Facing a disastrous business climate, AMC Theatres March 25 announced it was furloughing 600 employees at its corporate office in Leawood, Kan., including CEO Adam Aron.
The move is to save available cash, which the world’s largest movie exhibitor is hemorrhaging as its screens remain dark due to the global threat of the coronavirus.
“At this time, AMC is not terminating any of its corporate employees, however, we were forced under the circumstances to implement a furlough plan, which is absolutely necessary to preserve cash and to ensure that AMC can reopen our doors once this health crisis has dissipated,” AMC said in a statement.
In a previous interview, Aron said AMC doesn’t want bailout money. Instead he said the chain wants loans that banks are unwilling to give due to the current uncertainty of the theatrical business model.
AMC rival Regal Cinemas, which operates more than 7,000 screens, has reportedly furloughed about 90% of its workforce.
With a formal vote in the U.S. Senate ratifying a $2 trillion stimulus bill that would give families, small and large businesses, and some industries a fiscal lifeline still to come, AMC, Regal and other exhibitors have their backs to the wall trying to reduce overhead.
“The furlough plan calls for reduced working hours at reduced pay, or no working hours at no pay, for the hopefully short period of time when AMC’s theaters are all closed,” read the statement. “This action impacts every corporate AMC employee, including all those at the highest executive levels and including AMC’s chief executive officer.”
The National Association of Theater Owners, an industry trade/lobbying group, contends the theatrical business qualifies as a “distressed industry,” thus qualifying for federal assistance.