AMC Theaters Plan Major Updates for Moviegoing Experience
By Movieguide® Contributor
AMC Theaters are getting an upgrade. Adam Aron, CEO of AMC Entertainment, detailed the new project, titled the “GO Plan” (short for “go on defense”), that will bring seating and projection improvements in the upcoming years.
In a press release last week, Aron revealed that the improvements are expected to “generate attractive shareholder returns” and “help differentiate AMC in the theater sector.”
The plan will start in the United States but is expected to continue to international theaters.
Deadline reported, “The company’s third-quarter numbers beat Wall Street expectations, with AMC swinging to an adjusted loss per share of 4 cents from a profit of 8 cents in the year-earlier period. Total revenue of $1.35 billion slipped from $1.4 a year ago despite the presence during the July-to-September quarter of hits like DEADPOOL & WOLVERINE.”
Some improvements include four feet of leg room between seats and larger screens. Renovations have already begun in some major cities. “…depending on the timing of the renovations, costs likely would run into the hundreds of millions,” Markets Insider said.
In July, AMC went through a debt restructuring, “which extended $2.4 billion in debt maturities due in 2026 out to 2029 and 2030. So far this year, AMC has further reduced its outstanding debt by $349 million in total, the company said Wednesday.”
“In [the third quarter], AMC extended the debt maturities on a significant portion of its debt due in 2026 and reduced debt overall,” Wedbush analyst Alicia Reese wrote. “However, we expect 2024 [earnings before interest, taxes, depreciation and amortization] to still fall below interest expense in 2024, with a reversal in 2025 and beyond, as AMC continues to raise capital in the coming months via exchangeable notes and direct share issuances.”
Although movie theater attendance has declined for many reasons including the Hollywood strikes last year, the pandemic and home viewing options, many in the industry have hopes that theater use will trend upward again.
As the theater industry starts to rebound from the strikes and the lingering effects of the pandemic, it needs a combination of small and large films to help bring interest in going to the movies to a more normal level.
“You’ve got to take enough swings and you got to get people back in the habit,” Marcus explained. “Twenty years from now, the number of kids who will say to someone, ‘I remember my parents took me to my first movie. They took me to the living room and we turned on the TV and we watched INSIDE OUT 2,’ will be zero.”
READ MORE: ARE THEATERS RECOVERING FROM LAST YEAR’S STRIKES?
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