Blockbuster loss widens, reaches new forebearance agreement
DALLAS Blockbuster reported that total revenues for the second quarter of 2010 were $788 million, compared with total revenues of $982 million for the same period one year ago. Net loss for the second quarter of 2010 was $69 million, or 32 cents per share, compared with a net loss of $37 million, or 21 cents per share, in the second quarter of 2009.
The company announced that it has also reached a new forbearance agreement with noteholders who have, collectively, represented that they hold approximately 70% of the company's 11.75% senior secured notes due 2014. The executing noteholders have agreed to forbear from exercising certain rights and remedies they may have under the indenture and related collateral documents arising from not receiving payments due under the senior secured notes on July 1. The forbearance period, under the new forbearance agreement, will expire on Sept. 30, unless earlier terminated in accordance with its terms, the company reported. The forbearance period may be extended upon written agreement by the parties.
Jim Keyes, chairman and chief executive officer of Blockbuster, stated, "We appreciate the continued cooperation of our senior secured noteholders and the other parties involved in our ongoing recapitalization efforts. While making progress, this extension allows additional time to complete these complex, multiparty negotiations. To take advantage of its unique multi-channel model and revitalize its global brand, Blockbuster will require an improved capital structure. Our objective is to complete a recapitalization as soon as possible so we are better positioned to focus our attention and resources on the strategic opportunities to continue our business transformation."