Limited Time Deal Gets You Pro at Half-Price
Limited Time Deal Gets You Pro at Half-Price
Exclusive News, Scanners, and Chat Power Pro Users to Win More
Exclusive News, Scanners, and Chat Power Pro Users to Win More
Movie theater company AMC Entertainment Holdings AMC was one of several meme stocks that saw high volatility recently with the return of Roaring Kitty on social media.
In an interview, AMC CEO Adam Aron shared the path forward for the company with a high debt load and struggling movie sector recovering from the COVID-19 pandemic and Hollywood strikes.
What Happened: AMC, which recently reported first-quarter financial results, said that the impact of the Hollywood strikes could hurt second-quarter results.
Despite a heavy debt load, Aron avoided using the word bankruptcy.
"We're still here," Aron told Variety. "When you think about what we've been through the past four years, it's kind of a miracle. It could have gone kaplooey 10 times, but it didn't. And good for us. We're almost finally through it."
Acquisitions of other movie theaters added to AMC's debt, but Aron won't rule out additional acquisitions.
"We would be willing to grow AMC through acquisition going forward if we can find the right theaters at the right price."
The meme stock frenzy of 2021 sent AMC shares soaring and allowed the company to raise additional funds through share offerings, something not lost on Aron.
"Retail shareholders saved AMC. We said back then we weren't necessarily trading based on fundamentals."
Other items crucial to help AMC are concert films and popcorn buckets.
With movie studios releasing fewer films, AMC partnered with Taylor Swift on the theatrical release of "Taylor Swift: The Eras Tour." The film went on to break several records and was the 11th highest-grossing film domestically in 2023 at $179.8 million, as reported by BoxOfficeMojo.
"It was really good. It got an A+ on CinemScore and 98% on Rotten Tomatoes. It's not like we threw together some garbage."
AMC also released a Beyoncé concert film and recently partnered with Billie Eilish on a theatrical listening party for her new album.
The AMC CEO hit back at other theater chains who were mad about AMC's control of the Taylor Swift concert film.
"We couldn't blow Taylor's secret. And those theater chains, who groused to you? They grossed $100 million in ticket sales. It's not like they sold diddly."
Aron said AMC doesn't have to see box office return to pre-COVID-19 levels, something that merchandise like popcorn buckets and expanded food items could help with.
The AMC CEO said popcorn buckets like a "Wonka" top hat and "Barbie" toy pink convertible helped the company post $54 million in merchandise sales.
A popcorn bucket for "Dune: Part Two" helped AMC go viral for the wrong reasons thanks to its resemblance to a sex toy. The bucket was parodied on "Saturday Night Live."
"The only bad publicity is your obituary. As far as I'm concerned, they can make fun of AMC on ‘Saturday Night Live' every week. Nothing would be better."
Related Link: AMC Stock Trades At ‘Pre Meme Historical Multiple’: Can Donut Holes, Salads And Billie Eilish Help Grow Revenue?
What's Next: For 2024, Aron expects 25 movie tie-ins on merchandise like popcorn buckets. Thanks to the upcoming "Deadpool & Wolverine" movie, AMC could see its popcorn buckets go viral once again.
The popcorn bucket for the movie will be "intentionally lewd and crude," according to Marvel Studios President Kevin Feige, as reported by The Hollywood Reporter.
Other movies with popcorn buckets include "Inside Out 2" and "Twisters," The Hollywood Reporter said.
While the popcorn bucket for "Deadpool & Wolverine" could be a big seller for AMC, Aron also recently shared that ticket sales have been strong for the highly anticipated movie from Walt Disney Co DIS.
"Some 200,000 movie fans have bought their AMC tickets already. This is more Day 1 ticket sales at AMC than for any other R-rated movie ever," Aron tweeted about the Disney movie.
The movie could be one of the biggest releases of 2024. Aron has his eyes set on the future after this year.
"Just look a little ahead, and the box office in 2025 and 2026 is going to be so much bigger than 2023 and 2024," Aron told Variety.
Aron said he expected AMC to have two to three concert films released theatrically each year. The company recently made several management team changes to expand the events team, which could suggest pushing deeper into the non-movie release schedule.
"I happen to be a very large AMC shareholder. So clearly I would prefer that the stock price be higher rather than lower."
AMC Price Action: AMC shares are up 2.86% to $4.68 on Friday versus a 52-week trading range of $2.38 to $62.30. AMC stock is down 89% over the last year.
Read Next: AMC Bonds Hold Gains After Meme Stock Selloff: Is It A Better Bet Than Buying Shares?
Photo: Shutterstock
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
