×
You will be redirected back to your article in seconds

AMC Entertainment Quarterly Revenues Beat Estimates, but Buying Spree Takes Bite Out of Profits

UPDATED: AMC Entertainment’s recent acquisitions binge took a chunk out of profits even as the company’s quarterly financial results beat Wall Street projections.

Earnings at the world’s largest exhibition chain fell more than 70% to $8.4 million, which the company attributed to costs associated with its purchase of Odeon Cinemas Group and Carmike Cinemas, two deals that expanded its presence in Europe and the United States. Revenue for the three-month period ending in March rose 67.6% to $1.28 billion. Analysts had projected that the company would do $1.25 billion in sales. Earnings per share fell from 29 cents to 7 cents, in line with estimates.

Excluding merger and acquisition costs, AMC said its net earnings increased 7.5% to $34.6 million. Box office hits such as “Beauty and the Beast” and “Logan” helped goose attendance at the chain, with admissions revenues climbing nearly 70% to $817.3 million. AMC has invested heavily in updating its menu and moving beyond popcorn and soda. It has added alcoholic beverages and more inventive snacks at many locations. The strategy appears to be working — food and beverage revenues at the chain rose 63% to $397.9 million.

In a statement, AMC CEO Adam Aron said the company will continue to invest in sprucing up its food offerings and in outfitting theaters with recliner seats. He also predicted that the theater chain’s acquisitions would result in certain cost synergies.

“We are only just beginning to unlock the growth potential of our recent acquisitions,” Aron said. “The initial integration efforts of creating a transformed AMC have been done quickly and have been very smooth.”

In an earnings call after the results were made public, Aron said AMC will renovate 122 theaters in 2017 and 2018 and will retire the Carmike name. He argued AMC’s brand resonated more strongly with customers.

Aron also addressed studios’ plans to offer some new films on-demand with days of their release on theaters. Currently, most major films aren’t available to rent until roughly 90 days after their theatrical debut In order to get exhibitors to agree to screen movies that will hit home entertainment earlier, studios are offering to give theater chains a cut of their profits.

Aron said the plan was attractive to AMC because the company would “be paid handsomely in the process,” but said that any deal would need industry-wide support. It would not work if it was simply between one studio and one exhibitor.

“A consensus is going to need to emerge,” said Aron.

Shares of AMC Entertainment climbed more than 1% in after-hours trading, hitting $29.10.

More Film

  • Murder Mystery

    Netflix Reveals Record-Breaking Stats for Sandler-Aniston 'Murder Mystery' Flick

    “Murder Mystery,” the latest Adam Sandler film to debut on Netflix, broke viewing records on the streaming service, the company revealed Tuesday. The film, which is co-headlined by Jennifer Aniston, was seen by close to 30.9 million households in its first 3 days, according to a tweet sent out Tuesday afternoon. 🚨ADAM SANDLER AND JENNIFER [...]

  • Agents Accuse Writers Guild of Refusing

    Writers Guild 'Plans to Respond' to Agents' Proposal as Frustration Mounts

    In a sign of increasing frustration, Hollywood agents have accused the Writers Guild of America of foot-dragging in the bitter two-month dispute. “It has become clear as more days pass that the Guild is not interested in making a deal,” said the negotiating committee for the agents in statement issued Tuesday. “Over the past year, [...]

  • Jermaine Fowler arrives at the 69th

    Jermaine Fowler to Co-Star With Eddie Murphy in 'Coming 2 America' (EXCLUSIVE)

    Jermaine Fowler is set to play one of the leads opposite Eddie Murphy in Paramount’s sequel “Coming 2 America,” sources tell Variety. “Hustle & Flow” helmer Craig Brewer is on board to direct the pic with the studio planning an August 7, 2020 release. Plot details of “Coming 2 America” are unknown, as are the [...]

  • Henry Golding attends the Fragrance Foundation

    Henry Golding Starts Long House Shingle With 'Inheritance,' 'Harrington's Greatest Hits'

    “Crazy Rich Asians” star Henry Golding has started Long House Productions in partnership with China’s Starlight Cultural Entertainment Group with two features in the works. Golding’s first feature under the Long House banner is action adventure “The Inheritance,” based on an original story idea by Alistair Hudson and Golding. Hudson is writing the script for [...]

  • Max Landis Entertainment Weekly party, Comic-Con

    Max Landis Accused of Rape, Assault and Psychological Abuse

    Screenwriter Max Landis is facing allegations of sexual abuse and psychological manipulation from eight women who told their stories to the Daily Beast. Two of the women spoke on the record, and another five were identified by pseudonyms. An eighth women confirmed that she filed a police complaint against Landis in 2008, in which she [...]

  • Michael Fassbender'X-Men: Dark Phoenix' film premiere,

    Michael Fassbender to Produce, Star in Lionsgate Spy Thriller 'Malko'

    Michael Fassbender will produce and star in the Lionsgate spy thriller “Malko,” based on Gerard de Villiers’ S.A.S. series, with the studio planning to launch a franchise with the project. Eric Warren Singer, who was nominated for an Academy Award for best original screenplay for “American Hustle,” will write the screenplay. Joe Drake, chairman of [...]

  • American Film Institute Hires Susan Ruskin

    Susan Ruskin Appointed AFI Conservatory Dean

    The American Film Institute has named producer and educator Susan Ruskin as dean of the AFI Conservatory, where she will lead AFI’s graduate film-training program. Ruskin, who will also carry the title of executive VP, will report directly to Bob Gazzale, AFI President and CEO, the organization announced Tuesday. She replaces producer Richard Gladstein, who left [...]

More From Our Brands

Access exclusive content