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Movie theatres are preparing for business after the coronavirus

Lorie Shaull | Flickr

There is a popular old saying that “the show must go on,” and with the United States slowly opening back up phase by phase, movie theaters are soon to follow as well.

AMC Theatres, one of the largest movie theater chains in the United States, announced that “almost all” of their locations in the U.S. and the United Kingdom would reopen by July.

The mega theater chain closed the doors of all its locations March 17 due to the COVID-19 pandemic. The chain reportedly suffered a revenue loss of $2 billion in the recent quarter, around the time that COVID-19 halted the ability for people to go to movie theaters.

AMC Theatres are not the only movie chain planning a comeback after the coronavirus.

Stocks of the U.K. exhibitor, Cineworld, which is the parent company to Regal movie theaters, rose a total 23% in late May as the cinema company announced plans for its theaters to reopen in July as well. The company also stated that it hopes for financial help from government COVID-19 relief programs. Cineworld has begun to put in place procedures to ensure safety for both consumers and employees during reopening, while still giving people an enjoyable movie experience.

The Regal parent company announced that it retrieved some financial assistance from a deal with lenders and a liquidity injection. The chain came to an agreement with the lenders and waived the leverage covenant for its credit facility for a June test date. This has given the chain added flexibility going forward for the month of December.

The company also came to an agreement on a $110 million additional liquidity from an increase in its credit facility. In addition to the $110 million, Cineworld also acquired a secured credit committee approval to apply for an additional $45 million through the CLBLIS loan scheme in the U.K. They expect shortly to begin the same process for a $25 million loan through the U.S. CARES Act.

Cineworld hopes for the additional liquidity to provide it with enough headroom to stay financially stable until the end of the year as a contingency plan in case movie theaters are forced to shut down again. In less than a month, Hollywood is planning to restart its year and release a lineup of new films. Unhinged, the $33 million Russell Crowe thriller, is scheduled to release in theaters July 1. Following the thriller will be Christopher Nolan’s $200 million Tenet, which is scheduled for a mid-July release date.

While the corporate theaters are finding hope at the end of their tunnels, the journey to recovering for independent theaters proves to be different and much more difficult.

Nitehawk Cinema founder and executive director Matthew Viragh was forced to furlough most of his staff on March 13. He told them to apply for unemployment as well and invited them back to the Williamsburg and Park Slope theaters to collect any perishable items from their kitchens. Nitehawk Cinema operated as both a restaurant and movie theater — two types of businesses have been especially hit hard.

The coronavirus forced businesses in the service and hospitality industries to either close down or adapt very quickly to the new environment it created.

Viragh also said that because of the challenges of operating a restaurant in the theater with 180 employees who desire to feel safe to return to the workforce, Nitehawk may not open until next year. His vision of seeing his business returning to pre-COVID-19 levels will not be obtainable for another 18 months to two years.

Another independent theater differs from Nitehawk. Film Forum in SoHo, Manhattan is expected to reopen next month, with programming developed to start July 29 according to director Karen Cooper.

Film Forum received donations from its 6,000 members on top of funding from the National Endowment for the Arts, The New York City Department of Cultural Affairs and other sources. Despite Film Forum furloughing 37 of its part-time employees, it gave them each $1,000 from the $37,000 grant it received from the estate of Robert Osborne, the late Turner Classic Movies host.

With reopening plans in progress for New York, the question is whether consumers will feel safe from the coronavirus while watching movies in scrubbed down sanitized theaters with limited capacity—. As theaters plan on reopening, coronavirus cases are rising in some areas of the world, adding constant complications to this ongoing situation.

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Jahlil Rush
Jahlil Rush, Production Assistant
Jahlil Rush is a Production Assistant for The Ticker.
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