The outlook for the exhibition sector is grim, especially in the wake of the delay of the last lifeline “No Time to Die” which means no new tentpole films until Christmas at the earliest – assuming no more delays.
Variety reports that Cineworld is shuttering all 543 of its Regal Cinema venues in the U.S. and all cinemas across the U.K. and Ireland this coming week with staff notified ahead of Monday. Sources indicate a reopening date hasn’t yet been set, but cinemas could stay closed until 2021. Regal is the second largest domestic chain in the U.S., while Cineworld is the U.K.’s biggest cinema operator.
The largest domestic chain in the U.S., AMC Theaters, may be in even more dire straits. THR reports that debt ratings agency S&P Global Ratings has downgraded AMC Entertainment Holding’s credit rating saying it will “run out of liquidity within the next six months”. The hope is either the company raises additional capital, which they view as “unlikely,” or if attendance levels at cinemas materially improve. AMC already said the other week it plans to raise more fresh cash.
S&P Global adds that continuing reduced capacity at theaters and wary consumers continuing to embrace streaming platforms is likely to persist into 2021. Most exhibition companies weathered losses of 75% in the second quarter of 2020 after moviegoing came to a halt in mid-March.
Earlier this week, The L.A. Times reports that groups representing movie studios, theater owners and directors called on Washington lawmakers to provide ‘specific relief’ for film exhibitors saying nearly 70% of small and mid-sized theater companies will be forced to declare bankruptcy and/or shutdown without government assistance.
The National Assn. of Theatre Owners (NATO). the Motion Picture Assn. and the Directors Guild of America all sent the letter numerous senators including Senate Majority Leader Mitch McConnell, Minority Leader Charles Schumer, House Speaker Nancy Pelosi and House Republican leader Kevin McCarthy. Dozens of famous filmmakers signed the letter including Judd Apatow, James Cameron, Greta Gerwig, Christopher Nolan, Jordan Peele, Wes Anderson, Clint Eastwood and Ang Lee.
