AMC Entertainment CEO Says Cinemas Have a Problem and It's Not Covid, Streamers or Windows: 'We Need More Movies' - Update

AMC Entertainment CEO Says Cinemas Have a Problem and It’s Not Covid, Streamers or Windows: ‘We Need More Movies’ – Update

UPDATE with comments from the conference call: AMC Entertainment CEO Adam Aron has ignored Covid, streamers and windows as real exposure issues right now, saying the biggest challenge facing the industry “above all else is that exhibitors cinemas need more films”.

“At this point, there’s only one topic that should be … on the tip of every tongue,” he said on a conference call Tuesday after announcing its quarterly results. Studios are doing what they can to “pick up the pace” and there’s “tremendous progress” but the number of movies is still down 20% to 30% from pre-pandemic levels.

That said, “the industry-wide box office is rebounding both domestically and globally, going up and up.” He anticipates this weekend Black Panther: Wakanda Forever will it be the biggest release of the year after Top Gun: Maverick and that the 2022 box office will be at nearly 75% of pre-pandemic levels. Next year should grow 15% to 20%, maybe more, he says.

Meanwhile, the exhibitor continues to announce new projects to roll out next year, including an AMC-branded credit card on the way in Q1; AMC Perfectly Popcorn on grocery store shelves in the first half; and the recently announced cross-market Zoom Rooms for businesses in partnership with the online meeting powerhouse. The company is investing in new laser projectors and large format screens and saving some dry powder for more theater acquisitions.

Aron noted that the three-movie-a-week AMC Stubs A*List loyalty program has rebuilt between 600,000 and 700,000 members, “from scratch during” Covid, and the company plans to be “very aggressive” to do so. advance the plan. He does not plan to invest in AMC On Demand. “It’s always been lightly used and frankly, while it’s a great little product, I think our money is better spent elsewhere…in a time when dollars are scarce.”

“We will look to either phase out AMC On Demand or create a joint venture with another party to bring the same capability to our customers.”

PREVIOUSLY: Giant movie chain AMC Entertainment saw revenue rise and losses edge up last quarter, but CEO Adam Aron cited a stronger slate ahead and moved to reduce debt, raise capital and new projects .

Sales of $968 million for the quarter ended September, compared to $763 million for the 2021 period. Net losses were $226 million compared to $224 million. EPS was stable at 22 cents per share.

Operating cash burn for the quarter was negative $179.2 million. And cash on hand as of September 30 was $896 million, including $211 million of unused capacity under the company’s revolving credit facility.

Attendance for the quarter was approximately 53.2 million, including 38.3 million in the United States, on more than 10,000 screens.

Operating expenses rose from $1 billion to just over $900 million in the prior quarter.

“Exactly as expected and announced on our last quarterly earnings call, our third quarter results were impacted by a particularly weak industry-wide box office in the last two-thirds of the third quarter of 2022, but Encouragingly, our overall metrics per guest for both admission revenue and food and beverage spending remain well above pre-pandemic levels, increasing 12% and 30%, respectively, from the third quarter of 2019,” Aron said.

“Our recovery continues and we look forward to a return to a more robust film slate in Q4 2022, which has already started strong with the release of black adam.” Successive Blockbusters Include This Coming Weekend Black Panther: Wakanda Forever, strange world and Avatar: the path of water.

The exponent said it was bolstered by recent capital markets activity, including debt reduction, debt refinancing and equity raising. “These actions strengthen our agility and allow us to pursue strategic opportunities, like our recently announced Zoom Rooms at AMC, to transform our business in a post-pandemic environment. We expect to make more business development announcements in the weeks and months to come, which together with the improvement in the theater business, positions AMC Entertainment to create value for all of our stakeholders,” said Aaron said.

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