AMC has released its quarterly figures and it was a dark cloud but with a silver lining. Revenue was down nearly five per cent (4.7%), dragged down by a 7.1% drop in admissions and despite average ticket price being up to an average of USD $9.55, with Imax and F&B (food & beverage, i.e. concessions) as the main good news. The press release highlighted this other significant milestones.
“In spite of some tough comparisons, we enter the second half of the year building momentum behind our continuing transformation of the AMC guest experience. Our five strategic action fronts continue to deliver innovation, additional revenue opportunities, improved profit flow-through and better-than-industry results,” said Gerry Lopez, AMC president and chief executive officer. “Our vision for the circuit is working and is long-term, and we’re keeping our focus on it.”
“Our comfort and convenience, and enhanced food and beverage initiatives drive significant benefits for our guests and the Company, and are helping us outperform our peers. One of the newest, best examples is open source internet ticketing. After rolling out our own ticketing engine in April, tickets to an AMC theatre are now both easier to get and available in more places on the web than any of our competitors’. So far, we’ve seen a 45 percent increase in online ticket revenues this year, and have sold approximately 13 million online tickets this year. ” LINK
The conference call provided some ‘drill-down’ details, particularly for topics such as AMC’s re-seating (swapping regular seats for larger and more luxurious premium seats).
Let me briefly give you an update on the significant progress we have made on a few of our strategic action fronts. First, comfort and convenience remains a key focus as we continue with our recliner reseats. There are 505 screens at 44 locations; I said 505 screens at 44 locations that we have deployed to-date, delivered admissions revenue per screen growth of 33% more than doubling of the EBITDA in the second quarter of 2014.
To be sure, the solid top-line per screen growth and more than doubling of EBITDA in a period where industry admissions revenue was down 6.5 points, says we are dramatically significantly outperforming and our strategy is working. That 33% per screen admissions growth was nicely balanced as well, with 21 points coming from attendance and 10 points coming from average ticket price increase.
We believe that this type of balanced growth clearly illustrates the tremendous power of our re-seat program and their customers are not solely driven by this slate of movies, but also the experience of seeing those movies in the comfort and style of an AMC theater. LINK
Lopez also highlights the 69% top-box get satisfaction scores, calling it “not only the highest in the circuit, but in a class by themselves when it comes to retail enterprises.” Coupled with the improved on-line ticketing and an average concession spend per customer of USD $4.22, the message is clear: even if Hollywood delivers a poor slate of film, we are getting good at extracting more money from the people who do still go to the cinema.