Small-Town Theaters Face Bleak Future Without New Movies: ‘We Desperately Need Help’

Regal, the second-largest U.S. movie theater chain, is closing its theaters two months after reopening. It’s a decision, made in response to the delay of “No Time to Die,” that underscores the immense fallout surrounding the fact that moviegoing just isn’t a popular activity during a pandemic.

For now, it’s unclear if other major operations like AMC Theatres or Cinemark will follow suit. Cineworld, Regal’s parent company, is also shuttering locations in the U.K. Independently owned and operated theaters, many of which are in small towns across the country, have been feeling the pressure for some time now, with many concerned about their chances for survival in a world without exciting new movies to offer. Many have scaled back hours and limited the number of days they are open. Others, like Regal, opted to close back down entirely, surmising that they will lose less money with the lights off than they would with only a scant amount of patrons.

It wasn’t supposed to be this dire.

When Chris Johnson, CEO of Classic Cinemas, a family-operated movie theater chain with locations in Illinois and Wisconsin, reopened for business after months-long closures, he was in rarified company.

For the first time ever, his theaters ranked among the top 10 earners in the country based on weekend ticket sales. In pre-coronavirus times, that feat would be nearly impossible for a smaller venue. The highest-grossing theaters are routinely in New York and California, given higher ticket prices and the fact that they house more populous cities. But with cinemas still closed on the coasts, Johnson’s had an unexpected moment of glory.

“When we opened in June,” he recalled, “I had the No. 7 theater in the country. I thought that was cool.”

Yet in subsequent weeks, attendance wasn’t enough to justify keeping the lights on. After just a few weeks back in business, Johnson had to make what he refers to as a “heartbreaking” decision: He closed down his theaters. He doesn’t know, realistically, when he’ll be able to welcome customers again.

“We found there was a core audience who came out right away and was very excited, but those were the only ones who came out,” he said.

Johnson’s struggle is one that many in the exhibition community continue to face amid the coronavirus crisis. He followed the recommended safety protocols, instituting professional auditorium cleanings and training staff to adhere to enhanced cleaning procedures. But, he notes, “those costs are the same, whether it’s busy or not.” And though increased cleaning measures might ensure consumers feel safer in theaters, there’s nothing, cinema owners lament, that can make up for one plain fact: “Without consistent new movies, there isn’t enough to sustain the business,” Johnson said. “You can’t release one blockbuster and hope for the best.”

Rolando Rodriguez, president and CEO of Marcus Theaters, says he understands why Bond’s backers decided to postpone 007’s latest mission into 2021. Still, he called the news “challenging.” Even before the delay was announced, he had to close down 17 venues that had reopened. Marcus Theaters — with cinemas in Arkansas, Colorado, Georgia, New York, Pennsylvania and 12 other states — has 51 locations still open, but they are operating with reduced hours and less screen times.

“As exhibitors, we wish there were more films kept in this time period,” Rodriguez said. “But we recognize these are difficult financial decisions they have to make. We’re asking our friends in distribution to help us. We’re ready, and we need their film product.”

Like many in his position, Dale Coleman, who runs shop at Stone Theaters, chose strategically to turn marquee lights back on at his theaters in South Carolina in time for “Tenet” to debut over Labor Day weekend. But after “Tenet” reported lackluster U.S. ticket sales in the U.S., it sparked another mass exodus on the release calendar. In addition to “No Time to Die,” titles like “Wonder Woman 1984,” “Black Widow” and “Candyman” also pushed their release dates. Pixar’s animated adventure “Soul,” which opens on Nov. 20, is the next tentpole scheduled to hit the big screen — and “Wonder Woman 1984” and “Dune” are slated for release in December — but it’s looking increasingly likely those dates could change, especially if larger theater chains shut down and New York venues stay closed.

“We’ve been struggling and trying to keep things alive up until this point,” Coleman said. “It’s been very difficult.”

Coleman’s venues stayed open for less than a month. During those weeks, Coleman said his best-performing location was down 87% in revenues. After 24 days, he closed his theaters back down, citing that it was “a smarter business decision to close those locations until a time when there are really meaningful films that our valued guests want to see.”

“It was the hardest thing I’ve ever had to do in my career, and I’ve been doing this for a very long time,” Coleman said.

Roughly 30% of theaters remain closed, including most locations in New York and Los Angeles — the two biggest markets for moviegoing in the country. Box office experts predict it’s unlikely any release dates for major movies will stick without those cities open.

“The biggest problem is that middle America can’t support a tentpole film on its own. You really need the coasts,” said Eric Handler, a media and entertainment analyst at MKM Partners. “Until we can get New York and California back, I don’t think we’ll see any big major movies coming out.”

The issue is something of a chicken and egg situation. Studios are hesitant to theatrically release films, especially those they have paid hundreds of millions to make and market, if people aren’t willing to go to the movies. However, movie theaters can’t sustain business without new products to offer customers. The situation is already critical, but exhibitors are warning that if these conditions continue, they might not survive without government assistance. Leaders of the nation’s movie theater businesses are calling on Washington for help. They issued a letter last week, cautioning that nearly 70% of “small and mid-sized movie theater companies will be forced to file for bankruptcy or to close permanently” without help.

“We desperately need some government funding to help us. We need a second round of stimulus,” Coleman said. “There’s a time when we’re going to run out of resources and won’t be able to reopen. That’s about as blunt as I can put it. I don’t think that just applies to Stone Theaters. It applies to many exhibitors.”

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