Carmike Cinemas Inc. (CKE), the No. 3 U.S. movie theater operator, said Tuesday it filed to reorganize its businesses under Chapter 11 of the U.S. Bankruptcy code.

"We determined that Chapter 11 provides the most expeditious means to achieve a successful financial and operational restructuring of our business," chief executive Michael Patrick said in a statement. "Our focus is on preserving our assets and improving our operational strength during the difficult period for our industry."

Earlier this month, Columbus, GA.,-based Carmike, which operates 2821 movie screens in 447 theatres, said its lenders prevented it from making a payment under its 9.375 percent senior subordinated notes maturing in Febuary 2009 because it had technically defaulted under two credit lines and a master lease facility.

Carmike's shares were up 1/8 at 2-1/16 in early afternoon trading on the New York Stock Exchange. the stock has traded between 1-5/16 and 14 in the last year.
 

If this is how they run their best theatre in Montana, then my reaction to this Chapter 11 thing is: Hee hee hee!

However, the Carmike 8 in Decatur, 20 or 25 miles away, is like "the dark side of the force". During the past few years, that location has let its projection quality slip to abysmal levels. The cosmetic condition of the facility leaves a lot to be desired and the last time I was in there, I felt as if my shoes were going to irretrievably lost, permanently stuck to the floor (exaggerating a slight bit). The place was built in 1982 by Fairlane/Litchfield, taken over by United Artists in 1987, and by Carmike in 1990. I have been complaining about the ridiculously sloppy presentation there and in April, a new manager was put there and he has improved the projection considerably, but he can only do so much. Theatres like this one really give Carmike a bad name. I have been told by a Carmike manager that the Carmike locations in Cullman and Florence were just as bad or worse than the Decatur one. Ugh.

If Carmike lets all their smaller, older theatres run down like this, they deserve to go bankrupt. I've been tempted to go check out some of the older Carmikes in Nashville to see what they're like, but I haven't.

The question is, how is the filing of chapter 11 going to affect their operations? I wonder if they'll close any theatres. I wish they'd either build a new theatre in Decatur (like Huntsville's Carmike 10) and close that dump they have there, and if they can't do that, I feel that handing movie exhibition over to someone who cares more else would be the most appropriate thing to do.

Mark L.

 

I've done quite a bit of research on the old theatres in my area back to the 1920s and it was often the case that a theatre was owned by one person, or sometimes a small number of theatres would be owned by one person. Back before all of the major chains moved in, there were companies like Rosenbaum Theatres, Crescent Amusement Company and United Amusements that owned several theatres (all single-screen indoor or drive-in originally, with some twinning in the middle and late 1970s) in the area.

Any predictions for the future regarding theatre companies?

To me, it seems that the first logical step would be for the chains to close their least profitable locations, along with locations that need expensive maintenance to keep the building in proper condition. Locations such as these detract from the entire image of a company, since many people judge a company by how the company's local facilities appear and function. If I judged the entire Carmike chain by the Carmike Century Cinema 8 in Decatur, AL, I wouldn't bother to set foot in any Carmike theatre. If I judged them by the Carmike 10 in Huntsville, I'd seek out a Carmike theatre anywhere I went. It would be advantageous for Carmike to rid itself of their many "warts" such as the Decatur location that hurt the image of the whole company, and would save them a lot of money on maintenance that will eventually be needed. I suspect that if something else happens there, such as the climate control system failing and needing an expensive repair, that place may close. One manager told me that the next time the lease was up, they might just let it go. Another manager told me they had no plans to close the location. It shows that information from staff or managers is not very reliable.

I really would hate for one chain to end up owning and operating all of the theatres in the country. It would be almost as bad as every restaurant being a McDonalds. I like a variety of architectures, decorations, layouts, and styles of operation in different theatres. That is what makes individual theatres interesting.

Evans

Theatre Information Page: http://home.hiwaay.net/~criswell/theatre/

I agree that all the majors need to "trim the fat" from the industry. They also need to STOP BUILDING. The US is terribly over saturated with theatres as it is. They need to slow it down, make some money and then move forward.

Maybe filling Chapter 11 is the answer. Dickinson Theatres Inc here in the midwest filled chapter 11 a couple of years ago, restructured their home office, stopped building, shut down crappy theatres, and now they are doing better than ever and building state of the art 12+ plex's while turning a profit.

In general, I'd say that when a company expands to the point that they cannot effectively maintain their facilities because of complexity issues, or financial reasons, their fall will be coming soon.

It sound like the next few months will be interesting to observe in terms of theatre companies and their restructuring and reorganizing efforts.

Evans

Also, DPF Architects has recently sued Carmike for breaking some type of contract. I assume DPF designs Carmike's theatres and Carmike hasn't paid them.

Dustin...I will keep you informed if I hear anything, but so far no rumors have been started. I'll be happy to put a good word in for you in LaCrosse if you like.
 

Fist of all we have production companies that are making MILLIONS of dollars per film, while theatre companies suffer. If the 5 biggest chains got togeather and said, "NO, you will only get x % of boxoffice sales not xx %" things would be better. Decreased film rentals would also help the exhibitors. Production companies make far too much money.

Production companies need to figure it out that if there are no exhibitors left, they have no product, and will make no money. They need to start helping exhibitors not tightening the noose.

 

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John P. Pytlak, Senior Technical Specialist
Worldwide Technical Services, Entertainment Imaging
Eastman Kodak Company
Research Labs, Building 69, Room 7419
Rochester, New York, 14650-1922 USA
Tel: 716-477-5325 Fax: 716-722-7243
E-Mail: john.pytlak@kodak.com

It seems to me that the production companies could stand to take a dip in PROFITS in order to help out the exhibitors. Seems like good business to me, on the part of production companies to help the exhibitors.
 

At least Carmike never seemed to go overboard with the neon. The fronts of their newer theatres are all similar without neon, although there is some neon in the lobby. But is a moving message sign above the entrance to the hall where the auditoriums are really necessary?

 

"And with your last breath, you shall bear witness to the End of Film."

You must've never seen the Carmike Wynnsong 10 in Billings, Mt. It must have a thousand feet of blue neon out front. Some of which is burned out, right now. it has even more neon in its lobby. And, one of those moving message showtime boards over its boxoffice windows...it doesn't work; they have a sheet of paper with showtimes filled in taped to the window.
 

All:

I'm sure that the name "Carmike" is a combination of the names Carl and Michael (Patrick), the two guys that run, or used to run, the company. Why do they use "Wynnsong" as a name for so many of their theatres? It is interesting trivia.

Evans

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Greg Mueller
Amateur Astronomer, Machinist, Filmnut
 

Isn't it because Michael Patrick's son's name is Wynn?