Some U.S. states are already preparing to lift bans on large gatherings in the hopes of bolstering an economy sagging under the weight of the novel coronavirus pandemic, but at least one theater chain has no plans on opening its doors right away. Those hoping that theaters might open up to screen older movies, indie fare that’s willing t roll the dice in uncertain times, and other content that might light up the screens again are likely to be disappointed. In a statement, AMC Theatres said that it will not reopen until there are major new releases for them to exhibit.
That means unless something changes, AMC (and likely other theater chains as well) will not open until July, when Christopher Nolan’s Tenet is currently scheduled to kick off a truncated and chaotic summer movie season. AMC does say that they plan to open slightly before the blockbuster season begins, likely in order to work the kinks out and retrain staff with new safety standards, but they use the phrase “directly in advance,” likely meaning the week before or so.
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“As we plan our reopening, the health and safety of our guests and associates is our absolute highest priority,” AMC said in its statement (via THR). “To be able to open, we also need a line of sight into a regular schedule of new theatrical blockbusters that get people truly excited about returning to their favorite movie theatres. Those blockbusters are scheduled to return this summer, beginning with Warner Brothers’ Tenet and Disney’s Mulan, with many more major titles scheduled immediately thereafter. While we expect to open our theaters in the weeks ahead of these new blockbusters, utilizing creative programming of immensely popular previously released films, we would be wise to do so only directly in advance of the release of major new movie titles. AMC is currently working through every detail required to successfully showcase these exciting new releases in an environment that’s safe and welcoming for moviegoers, and we will share those details as we get closer to the dates when our theaters will reopen.”
The pandemic has hit AMC hard: the chain has been sued by landlords who say some locations have not been paying rent during the closure, and last estimates were that AMC Theatres had laid off 98.5% of its employees in a closure that may now last as long as four months (some early, optimistic projections had held the theatres might be able to open after six weeks of downtime). The company’s credit rating was downgraded at the start of this month, with some analysts predicting that AMC would not reopen at all, but more recently reports came out that the chain was talking with bankruptcy lawyers and working on a path forward that would allow the company to continue operations in spite of the hit it’s taking right now.
The company, which is already deep in debt, will likely face serious financial problems in the fall, unless creditors can grant AMC a waiver. AMC’s creditors may be more likely than usual to grant such a waiver — after all, the COVID-19 impact has hit virtually everyone. Still, it seems likely that AMC will face an uphill battle in recovering from the losses. Last year at this time, the domestic box office was generating more than $100 million in revenue per week. Now, it’s a few thousand dollars from the handful of places where theaters (mostly drive-ins) are still open.
Even while theaters were taking in huge amounts of money in 2019 — a record year for the box office — AMC was running a deficit. According to earnings statements, the country’s largest theater chain lost more than $100 million last year. The company reported a $5 billion-plus deficit at the end of 2019 and losses of $149 million for the year — numbers that aren’t likely to bounce back this year. In 2018, they were profitable — but by less money (around $110 million) than last year’s deficit.
