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AMC Entertainment Holdings Inc. reported a loss of nearly $1 billion in the holiday season to wrap up a woeful year of closed movie theaters, but executives sounded a hopeful note for reopening in 2021.
AMC AMC, -6.19% reported a fourth-quarter loss of $946.1 million, or $6.21 a share, a sharp decline from a loss of $14 million a year ago. Sales fell more than 88% from the holiday season a year ago, coming in at $162.5 million after the theater chain reported revenue of $1.46 billion in the same period last year.
After adjusting for $466.1 million in impairment charges largely related to the struggles of the past year, AMC reported a loss of $3.15 a share; the company collected adjusted earnings of 35 cents a year ago. Analysts on average expected AMC to report an adjusted loss of $3.24 a share on sales of $142.3 million.
AMC’s business has been ripped apart by the COVID-19 pandemic, with theaters nationwide closed as the coronavirus forced lockdowns. For the year, AMC reported sales of $1.24 billion, down from $5.55 billion in 2019.
As COVID-19 cases begin to calm down after a winter spike and vaccinations grow, however, theaters are beginning to open up again with new precautions, including mask requirements and capacity restrictions.
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“As we sit here today, we see that vaccinations are occurring in the United States at a brisk clip, our theaters in New York City have finally opened, with theaters in Los Angeles likely opening shortly as well, blockbuster movie titles are currently scheduled to be released in significant quantity in the coming few months, and we have more than $1 billion of cash on hand,” Chief Executive Adam Aron said in Wednesday’s announcement. “Taking these facts together, we have reason to be optimistic about AMC’s ability to get to the other side of this pandemic.”
AMC’s stock has not suffered as much as its finances, largely because of an investment frenzy in bedraggled stocks like videogame retailer GameStop Corp. GME, +7.33% and former cellphone giants Nokia Corp. NOK, and BlackBerry Ltd. BB, -1.05%, which appears to have been sparked by users of Reddit’s online message boards. AMC stock has more than doubled in the past three months, a gain of more than 140% that allowed the company to sell fresh shares for much-needed capital and allowing other investors, including at least one large hedge fund, to cash out for big gains.
AMC shares gained more than 5% in after-hours trading immediately following the release of the results Wednesday. The stock closed with a 6.2% decline amid one of the most tumultuous trading sessions in weeks for the so-called meme stocks.
