Shares of AMC Entertainment Holdings Inc. rallied 3.9% in premarket trading Tuesday, after the movie theater operator reported second-quarter results that beat expectations, amid a 12% increase in attendance and higher per-guest spending, which “far exceeded pre-pandemic norms.”
The movie-theater chain and meme-stock darling swung to net income of $8.6 million, or 1 cent a share, from a loss of $121.6 million, or 12 cents a share, in the year-ago period. Excluding nonrecurring items, AMC broke even on an adjusted per-share basis, beating the FactSet consensus for a per-share loss of 4 cents.
Revenue grew 15.6% to $1.35 billion, above the FactSet consensus of $1.29 billion, as attendance rose 12.2% to $66.37 million, average ticket increased 1.8% to $11.21 and food and beverage revenue per patron climbed 9.7% to $7.36.
Related: AMC ‘killing it at the box office’ but faces ongoing liquidity challenges, says CEO
In a statement, AMC CEO Adam Aron said that the company’s theaters across the
globe welcomed more than 66 million guests in the second quarter, marking AMC’s highest quarterly attendance number since the fourth quarter of 2019.
The 2023 domestic industry box office is 20% ahead of last year, according to Aron. “We believe the second half of the year could be even better unless the current writers/actors strikes wind up delaying the release of movie titles into next year,” he said. “The third quarter of 2023 is off to an explosive start with BARBIE, OPPENHEIMER, MISSION IMPOSSIBLE – DEAD RECKONING PART ONE, and SOUND OF FREEDOM, among others, combining to cause July to become the highest monthly revenue in AMC’s storied 103-year history.”
Aron also discussed the company’s balance sheet. During the second quarter, AMC raised some $34 million of cash through the sale of AMC Preferred Equity
APE,
units and reduced the principal balance of its debt by $42 million through debt repurchases, he said.
Related:‘Barbenheimer’ may have sparked euphoria, but ‘cash is very tight’ for AMC, CEO warns
As of June 30, 2023, the company’s cash position was $435.3 million excluding restricted cash of $22.9 million. AMC’s available liquidity was $643.4 million.
But the CEO reiterated his recent warning that AMC faces liquidity challenges. “Even with our $643 million of quarter-ending liquidity, our ability to continue to raise capital and remain agile are absolutely vital to maintaining our strong recovery trajectory,” he said. “There are real and potentially severe liquidity hurdles on the horizon that we will need to overcome.”
AMC’s plan to convert its AMC Preferred Equity units to common stock was blocked last month when a Delaware judge rejected a settlement that would have allowed the deal to proceed. The stock-conversion plan was part of the movie theater chain and meme stock darling’s ongoing battle to eliminate debt.
Related: AMC has again asked NYSE and FINRA to look into the trading of its stock
The APEs rose 1.1% in premarket trades Tuesday. AMC’s stock has dropped 13.2% over the past three months through Monday while the S&P 500
SPX,
has gained 9.2%. The APEs have risen 9.3% over the past three months through Monday.
