AMC Entertainment, the biggest cinema exhibitor in the U.S., has found its credit rating has been downgraded to ‘CCC-‘, a rating that means: “Default imminent, with little prospect for recovery” reports The Wrap.
Analyst S&P Global says that with cinemas likely to remain closed beyond June due to the impact of the global coronavirus pandemic, that “we do not believe AMC has sufficient sources of liquidity to cover its expected negative cash flows past mid-summer… While unlikely, we could raise the rating if AMC were able to secure additional liquidity without further burdening its capital structure.”
AMC is in serious debt after reporting a $5+ billion deficit at the end of 2019 and losses of $149 million due to making a lot of acquisitions in recent years. The pandemic crisis meanwhile continues to send shockwaves across the globe and forced cinema closures around the world without any conclusive knowledge as to when cinemas can once again open.
