AMC CEO Says Keeping Theaters Open Is “The Right Decision”

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AMC Entertainment CEO Adam Aron on Thursday defended the company’s decision to continue operating its theaters during the coronavirus pandemic, even as one of its main rivals opted to temporarily turn off its screens dark.”We think it’s the right decision to stay open,” Aron told CNBC’s “Closing Bell” show. “Millions of people… have come to our theaters in the United States and certainly in Europe since we reopened this summer. ”

Aron pointed to AMC’s landmark deal with Universal Pictures in July as one reason the company is able to keep theaters open. The deal shortened the length of time that Universal’s films had to be shown in AMC theaters before switching to on-demand streaming from 90 days to 17 days.

“We are getting a reduction in both movie theater revenues and home revenues. It’s an agreement made by AMC, ”said Aron. “Our competitors have not yet concluded this agreement. ”

The lack of blockbuster films was one of the main reasons Regal Cinemas’ parent company, Cineworld, halted operations at its US and UK theaters. Its CEO, Mooky Greidinger, told CNBC on Monday that it had become “a kind of grocery store that has no food to sell.”

Aron acknowledged that the lack of new blockbusters is a challenge in motivating people to come to the theater, comparing AMC to a car dealership with no new vehicles to sell.

Even so, Aron has stated that in his deal with Universal, he will have upcoming releases such as “The Croods: A New Age,” which is due out the day before Thanksgiving.

“There are five Universal films coming out by Christmas Day that AMC will be able to show as a result of this deal,” Aron said.

AMC is pursuing further reopening plans, notably in Washington after receiving state permission to resume operations. By mid-October, the company will have more than 80% of its roughly 600 theaters open – although the key New York market remains closed.

Aron has championed AMC’s coronavirus safety protocols, including improved cleaning and restrictions to maintain social distancing. He also said there was a need for movie theaters in the pandemic.

“We’re in the business of fun and entertaining people. If there ever was a time when people needed to have fun and entertainment, to escape the stresses of everyday life, it is right now that Corona is hitting this country very hard, ”he said. said.

AMC shares closed up 2.48% Thursday at $ 4.14 each. The stock is down 42.8% so far in 2020.

Disclosure: NBCUniversal is the parent company of Universal Studios and CNBC.

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