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Business News/ News / Poor Box Office Sends 100-Year-Old Theater Chain Into Bankruptcy
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Poor Box Office Sends 100-Year-Old Theater Chain Into Bankruptcy

The shrinking North American box office has forced a 100-year-old movie theater operator into bankruptcy.

Poor Box Office Sends 100-Year-Old Theater Chain Into BankruptcyPremium
Poor Box Office Sends 100-Year-Old Theater Chain Into Bankruptcy

(Bloomberg) -- The shrinking North American box office has forced a 100-year-old movie theater operator into bankruptcy.

Metropolitan Theatres Corp. — a family-owned business operating 16 theaters in California, Colorado and Utah — said in court papers that the Covid pandemic and its aftermath on the movie industry stressed its liquidity. Last year’s Hollywood strikes are a further blow because fewer film releases are expected through 2025, the company said. 

Much-larger peer AMC Entertainment Holdings Inc. avoided bankruptcy during the height of the pandemic, but Regal Cinemas parent Cineworld Group Plc filed Chapter 11 in 2022. Others have either gone bankrupt or closed in recent years, including the former owner of the historic Cinerama Dome in Hollywood.

Metropolitan Theatres said in Thursday’s filing it doesn’t have enough cash to make-up for this year’s poor ticket sales without reducing rent at its remaining locations. President David Corwin, in a sworn statement, also highlighted continued pressure from streaming as North American ticket sales are down roughly 20% this year.

Corwin, whose family has owned Metropolitan Theatres since it was founded by Joseph H. Corwin in 1923, said the company intends to use Chapter 11 to negotiate rent reductions with landlords and close locations it can no longer afford. The firm pays about $2.6 million annually in rent, a cost he said continues “to be a drain."

Metropolitan Theatres is using a form of Chapter 11 for small businesses that’s designed to be cheaper and faster than a traditional corporate bankruptcy. The company filed customer motions to continue paying ordinary business expenses, including wages for 240 part-time and 12 full-time employees.

The case is Metropolitan Theatres Corp., 24-1169, in the US Bankruptcy Court for the Central District of California (Los Angeles).

More stories like this are available on bloomberg.com

©2024 Bloomberg L.P.

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Published: 02 Mar 2024, 12:05 AM IST
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