Business: Loews to close 112 theaters in U.S. and Canada

By ADAM GELLER, Associated Press

NEW YORK (January 23, 2001 12:00 p.m. EST http://www.nandotimes.com) - With viewers avoiding its older theaters, financially strapped Loews Cineplex Entertainment Corp. plans to close 112 aging movie venues in the U.S. and Canada, turning about 675 screens dark. That represents nearly 23 percent of its screens worldwide.

In preparation for the closings, Loews incurred $122.4 million in charges during the quarter ended Nov. 30, the company said Tuesday. The timing of the closings and the exact locations to be shuttered have not yet been finalized, Loews said.

Loews, which closed 164 screens at 34 locations between March and November of last year, is struggling to cope with the opening of new competing theaters and a string of films that have failed to attract large audiences.

"I think the company had recognized that over a longer period of time it would be necessary to close these theaters, but in light of the building of the newer megaplexes at such a rapid rate...combined with the poor product performance last year, we feel that its necessary to accelerate the disposition of these theaters which have become unprofitable," said Mindy Tucker, the company's vice president of strategic planning.

The drain of operating the older theaters and the decline in attendance have left Loews struggling to meet its financial obligations. The situation improved in November, when movies released for the holidays brought in crowds, but that was not enough to offset deep-seated problems, Loews said.

"Our company continues to experience significant financial challenges," Lawrence J. Ruisi, president and CEO of Loews, said in a written statement Tuesday.

Loews had a net loss of $185.9 million in the quarter that ended Nov. 30, compared to a loss of $23.8 million in the same quarter of 1999. The loss came on revenues of $192.1 million, down from $209.3 million in the previous year, and earnings before interest, taxes, depreciation and amortization of $7.9 million versus $26.2 million in the prior year, the company said.

Loews has theaters in 22 states and the District of Columbia, and in six Canadian provinces. Most of the theaters it plans to close are 15 to 20 years old, Tucker said. The company, which runs a total of 2,965 screens in 365 locations, operates under the Loews, Sony, Cineplex Odeon and Europlex names.

In morning trading Tuesday on the New York Stock Exchange, Loews Cineplex shares were unchanged at 56 cents.

-- kevin (ktross@mailcity.com), January 23, 2001