Nomura Equity Research’s Robert Fishman and Michael Nathanson slashed Q3 earnings forecasts for exhibition chains Regal and Cinemark after noting that industry sales in the quarter will be -8% vs last year — which is “worse than we expected.” They cut Regal by nearly 49% to 16 cents a share, which they say is 6 cents lower than the consensus forecast from their peers. And they took Cinemark down 22% to 35 cents a share, 7 cents below the Street’s expectations. Theaters were hurt because only about seven films in Q3 are likely to generate $100M or more at domestic box offices vs nine films that did so in the period last year. As a result, the analysts cut their domestic box office projection for the year to $10.6B (it had been $10.9B), which would still be up 4% for all of 2011. They remain optimistic that holiday releases including Lionsgate’s The Twilight Saga: Breaking Dawn Part 2, Warner Bros’ The Hobbit: An Unexpected Journey, and Sony/MGM’s James Bond film Skyfall will contribute to a bounce-back resulting in a 7% increase in Q4 sales vs last year.

Fishman and Nathanson say that Regal and Cinemark have been saving cash to buy smaller exhibition chains. But if they don’t do something by the end of the year then “we expect pressure will build to return more capital to shareholders, either through a regular dividend increase or a special dividend.” Regal and Cinemark shares are down less than 1% in mid-day trading.