AMC Entertainment (AMC -6.28%) is sounding the bankruptcy alarm again, saying that if it doesn't raise another $750 million, it won't be able to make it through next year.
The movie theater operator says the situation is dire and there are doubts about its ability to continue as a going concern. In fact, if there isn't a sudden spike in moviegoers at its cinemas, it will run out of cash by the end of January.
Bringing down the curtain
AMC had said it had $418 million on cash at the end of September, but by the end of November it had declined to $320 million.
It notes it has 404 of its 594 U.S. theaters in operation, but they have limited seating capacity and constrained hours of operation. Opening the theaters itself has caused expenses to climb and there hasn't been a commensurate increase in moviegoers.
AMC attempted to increase interest by consumers to attend the theater by offering to rent out an entire cinema to a group for just $99, but it says attendance between Oct. 1 and Nov. 30 plunged 92% from last year.
The theater owner did say it got a $100 million cash infusion from Mudrick Capital Management, a private equity firm that already holds AMC debt. It will also convert $100 million worth of debt into AMC stock, for which the theater operator will issue 22 million new shares.
The situation is getting worse for AMC and other theater owners, as AT&T's (T 3.36%) Warner Media division recently said it would release its entire slate of new films next year to both theaters and its HBO Max streaming service. Disney (DIS -1.33%) just announced up to 80% of its new movies will hit Disney+ rather than go to theaters.