outperformed their competitive sets. In terms of developments, I just wanted to highlight a couple of things on this page. The two targeted hotels for upgrades are Rydges Melbourne and QT Gold Coast. QT Gold Coast, we've already commenced the program. The shared spaces, suites, pool area, et cetera, has been upgraded through this period. The next phase of this project includes rooms and conferencing space.
We're well underway in planning the Rydges Melbourne property for the major upgrade, which we aim to commence in FY 2022. We also welcomed Yarra Valley Lodge to the group just a week or so ago, which is a 102-room property in Victoria and will operate under the Independent Collection by EVT. The Independent Collection, it's a growth platform. We've been working on this for about the past 18 months. First, recognizing a gap in the market and matching this with our ambition to expand and better leverage one of our key competitive advantages, local-based experience and capabilities. It's important to note there's actually more unbranded properties in Australia than branded, and whilst that set of hotels is a large number, our target is a clear subset of this around a group of properties with 75 rooms or more. The financial model is flexible for owners.
Traditional management agreements included to a select services model. The strategy will continue to evolve. One project which is underway right now is innovating with a new bookings platform, which makes the connection for independent owners even easier and more cost-effective. This trial is underway across our owned Atura properties. Simply put, to have an EVT branded hotel, owners were required to meet our brand standards. To be part of the Independent Collection by EVT, it's about being flexible to meet the owner's brand standards and to aid them in unlocking growth potential. The tiers provide flexibility to ensure we have an option for all hotel experiences, we really see this as a strong opportunity for EVT to expand. Moving to property.
The movement in EBITDA is primarily related to the rent relief that we provide to our tenants during the COVID period, and also the fair value adjustment of investment properties down AUD 1 million on prior year. We've made really great progress with 525. Stage One DA was approved, and the design competition process has been completed. Further, it will be completed on the detailed design to maximize the value of the 108 residential apartments and 330-room hotel, retail, and cinema podium. We expect to be submitting the Stage Two DA application around October this year. 458-472 George Street, we received approval for the Stage One DA in November for the podium extension of the QT Hotel, which includes 72 rooms, conference space, rooftop bar and ground floor retail. We're now preparing Stage One DA for a commercial office tower above the approved extension.
We're also pleased to have Gowings as a flagship tenant, which is on the corner of the Gowings property. I don't know if anyone's walked past it, but it looks fantastic and it's prime real estate in Sydney. It's really a great addition to that area. As mentioned, we've identified and commenced the process of divesting around AUD 250 million of non-core property assets. We have indicated two years to complete this, but we aim to achieve the best return for these properties. Some of the properties include three of the investment properties, including the Civic Building in Canberra, the Forum Building in Brisbane, and the Double Bay Centre. We're reviewing a couple of hotel properties at this moment in time, and we have four German properties, which we will look to divest.
There's also a list of smaller regional properties, including the likes of FilmLab in Miranda, which had a valuation of AUD 5 million and recently sold for AUD 7.8 million. There have been a limited number of hotel transactions since March 2020, a recent updated valuation for a small number of our EVT properties suggests a decline in the value in the range of 10%-15%. Some more recent larger transactions show strength in the property market, we'll have the majority of our circa 50 properties revalued in June, and we'll update you at the full year. The sale of these non-core property assets, we expect to at least offset with the growth and development of our core property assets over time. Moving to Thredbo. Thredbo delivered an incredibly strong result despite the 50% capacity restrictions and weaker snow conditions.
EBITDA declining 16.7% as a result of an entirely new business model. New products, new pricing, new operations to operate with those constraints. We've had a record mountain biking growth over 100%, adjusting for non-recurring items in the summer months where we do a lot of our winter R&M, we were profitable for the first time. We've seen January also perform well, as I've mentioned. Pleasingly, Thredbo has retained the Australian's Best Ski Resort in the World Ski Awards for the fourth year. Even more pleasingly, Gold Certification from EarthCheck in February 2021, the first Australian resort to achieve this. We've made great progress on our Thredbo growth plan, we'll continue to do so. Everyone's aware of the Merritts Gondola completed. New mountain biking trails are being added each year.
We're enhancing our snowmaking, and we have plans in place to do a rollout and upgrade of each of the chairlifts over the next five to six years. We also have some property in Thredbo which we're looking to unlock the value. Moving now to entertainment. There's been numerous studies commented on in media relating to cinema visitation. More than often, these studies have a very small sample from our markets and don't take into consideration how COVID impacted the market is. We've been conducting our own research with the largest sample size of cinema goers in our markets. This recent study that you can see today was completed last week. We spoke to 7,500 cinema goers, of which around 26% of those had not visited the cinema recently. The findings were really clear.
The key reason that they had not attended, the 26%, was that there was nothing that they had wanted to come and see. We have ensured them a line-up of the 2021 films waiting to release. An overwhelming 91% responded that they would return to see one of these films. We also test our COVID safe practices, and all segments of the market rate cinema in line with going out to a restaurant as safe. Customers are very willing to return to cinemas when there is a film to see. Research tells us what customers are saying and thinking, this slide highlights our transactional data confirms what they are doing, and we've got a really strong fact base. In the first half, even with less films, all customer demographics have returned to the cinema. Less volume, of course, no segments have changed their behavior.
75% of those who attended have been our movie fans from the Cinebuzz members, those that consume the most film content across all platforms. Given around half of the global cinemas have been closed due to the pandemic, studios have had to delay blockbuster releases, and in the first half, there was only one film released that was over AUD 15 million at the box office, which was Tenet, and that only just got over that AUD 15 million level, versus 10 in the prior year. Important to note that Wonder Woman is not included in this series. It was only about six days of the first half financial result. Customers have pent-up demand to return, and when films are released, cinemas will bounce back quickly.
Some further recent examples of this include in Australia, the Australian movie, "The Dry," is currently at about AUD 17.5 million nationwide box office, well ahead of the pre-COVID forecast. In Japan, the Demon Slayer movie broke all box office records from pre-COVID and is still holding the best opening weekend and best lifetime box office of all time. China, "The Eight Hundred" performed well, more recently, over Chinese New Year, had its best weekend box office taking, over $1.2 billion, with the "Detective Chinatown 3" beating Avengers: Endgame opening weekend, even with the 50%-75% capacity restrictions they're operating under in that market. There's plenty of pent-up demand. We just need more blockbusters to release. Looking at entertainment structure, nationwide box office was down 75.7%, which outperformed other major markets.
The COVID-19 government-mandated closure of the JV sites in Victoria, they were closed for the majority of this period, as I said, no major releases. We had very strong cost management by the team of around AUD 37 million, which has really improved our operating model moving forward. I think a key point to highlight here is that every customer that's walking through the door is spending more. Our Net Promoter Score has had a record increase of nine points, they're more satisfied with the experience, and we're delivering that at a lower cost to serve. That's a model that we feel very confident with moving forward. We continued our pre-COVID strategy of exiting underperforming sites, that included Arndale, Adelaide City, and Townsville City.
We were pleased that despite nationwide box office being down 50%, Australia delivered a positive EBITDA, and we launched our Cinebuzz On Demand trial. Cinebuzz On Demand, why? Well, simply put, we know customers cannot be with us in cinemas 24/7. We have direct relationships with more than 2.5 million Australian-based moviegoers who love watching movies. For the past 16 months, we've been working on this initiative. When members are stuck at home, they can now rent a movie and earn rewards to redeem back in cinema. The movies will include films that have had a limited release at our cinemas, films that did not release, and films that were popular and will strongly support the local film industry. In some of our regional areas where we only have six screens, this enables us to give our members a vast or broader choice of content to consume with us.
The Cinebuzz intelligence tool that sits behind this will leverage the transactional data and enable better curation and recommendations for films. However, it aims also to serve up film recommendations that actually broaden preferences of our members. We're going to continue to evolve this model. We're going to learn with members what works, what does not work, and we'll refine it over the next 12 months. Entertainment New Zealand, really the key thing to highlight here is that despite New Zealand being a relative COVID-free market, given the global cinema closures forcing day-and-date blockbusters to be delayed, they didn't have the product to recognize that relatively COVID-free market. Pleasingly, New Zealand content performed well, which was 11% of box office. Again, the same model that we've applied in Australia as in New Zealand. Each customer walking through the door is spending more.
Customer satisfaction has increased, and it's costing us less to serve. In Germany, cinemas were restricted or closed for the majority of H1, given the state of the pandemic across Europe. The German market was down 84%, and performed well relative to other European markets, which were unfortunately, U.K. and Ireland were down 91%, and that was supported by local film content, which was around 30% of the box office during that period. No blockbusters were released. We did see a snippet of time when restrictions started to ease in September, and quickly we saw box office return to around 50% of the same month prior year. Customers came back relatively quickly, just fewer films to see. Customers spent more, as we saw in Australia, the same strategy. The key point here in terms of the results is the European COVID-19 recovery package is yet to be finalized.
There was a wage subsidy, short-time pay, which covered a smaller proportion of the wage costs in Germany. We're now working through the November, December release and the first six months of this year release, and we'll update you more when we have more news on those. It's fundamentally a strong business when cinemas are open and content is available. We do actually have three strong local German films waiting to be released as soon as the cinemas do open, which we're expecting to be early May. In terms of an update on CineStar sale to Vue's failure to satisfy the SPA's condition of the transaction has meant that we're just exploring all of our legal options in terms of Vue's breach of sale on the purchase agreement. Again, we'll update you as we can. We've got a strong film lineup.
If we were to design a lineup of films that we would dream of waiting to release, it would look something like this. In fact, in September, it's been quoted that there's a blockbuster every few weeks. It is subject to change because it really does depend on the vaccination program progress in the U.S. market and in the U.K. to enable cinemas to open and their global day-and-date releases to unfold. In terms of our outlook, key point there is that the COVID-19 vaccination program dictates our speed of recovery because that unlocks the government restrictions that we have currently across all of our businesses. We're targeting an improved second half to a first half for cinemas and hotels, and we have a positive outlook for July to December subject to the vaccination program progress. Entertainment, there's pent-up demand. The film lineup looks great.
If the U.S.A. vaccination program continues, we expect releases to kick off in the Northern Hemisphere summer. German cinemas, I've already mentioned, open by May with some strong films to get that underway. Hotels. Domestic demand we're seeing returning quickly after interstate borders reopen. Our products are very strong in these markets, we expect to be able to maintain an EBITDA positive result for the second half. Thredbo, we expect the second half to be favorable on the prior comparable. We are expecting to still be operating in the winter season with capacity constraints, we're developing our model around that. We're still targeting ourselves to return to around the 2019 winter profitability, of course, subject to weather conditions. Debt, we expect to remain relatively consistent with our current levels.
Of course, there'd be additional improvement to this from the proceeds of any of the non-core property assets that we've identified if it's sold in that period. The government-mandated closures do make it very difficult to provide short-term outlook, and I think this is as clear as we can be at this point in time. Our priorities are very clear. The three priorities have guided our business for the last four years. If there's revenue to be had, we need to get the lion's share of it. Grow revenue above market. We've got agile COVID-safe operations. We test them, we refine them, and they're working. They keep us open. We've enhanced our sales models to make sure that we are able to outperform the market.
We've a strong focus on looking at every single product, every price, every experience that we have to improve that to improve yield. Maximizing our assets. The strategic divestment of the non-core assets with the increased value of the core assets is a big part of that, and we're being very targeted about the upgrades on where we can get the best return. Business transformation. We've made very strong progress with our cash burn. We continue to evaluate everything every day to make sure that the changes we're making today do deliver benefits into the future, and they're not short-term initiatives just to get through this period. We've improved the efficiency immensely in our IT infrastructure. Our source-to-pay progress, which is our procurement program, is progressing well. We've completed the stage 1 of our cloud migration and our employee experience efficiency program is underway.
Our agile operating model. How can we do things better every day? We're a new business. I think COVID-19 has taught us to be a very new business, we're going to come out being a very new business and far more agile. Happy to take any questions.
Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you are on a speakerphone, please pickup the handset to ask your question. Your first question comes from John O'Shea from Ord Minnett. Please go ahead.
Hi. Good morning, Jane and team. Can you hear me?
Yes. Morning, John.
Thank you for taking my question. I guess I'm just trying to get a handle on how you're sort of seeing the second half when you put it together. Obviously, I appreciate the uncertainty. If we take the scenario where obviously the vaccination program's just starting here, aren't we sort of talking more like towards the end of this year as to when you're going to see perhaps the border closures being a non-issue and all that? At least finish the vaccination program the way it's looking, and that becomes a non-issue and then cinema is similar. Isn't the second half still very much in that kind of hibernation period? Not hibernation, but very restricted period in the sense of cinemas and hotels being impacted by that in the second half. I'm just a bit interested in your overall putting it together for the second half.
I appreciate your comments, but in light of where we're at, I'm just trying to get a bit of a sense as what you're trying to say there, if that makes sense.
Okay. We're trying to indicate that the second half looks like a carbon copy of the first half. You're right. We're not anticipating that the vaccination program will deliver too many benefits in the second half.
Sure.
It will be in the July to December period, where we start to see some of those benefits. The only difference to that, and again, a factor we're not in control of, is the vaccination program in the U.S.
Of course.
If that delivers more benefits faster, we do see that as a trigger of unlocking global blockbuster films in the May-June period. That would be a little bit earlier.
Yeah. John, No worries I know you know this, the first half includes the seasonal impact of Thredbo, right?
Yeah.
You've just got to adjust it. Yes, of course.
Yeah.
Of course. Yeah, that makes it much clearer, Jane. Thank you very much.
No problem.
Good work on the cost reductions. Thank you. We'll speak soon.
Okay.
Thank you. Your next question comes from Sam Teeger from Citi. Please go ahead.
Good morning, Jane.
Hey, morning Sam.
In terms of the CapEx outlook, I think you spent around AUD 12 million in the first half. What are you currently budgeting for in the second half and maybe FY 2022?
Sam, we're currently budgeting around the same for the second half, and we are still refining FY 2022 because we're pulling in, getting more accurate costing on the Melbourne project.
Got it. Okay, cool.
That's-
Yeah.
You touched on the wage subsidies, just given there's a few of them, can we just go through them? JobKeeper finishes in March. The New Zealand wage subsidy is finished. Can you just confirm when the German short-time pay finishes? I guess, what does the monthly cash burn look like when all these subsidies are over?
Okay. you're right with JobKeeper Australia. We only had one month of the year for New Zealand wage subsidy in July. That ended last July.
Short-time pay.
Short-time pay for Germany, that is running through to December.
Yeah.
This year.
31 December 2021.
Yeah.
Currently.
In terms of what we're saying, is we think that there will be a little more revenue in the second half to help offset some of the JobKeeper impact, and we'll be adjusting our business as well in terms of costs further, to offset that if some form of subsidy or government relief doesn't eventuate for the hotels and entertainment segments, which is probably the hottest topic of debate at this point in time.
Got it. Just assuming worst case scenario, the revenues kind of stay flat. What does the cash burn look like as all these wage subsidies finish?
Sam, as Jane referenced before, the thing is with Germany, there's the EU and the German government. We know something's coming. It's hard to quantify at this point. The number that I could give you now isn't correct because we know German subsidies are coming. We can't really give you any information on that currently. Jane's correct. What we're assuming is that She's already sort of said the second half will be a replication of the first half in general. There might be some upside, there might be some downside. That's the only guidance we can give at this point in time.
Yeah. Sam, I think it's really tough to predict at this point in time.
Yeah.
Moving pieces.
I can definitely appreciate that. There's AUD 13 million in rent abatements. Just number one, is that primarily cinemas with shopping center landlords? Two, are you expecting any more to come?
Yes, Sam. It's primarily cinemas. We are in discussions for more to come.
All right. Thanks. Just, sorry, last question. Just maybe an update on, is it M- City, Ed. Square? Is that still likely to open this half?
We're expecting it to open sometime this half.
Thank you.
Thank you.
Thank you. Your next question comes from Brian Han from Morningstar. Please go ahead.
Jane, the AUD 150 million odd of cost management that you did during the COVID period, how much of that do you think will come back to service the return of your customers to pre-COVID levels?
That is very difficult to provide an answer on at this point in time. If you think about it, strategically, we want to put the right level of cost back in the business to make sure that we grow. We'll provide more guidance when business normalizes about how that model has benefited.
Yeah.
What we've brought through. At this stage, to predict that, it's too difficult.
Yeah.
Okay. With respect to the German sale, was there a break clause or compensation amount to cover such non-completion?
At this point in time, we're not in a position to be mentioning anything around the sales agreement, because as you'll respect, we're about to explore our legal options.
Accounting-wise, we should just assume that this is now a continuing business for the foreseeable future.
Yes, you should.
Yeah. Hence the reason the accounts are a little bit complicated this time around.
Yeah. I noticed that. Yeah. Thanks.
Thank you. Your next question comes from Wei-Weng Chen from JP Morgan. Please go ahead.
Hi, guys. Thanks for taking my question. The first one is, there's obviously a lot going on in this result. I think the general assumption for most pandemic-impacted businesses is that the exit rate out of December or early second half trading is better than the average of what was seen in the first half. Just wanted to check if that's holding for your business or are there businesses where things have actually deteriorated or have not seen much improvement from first half average.
Sorry. I think we've referenced it in the pack that January's been a better month, hence there's been a more improved result than what was in the first half. Is that the question? I couldn't really quite understand.
Yeah. I think the question was more around, in general with these businesses, we assume that things are continually getting better. I just wanted to check that that was the case and you weren't seeing certain businesses where the first half average was actually misleading and the business has actually gone backwards from that runway.
No. We would've said that. We've got an obligation to tell you that if we would see that, particularly as we're discussing it now. No, the January result, we were very pleased with the January result. There are some notes in the pack there that sort of give that indicator.
Yeah. Okay. Thanks. Just on the quarantine business in your hotels. A most recent press where hotels were sort of exiting this business due to concerns around reputation damage. Just wondering what was EVT's view on this? Are you guys exiting too, or does the exit of others provide sort of a market share opportunity for EVT?
We've got no plans to exit at this point in time. We're comfortable with our position. As I said, we've only got very few hotels engaged in the quarantine program. We probably don't share the belief that there will be a major brand impact. Every single major brand almost has been involved in the quarantine program. We don't really see that as a big industry issue moving forward. We have noticed that those pulling out seem to be five-star hotels. Yeah, no, we don't have any plans not to support the program. At this time, well, it's a need in the country as well. We don't share the concerns that it's going to be a major brand impact moving forward.
We think that people know what's going on and why it's going on and, yeah, that's our position.
Yeah. Okay. I guess the continuation to that was, is that a share opportunity for you guys then or not really?
Well, it doesn't operate like a pitch and win situation. It's not a typical piece of business. Basically, quarantine business is selected based on how they can best resource within a particular area. It's really, they choose their location. They're selecting hotels that fit within that location because you've got Defence Force, different type of resource that they need to leverage across that. Yeah. We don't see this as an opportunity to pitch and win business. It really is allocated just simply and purely by location.
Okay. Understood. Thanks. The last one, just on the cinemas, just on the upcoming slate, assuming everything just proceeds, just wondering if you could speak to any changes to the theatrical window? Are there differences on a studio or a by film basis? While windows might be shrinking now, do you see a situation where post-pandemic windows might start to stretch out again?
I hope we've got a one-to-one meeting because we could spend an hour on that. Yeah. Basically what's happened right now. Here's the context. Half of the world's cinemas are closed. The studios have got content that they want to release. It's not their A-grade blockbuster content, but they've got content they want to release, and they've got to make money on it. Right now they're exploring different models. There are differences in their tests that are occurring in the U.S. and other markets. Not all markets are the same. I think they're in a test phase, but the primary objective is how do we make some money on this content in a COVID period? Do we see that major blockbuster windows are going to shrink dramatically?
We haven't seen any of those tests prove that more money can be made by a reduced window. $42 billion of global box office that shrunk to $12 billion calendar year last year. I would see that the studios wanting to get that $42 billion worth of box office back, any strategy that they're taking is trying to be incremental on that, not eaten into it. That's probably a very short answer. There's lots of tests going on. There's a lot of trials going on. Recently in this market, actually, there was a trial with Wonder Woman. Wonder Woman ended up having a 35-day window. It had no impact.
At that point in time when that window reduced and it was available at Premium Video on Demand, the drop-off was actually less than other relative films of its nature in the same period, like for like analysis. Yeah, we're in a COVID period. Decisions are being made short-term to make money, and I think that we'll see different discussions occur once cinemas reopen.
Great. Thanks for that. That's all from me.
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