Impact of COVID-19 Pandemic
|3 Months Ended|
Mar. 31, 2021
|Extraordinary And Unusual Items [Abstract]|
|Impact of COVID-19 Pandemic||
As the Company has previously disclosed, the COVID-19 pandemic has had an unprecedented impact on the world and the movie exhibition industry. The social and economic effects have been widespread, and the situation continues to evolve. As a movie exhibitor that operates spaces where patrons gather in close proximity, the Company has been, and continues to be, significantly impacted by protective actions taken by governmental authorities to control the spread of the pandemic. To comply with government mandates at the initial outbreak of the COVID-19 pandemic, the Company temporarily closed all of its theatres in the U.S. and Latin America in March of 2020, implemented temporary personnel and salary reductions, halted non-essential operating and capital expenditures, and negotiated modified timing and/or abatement of contractual payments with landlords and other major suppliers until its theatres reopened. In addition, the Company suspended its quarterly dividend.
As of March 31, 2021, the Company had reopened 301 of its domestic theatres and 78 of its international theatres and continued to show a limited volume of new releases along with library content during reduced operating hours. Theatre staffing levels remain reduced as compared to pre-COVID levels due to limited operating hours as well as the Company’s focus on initiatives to enhance productivity. The Company also continues to limit operating expenses and capital expenditures to essential activities and projects as volumes remain reduced. The Company is continuing to work with landlords and other vendors to extend payment terms while it reopens theatres and recovers from the impacts of the COVID-19 pandemic.
Based on the Company’s current estimates of recovery, it believes it has, and will generate, sufficient cash to sustain operations. Nonetheless, the COVID-19 pandemic has had, and continues to have, adverse effects on the Company’s business, results of operations, cash flows and financial condition.
During June 2020, Company management approved and announced a restructuring plan to realign its operations to create a more efficient cost structure (referred to herein as the “Restructuring Plan”). The Restructuring Plan primarily included a permanent headcount reduction at its domestic corporate office and the permanent closure of certain domestic and international theatres. The following table summarizes activity recorded during the three months ended March 31, 2021:
The remaining accrued restructuring costs of $6,183 are reflected in accounts payable and accrued expenses on the condensed consolidated balance sheet as of March 31, 2021.
The entire disclosure for an event or transaction that is unusual in nature or infrequent in occurrence, or both.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef