Nearly three-quarters of small and medium-sized cinemas in the United States are at risk of bankruptcy due to the impact of the new crown epidemic, and about 100000 people working in the industry may lose their jobs due to the flu pandemic, according to the National Association of theater owners, according to Bloomberg.
Of course, its not just smaller operators that face a higher risk of permanent closure. According to NATO, major chains are struggling to keep up. AMC entertainment Holdings Inc., the worlds largest theater touring company, issued a going concern notice saying it was able to continue its operations before acquiring new funds. Cineworld Group PLC, which runs Regal, the second largest U.S. cinema, warned earlier this month that more money might have to be raised.
As we all know, cinema line has been one of the most seriously affected industries after the global outbreak of the new crown epidemic. Almost all cinemas in the United States closed in March, and only last week did about 60% reopen.
But the industry is still struggling. On the one hand, it is difficult for theater owners to attract audiences and repay their debts due to the successive postponements of new films. On the other hand, Ministry of health officials have categorically banned re opening in some places, and operators have been forced to restrict ticket sales due to social distance regulations. However, in fact, cinemas have spent millions of dollars on new security in order to attract consumers back to the cinema And social distance agreement, including limiting attendance.
The largest cinema line in the United States
Not only small and medium-sized cinemas, but also AMC theaters, the largest chain cinema chain in the United States, are struggling.
In March 16th, the novel coronavirus pneumonia affected the AMC theater, which announced that it had closed 1000 theaters, including 661 North American Theaters, including 600 employees including CEO Adam Alan, who temporarily suspended their jobs to keep cash.
Although the companys cinemas have opened in the second half of the year, the situation is still not optimistic. In its September 24 announcement, the company said its theater business in the U.S. market had been suspended for the entire second quarter ending June 30, 2020.
The company resumed its limited operation in the U.S. market in late August 2020, and reopened 115 theaters on August 20, 2020, 170 theaters on August 26, and 142 theaters on September 4. As of September 14, 2020, the company has resumed operations in 461 theaters in the United States.
Since the U.S. market resumed operation, the attendance rate has basically maintained between 25% and 40%. As of September 14, 2020, the company has served more than 1.4 million guests. However, compared with the same period a year ago, the audience number of the theater has decreased by about 81%.
We currently estimate that unless there is a significant increase in theater attendance from the third quarter of 2020 to the fourth quarter of 2020 and 2021, and our attendance rate is close to three-quarters of the normal level, the company will continue to need additional liquidity to meet maturing debt, which may be very large for AMC, the company said
In the case of AMCs debt repayment, redemptions or other capital repayments, represented by the sale of existing debt, redemption or other capital payable events on September, will also include debt repayment, redemption or other capital payable events.
Previously, the company had sold the Baltic theatre. As of August 31, 2020, the company had a cash balance of $507.9 million, including an initial gain of $37.5 million from the sale of the Baltic theatre.
In the secondary market, the stock price of AMC fell to US $1.95/share due to a number of negative news. Among them, the share price of AMC fell sharply by 21% on April 9 and 20% on April 13. As of the latest closing, although the companys share price has slowly recovered to US $4.65, it is still about 70% lower than that of US $16 last April.
A number of industry celebrities wrote to Congress
More than 70 industry-renowned directors and producers have signed a joint letter with the American Association of theater owners, the American directors Union and the American Film Association, and submitted it to the U.S. Senate and the house of Representatives on Wednesday, Reuters reported.
The joint letter is mainly aimed at a vote on a $2.2 trillion coronavirus stimulus bill postponed by the house of Representatives. It is intended to call on Congress to redistribute the remaining funds of the care act. To the entertainment industry, or to enact new legislation to inject funds into cinemas to help cinemas destroyed by the new coronavirus epidemic.
The letter was signed by Oscar winning film directors James Cameron, Clint Eastwood and Martin Scorsese. They said that without help, 69% of small and medium-sized cinema companies in the United States would be forced to apply for bankruptcy or permanent closure, and cinemas might not survive the pandemic.
The following is the full text:
Distinguished leaders McConnell, Speaker Pelosi, Schumer and McCarthy
Thank you for your leadership at this challenging time for our country. When you consider the coming covid-19 rescue legislation, we ask you to give priority to the industries that have suffered the most, such as our countrys favorite cinemas.
Theres no doubt youve heard a lot, a lot of companies need to be bailed out. Cinemas are in trouble, and we urge you to use the unallocated funds in the care act back to proposals to help businesses that have suffered the most from the flu pandemic, or to develop new ones, such as the restart act. Theaters may not survive without the pandemic effects designed for them.
The pandemic has dealt a devastating financial blow to cinemas. 93% of cinema companies lost more than 75% in the second quarter of 2020. If this situation continues, 69% of small and medium-sized cinema companies will be forced to file for bankruptcy or permanent closure, and 66% of cinema jobs will be lost. Our country cannot lose the social, economic and cultural value that theaters provide.
The experience of watching a movie is crucial to American life. Last year, 268 million people in North America went to the cinema to laugh, cry, dream and be moved together. The cinema is a great unity, where our countrys most talented storytellers demonstrate their film achievements. Every aspiring filmmaker, actor and producer dreams of bringing their art to the forest.
More than half of the North American cinema lines have returned to work
But the people have low desire to watch the film
As unemployment soared at the start of the spring pandemic blockade, most of the money from the care act went to workers and small businesses to help them pay for basic necessities during the crisis, with relatively little going to cinema related sectors.
A large part of the reason why celebrities in the film industry jointly submit a letter is that Congress has not seen the strong demand of American people for cinemas.
According to a new survey conducted by performance research in collaboration with fullcircle research, consumers believe that cinemas and live music concerts are among the industries with the most severe coronavirus pandemic. However, despite this understanding, when asked if they would support the use of federal relief funds for these industries, the opposite is true.
The survey of more than 1000 U.S. viewers from August 3 to 10 showed that most viewers are not forced to watch movies in cinemas, but are willing to accept or enjoy watching movies at home.
Even in the 90 day window period from cinema to online, only 12% of the audience said that they must watch the new film in the cinema first, 15% of the audience said that they might watch the new film in the cinema first, 29% did not care whether they went to the cinema or at home, 21% might watch it at home, and 23% must watch it at home.
If the window period is changed to the current agreement between globegroup and AMC, that is, 17 days, only 7% of the people said that they must watch in the cinema first, and as many as 28% of the people first choose to watch at home.
Over the weekend of September 18-20, 3453 of about 6000 cinemas in North America were back in operation because more jurisdictions allowed movies to be shown, according to comScore.
Operator: this is a terrible October
Several films have been delayed
The lack of new films in Film Studios has brought serious difficulties to cinemas. Film studios do not plan to arrange the release of new films until November. Some new films that have been scheduled for release have been postponed for a time.
For example, the black widow, which was originally scheduled to be released on May 1, 2020, was postponed to November 6, 2020, and then postponed to May 7, 2021;
Magic woman 1984, originally scheduled for release on October 2, 2020, was also postponed by Warner to December 25, when tenet premiered;
Shangqi, originally scheduled to be released in February 2021, was postponed to May 7 and then to July 9 next year;
The eternal family, originally scheduled to be released on February 12, 2021, will be directly postponed for more than half a year to November 5, next year;
The original release of deep water on November 13, 2020 was postponed to August 13, 2020;
The new version of west side story, which was originally scheduled for release on December 18, 2020, has also been directly postponed to December 10, next year.
For example, the current schedule of journey of the soul is still on November 20, this year in North America, and the cinema has not been cancelled;
The tragedy on the Nile was postponed from October 23 to December 18, and is still scheduled to be released this year, but only if Christmas can return to normal. However, according to the current epidemic situation in the United States, the movie will probably be delayed.
This is going to be a terrible October, industry insiders said
The release of creed in American cinemas is regarded as a test case of whether cinemas can resume business to some extent. But so far, nearly a month after it was released on September 3, 2020, creed doesnt look very good.
Up to now, creed has made a total of 41.2 million box office in the United States. Its performance in the United States is still poor, and its word-of-mouth is not particularly excellent, which is lower than the expectations of Warner Brothers and the cinema chain.
On the contrary, Chinas regional box office revenue has become the biggest support of the creed. According to box office mojo statistics, the film has earned $284 million at the box office, including more than 400 million yuan (about 62 million U.S. dollars) in box office revenue, far surpassing North America as the films largest ticket warehouse, and putting the creed in the fourth place in the world box office in 2020.
In addition, it is worth noting that eight hundred has won the world box office title with a record of $442 million. So far, it has surpassed the former champion Jedi police: fast track released in August. The gap between the two films is about 15 million dollars. However, with the resumption of domestic cinemas, it is predicted that many domestic films with strong box office will be on the list. Source: Zhang Mei, editor in charge of China fund daily_ NF2100
In addition, it is worth noting that eight hundred has won the world box office title with a record of $442 million. So far, it has surpassed the former champion Jedi police: fast track released in August. The gap between the two films is about 15 million dollars. However, with the resumption of domestic cinemas, it is predicted that many domestic films with strong box office will be on the list.