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AMC Theatres says future uncertain while theaters remain closed

Reports: AMC may close theatres, file for bankruptcy
Posted at 12:47 PM, Jun 03, 2020
and last updated 2020-06-03 15:36:31-04

KANSAS CITY, Mo. — With all of its movie theaters shuttered due to the COVID-19 pandemic, AMC Theatres says its future looks increasingly more uncertain.

The Leawood-based movie theater chain, the largest in the United States, closed of all its theaters in March and will not reopen any locations until late June at the earliest.

Though the company still plans to reopen theaters this summer, uncertainty surrounding expected revenues — along with concerns that a recurrence of the virus could shut down operations again later this year — has cast “substantial doubt” about its ability to continue operations, AMC Theatres said in a regulatory filing.

Currently, the company is “generating effectively no revenue,” according to the filing. AMC Theatres estimates it lost between $2.1 billion and $2.4 billion in the first quarter of this year, based on preliminary figures.

AMC said it has taken “significant steps to preserve cash,” which included salary cuts for executives and staff furloughs, including hundreds at its corporate office. The company also said it is working with landlords and other partners to defer costs caused by the pandemic.

Even when its theaters reopen, the release of new movies could be delayed, AMC said in the filing, noting that some studios have even begun to eliminate theatrical releases during the pandemic, which could continue after theaters begin to reopen.

Earlier this year, AMC said it will not license Universal Pictures movies after the studio issued a direct-to-home release for “Trolls World Tour” and then said it would release future films simultaneously at-home and in theaters.

“We cannot predict when or if our business will return to normal levels," AMC said in the filing, dated June 3. “…Even when the COVID-19 pandemic subsides, we cannot guarantee that we will recover as rapidly as other industries, or that we will recover as rapidly as others within the industry due to our strong footprint in densely populated areas.”

AMC already was struggling before the coronavirus outbreak. In 2019, the company lost $149 million and finished the year roughly $5 billion in debt, according to reports.

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