Getty Images
AMC Entertainment's biggest problem right now may be the fact that it has $4.5 billion in debt, most of which is due in 2026. During today's post-earnings conference call, CEO Adam Aron spoke publicly about the issue for the first time, assuring investors that the giant theater chain is here to stay. He has been working with lenders for almost a year to extend the maturity, and he is hopeful they will extend it.
“I want to assure everyone listening to this call that the management of this company has navigated the pandemic very wisely… with a total focus on debt maturing in 2026. It’s not something we’re thinking about.’ We’ll see next year or the year after. ”
“The good news is that there are financial syndicates that generally like AMC, have worked with us in the past, and are working with us now, and are 'excited' about the agreement,” he said. “That means,” he said. “That is our biggest focus. We are aware of our upcoming obligations and intend to refinance if possible, and we hope we can refinance on attractive terms.”
The company has indeed done its best to weather the coronavirus and its aftermath, with some pushing it towards meme stock status and others creating a new type of stock (APE). It was just a wild thing to do, to get the court to approve it. Selling stocks over the objections of individual shareholders. He has accumulated cash on hand and is steadily repaying his debts.
The company reported its fourth quarter results today (after a pre-announcement last month) and said it had $624 million in cash at the end of March.
Despite the Hollywood strike being another setback, Aaron was still pleasantly surprised by AMC's increased market share in the first quarter. If the company has the funds, it plans to invest in better, larger halls, which are the ones that perform best. He has a positive outlook that his 2025 box office numbers will be even better than in recent years.
AMC ramped up its theatrical film footprint late last year by making the leap into distributing concert films by Taylor Swift and Beyoncé. Aaron said the company aims to produce at least a few event films each year, some of which will be shared with other theater owners and some of which will be released next week on May 16-17 as a new album. He said some are exclusive to AMC, like the Billie Eilish listening event, which will be held at many AMC theaters across the country. drops, and before that, Hit Me Hard and Soft: The Tour is scheduled for this fall. For this event, timing was too tight for AMC to involve other exhibitors.
“It's a lot of work to get artists to agree to show their talent in our theaters, but that's just the way it is…I think we'll do it a few times a year. Even if it's just a one-time listening event. But if you look at it screen by screen, it's beneficial for us,” he said, noting that Billie Eilish's event with Apple Music and Interscope Records was an album release with visuals, not a concert film. He said he hopes other artists will consider delivering it to their fans when they release albums.