AMC Entertainment Holdings, Inc. (NYSE: AMC) (“AMC” or “the Company”), today reported results for the second quarter ended June 30, 2022.
Second Quarter Summary
Adam Aron AMC Entertainment Chairman & CEO said, “AMC just completed a spectacularly encouraging second quarter that boosts our mood and brightens our prospects as we look ahead. Total Revenue in the second quarter of 2022 was more than two and a half times the revenue of the second quarter a year ago, and Adjusted EBITDA of a positive $106.7 million compares ever so favorably to a loss a year back in Adjusted EBITDA of a $150.8 million. That is a $257.5 million improvement in only twelve months. In addition, we achieved positive Operating Cash (Burn) Generated of $52.0 million, a $178.8 million improvement from 2021’s second quarter. Our Q2 2022 results, in our minds, prove once again what we have long said, that as Hollywood releases movies with broad consumer appeal, people will flock to see them at movie theatres in huge and eye-popping numbers. In the second quarter of 2022, AMC had attendance of 59 million people at our theatres globally, up 168% from the 22 million attendees in the same quarter a year ago. So, 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.”
Aron continued, “It is similarly exciting that AMC is driving so much additional revenue per patron, including in our highmargin food and beverage business. At our AMC theatres in the United States, Food & Beverage spending per patron was $7.52 versus $5.58 in the comparable pre-pandemic quarter of 2019, up 34.8%. Internationally, F&B revenue per patron in these periods was up 21.5%. Globally, our Other Revenues per patron were $2.01 in Q2 of 2022 versus $1.22 in Q2 of 2019, also up a healthy 64.8%.”
Aron added, “In our unique circumstance, while our loss per share benefits from improved operating results, it is also impacted by our quarterly marking to market of the volatile share price of Hycroft Mining Company. Because of stock price swings, in the second quarter of 2022 we wrote down much of the large gains that were booked in the first quarter. While our reported losses will continue to be impacted by market price volatility, we continue to believe strongly in the potential value of our $28 million Hycroft Mining investment. In fact, Hycroft just announced it would commence its largest drilling exploration program in nearly a decade, and we have every confidence that over time our investment in Hycroft will pan out to be golden.”
Aron concluded, “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 in 2023. As but two examples of let the good times roll, attendance in the just-completed month of July 2022 saw the highest number of guests visit AMC’s U.S. theatres since December of 2019, and our preliminary July food and beverage revenue numbers appear to be the biggest single-month figure at our U.S. theatres in our company’s entire 102-year history. For full transparency, there is a dearth of new big movie titles being released in August and September, so things will slow for several weeks, but then comes Q4. Talk about star power, these movies and more will all grace our screens at AMC in Q4 of 2022: Jamie Lee Curtis in “Halloween Ends”; Julia Roberts and George Clooney in “Ticket to Paradise”; Dwayne Johnson, Pierce Brosnan and Viola Davis in “Black Adam”; Jessica Chastain, Anne Hathaway and Sir Anthony Hopkins in “Armageddon Time”; Margot Robbie, Christian Bale and Robert De Niro in “Amsterdam”; Tom Hanks in “A Man Called Otto”; Brad Pitt and Margot Robbie in “Babylon”; oh, and 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. Our current internal forecast is that the 2023 domestic box office, the basic metric suggesting the health of theatrical exhibition both in the U.S. and globally, will be billions of dollars larger than that of 2022. We look forward to Q4 of 2022 and calendar year 2023 with glee.
Balance Sheet, Cash and Liquidity
Cash at June 30, 2022 was $965.2 million excluding restricted cash of $22.7 million. AMC currently has liquidity availability of more than $1.17 billion (including cash and undrawn revolver lines), however the Company does not anticipate the need to borrow under the revolver lines during the next twelve months. During May of 2022, the Company repurchased $72.5 million aggregate principal amounts of the Second Lien Notes due 2026 for $50.0 million and recorded a gain on extinguishment of $38.6 million in other expense (income). Accrued interest of $3.1 million was paid in connection with the repurchases.
AMC Preferred Equity Unit Dividend
On August 4, 2022, AMC announced the declaration of a special dividend of one AMC Preferred Equity Unit (an “AMC Preferred Equity Unit”) for each share of AMC Class A common stock, par value $0.01 per share (the “Common Stock”), outstanding at the close of business on August 15, 2022, the record date. The special dividend is expected to be paid at the close of business on August 19, 2022.
AMC expects the AMC Preferred Equity Units to trade on the New York Stock Exchange (“NYSE”) under the symbol “APE”. Each AMC Preferred Equity Unit is designed to have the same economic and voting rights as one share of Common Stock.
The ex-dividend date will be August 22, 2022 (i.e., the first business day after the payment date of the dividend). The AMC Preferred Equity Unit dividend is expected to be paid as of the close of business on August 19, 2022. The NYSE has established August 22, 2022 as the ex-dividend date. If an investor sells our Common Stock before the exdividend date (August 22, 2022), they will not be entitled to the AMC Preferred Equity Unit. Alternatively, if a person buys our Common Stock before the ex-dividend date (August 22, 2022), they will be entitled to receive the AMC Preferred Equity Unit dividend.
Shareholders will receive one AMC Preferred Equity Unit for each share of AMC common stock owned. Based on 516,820,595 issued and outstanding Common Stock, the Company expects to issue a dividend of 516,820,595 AMC Preferred Equity units.
Each AMC Preferred Equity Unit is designed to have the same rights as a share of AMC common stock and is convertible into AMC common stock in the future if the Company proposes and its equity investors so approve.
Investors should note that on the ex-dividend date, August 22, 2022 the price of AMC Common Stock is likely to decline to reflect the fact that shares purchased on or after such date would no longer be entitled to the dividend. This is similar to what occurs in a stock split.
The AMC Preferred Equity Unit dividend is exclusively for shareholders of the 516,820,595 issued and outstanding AMC Common shares and offers AMC investors another investment vehicle to participate in AMC’s recovery and growth. In addition, and importantly, 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.
About AMC Entertainment Holdings, Inc.
AMC is the largest movie exhibition company in the United States, the largest in Europe and the largest throughout the world with approximately 950 theatres and 10,600 screens across the globe. AMC has propelled innovation in the exhibition industry by: deploying its Signature power-recliner seats; delivering enhanced food and beverage choices; generating greater guest engagement through its loyalty and subscription programs, web site and mobile apps; offering premium large format experiences and playing a wide variety of content including the latest Hollywood releases and independent programming. For more information, visit www.amctheatres.com.
Read the full results here.