Cirque du Soleil has had a new CEO since last week, when Daniel Lamarre handed over the reins of the organization to his right-hand man of the past five years, Stéphane Lefebvre, who immediately became the big boss of the global company of entertainment. If the new CEO is fully active in relaunching the group’s activities in markets where it is possible to do so, his long-term objective is to ensure the sustainability of the company and restore it to its former glory. .
You joined Cirque du Soleil in 2016 as Chief Financial Officer after having held the same position at CAE for 10 years. How did you make the transition from aeronautics to the circus arts?
When I joined Cirque, it was to form a three-person partnership with Daniel Lamarre and Jonathan Tétrault and put in place a new development strategy.
I was very well at CAE, where I worked for 10 years alongside CEO Marc Parent, but I have always been fascinated by the Circus. I attended the creation ofO in Las Vegas at the time. I told Marc that I was leaving a world leader to join another world leader. These are two companies that generated a lot of cash, the transition went well.
In the spring of 2020, everything fell apart, all shows were canceled, pretty much all of the staff were let go, and you found yourself strapped for cash, forced to shelter from creditors. How did you experience this crisis?
It was long months of work, and we had only one goal in mind, that of saving the Circus. It was a complex process, there were several offers to relaunch the business. What was important was not just the takeover of Cirque, but to have the necessary funds to relaunch our operations.
We managed to get a fund of 300 million from our new financial partners to gradually restart the machine and this is what we have been doing since last June with the gradual resumption of our shows.
Before telling us about the relaunch of your activities, explain to us who are the shareholders of Cirque du Soleil today?
It’s a bit complicated because several Cirque shareholders can sell their stake in shares or in debt, so it can fluctuate. There are currently about 50 shareholders, but there are three main shareholders who have seats on the board of directors, namely Catalyst Capital, CBAM Partners and Sound Point Capital, three investment funds.
In March 2020, when the pandemic broke, you had 44 shows in as many cities around the world. How many shows did you manage to restart today?
Our six permanent shows have taken over in Las Vegas. This has been done gradually since June. Our permanent show has resumed in Orlando, and Alegría has resumed his tour of Houston. We have a Christmas-themed show that’s playing in Chicago right now and it’s going to New York soon.
We are going to have another show in January which will debut in London. We decided to take a cautious approach and open a show when we are sure that the sanitary conditions, such as the vaccination passport, allow it. We obviously remain very attentive to the appearance of new variants.
For us to open a new market, it takes three essential conditions. Our teams must be well prepared – there is no question of taking any risks – our equipment must be as well adapted and the financing conditions allow it.
When the crisis erupted, you were making annual revenues of over US $ 1 billion. Do you expect to return to this level of income one day?
If you ask me the question, it is yes, I am convinced that Cirque has the potential to regain this level of income, but I am unable to tell you when that will happen.
We have just resumed our activities and 2022 will be a year of recovery and in 2023, we should be fully operational, if all goes well and the health situation stabilizes.
It is possible that we will return to the breakeven point as early as 2022, but that depends on many factors. We have to be careful.
Cirque du Soleil had 5,000 employees around the world when the crisis hit in March 2020. How many people have you called back to date?
We have returned to a level of 2,500 employees worldwide, including 450 at the head office in Montreal. This is where our artists come to prepare for each of the shows which will gradually resume.
You had a debt of over US $ 1 billion when you took protection from the Companies’ Creditors Arrangement Act in June 2020. Where are you today?
Our debt stands at 600 million US, but we have the necessary liquidity to carry out our recovery without affecting the debt. We do not think we should use the 300 million that our financial partners have made available to us. Our shows are already starting to generate cash, and it’s going to go up.
At the height of the crisis, in the spring and summer of 2020, did you fear the worst for the survival of Cirque du Soleil?
There was a lot of uncertainty, it’s true. It’s been long months. But there were a lot of potential buyers, and that confirmed to us that the Circus still had a great future ahead of it.
We had to save the company, and that’s what we did. There, we are working to ensure the sustainability of this world leader that is Cirque du Soleil, and Montreal will remain the decision-making and creative center of this great international brand.