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Editor's take: As the magnitude and duration of the pandemic remain uncertain, I’ve got an ever-increasing suspicion that the traditional movie-watching experience is going to be a permanent casualty of the new normal.
In a filing with the US Securities and Exchange Commission this week, AMC said it expects to burn through its current cash reserves by the end of 2020 or in early 2021.
As of October 9, 2020, AMC had resumed operations at 494 of its 598 theaters in the US, albeit with limited seating capacities of between 20 percent and 40 percent. The majority of theaters still closed are in California, New York, Maryland, North Carolina and Washington State and are among the company’s most lucrative locations, representing 23 percent of revenue in 2019.
Since reopening, AMC has served north of 2.2 million guests, a decline of 85 percent compared to the same period a year ago (before the pandemic).
In addition to dealing with ongoing closures and limited seating capacity, AMC’s business has been impacted by major movie releases being pushed back to 2021. Worse yet, some studios are continuing to explore the direct to streaming approach, bypassing theaters entirely.
Share value in AMC Entertainment Holdings Inc. is down nearly 18 percent on the news.
Regal Cinemas earlier this month decided to reclose its theaters in the US and the UK in response to the continuing pandemic.