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Coronavirus Could Force AMC Theatres to File for Bankruptcy | CBR

Due to the coronavirus (COVID-19) pandemic, AMC Theatres might be forced to file for bankruptcy.

“Based on our view that theatres will be closed until at least August and our belief that AMC lacks the liquidity to stay afloat until that time, we expect the company will soon be faced with filing for bankruptcy,” MKM Partners analyst Eric Handler said.

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“AMC is the exhibition company we view with the least financial flexibility,” he added. “We believe the company’s monthly cash burn rate in a no-revenue environment is running at $155 million per month, which likely keeps AMC liquid until June/July.”

In March, AMC furloughed 600 employees, including CEO Adam Aron, in an effort to try to stay financially stable despite not receiving any revenue. It also shut down its entire chain of theaters for an estimated six to 12 weeks and told its landlords it will not pay rent during the closure.

 

AMC currently has $265 million in cash and equivalents, $332 million in credit and $4.75 billion in debt, and as of April 9, the company’s stock is down more than four percent.

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With coronavirus (COVID-19) forcing the closure of its cinemas, as well as billions in debt, AMC Theatres may need to file for bankruptcy.

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