AMC Stock (NYSE:AMC)
On Friday at lunchtime, shares of AMC Entertainment (NYSE:AMC) were up 1.7% after the company reported a better-than-expected loss for the first quarter while reporting higher-than-expected sales. As a result, AMC stock surged.
Box office receipts increased by 21.5% annually to $954.4 million on the strength of 22% higher attendance (also above projections).
The company’s adjusted net loss shrank by approximately $90M to $179.7M. And it earned a profit of $7.1M on adjusted EBITDA, up from a loss of $61.7M last year.
The debut of The Super Mario Bros. Movie in April, the year’s largest film to date with almost half a billion dollars in domestic grosses and more than $1 billion globally, as well as the forthcoming summer release season, likely contributed to the increase in earnings.
Compared to the first quarter of 2022, the number of releases increased by 35% due to the aseasonal nature of the release schedule.
CEO Adam Aron said that the first three months of 2023 were the beginning of great things.
According to Aron, expenditure in the high-margin food/beverage sector has remained at a “blistering pace,” with average per-patron prices of $7.99 in the United States and $6.90 elsewhere.
AMC has reduced its operational cash burn from the prior year to $139.4M (non-GAAP) from $223.9 Million. After the third quarter, the firm reported $703.7 million in available cash, including $208.1 million in unused capacity under its revolving credit facility.
The results were achieved in the context of the company’s efforts to convert its AMC Preferred Equity units (APE) into common shares, perform a reverse stock split, and raise financing via the legal system in Delaware. A settlement has been filed in a lawsuit seeking an injunction against that proposal. Investors are waiting for an SEC filing to establish the formal pathways for objections before an anticipated hearing on June 29-30 to resolve the issue.
By lunchtime, the APE index had risen by 0.6%.
In the first three months of 2023, the company strengthened its balance sheet by generating over $155 million in cash via the sale of APE units and by decreasing its principal amount of debt by more than $200 million by repurchasing debt or exchanging APE units for debt, as stated by the company’s CEO, Mr. Aron.
Box office receipts in the entertainment sector will not return to their pre-pandemic levels for “a few more years,” making it imperative that businesses be able to acquire finance during this time.
Featured Image: Freepik
Author Shariq Khan 
