Movie Gallery Gets the Blues
by July 16, 2007 12:00 am 88 views
If you’ve got some late fees at Movie Gallery, don’t worry. The company has bigger problems.
The No. 2 movie rental business in the country with 4,580 stores, including 10 in Northwest Arkansas, announced recently it missed its loan payment for the quarter ending July 1 and it has exhausted its credit.
The company could be filing for Chapter 11 bankruptcy protection as soon as the end of the summer.
It has been a rapid decline for Movie Gallery, which made a $40.3 million profit in 1Q 2006 but lost $14.9 million in 1Q 2007. The acquisition of Hollywood Entertainment in 2005 may have given a momentary boost to its revenue, but Movie Gallery was a day late and more than a dollar short joining the online, mail-order DVD rental business, which it just did in May.