AMC Theater Chain Says Weak Movies Hurt Financial Results
CEO Adam Aron says AMC's $1.2 billion bid for Carmike Cinemas is its "best and final offer," adding: "I shudder to imagine what would happen to Carmike stock performance in a standalone scenario."
AMC Entertainment, soon to be the nation's biggest movie exhibition company, reported quarterly financial results that fell shy of expectations, and the theater chain blamed weak films for the disappointing earnings.
The company on Monday reported a profit of 24 cents per share in the second quarter, while Wall Street expected 27 cents. Revenue of $764 million was $9 million shy of expectations.
In the same quarter a year ago, AMC posted 45 cents a share in earnings on $821 million in revenue.
The disappointing financial results come one week after Regal Cinemas reported lackluster earnings, also citing a weak slate of films.
"Movie after movie disappointed in this year's second quarter," AMC chief executive Adam Aron told analysts on Monday. He also said movies on its Imax screens disappointed, which is also notable because AMC is the largest Imax partner.
Aron called the backdrop of the movie theater industry "dismal" in the second quarter but said he has high expectations for the remainder of the year.
He said the "bad news" of the second quarter is "already a thing of the past" due to a "somewhat spectacular array of films," beginning with Jason Bourne, which took in $60 million in its opening weekend, and continuing with this week's opening of Suicide Squad.
AMC was acquired by China's Dalian Wanda Group four years ago, and it is poised to overtake Regal Cinemas as the country's biggest exhibitor if it completes its proposed acquisition of Carmike Cinemas.
Some Carmike shareholders object to the recently upped $1.2 billion price, but Aron said Monday it is AMC's "best and final offer," and he added: "I shutter to imagine what would happen to Carmike stock performance in a standalone scenario."
AMC is also acquiring Odeon & UCI Cinemas in Europe.
AMC said Monday that it operated 5,334 screens during the quarter, up from 5,031 a year earlier, but attendance of 50 million was down from 53.8 million.