AMC Theatres parent AMC Entertainment pulled the curtain back on a strong first quarter, boosted by a solid start to this year’s box office.
After markets closed Monday, AMC reported revenue of $1.28 billion and earnings of 7 cents a share for the three months ended March 31. That topped the $766 million in revenue and earnings of 27 cents a share the company reported for the same time last year. Analysts had estimated revenue of $1.25 billion and earnings of 7 cents a share on average.
“AMC is off to a tremendous and record start in 2017,” AMC CEO and President Adam Aron said in a statement. “AMC’s ability to purposefully act on the opportunities and innovations that drive growth continues to set us apart and further solidifies our leadership position among movie-theatre operators in the U.S. and Europe. Achieving record first quarter 2017 Adjusted EBITDA of $251.3 million is tangible evidence of what we have been saying for the better part of a year, that the earnings power of this new incarnation of a larger and more influential AMC is enormous compared to other operators and even to our own recent past.”
AMC benefited from a strong start to the year at the box office, as the domestic theatrical gross for the first quarter jumped nearly 10 percent year-over-year, led by smash hits like Universal’s “Get Out” and Disney’s “Beauty and the Beast” — which has gone on to gross nearly $1.2 billion worldwide.
However, acquisition costs were largely responsible for AMC’s dip in profitability, as the chain got even bigger in the first quarter. Last month, AMC issued guidance informing investors that depreciation and amortization, interest and acquisition expenses for the quarter will exceed comparable costs for the first quarter of 2016 because of its recent purchases. Since China’s Dalian Wanda Group — owned by the country’s richest man, Wang Jianlin — acquired AMC in 2012, marking one of the first major China-Hollywood cross-border deals, the theater chain has been on a buying spree.
In March, AMC completed its acquisition of Scandinavian chain Nordic Cinema Group in a $964 million deal, making it the first exhibitor to have more than 1,000 theaters and more than 11,000 total screens. Nordic was folded into Odeon Cinemas Group, the London-based cinema company AMC acquired in November for $1.2 billion which made it the world’s largest movie theater company. In December, AMC bought the U.S.’ No. 4 chain, Carmike Cinemas. AMC plans to re-brand Carmike’s theaters under the AMC name, with smaller venues being renamed AMC Classic.
AMC’s stock dipped slightly in advance of its earnings release, dropping 1 percent to close at $28.80. The company will hold a conference call at 5 p.m. ET to discuss the earnings.