AMC movie theaters could run out of cash by the end of the year, the company said in regulatory filings Tuesday.
“[T]he company anticipates that existing cash resources would be largely depleted by the end of 2020 or early 2021,” the company stated in a filing with the Securities and Exchange Commission.
The pandemic has forced movie producers to either postpone the release of major films or allow them to be streamed online. Either way, it has produced a “reduced slate of movie releases.”
AMC closed its theaters in March to help slow the spread of the coronavirus.
In August, the world’s largest movie theater chain opened 100 of its outlets in the United States and charged a mere 15 cents for tickets, which was the price 100 years ago, in 1920.
Since August, 494 of its 598 U.S. theaters have reopened with limited seating capacities of between 20% and 40%. Those openings represented 83% of the U.S. AMC theaters.
The theaters that have yet to reopen are in California, Maryland, New York, North Carolina, and Washington state, and include some of AMC’s most productive theaters, representing approximately 23% of 2019 U.S. revenue.
As of Oct. 9, more than 2.2 million people have gone to the theaters, which is approximately an 85% decline in moviegoers compared to the same period a year ago.
AMC also has theaters internationally, and 86% of them were open as of Oct. 9.
These theaters reopened on June 3 and served more than 5.2 million guests as of Oct. 9. This represents an attendance decline of approximately 74% compared to the same period a year ago.
Once the company runs out of cash, it will “require additional sources of liquidity or increases in attendance levels,” according to Tuesday’s filing.
AMC is exploring options to remain liquid into next year, which includes taking on additional debt or issuing more stock. It also seeks to renegotiate rents for theaters and potential sales of assets.
