June 9, 2020 / 8:55 PM / 24 days ago

AMC to reopen theaters globally in July, shares rise

(Reuters) - AMC Entertainment Holdings Inc (AMC.N) said on Tuesday it was expecting to reopen its theaters globally in July after shutting them down in mid-March due to the COVID-19 pandemic, sending its shares up about 4% in extended trading.

The world’s largest movie theater operator said it was planning to reopen almost all its U.S. and UK theaters in time to showcase Christopher Nolan’s “Tenet”, slated for release on July 17, and Walt Disney Co’s (DIS.N) “Mulan” on July 24.

AMC said it expects to run with limited capacity and blocked seating to maintain safety at its theaters, besides taking the usual precautionary measures.

Last week, it flagged “substantial doubts” about its ability to continue operations, if it was forced to keep its theaters closed for a longer period.

Much like most other out-of-home entertainment businesses, movie theater chains have also been hit by lockdowns and social distancing measures, which further added to the challenges due to a broader consumer shift to streaming services.

AMC on Tuesday said it was conducting an “exhaustive analysis” of its theaters to determine which ones to shut permanently, due to lack of profitability.

The company, which operates Odeon Cinemas, recently reopened some theaters in Norway.

“Even though those 3 theaters were limited in ticket sales to 25% of seat capacity, we sold 83% of our available seats this past weekend” Chief Executive Officer Adam Aron said, adding that it also recorded strong sales of food and beverages.

AMC’s total revenue fell 21.6% to $941.5 million in the quarter ended March 31, missing analysts’ average estimate of $951.4 million, according to IBES data from Refinitiv.

Net loss widened to $2.18 billion, largely due to an impairment charge of about $1.85 billion driven by suspension of global operations and the resulting declines in the company’s market capitalization.

Reporting by Ayanti Bera in Bengaluru; Editing by Shinjini Ganguli

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