Just a week ago, many industry analysts were predicting the worst for AMC Theaters. The largest domestic cinema chain closed its doors as a result of the Coronavirus pandemic and it may never reopen them. The company was already in a sticky situation before the pandemic, reporting a $5 billion-plus deficit at the end of 2019 and losses of $149 million for the year. Just a few days ago, though, there were reports that bankruptcy lawyers had been called in to make a Chapter 11 filing, allowing the chain to keep function as it reorganizes its debts.
But now there’s a glimmer of light at the end of the tunnel for AMC and its employees. When President Donald Trump announced his plans to re-open America, he specifically mentioned that movie theaters were a high priority. This gave a welcome jolt to moribund AMC shares, which rose by as much as 37%. They finished the week at $3.20, their highest level in two weeks. Not to mention they also saw a boost thanks to the recent debt sale the company announced, which should hopefully help them turn things around.
According to Deadline:
“Shares roared to life in after-hours trading, rising as much as 37% after the company announced a $500 million debt sale and the White House announced sweeping measures to reopen U.S. businesses.”
While nothing is for certain just yet, there are now hopes that the re-opening plans could mean that 2020 will have some kind of summer blockbuster season after all and the back half of the year will be jam-packed with heavy-hitters. That being said, even if cinema chains do reopen, it’s possible that the theater-going experience will be different for some time yet. We may still have social distancing rules, meaning that they’ll be unable to sell consecutive seats. This will effectively halve the amount of tickets they can sell per screening and will impact the box office of any films released during that period.
Most major movies between now and July have been postponed, but the first big test of the new system will be Christopher Nolan’s Tenet. This has stuck to its July 17th release date. The first family-friendly release, meanwhile, will be Disney’s live-action Mulan, which will hit on July 24th.
2020 is destined to become the lowest-grossing year at the box office for decades, but it now seems that there’s at least a chance that the theater industry may survive in its current form.
