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AMC Entertainment Holdings, Inc. Previews Second Quarter 2017 Results, Announces Cost Reduction And Revenue Enhancement Initiatives, Issues Additional 2016 Pro Forma Financials And Provides Guidance For Full Year 2017

AMC Entertainment Holdings, Inc. (NYSE: AMC) ("AMC" or "the Company") today announced the following: Preview of Second Quarter 2017 Results AMC previewed results for the second quarter ended June 30, 2017. The preliminary financial results are subject to finalization by the Company, including purchase accounting adjustments for acquisitions where the purchase price allocation is preliminary.

  • AMC expects to report total revenues for the three months ended June 30, 2017, to be between $1,200 million and $1,204 million compared to $764.0 million for the three months ended June 30, 2016.
  • The Company expects to report a net loss for the second quarter of 2017 of between $178.5 million and $174.5 million compared to net earnings of $24.0 million for the second quarter of 2016. Included in the net loss for the second quarter of 2017 is a $202.6 million pre-tax impairment charge related to AMC's National CineMedia, LLC (NASDAQ: NCMI) ("NCM") investment. As previously disclosed on SEC Form 10-Q for the three-month period ended March 31, 2017, because the market value of our investment in NCM further declined significantly below our carrying value, the decline in value is considered other than temporary. Due to the significant decline in value of the publicly quoted price per share of NCM, Inc., this impairment charge was recorded for all the units and shares owned in NCM.
  • AMC expects to report a loss per diluted share for the second quarter 2017 of between $1.36 and $1.34 compared to diluted earnings per share of $0.24 for the second quarter 2016.
  • The Company expects to report Adjusted EBITDA for the second quarter of 2017 of between $134.0 million and $136.0 million compared to $129.6 million in the same period a year ago. Adjusted EBITDA is a non-GAAP financial measure, and a table reconciling expected net earnings to Adjusted EBITDA is included in this release.

AMC's results also reflect industry box office trends. The North American industry box office for second quarter ended June 30, 2017, which includes Canada, decreased approximately 3.3%, and the U.S. industry box office declined approximately 4.4%, compared to the same period in 2016.


European box office trends improved in the countries served by AMC, growing by a double-digit percentage year-over-year. That growth did not produce as big a benefit as it might have otherwise, because the second quarter is seasonally often the smallest quarter of the year.

AMC expects to report its complete financial results for the second quarter ended June 30, 2017, after the market closes on Monday, August 7, 2017. The Company will host a conference call for investors and interested parties at 4:00 p.m. CT/5:00 p.m. ET the same day. All interested parties are invited to access a live audio broadcast of the call via webcast. To listen to the conference call via the internet, please visit the investor relations section of the AMC website at www.investor.amctheatres.com for a link to the webcast. Investors and interested parties should go to the website at least 15 minutes prior to the call to register, and/or download and install any necessary audio software. Cost Reduction/Revenue Enhancement Initiatives Against the U.S. industry backdrop of a weaker than anticipated second quarter and estimates for a very challenging third quarter, the Company has embarked on a domestic cost reduction and revenue enhancement plan to better align operating expenses with theatre attendance in its markets and reduce general and administrative costs for the balance of 2017 and into 2018. The company expects to achieve at least a $30 million adjusted EBITDA contribution from cost savings and revenue enhancements through the end of 2017 which will include strategic pricing, promotional incentives, adjusting scheduling practices, reductions in operating hours, staffing levels, and additional general operating expense line items. The cost reduction initiatives affect both the Theatre Support Center based in Leawood, Kansas and AMC's domestic theatre locations. AMC began implementing the cost reduction initiatives in July 2017, and they will continue throughout the balance of the year.


Issuance of Additional Pro Forma Financials

Consistent with the Company's previous commitment to provide comprehensive disclosure regarding its three recent acquisitions, additional information detailing select unaudited pro forma financial data for 2016 and the three month-period ended March 31, 2017, was furnished and filed on a Form 8-K dated August 1, 2017. The Company believes the pro forma information provides a more comparable view of its results relative to prior periods. The select unaudited pro forma data for the periods combines the historical financial data of operations of AMC, Odeon, Carmike and Nordic, giving effect to the acquisitions, financings and theatre divestitures as if they had been completed on January 1, 2016. The historical consolidated financial information for Odeon, Carmike and Nordic have been adjusted to comply with U.S. Generally Accepted Accounting Principles ("U.S. GAAP"), including the effects of purchase accounting. The classification of certain items presented by Odeon under UK Generally Accepted Accounting Practice ("UK GAAP") has been modified in order to align with the presentation used by AMC under U.S. GAAP. The classification of certain items presented by Nordic under International Financial Reporting Standards ("IFRS") has been modified in order to align with the presentation used by AMC under U.S. GAAP. In addition to the U.S. GAAP adjustments and the reclassifications, amounts for Odeon and Nordic have also been translated to U.S. Dollars. The unaudited pro forma financial information is provided for informational purposes only and is not necessarily indicative of what our results of operations would actually have been had the acquisitions occurred on the date indicated. Please refer to the March 13, 2017, Form 8-K/A for additional information on pro forma financial statement adjustments. Issuance of Full Year 2017 Guidance Considering the complexity surrounding AMC's three recent acquisitions, for the first time, the Company is announcing its outlook for fiscal 2017. The Company does not intend to update this guidance or provide guidance for subsequent years beyond this outlook for fiscal 2017.


The 2017 guidance ranges are as follows:

2017 Guidance Ranges
Total Revenues $5.10 to $5.23 billion
Net Loss $150.0 to $125.0 million
Diluted loss per share $1.17 to $0.97
Adjusted EBITDA $860 to $900 million
Gross Capital Expenditures $600 to $670 million
Net Capital Expenditures $500 to $550 million
Total Attendance 350 to 360 million attendees
Total Average Screens 10,650 to 10,700 screens

This guidance reflects management's estimates based solely upon information available to it as of the date of this press release. The ranges provided constitute forward-looking statements, are subject to change, and actual results may differ from these estimates and such differences may be material.


The Company's 2017 guidance contains a number of assumptions, including:

  • 2017 guidance anticipates the 2017 North American industry box office generates approximately $11.2 billion in revenues.
  • 2017 guidance includes the Company's achieving its anticipated $30 million adjusted EBITDA contribution from cost reductions and revenue enhancements.
  • 2017 guidance includes no further impairment charges related to the NCM investment.
  • 2017 guidance includes cash distributions from non-consolidated entities. These cash distributions are outside the Company's control and are subject to variability.
  • 2017 guidance includes variability in tax rates based on the country mix of profit and loss before taxes.

Adjusted EBITDA is a non-GAAP financial measure, and a table reconciling expected net earnings to expected Adjusted EBITDA is included in this release. Information Regarding Preliminary Results The preliminary estimated financial information contained in this press release reflects management's estimates based solely upon information available to it as of the date of this press release and is not a comprehensive statement of our financial results for the three months ended June 30, 2017. We have provided ranges for the preliminary estimated financial results described above primarily because our financial closing procedures for the three months ended June 30, 2017, are not yet complete and the impact of purchase accounting for acquisitions where the purchase price allocation is preliminary. The information presented above should not be considered a substitute for full unaudited financial statements for the three months ended June 30, 2017, once they become available and should not be regarded as a representation by us or our management as to our actual financial results for the three months ended June 30, 2017. The ranges for the preliminary estimated financial results described above constitute forward-looking statements. The preliminary estimated financial information presented above is subject to change, and our actual financial results may differ from such preliminary estimates and such differences could be material. Accordingly...


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