AMC Entertainment, the country’s largest movie theater chain, said Tuesday that it is looking to raise more cash as the coronavirus pandemic continues to hammer its business.
The cinema chain, which plans to sell up to 15 million shares, said in an SEC filing that it expects revenues for the three months ended Sept. 30 to plunge 91 percent to $119 million from $1.32 billion, a year earlier.
Shares of AMC fell over 9 percent in early morning trading on the news.
AMC, like rival cinema houses, temporarily shut down in mid-March amid the pandemic. The chain has reopened nearly 87 percent of its fleet of about 598 US-based theaters since Labor Day, but has been operating at limited capacity of between 20 percent and 40 percent, the filing said.
As a result, the struggling chain has scrambled to keep the lights on, recently raising close to $55 million by selling roughly 15 million shares.
AMC currently has cash and cash equivalents of $417.9 million, according to the filing, which reiterated a recent warning that the company could run out of cash by the end of the year or by early 2021.
“As previously disclosed, in the absence of significant increases in attendance from current levels or the availability of significant additional sources of liquidity, at the existing cash burn rate, the company anticipates that existing cash resources would be largely depleted by the end of 2020 or early 2021,” AMC said.
“Thereafter, to meet its obligations as they become due, the company will require additional sources of liquidity and/or increases in attendance levels. The required amounts of additional liquidity will be material,” the statement said. “Due to these factors, as previously disclosed, substantial doubt exists about the company’s ability to continue as a going concern for a reasonable period of time.”
Last week, AMC said it is actively exploring potential sources of additional liquidity such as renegotiating leases, assets sales and minority investors.
Despite the dim financial picture, AMC remained optimistic over recent news that movie theaters in New York state can reopen this weekend, and hopes that the reopening of theaters in New York City is not far behind.