The movie chain’s stock has dropped 60 percent in the last three months.
www.foxbusiness.com
AMC filing for bankruptcy is comparable to SEAS situation. No revenue coming in and one of the harder types of businesses to re-open with the virus still around.
Maybe if SEAS was a smaller company with a single creditor, they could work things out, but a larger company like SEAS has numerous creditors and vendors with all kinds of terms and covenants to navigate. They might be able to extend some loans and payment periods, but that only goes so far.
I think comparing movie theaters to BGW is a bad avenue to take. Movie theaters have their own set of issues like leases (massive spaces in expensive areas), the fact that most of their revenue comes from concessions not ticket sales (they get such a small portion of ticket sales they might as well consider it a net nothing), and the expense of maintaining a projector. Plus their cash flow is on a much smaller scale than a place like SEAS.
The point I was making originally is there are hundreds to thousands of companies in the same exact boat as SEAS right now. No money is coming in, too many things to pay, unable to pay everyone. And I bet if you really dug around you would find those places reporting the same issues. It's up to SEAS and their creditors/vendors to come up with solutions to help each other. The last thing those places want is for SEAS to declare Chapter 11 bankruptcy and they lose out on any money. I know the company I work for called some vendors mid-March and started to plan on working on deferments for payments in April and May. And the vendors worked with us because they knew if they didn't it would get bad.
Even if they do reduced payments for up til 3 months after they reopen in exchange for slightly raised payments after that, its better business for that creditor/vendor than refusing to work with them and having no payments come in and have to go to some sort of collections. If they go the route of refusing to work with SEAS or
any company they work with, prepare for hundreds/thousands of companies to shutter before this is offer and never come back. Which would do the long term damage to the economy as opposed to working together and making this recession look more like a 'V'.
To be more BGW/SEAS specific, they should be calling these places now to solve all of this. Figure out how to continue to make payments or not to fall to something like collections before this is over. If SEAS is struggling
that much, they should (as I suggested) consider possibly selling something that someone is willing to purchase. They should look into how to qualify for funding that's available. There's so many things they should try long ling before filing any form of bankruptcy is the answer.
EDIT:
Basically my point boils down to the fact that
everyone is in the same position here. This isn't like SF needing to file Chapter 11 (overextending themselves) or SEAS struggling with debt (Blackfish scandal) where they put themselves in this situation. Everyone is struggling with the same things right now so those creditors/vendors are most likely to work with companies more so than usual.
? I'd be really pissed to receive a response like this from a legit company. Sadly, this level of incompetence, and lack of care, is what I now expect from BG.
