AMC Entertainment Q2 Earnings: What You Need To Know About The 'APE' Preferred Dividend

Movie theater market leader AMC Entertainment Holdings AMC reported second-quarter financial results after market close Thursday. Here are the highlights.

What Happened: AMC reported second-quarter revenue of $1.17 billon, an increase from last year’s $444.7 million in the same time period. The revenue total beat a Street consensus estimate of $1.16 billion, according to data from Benzinga Pro.

The company reported an adjusted loss of 20 cents per share in the second quarter, missing a Street estimate of a loss of 19 cents per share for the quarter.

“AMC just completed a spectacularly encouraging second quarter that boosts our mood and brightens our prospects as we look ahead,” AMC CEO Adam Aron said.

Along with the quarterly results, AMC announced the declaration of a special dividend. The company will pay out one AMC Preferred Equity unit for each share of AMC Class A common stock based on a record date of Aug. 15, 2022. The dividend is expected to be paid out Aug. 19.

The AMC Preferred Equity Units will trade on the NYSE under the ticker "APE."

“The AMC Preferred Equity Units will provide AMC with a currency that can be used in the future to strengthen our balance sheet, including debt repayments, and provide capital for shareholder value-enhancing and transformative investment opportunities,” the company said.

Updates On Movie Business, Hycroft Investment: Aron said the quarterly results show once again that consumers “will flock to see them (movies) at movie theaters in huge and eye-popping numbers.”

Attendance in the second quarter was 59.1 million for AMC theaters, up 168% year-over-year. U.S. attendance for the quarter was 43.5 million compared to 17.8 million last year and 15.6 million in international theaters compared to 4.3 million last year.

“We would like to extend a special thank you to Doctor Stephen Strange, Tom ‘Maverick’ Cruise, Elvis Presley, and all those hungry people-eating Jurassic dinosaurs who graced our big screens in the quarter.”

Food and beverage spending was $7.52 per person in the United States compared to $5.58 in the second quarter of 2019 (pre-pandemic). Internationally, food and beverage per person was up 21.5% from the 2019 levels.

Aron said the company wrote down its large gains booked in the first quarter on an investment in mining company Hycroft Mining Holding Corporation HYMC.

“We continue to believe strongly in the potential value of our $28 million Hycroft Mining investment.”

AMC ended the second quarter with $965.2 million in cash and liquidity of $1.17 billion.

Related Link: Is The Pounce Happening Today? Here's What To Expect For AMC's Earnings 

What’s Next For AMC: The company said July 2022 saw the highest number of guests at AMC’s U.S. theaters since December 2019.

Preliminary food and beverage revenue for the U.S. segment in July “appear to be the biggest single-month figure at our U.S. theaters in our company’s entire 102-year history.”

“Looking ahead, we could not be more bullish about the probability of significantly improving operating results for AMC, beginning with Q4 of 2022 and continuing into 2023,” Aron said.

Aron points to a slow down of big movie releases in the third-quarter months of August and September. The fourth quarter lineup was highlighted by the CEO citing many upcoming blockbusters with major stars attached.

“Don’t forget the ever so much anticipated sequels to Black Panther, Shazam and Avatar. So too should the movie slate for 2023 make us smile.”

Aron said the 2023 domestic box office could be billions of dollars larger than 2022.

“We look forward to Q4 of 2022 and calendar year 2023 with glee.”

AMC Price Action: AMC shares are down 6% to $17.67 in after-hours trading Thursday.
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