The theater chain bests expectations on profit thanks to higher concession spending per customer, but revenue is soft
AMC Entertainment reported better-than-expected earnings in the fourth quarter Monday, as a period amped up by the record-breaking release of “Star Wars: The Force Awakens” helped the theater chain sell more concessions per customer.
But sales were unexpectedly weak, with overall attendance slightly below the rest of the industry’s average.
Shares were up 3.7 percent at $23.30 in premarket trading. The stock is down 34 percent in the last year.
The quarter “was all about ‘Star Wars,'” AMC’s new CEO, Adam Aron, said on a call to discuss results. “We just played the hell out of that movie,” he said, noting that many of the chain’s theaters played “The Force Awakens” 24 hours a day for days on end.
The results were the first for Aron, formerly the chief of Starwood Hotels, who joined AMC in December.
In the latest period, food and beverage revenues per patron increased 6.5% to $4.75, the company’s highest level ever. Average ticket price increased 2.4% and attendance grew 5.8%.
Aron also touted AMC’s role at the Oscar awards last night. AMC owns half of Open Road Films, the production company behind “Spotlight,” which capped Oscar night as the surprise winner of the Best Picture statue.
“This success with ‘Spotlight’ gives us a pedigree, which we suspect would improve the financial success of Open Road,” Aron said.
AMC reported earnings of $41.6 million, or 42 cents per share, up from $29.8 million, or 30 cents a share, during the same period a year ago. Adjusted earnings were 43 cents per share, beating the consensus estimate on Wall Street for 40 cents.
Revenue rose to $783.86 million, short of the consensus estimate for $801.75 million.