AMC Furloughs Employees and Cuts CEO Pay as Theaters Sit Dark

(Bloomberg) -- AMC Entertainment Holdings Inc., the largest U.S. movie-theater chain, has furloughed its employees and cut pay for top executives as it tries to save cash.

The theater chain closed all of its roughly 600 U.S. locations last week after public officials around the world placed limits on public gatherings to prevent the spread of novel coronavirus. AMC now has “no revenue and substantial fixed costs,” which has left it scrambling to preserve cash, the company said.

The furlough plan means some employees won’t work and or be paid, while others will have reduced hours and take a pay cut. Senior executives are included in the plan, including Chief Executive Officer Adam Aron.

“These are unprecedented times,” the company said. “AMC is doing everything possible to ensure that we can welcome back both our associates and our guests as our theaters reopen.”

AMC was the first major U.S. theater chain to stop operating as the coronavirus pandemic worsened. Initially it said it would limit ticket sales, allowing customers to sit farther apart. Later, executives decided that action wasn’t drastic enough and closed down all locations indefinitely. Most theaters in the U.S. made similar announcements in the following days.

Earlier this week, AMC drew down all remaining available amounts under its credit lines as a precautionary measure. The National Association of Theatre Owners, a trade group for the industry, has been lobbying legislators for federal relief money.

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