AMC Entertainment says that unless circumstances change, it will be out of cash by late 2020 or early 2021.
The largest U.S. movie-theater exhibitor laid out the grim news in a Tuesday SEC filing, which sent company stock price below $4 per share. At the time of this writing, AMC stock (AMC) had declined 8% from Monday’s close.
The company sounded the alarm in a Tuesday filing to the Securities and Exchange Commission, pointing to low attendance figures for theaters that have managed to reopen amid the pandemic and the drought of major Hollywood films to lure moviegoers into its venues.
Without a major uptick in attendance or an injection of new funding, the company said, “existing cash resources would be largely depleted by the end of 2020 or early 2021. … to meet its obligations as they become due, the Company will require additional sources of liquidity or increases in attendance levels. The required amounts of additional liquidity are expected to be material.”
Also Read: AMC Theatres Will Remain Open Amid Cineworld, Regal Shutdown
AMC warned that the already sparse movie slate could get even sparser since “certain competitors” (they’re talking about Cineworld’s Regal Cinemas) have announced the re-closure of their own theaters this month amid the ongoing pandemic.
Alternative methods for AMC to achieve liquidity include borrowing money, taking on investors, selling off assets, attempting to renegotiate theater leases and simply hoping attendance levels are able to increase as COVID-19 continues to shut down everyday American life.
Good luck with that last one.
Also Read: Regal Cinemas Parent Cineworld’s Stock Plunges 35% After ‘Temporary’ Closure of Theaters
As of Oct. 9, 2020, 494 of AMC’s 598 U.S. outlets have resumed operations — but with very limited seating capacities between 20% and 40%. The company is experiencing same-theater attendance declines of 85%.
“There is a significant risk that these potential sources of liquidity will not be realized or that they will be insufficient to generate the material amounts of additional liquidity that would be required until the Company is able to achieve more normalized levels of operating revenues,” the filing continued.
Yeah, it was all one big bummer of a filing. Read it all here.
Read original story AMC Theatres Says It Will Be Out of Cash by Early 2021, Stock Price Plummets At TheWrap