AMC Theatres Facing Bankruptcy Over Coronavirus Pandemic

AMC Theatres has continuously reigned supreme as the top theatre chain in the United States, earning over $5.6 billion in revenue in 2018 alone. But their reign could soon be over and it is all thanks to the COVID-19 pandemic.

On March 17th, AMC Theatres announced that is was closing all of their 350+ locations in the United States "until further notice" to cooperate with federal guidelines regarding social distancing. This includes local theatre AMC Neshaminy 24 in Bensalem. And that was not the worst part. According to sources, over 650 corporate employees and 25,000+ theatre employees have been "layed off" and with no sales of tickets or concessions and no clear opening date in the future, AMC Theatres is seeing themselves heading into hot water.

According to a Variety report, MKM Partners analyst Eric Handler wrote: "our belief that AMC lacks the liquidity to stay afloat during that time, we expect that the company will soon be faced with filing with bankruptcy." The report also states that in 2019, AMC reported $265 million in cash and $332 million in lines of credit transactions.

But what does this mean for the theatre chain? It is being reported that the theatre will file for Chapter 11 Bankruptcy which will allow the theatre to have a "fresh start" in order to recover from the lost revenue during closure. This does not mean that the theatres will be bankrupt completely and will close their doors forever, but it will be a long process to get the theatre back on their feet.

In an statement, AMC Theatres CEO Adam Aron said: "We are ever so disappointed for our moviegoing guests and for our employee teams... the health and wellbeing of AMC guests and employees and of all Americans, takes precedence above all else. We will continue to monitor this situation closely and look forward to the day we can again delight moviegoers nationwide by reopening AMC movie theatres in accordance with guidance from the CDC."