AMC Entertainment, the world’s largest multiplex operator, avoided yet another brush with death on Monday, revealing in a securities filing that it had found enough money to keep running until July if attendance does not begin to recover, and the full year if it does.
AMC’s chief executive, Adam Aron, had said in mid-December that AMC needed to raise another $750 million to squeak through. By early this month, it had lined up $204 million. In the filing on Monday, the company said that it had secured another $713 million, bringing the total to $917 million — and averting bankruptcy for the fifth time in less than a year. AMC had previously raised more than $1 billion in fits and starts.
The latest lifeline came, in part, from Odeon, AMC’s European chain. The company was able to refinance an existing line of Odeon credit and come up with $411 million.
AMC had about $308 million in cash at the end of the year, according to the filing, and had a monthly average cash burn rate in October, November and December of $124 million. About 438 of the company’s 593 theaters in the United States are open, albeit with limited seating and operating hours (and no major movies to play); 86 of 360 locations are open overseas.
Mr. Aron has had one of the wildest corporate rides of the pandemic, which has severely tested chief executives everywhere. And it is not over yet. Even with the new funding, AMC will need to convince landlords to extend rent deferrals that were negotiated early in the pandemic. Theater owners also need film studios to begin releasing major movies. Last week, studios announced more postponements, leaving “Black Widow” (May 7) as the next would-be blockbuster on Hollywood’s release schedule.
The pandemic has also thrust Mr. Aron, 66, to the front lines of the streaming wars. Over the past six months, his industry has blasted him as a traitor one minute, when he agreed to drastically shorten the exclusive window that AMC receives to play Universal films, and hailed him as a trailblazer the next, with two other chains, Cinemark Holdings and Cineplex, following AMC’s lead.
Even if he does manage to steer AMC through the pandemic, Mr. Aron faces bone-chilling challenges on the other side. At best, the company will emerge deep in debt. Moviegoing could surge with pent-up demand. Or the masses, now trained to expect instant access to major films on streaming services or online rental platforms, could be reluctant to return.
Nobody really knows.
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