AMC Theaters is trying to win over retail investors with an ‘APE’ dividend –

AMC Entertainment Holdings is issuing a special dividend to thank its retail investors, but so far it doesn’t look like they’re buying it.

Ahead of Thursday’s results, the company announced that it would pay a special dividend to investors for one unit of AMC preferred stock for every AMC common share outstanding at the close of business on Aug. 15. The company requested a list of these entities. On the New York Stock Exchange, under the symbol “APE”, referring to a group of investors who helped revive the stock, since Aug. 22.

“While no crystal ball can accurately predict stock market swings or volatility, the economic interests our shareholders will have in equities and APEs will be in a company that we believe is much stronger than expected. Now it’s AMC.” – AMC Entertainment CEO Adam Aron said to analysts in an aftermarket conference call.

Investors took note of the market’s volatility as AMC’s shares tumbled 8 percent after hours on Thursday, as the theater chain saw audiences increase but reported losses linked to its unique investment strategies.

Aron announced that he had $15 million in AMC stock and about $50 million in company stock. “I have over $50 million in economic capital in AMC,” Aron said, adding, “It’s a huge incentive for me to do what’s right for all of our shareholders.”

In the second quarter, the theater chain reported total revenue of $1.2 billion, compared to $444.7 million in the previous quarter. The company reported a net loss of $121.6 million compared to a net loss of $344.0 million a year ago.

Attendance reached 59 million people, up 168% from 22 million a year ago. Aron cited the popularity of films such as Doctor Strange in the Multiverse of Madness, Elvis and Top Gun for increasing attendance in the last financial quarter.

“Our Q2 2022 results, in our minds, reaffirm what we have long said that when Hollywood releases films with broad consumer appeal, people rush to see them in theaters in huge and spectacular numbers,” said Aron. .

In the analyst’s call, Aron pointed to several blockbusters in the last quarter, led by Tom Cruise. Top Gun: Maverick. “I’ve seen it four times now,” he added. Top Gun: MaverickEarlier, during a call with analysts, he took aim at critics of AMC’s turnaround strategy, which he called a “fatal victory.”

“For the naysayers who foolishly predicted the secular decline of theatrical display, all I can say is that they saw my hilarious hashtags on Twitter. You know what I’m saying, Aaron said. But the head of AMC Theaters has warned of a box office slowdown for Hollywood’s summer premieres at local multiplexes in the current quarter.

“It will subside for a few weeks. Don’t expect too much from us in the third quarter,” added Aron, before pointing to a strong fourth quarter expected, with Hollywood titles like Black Adam, Amsterdam and to continue avatar s Black Panther.

Aron also discussed on the conference call the company’s recent $28 million stake in mining company Hycroft Mining, which had an impact on the company’s earnings due to “market price volatility” as AMC reduced the value of the investment by nearly $100. 10 million.

“We are confident that our investment in Hycroft will be very profitable for AMC,” Aron said while promoting one of the company’s latest moves to diversify into alternative revenue streams outside of theaters.

In early 2021, AMC became a popular stock among retail investors after the company appeared to be on the brink of bankruptcy as a result of the pandemic on theater chains. The rise in shares helped the company strengthen its financial position, as executives took the opportunity to sell shares and buy back debt.

While the stock’s initial momentum has waned (the shares are up 30% in the last three months but down 43% last year), AMC has continued to use strategic investments to shore up its finances, including $28 million in Hycroft Mining.

In the coming months, Aron said July was a big month for the company, with attendance in July 2022 attracting the most guests to the company’s US theaters since December 2019 and anticipated food and beverage numbers for the month. which marks the “biggest single”. Throughout our company’s 102-year history, the month has been featured in US theaters.

During the call, Aron argued that Hollywood has given up on streaming platforms as consumers have returned to local multiplexes and major studios have realized how much money can be made with exclusive features of their online titles. “I think you put all these things together and Hollywood moves away from broadcasting, Wall Street moves away from broadcasting and Hollywood goes back to theatrical release,” he argued.

Aron was also looking forward to the year ahead as he predicted a steady recovery at the box office. “Our current internal forecast is that the 2023 domestic box office, a key metric that indicates the health of film exposure in the US and around the world, will exceed 2022 by billions of dollars.” We look forward to the fourth quarter and calendar year 2022. 2023 with joy,” said Aron.