AMC Theatres CFO: Hurricanes Shouldn't Hurt Box Office
"What we were able to offer people was an escape," says Craig Ramsey.
Hurricanes in Texas and Florida shouldn't hurt business for AMC Theatres too much, CFO Craig Ramsey told Wall Street on Wednesday.
In Texas, none of the chain's theaters were flooded though there was some wind damage to air conditioners, but all but about two are up and running again. In Florida no theaters were damaged and all but about six are working again. The ones still closed would be open if not for power outages.
Ramsey, speaking at the Goldman Sachs Communacopia Conference in New York, predicted strong business near areas ravaged by Hurricane Irma and Hurricane Harvey, since that's what happened in New Orleans after Hurricane Katrina in 2005.
"What we were able to offer people was an escape," he said. "Hopefully we're doing a service to those folks."
Ramsey lamented a dismal performance thus far this year at the box office and was hopeful — but careful not to predict — that the horror film It represents the beginning of a turnaround, given it has raked in $132.2 million domestically since opening Friday.
He said that "moviegoing begets moviegoing," since that's the primary place customers are introduced to upcoming product via trailers.
The summer domestic box office is off about 16 percent compared with last summer.
If It isn't the kickstarter some expect it to be, then perhaps it will be Thor: Ragnarok on Nov. 3. Either way, Ramsey expects a strong finish to the year, though given how far behind the box office is it would be a victory if 2017 finished flat compared with 2016.
"It is about the content and getting people back in theaters," he said.
Ramsey also warned studios against "the nuclear option," his term for them adapting premium VOD without discussing details of the plan with the movie exhibition industry.
"The loser would be our guests, the consumers," he said.
Premium VOD refers to the plan under consideration now whereby movies would be offered at home for about $30 at around the same time they open in theaters.
Ramsey indicated that theatrical windows are not sacrosanct — that smaller movies should get smaller windows, for example — but the nuclear option is problematic.
"The windowing strategy is something we've been very willing to talk about," he said.
Ramsey also warned of a "day of reckoning that disappoints the guest" for MoviePass, which is offering a month's worth of movies for a $10 subscription fee.
While MoviePass pays full price for tickets, AMC nevertheless objects to the company, claiming it cheapens the value of the moviegoing experience and sets up false expectations that customers will be able to essentially buy a month's worth of movies for the price of a single ticket from now on.