Movie rental company Blockbuster: may not be able to stay in business

[ilovedealsbaby]

Movie rental company Blockbuster: may not be able to stay in business
Mon Apr 6, 7:11 PM
The Associated Press Email Story IM Story Printable View
By The Associated Press

NEW YORK - Movie rental company Blockbuster Inc. said Monday the risk that it may not complete financing deals raises "substantial doubt" about its ability to continue as a going concern.

Dallas-based Blockbuster, which has struggled amid the rising popularity of DVD-by-mail services like Netflix, disclosed the warning in a filing with the U.S. Securities and Exchange Commission. The company had already cautioned last month that its auditor was likely to raise doubts about its ability to stay in business.

A going-concern qualification refers to an auditor's assessment of a company's ability to continue to operate for the foreseeable future.

Last week, Blockbuster said its revolving and term loan agreement was amended, giving it a US$250-million revolving loan refinancing that matures on Sept. 30, 2010. Lenders including JPMorgan also agreed to waive any default that could result if auditors attached a "going concern" classification.

But on Monday, the company said its lenders' obligation to fund the $250-million credit facility is subject to meeting certain conditions, and there can be no assurances that these conditions will be met.

Even if the loan is funded, the company said it "may not have sufficient liquidity to finance the ongoing obligations of our business, which raises substantial doubt about our ability to continue as a going concern."

Blockbuster said it believes that it will be in a position to close the amended credit facility by around May 11, though "there can be no assurance regarding these matters."

Shares fell three cents to 85 cents in after-hours trading, having closed earlier at 88 cents.

[darthdelegate]

I'd like you to explain where the bargain is in this post. I am in the DVD Bargain section, aren't i?

[Trevor]

Originally Posted by darthdelegate

I'd like you to explain where the bargain is in this post. I am in the DVD Bargain section, aren't i?

Forthcoming closeout sales.

[Wolf359]

darthdelegate, why are so many of your posts so snotty?

This, from someone who posted one of the "When does the DD sale start" threads....

[SuperJim88]

Let's not get personal and stay with the topic, huh?

[ilovedealsbaby]

well if they go under ever block buster will have lots of deals

[kenbenobi]

I smell a government bailout... Politicians like renting movies...

[RustyOrgan]

Historic Blockbuster' Store Offers Glimpse Of How Movies Were Rented In The Past
http://www.theonion.com/content/vide...r_store_offers

[dollfins1]

good. they got pwned just like they did to all the mom and pop vid stores back in the day. karma = bitch

[fujishig]

I do kinda agree with darth that this should be in the store forum until the inevitable closeout deals come in.

What happens to store credit if there is a bankruptcy? Does it get wiped out like gift cards do?

[IamLegend]

its nice to get heads up on these things...it is inevitable that blockbuster will have to do something.

[stronghold7000]

Thanks for the heads up

[BuckNaked2k]

Originally Posted by dollfins1

good. they got owned just like they did to all the mom and pop vid stores back in the day. karma = b*tch

Maybe so, but now it is now we who will "get owned" by NetFlix with their "Very Long Wait", and outrageous Blu-ray premiums.

[Peep]

Originally Posted by fujishig

What happens to store credit if there is a bankruptcy? Does it get wiped out like gift cards do?

Even faster.

[steebo777]

That's why I used all my store credit a few months ago as they were going downhill fast.

[Anono]

Let em die.

[RustyOrgan]

Originally Posted by BuckNaked2k

Maybe so, but now it is now we who will "get owned" by NetFlix with their "Very Long Wait", and outrageous Blu-ray premiums.

NetFlix RULES!!

[darthdelegate]

Originally Posted by dollfins1

good. they got pwned just like they did to all the mom and pop vid stores back in the day. karma = bitch

I never understand ignorant comments like this. So you're blaming the average, everyday store employees for what happened to local video stores? Yeah! It's a good thing they could be a out of jobs!

That's like me saying, "You're company did something I view as bad! I hope it goes belly up so you'll be out of a job!"

Unbelievable.

[UAIOE]

I pondered Blockbusters troubles and wondered why they didn't try to take on Netflix or, at the very least, do a Redbox type thing.

I honestly think those machines in grocery stores causes more harm to them than is mentioned. Why would I want to go to Blockbuster when I can return the DVD to a place that I'll go to to buy a necessity?

[Heat]

Good riddance.

[spainlinx0]

I have an idea. I'm going to start a rental store that charges for a rental almost the price of buying the DVD outright. How could that business fail?

[cmleidi]

I worry about the people whose jobs may be lost because of this. I can't be gleeful about that. I just don't understand what Blockbuster has been thinking the last few years. It's as if they've done their best to drive people away.

[fujishig]

Originally Posted by UAIOE

I pondered Blockbusters troubles and wondered why they didn't try to take on Netflix or, at the very least, do a Redbox type thing.

Huh? What is (or was) blockbuster online?

[mcfly]

Yes, Blockbuster still is online. It's called Blockbuster Total Access. You rent online like Netflix, but can also return the movies in store. I heard they changed their policies though and now it sucks.

[UAIOE]

Originally Posted by fujishig

Huh? What is (or was) blockbuster online?

A lame attempt to take on Netflix.

I meant "more aggressively". It just seemed like BB kinda took their time doing the online thing, and they weren't doing it seriously because maybe they thought the online thing wouldn't pan out.