The US's largest theater chain cited delayed releases and weak demand as new threats facing the already slammed industry. AMC has resumed partial operations at 494 of its 598 US theaters as of Friday, but its most successful locations remain closed.
Unless audience attendance trends higher or a new source of liquidity emerges, the company is likely to exhaust its cash supply by the end of 2020 or early 2021, AMC said in a Securities and Exchange Commission filing published Tuesday.
AMC shares pared some losses through the morning but remained at their lowest level since April.
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After delays to releases including "No Time To Die" and "Dune," only four major titles are set to be released this year: "Coming 2 America," "Free Guy," "The Croods: A New Age," and "Wonder Woman 1984." Rising COVID-19 infection rates throughout the US threaten to drag further on demand for the upcoming releases. Studios can still delay or pull the remaining films should risks to a near-term release outweigh benefits.
Other theater giants have already thrown in the towel. Regal Entertainment Group began closing all 536 of its US locations starting Thursday due to the lack of new showings.
AMC continues to mull funding options ranging from debt and stock sales to joint ventures with business partners. Still, there's "a significant risk" the cash sources won't materialize before the company runs out of capital, according to the SEC filing.
The chain's July deal with Universal could yield a last-minute lifeline. The agreement allows Universal to show a new movie for just 17 days before being able to release it on demand. AMC gets a cut of the online sales. With Universal's "Croods" set to debut on Thanksgiving, an on-demand release could bring AMC much-needed cash before the new year.
AMC traded at $3.75 per share as of 1:05 p.m. ET Thursday, down 48% year-to-date.
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