Deckchairs sit stacked outside a closed movie theater during the global outbreak of coronavirus (COVID-19) in Santa Monica, California, U.S., March 16, 2020.

Lucy Nicholson | Reuters

AMC shares tumbled Wednesday as investors tried to gauge the likelihood of a bankruptcy filing.

On Tuesday, the largest cinema chain in the world warned investors that a combination of lackluster attendance and limited new movies has left it in dire need of financial assistance. The company said it could run out of cash by the end of this year or the beginning of next unless its circumstances changed.

AMC CEO Adam Aron told Bloomberg News in an interview Tuesday that its efforts are focused around raising fresh cash to tide it over until coronavirus restrictions are eased and movie release schedules normalize. However, a separate report by the media company on Tuesday said a potential bankruptcy was an option to relieve the company’s debt load. That report cited people with knowledge of the matter.

According to Bloomberg, these people said no formal proposal has been presented to AMC.

Shares of AMC plummeted more than 18% Wednesday, dropping below $3 a share. AMC’s stock, which has a market value of $387 million, has plunged around 60% this year. Recently, shares were off about 14%.

On Wednesday, a company spokesman told CNBC that AMC wasn’t preparing for bankruptcy or holding bankruptcy talks with lenders, calling the report “false.”

AMC has been focused on fundraising for months. The cinema chain already renegotiated its debt to improve its balance sheet this year and is exploring several ways of acquiring additional sources of liquidity. It is also trying to figure out ways to increase attendance levels, which have fallen 76% compared with last year.

The company said Tuesday that it is looking into additional debt and equity financing, renegotiating with landlords concerning lease payments, possible asset sales, a joint-venture with an existing business partner and minority investments in its stock.

Much of AMC’s cash woes stem from a lack of returning customers and a limited number of new film releases.

Blockbuster films have repeatedly been delayed until 2021 or have moved to streaming services. “Coming 2 America” is now set to move to Amazon Prime Video leaving only three major films on the 2020 slate: “The Croods: A New Age,” “Free Guy” and “Wonder Woman 1984.

Additionally, AMC is missing out on potential revenue from states that have higher ticket prices and high concentrations of moviegoers, due to ongoing restrictions on theater operations.

In its public filing, AMC detailed that is has been able to reopen 494 of its 598 U.S. theaters, but only at a limited capacity of 20% to 40%. Its remaining 104 theaters are in California, Maryland, New York, North Carolina and Washington. These theaters, although only around 17% of the company’s total footprint, represented nearly a fourth of the company’s total revenue last year.

AMC said it is in talks with local and state government officials from these states, but there is no clear timing for when these locations will be able to reopen.

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