Gallery to Meet With Lenders6 Feb, 2006 By: Holly J. Wagner
Movie Gallery will meet with its creditors to revise lending agreements in the face of a soft rental market, chairman and CEO Joe Malugen said today.
“Looking forward to 2006, with the continued softness in the rental industry, we will soon resume discussions with our lenders regarding further amendments to Movie Gallery's senior credit facility,” he said. “We continue to believe that our industry is long-term fundamentally sound, and we are looking forward to the introduction of next-generation, high-definition DVDs as a significant catalyst for our business."
The company reaffirmed its fourth quarter 2005 guidance of revenue between $675 million and $705 million and same-store revenue down between 5% and 9% from the fourth quarter of 2004.
The statement was likely timed to shore up investor confidence. Gallery's stock has languished since its previous announcement last Nov. 10 forecasting the same results. Shares closed that day at $6.46, but the price has been in a slide ever since. Shares lost 20% Friday to close at $4.03.
Movie Gallery expects to report fourth quarter and full-year 2005 results in March.