AMC Theatres Posts $227M Loss Amid Slow Box Office Quarter

AMC Entertainment Holdings has increased its latest quarterly loss on higher overall revenues and sharply increased attendance as the movie exhibition giant took advantage of a Hollywood box office rebound in its theaters.

In the third quarter, the theater chain, amid an industry upheaval brought about by the pandemic and the streaming era, reported total revenue of $968.4 million, up 27 percent from $763.2 million in the year earlier quarter. That just beat a Zacks Consensus Estimate for revenues at $967 million.

But AMC reported a net loss of $226.9 million, up nearly 3 percent on a net loss of $224.2 million a year ago. The loss per-share in the latest quarter was 22 cents, unchanged from the 22 cent loss per-share in the same period of 2021. Zacks Consensus Estimate predicted a loss per-share at 25 cents.

During the latest quarter, attendance reached 53.1 million people, compared to a year earlier 39.9 million patrons, allowing admissions and food and beverage revenues to improve.

“Exactly as anticipated and foreshadowed on our last quarterly earnings call, our third quarter results were impacted by a particularly soft industry-wide box office in the latter two-thirds of the 2022 third quarter, but encouragingly our overall per-patron metrics for both admissions revenue and food and beverage spending remain well above pre-pandemic levels, growing a sizable 12 percent and 30 percent, respectively, compared to the third quarter of 2019,” AMC Theatres CEO Adam Aron said in a statement.

Despite that improved industry backdrop for AMC, investors are left puzzling over the cinema giant’s future, given current box office trends and its high debt load.

In early 2021, AMC became a popular stock among retail investors, after the company appeared close to bankruptcy amid the pandemic fallout at movie theater chains.

The stock surge helped the company strengthen its financial position, and diversify its revenue streams — the latest is to hold Zoom meetings in select cinemas — as executives seized the opportunity to sell shares and repurchase debt.

Other new ventures for AMC to bring down its high debt load include buying a 22 percent stake in a gold mine, Hycroft Mining Holding Corp., pushing for its popcorn to be sold in retail stores and creating a special stock dividend, called APE, for the retail investors who rallied around the stock and helped the company avoid bankruptcy. 

On Tuesday, AMC reported a loss of $11.8 million in the value of its investment in Hycroft Mining Holding during the latest financial quarter, which was offset by $36.4 million in net proceeds received from the sale of 14.9 million shares of its AMC Preferred Equity Units.

But as the company’s fortunes continue to hinge on theatrical exhibition to stem future losses, last year’s stock momentum has faded, even as shares in AMC Entertainment rose by 29 cents, or just over 5 percent, to $5.62 on Tuesday, before in after-hours trading falling back 20 cents to $5.42.

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