In its Q3 report, AMC Theatres reported a loss of $900 million. The company received the loss even as it attempted to reopen cinemas. Since the COVID-19 pandemic shuttered the film business in March, AMC has reopened 539 locations or 90% of its 600 U.S. movie houses.
AMC spent most of the pandemic avoiding bankruptcy by restructuring its debt and taking other measures to improve its balance sheet. The company's revenue dropped by 90.9% from a Q3 2019 period during which it garnered USD 1.3 billion. The chain made only $119.5 million in sales during this year’s third quarter, during which most of the chain's theaters were shuttered.
The conglomerate began reopening its theaters in August with seating capacity restricted to between 20% and 40%. However, with numerous studios across major, urban cities still closed, studios have been reluctant to release major new movies. The company will be trialed November with the release of Universal Pictures’ “The Croods: A New Age,” a DreamWorks Animation sequel. The theater chain signed an agreement with Universal earlier this year, allowing the Comcast Corp.-owned studio to put its movies on digital home video rental platforms for USD 20 as soon as 17 days after they hit theaters.
The company in October warned investors that it could run out of cash by the end of this year or early 2021 if it couldn’t find new financing or generate significantly improved attendance. The company in a Monday filing said it would sell up to 20 million of its shares to raise USD 47 million in new capital.
Shares dropped by 9% in regular trading on Monday, before the earnings report was released. “The magnitude of the impact of the global pandemic on the theatrical exhibition industry was again evident in our third-quarter results," AMC Chief Executive Adam Aron said in a statement. “Yet the AMC team continued to make significant progress in pursuit of our three key priorities: to strengthen our liquidity position; to dramatically reduce operating and capital expenditures, and to continue to safely and successfully restore our operations.”