Theater Firm GC Weighs Bankruptcy

GC Cos., parent of General Cinema Theaters Inc., which has struggled under the costs of operating expensive mega-plex theaters and declining attendance, said it is considering filing for bankruptcy if it can’t get concessions from creditors, a regulatory filing said.

In a separate filing, Harcourt General Inc., which spun off General Cinemas in 1993, said a bankruptcy filing by GC could leave Harcourt liable for future theater-lease payments totaling as much as $355 million as of July 31. Harcourt’s filing said it “cannot predict” the future of GC’s financial situation, though it believes that if GC seeks bankruptcy reorganization Harcourt’s ultimate liability will be less than $355 million.

GC, which operated more than 1,000 screens at 130 locations in 23 states as of July 31, in the filing blamed the decline in patronage and profit on the build-up of mega-plexes and an inability to terminate leases.

GC’s stock fell $2.69 to close at $4.94 on the New York Stock Exchange. It has fallen 81% since the start of the year. Harcourt’s shares fell $1.13 to close at $59.50, also on the NYSE. They have risen about 48% this year. Both companies are based in Chestnut Hill, Mass.