AMC declares special dividend, posts quarterly loss

AMC Entertainment Holdings posted a bigger-than-expected loss as costs jumped nearly 60% in the second quarter.

The company also announced that it would pay a special dividend in the form of preferred shares.

Shares of the once-popular meme stock are down 7% in premarket trading as the move raised concerns about possible stock dilution.

AMC’s preferred stock could be converted into common stock if investors approve the move.

AMC CEO: Moviegoers spend despite inflation

The photo shows the AMC Empire 25 theater in Times Square in New York. (Photo by Evan Agostini/Invision/AP, File/AP Newsroom)

The company will allot one preferred stock for each AMC common stock held.

AMC plans to list approximately 517 million preferred shares on the New York Stock Exchange under the symbol “APE”.

Adam Aron President and CEO of AMC Theaters

AMC CEO Adam Aron. (Fox News / Fox News)

“This new AMC preferred stock gives AMC currency that can be used in the future to strengthen our balance sheet, including paying down debt or raising new capital,” Chief Executive Adam Aron said.

AMC REVENUES QUINTUPLE AS THEATERS RETURN TO THEATERS

Quarterly revenue hit $1.17 billion, beating the estimate of $1.16 billion, while the net loss of 24 cents per share was above market expectations of 21 cents, according to Refinitiv data.

An AMC theater lobby

The box office at AMC Lincoln Square 13 in New York City. (Jeenah Moon/Bloomberg via Getty Images/Getty Images)

Teleprinter Security Last To change To change %
CMA AMC ENTERTAINMENT HOLDINGS INC 18.67 +0.46 +2.52%

AMC’s market value soared last year in a rally driven by retail investors, helping it raise billions of dollars in equity, even at the cost of investor concern over a erosion of the value of its shares.

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At the height of the coronavirus pandemic, AMC suffered heavy losses as restrictions forced theaters to close again.

Reuters contributed to this report.

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