AMC Theatres CEO Says The Company Has Survived COVID-19

By
x

The COVID-19 coronavirus has changed everyday life for billions of people around the world since it first began to rear its ugly head early this year. And as much as we all wish it would end, it doesn’t seem destined to do so anytime soon. The virus is already creeping up on 20 million confirmed cases and over 700,000 deaths, and the number of actual infections is sure to be considerably higher.

The United States continues to be the epicenter of the outbreak with nearly 5 million cases and 160,000 deaths in the country alone. The pandemic has become a largely political topic throughout all 50 states as ongoing debates rage on about the importance of the economy over safety. And although many businesses have reopened, albeit with quite a lot of safety precautions in place, most types of social gathering spots have remained widely shut down.

Among the social experiences that remain closed are movie theaters, including the largest theater chain in the world, AMC Theatres. With the ongoing outbreak keeping their doors closed and many movies heading to streaming services in return, it’s been long speculated by analysts that the company wouldn’t survive the pandemic. However, recent remarks from the CEO show a sign of confidence that AMC Theatres may yet pull through.

In an earnings call with investors, President and Chief Executive Officer Adam Aron stated that the company has already weathered the pandemic. He went on to explain how he came to that conclusion, saying:

A third of our theatres are open in Europe. We think all of our theatres (in Europe) will be open by Tenet’s August 26 release, and we ought to be able to open at least two thirds of our theatres this month in the United States. So, we’re not going to be shut. I really do think that subject to never relying on a forward-looking statement, which is the good time to bring that up again. I think we’ve survived the corona crisis, and now we just have to get back to running the company really well.

However, things won’t necessarily be the same when AMC Theatres officially resume business, as extremely deep cleaning procedures could lead to higher ticket prices for consumers. This is a hard truth confirmed by Aron during the call when he claimed:

On enhanced cleaning costs, they are sizeable. I’ve seen others of our competitors’ state, what they think they are for their chains. We think they are appreciably higher in part. Because we’re taking this so seriously, we’ve got electrostatic sprayers and HEPA vacuums and upgraded MERV 13 air filtration filters that are quadrupled the cost of what we had previously. We can’t eat all these costs. Ultimately, we’re going to have to pass these costs on the consumer.

Aron’s confidence may bode well for AMC Theatres for now, but higher ticket prices and the major push towards bringing brand new movies to streaming services may ultimately spell disaster for theaters in the future regardless. Only time will tell.

All Posts
Loading more posts...