AMC Entertainment says the risk of bankruptcy is now off the table

AMC Entertainment Holdings Inc. (NYSE: AMC) said on Monday that it boosted its finances by £671 million that helped cushion the economic blow from the ongoing Coronavirus pandemic that has so far infected more than 25 million people in the United States and caused over 430 thousand deaths.

Chief Executive Adam Aron commented on the news on Monday and said:

“With the world getting vaccinated now, we all understand that theatres will remain closed or empty in January, but that’s not where we are going to be in the summer hopefully, not where we will be in the next winter. But of course, nobody knows. For AMC to succeed over the medium term, we are going to need for much of the general public in the U.S. and abroad to be vaccinated.”

In separate news, software company Blackberry saw its stock jump more than 30% in premarket trading on Monday. The Canadian firm, however, said that it was unaware of the reason for the surge in its per-share price.

AMC Entertainment’s performance in the stock market

AMC shares jumped nearly 30% in premarket trading on Friday but slid close to 10% on market open. Including the price action, the stock is now trading at £3.23 per share after recovering from a low of £1.45 per share in the first week of January 2021.

AMC said that it issued new shares to raise capital, following which, the risk of bankruptcy is entirely off the table. The American movie theatre chain, however, is still expected to face heavy losses in the upcoming months as the new COVID-19 restrictions pushed cinemas into temporarily shutting down for the public once again.

In July 2020, the Leawood-based company announced to have signed a deal with bondholders to minimise up to £499 million of debt.

The COVID-19 crisis weighed on theatre chains last year

The Coronavirus pandemic weighed heavily on theatre chains in 2020 as it caused delays in the release of the most awaited films. The latest setback, as per AMC Entertainment, was the highly anticipated James Bond movie, “No Time to Die” that is now scheduled to release in October 2021 – months later than originally planned.

AMC Entertainment Holdings Inc performed largely downbeat in the stock market last year with an annual decline of close to 70%. At the time of writing, it has a market capitalisation of roughly £535 million.