AMC Theaters said on Tuesday that its current cash resources were largely depleted by the end of 2020 or early 2021, due to the “low movie slate for the fourth quarter”, as well as “the absence of a significant increase in attendance from current territories”. “Will be done” . “
The company said it had two ways to overcome its cash crunch: either more customers needed to buy tickets, or it would have to find new ways to borrow money.
Getting butts in seats has proved to be a major challenge. As of 9 October, AMC reopened 494 of its nearly 600 US theaters at a seating capacity of between 20% and 40%. but AMC (AMC) It is not filling limited seats: After America’s theatrical market reopened in late summer, it has served more than 2.2 million guests. This represents a drop in attendance of 85% over the previous year.
Increasing liquidity will not be easy without the return of business. It is exploring additional debt financing, rebirth with landlords and possible sale of property. But AMC threw cold water on those options.
“There is a significant risk that these potential sources of liquidity will not be realized or that they will be insufficient to generate a physical amount of additional liquidity that will be necessary until the company is able to achieve a more generalized level of operating revenue Ho, “said AMC.
AMC’s stock fell nearly 6% on Tuesday.
The news of AMC’s cash crisis comes as the movie theater industry struggles to survive during the epidemic.
Cineworld Group, owner of Regal Cinema, said last week that it would suspend operations at all its theaters in the United States and the United Kingdom as cases continue to spread. And the American box office has seen an anemic return, due to which studios decide to delay major films.
Movies like Marvel’s “Black Widow” and the new James Bond title “No Time to Die” have been pushed to next year, while Pixar’s “Soul” was pulled entirely from theaters for the first time on Disney’s streaming service, Disney + has gone.
Since closing its doors in March, theaters have tried to reopen and do so with health measures to help prevent the spread of the virus. Nevertheless, the industry has not been able to get back on its feet.
Despite these challenges, AMC has stated that it will remain open. However, after Tuesday’s filing, we now know that it can only do so for a few more months.
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