Good morning, MBA readers,
From movie theaters to hotels to casinos, the COVID-19 pandemic abruptly brought business to a halt in a variety of venues where consumers tend to spend disposable income. About three months removed from the initial shocks to most of those businesses, the impact of coronavirus slowdowns and closures is becoming clear. AMC Entertainment, which suspended operations of its theaters in March, reported a first-quarter loss of nearly $2.2 billion in an earnings call Tuesday. It simultaneously revealed plans to reopen theaters worldwide in July. Hotels including the Ritz-Carlton, Hyatt Regency and Marriott, which have seen travelers dry up in recent months, plan to lay off nearly 1,000 workers in the St. Louis area. And in several smaller Missouri towns where the gaming industry is a big source of jobs and revenue, casino closures have put serious strain on municipal budgets.
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Rate of new COVID-19 cases declining in Missouri
The seven-day average for the rate of positive tests in the state was 3.59% on Monday, down from 6.63% a month ago. (Kansas City Star)
Three St. Louis hotels to cut or furlough almost 1,000 workers
Ritz-Carlton, Hyatt Regency and Marriott will furlough nearly 1,000 workers. This comes after similar job cuts in the area by Lodging Hospitality Management. (St. Louis Post-Dispatch)
St. Clair County launches bid for new US Space Command headquarters
The bid comes after a battle between St. Louis and St. Clair counties for the National Geospatial-Intelligence Agency’s western headquarters, which St. Louis won in 2016. The new facility is expected to employ 1,400 and be fully functional by 2026. (St. Louis Post-Dispatch)
Clinical trial company to move from Columbia to Creve Coeur
BioPharma Services said it plans to move its U.S. operations to the St. Louis area for easier access to employees and trial participants. The facility will bring about 40 jobs to Creve Coeur. (St. Louis Business Journal)
KC-area company partners with Alibaba on payment technology
The company, MSTS, provided technology for a payment system recently unveiled by the Chinese ecommerce company. The business-to-business system aims to simplify the process of purchasing foreign goods and services. (Kansas City Business Journal)
St. Louis public pools to open Monday with new guidelines
Splash pads and other water playgrounds will stay closed, but pools will be allowed to open under the conditions that staff have their temperature checked and wear face masks, capacity stays at 25% or less and social distancing is maintained. (KSDK)
Over half of youth in state facility test positive for COVID-19
At the Hogan Street Regional Youth Center in St. Louis, 15 out of 28 residents and eight staff members tested positive for COVID-19. The center lists nine recovered cases as well. (St. Louis Post-Dispatch)
Community Foundation of the Ozarks surpasses $2 million in COVID-19 grants
With an additional $280,000 going to 25 nonprofits, the foundation has passed the $2 million threshold. The latest grants were supported by an anonymous donation of $200,000 (Springfield Business Journal)
Lee’s Summit to plan development of 4,200 acres
The property, owned by the real estate arm of the Mormon church, makes up 10% of Lee’s Summit’s total land area. The city announced last year it will partner with the landowner on development, and it’s set to launch a website this week to solicit feedback on plans. (Kansas City Business Journal)
Say that again
“Being a small municipality that has a casino — we don’t really have anything else. Does it hurt, ultimately? Yeah, they’re probably our biggest draw.”
That’s John Roach, city administrator for La Grange, where the Mark Twain Casino was shut down from mid-March until last week as state gaming regulators tried to reduce the spread of the coronavirus. The casino is not only a major employer in La Grange but also one of the largest sources of revenue, with casino taxes making up about 75% percent of the town’s budget. La Grange is not alone. Several small Missouri towns rely heavily on funding from local casinos, and when COVID-19 forced the casinos to shut their doors, the money ran dry. The state’s gambling halls began reopening June 1, but city governments are still scrambling to adjust to the lost revenue.
That’s how much AMC Entertainment lost in the first quarter this year. In an earnings call Tuesday, the global cinema chain announced plans to reopen all of its theaters in July after months of shutdowns due to the coronavirus. AMC already has opened 10 theaters in Europe. The Leawood, Kansas-based company reported revenue of $941.5 million in the first quarter, down nearly 22% from last year despite the effects of COVID-19 not taking a sizable toll on revenue until March.
Hello, my name is
KC Hemp Co.
This Kansas City-based cannabis products retailer has increased sales by 600% after deciding to transition from a brick-and-mortar store to an online-only approach, Startland News reports. KC Hemp Co. adopted a same-day delivery approach that its founders said caters to the needs of customers who are 65 and older. The startup’s sales skyrocketed when stay-at-home orders came into effect, and switching to e-commerce has helped the business cut 80% of its overhead costs. KC Hemp Co., which has focused efforts on educating customers about the uses and benefits of its products, also plans to launch a podcast about the topic.
It’s been a pleasure doing business with you this morning.