Attached files

file filename
8-K - 8-K - AMC ENTERTAINMENT HOLDINGS, INC.a14-6629_18k.htm

Exhibit 99.1

 

GRAPHIC

 

AMC ENTERTAINMENT HOLDINGS, INC. ANNOUNCES FOURTH QUARTER AND FULL YEAR 2013 RESULTS

 

Leawood, Kan. — February 25, 2014 (BUSINESS WIRE) — AMC Entertainment Holdings, Inc. (“AMC” or “the Company”), one of the world’s largest theatrical exhibition companies and an industry leader in innovation and operational excellence, today reported results for the fourth quarter and full year ended December 31, 2013.

 

Gerry Lopez, AMC’s president and chief executive officer, stated, “Our strong operating results in 2013 give us confidence that our strategy, as laid out during the recent initial public offering (“IPO”) is working. Our year-over-year revenue improvement in 2013 was fueled by the progress we are making in our efforts to further set ourselves apart as the guest experience leader in movie exhibition. Our five strategic action fronts, led by innovations in comfort and convenience as well as our enhanced food and beverage offerings, are changing industry standards. These initiatives drove improved performance, and in combination with our expense-management focus, also produced adjusted EBITDA gains for the year. These results demonstrate the strength of our differentiated business model, heightened brand awareness, and solid execution by our entire team at AMC.”

 

Mr. Lopez continued, “With the extremely robust AMC Stubs membership loyalty program as an anchor, we delivered record revenues and our revenue growth outpaced the domestic box office performance. Furthermore, with the completion of our IPO and the subsequent refinancing of a significant portion of our outstanding debt, we have increased our financial flexibility. This will enable us to continue to reinvest in our business and receive a high return on project investments that both enhance our guests’ experience, and our long-term overall profitability.”

 

Quarter Results

 

AMC’s revenues for the three months ended December 31, 2013 increased 2.3% to $713.0 million, compared to $697.0 million for the three months ended December 31, 2012. For the three months ended December 31, 2013, admissions revenues increased 2.1% and food and beverage revenues increased 0.3%, driven by a 5.5% increase in average ticket price, and a 3.7% increase in food and beverage revenues per patron, offset somewhat by a 3.2% decline in attendance.

 

Adjusted EBITDA for the three months ended December 31, 2013 was $112.9 million compared to $114.8 million for the three months ended December 31, 2012. The current quarter was negatively impacted by additional expenses of $3.8 million, (compared to $1.3 million in the prior period) related to a cash-based management profit sharing plan which was terminated at December 31, 2013 and $3.2 million related to a voluntary retirement program both of which were undergone in connection with the company’s IPO. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.

 

-more-

 



 

Quarter Results (cont.)

 

Net earnings attributable to AMC for the three months ended December 31, 2013 was $279.6 million compared to $0.4 million for the three months ended December 31, 2012. Diluted earnings per share for the three months ended December 31, 2013 was $3.58 compared to $0.00 for the three months ended December 31, 2012. Net earnings attributable to AMC for the three months ended December 31, 2013 included reversal of a non-cash deferred tax asset valuation allowance of $265.6 million, or $3.40 per share on a diluted basis.

 

Full Year Results

 

As a result of the August 30, 2012 Wanda merger, we do not have comparable financial results for the period December 30, 2011 through August 30, 2012. In order to present investors a meaningful period-to-period comparison of our financial results, we have combined the prior year Predecessor with prior year Successor operating information, on an unaudited pro forma combined basis. The pro forma information for the calendar year ended December 31, 2012 does not purport to represent what our consolidated results of operations would have been if the Successor had actually been formed on December 30, 2011 (the first day of that fiscal year), nor have we made any attempt to either include or exclude expenses or income that would have resulted had the Successor been formed on December 30, 2011. In addition, this pro forma information is not presented in accordance with GAAP; for a presentation of our GAAP results of operations, see the “predecessor” and “successor” information for 2012 provided in the financial schedules accompanying this press release.

 

AMC’s revenues for the year ended December 31, 2013 increased 3.6% to $2,749.4 million from $2,654.0 million for the year ended December 31, 2012, which included two additional days due to change in accounting periods. For the year ended December 31, 2013, admissions revenues increased 3.2% and food and beverage revenues increased 5.8%, primarily due to a 3.0% increase in average ticket price and a 5.6% increase in food and beverage revenues per patron.

 

Adjusted EBITDA for the year ended December 31, 2013 increased 2.2% to $448.1 million from $438.3 million for the year ended December 31, 2012 and was negatively impacted by additional expenses of $11.3 million, (compared with $2.6 million in the prior period) related to a cash-based management profit sharing plan which was terminated at December 31, 2013 and $3.2 million related to a voluntary retirement program both of which were undergone in connection with the company’s IPO.

 

Net earnings attributable to AMC for the year ended December 31, 2013 increased to $364.4 million from $46.0 million for the year ended December 31, 2012. Diluted earnings per share for the year ended December 31, 2013 was $4.76 compared to $0.68 for the year ended December 31, 2012. Net earnings attributable to AMC for the year ended December 31, 2013 included reversal of a non-cash deferred tax asset valuation allowance of $265.6 million, or $3.47 per share on a diluted basis.

 

As of December 31, 2013, the Company’s aggregate screen count was 4,976. During 2013, the Company opened one new theatre with a total of 12 screens and acquired four theatres with 37 screens in the U.S., permanently closed four theatres with 29 screens in the U.S., and temporarily closed 371 screens and reopened 339 screens in the U.S. to implement our strategy and install guest experience upgrades.

 

-more-

 



 

Public Offering

 

On December 23, 2013, the Company closed its IPO, including the full exercise of the underwriter’s option to purchase additional shares of 21,052,632 shares of Class A common stock at $18.00 per share. The net proceeds to the Company were approximately $355.3 million after deducting underwriter discounts and commissions, and offering expenses.

 

Subsequent Events

 

On February 7, 2014, the Company completed the private offering of $375.0 million aggregate principal amount of senior subordinated notes due 2022 (the “Notes”). The Notes were sold to investors at a price of 100.000% of the principal amount thereof and bear interest at a rate equal to 5.875% per annum.

 

In conjunction with the offering of the notes, on February 14, 2014 the Company completed a tender offer (“the Tender Offer”) and acquired $463.9 million, or approximately 77.3%, of its outstanding 8.75% Senior Notes due 2019. The Company expects to call the remaining $136.1 million of untendered notes in June of 2014.

 

Upon completion of the offering of the Notes and Tender Offer, the Company had total debt outstanding of approximately $2.0 billion, with a weighted average interest rate of 6.6% per annum. The Company has no debt maturing during the remainder of 2014.

 

Conference Call / Webcast Information

 

The Company will host a conference call via live webcast for investors and other interested parties beginning at 5 p.m. Eastern Time today. Participants may access the live webcast by visiting the Company’s investor relations website at investor.amctheatres.com. The call can also be accessed by dialing (877) 407-3982, or (201) 493-6780 for international participants.

 

The replay of the call will be available from approximately 8 p.m. Eastern Time today through midnight Eastern Time on March 11, 2014.  To access the replay, the domestic dial-in number is (877) 870-5176, the international dial-in number is (858) 384-5517, and the passcode is 13576163. The archive of the webcast will be available on the Company’s website for a limited time.

 

About AMC Entertainment Holdings, Inc.

 

AMC Theatres® delivers distinctive and affordable movie-going experiences at 345 theatres and 4,976 screens primarily in the United States. AMC has propelled a history of industry innovation and continues today by delivering comfort and convenience, enhanced food and beverage, guest engagement and loyalty, premium sight and sound and targeted programming to audiences in its theatres across the United States.

 

-more-

 



 

Forward-Looking Statements

 

This press release includes “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “forecast,” “estimate,” “project,” “intend,” “expect,” “should,” “believe,” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward looking statements include any statements regarding the Company’s strategic and operational plans. Forward looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved.

 

Forward looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward looking statements. For a detailed discussion of these risks and uncertainties, see the section entitled “Risk Factors” in the final prospectus contained in our Registration Statement on Form S-1 filed with the Securities and Exchange Commission on December 19, 2013. The Company does not intend, and undertakes no duty, to update this information to reflect future events or circumstances, except as required by applicable law.

 

Media Contacts - AMC Entertainment Holdings, Inc.:

Jessica Liddell

(203) 682-8200

Jessica.Liddell@icrinc.com

 

Investor Relations - AMC Entertainment Holdings, Inc.:

Dan Foley

(866) 248-3872

InvestorRelations@amctheatres.com

 

-more-

 



 

AMC Entertainment Holdings, Inc.

Consolidated Statements of Operations

For the Fiscal Quarters and Four Quarters Ended 12/31/13 and 12/31/12

(dollars in thousands, except per share data)

(Unaudited)

 

 

 

Quarter Ended

 

Four Quarters Ended

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

 

 

 

Pro Forma

 

 

 

2013

 

2012

 

2013

 

2012

 

Revenues

 

 

 

 

 

 

 

 

 

Admissions

 

$

482,149

 

$

472,276

 

$

1,847,327

 

$

1,790,489

 

Food and beverage

 

197,886

 

197,374

 

786,912

 

743,468

 

Other theatre

 

32,942

 

27,336

 

115,189

 

120,050

 

 

 

 

 

 

 

 

 

 

 

Total Revenues

 

712,977

 

696,986

 

2,749,428

 

2,654,007

 

 

 

 

 

 

 

 

 

 

 

Operating costs and expenses

 

 

 

 

 

 

 

 

 

Film exhibition costs

 

258,187

 

256,902

 

976,912

 

949,291

 

Food and beverage costs

 

27,293

 

25,767

 

107,325

 

100,491

 

Operating expense

 

192,582

 

184,375

 

726,641

 

699,114

 

Rent

 

112,615

 

109,881

 

451,828

 

443,179

 

General and administrative:

 

 

 

 

 

 

 

 

 

Merger, acquisition and transaction costs

 

931

 

2,862

 

2,883

 

10,036

 

Management fee

 

 

 

 

3,750

 

Other

 

37,491

 

21,841

 

97,288

 

71,754

 

Depreciation and amortization

 

50,102

 

55,031

 

197,537

 

209,451

 

Impairment of long-lived assets

 

 

 

 

285

 

Operating costs and expenses

 

679,201

 

656,659

 

2,560,414

 

2,487,351

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

33,776

 

40,327

 

189,014

 

166,656

 

Other expense (income)

 

 

 

 

 

 

 

 

 

Other expense

 

(1,231

)

 

(1,415

)

2,545

 

Interest expense:

 

 

 

 

 

 

 

 

 

Corporate borrowings

 

32,259

 

35,018

 

129,963

 

155,219

 

Capital and financing lease obligations

 

2,350

 

1,431

 

10,264

 

5,751

 

Equity in (earnings) of non-consolidated entities

 

(9,292

)

(898

)

(47,435

)

(15,760

)

Investment expense (income)

 

1,322

 

291

 

(2,084

)

224

 

Total other expense

 

25,408

 

35,842

 

89,293

 

147,979

 

 

 

 

 

 

 

 

 

 

 

Earnings from continuing operations before income taxes

 

8,368

 

4,485

 

99,721

 

18,677

 

Income tax provision (benefit)

 

(274,243

)

3,400

 

(263,383

)

6,505

 

 

 

 

 

 

 

 

 

 

 

Earnings from continuing operations

 

282,611

 

1,085

 

363,104

 

12,172

 

Earnings (loss) from discontinued operations, net of income taxes

 

(2,994

)

(712

)

1,296

 

33,845

 

 

 

 

 

 

 

 

 

 

 

Net earnings

 

$

279,617

 

$

373

 

$

364,400

 

$

46,017

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share:

 

 

 

 

 

 

 

 

 

Earnings from continuing operations

 

$

3.62

 

$

0.01

 

$

4.74

 

$

0.18

 

Earnings (loss) from discontinued operations

 

(0.04

)

(0.01

)

0.02

 

0.50

 

Net earnings (loss) per share

 

$

3.58

 

$

 

$

4.76

 

$

0.68

 

 

 

 

 

 

 

 

 

 

 

Average shares outstanding diluted

 

78,092

 

76,000

 

76,527

 

67,230

 

 

-more-

 



 

Balance Sheet Data (at period end):

(dollars in thousands)

(unaudited)

 

 

 

As of

 

 

 

December 31,

 

 

 

2013

 

2012

 

Cash and equivalents

 

$

546,454

 

$

133,071

 

Corporate borrowings

 

2,078,811

 

2,078,675

 

Other long-term liabilities

 

370,946

 

433,151

 

Capital and financing lease obligations

 

116,199

 

122,645

 

Stockholders’ equity

 

1,507,470

 

766,774

 

Total assets

 

5,046,724

 

4,273,838

 

 

Other Data:

(in thousands, except operating data)

(unaudited)

 

 

 

Quarter Ended

 

Four Quarters Ended

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

 

 

 

Pro Forma

 

 

 

2013

 

2012

 

2013

 

2012

 

Net cash provided by operating activities

 

$

152,677

 

$

106,017

 

$

357,342

 

$

150,438

 

Capital expenditures

 

(96,878

)

(62,136

)

(270,884

)

(167,166

)

Screen additions

 

12

 

 

12

 

 

Screen acquisitions

 

12

 

166

 

37

 

166

 

Screen dispositions

 

 

 

29

 

60

 

Construction openings (closures), net

 

2

 

18

 

(32

)

 

Average screens-continuing operations

 

4,865

 

4,730

 

4,859

 

4,744

 

Number of screens operated

 

 

 

 

 

4,976

 

4,988

 

Number of theatres operated

 

 

 

 

 

345

 

344

 

Screens per theatre

 

 

 

 

 

14.4

 

14.5

 

Attendance (in thousands) -continuing operations

 

50,400

 

52,086

 

199,270

 

199,034

 

 

Reconciliation of Adjusted EBITDA:

(dollars in thousands)

(unaudited)

 

 

 

Quarter Ended

 

Four Quarters Ended

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

 

 

 

Pro Forma

 

 

 

2013

 

2012

 

2013

 

2012

 

Earnings from continuing operations

 

$

282,611

 

$

1,085

 

$

363,104

 

$

12,172

 

Plus:

 

 

 

 

 

 

 

 

 

Income tax provision (benefit)

 

(274,243

)

3,400

 

(263,383

)

6,505

 

Interest expense

 

34,609

 

36,449

 

140,227

 

160,970

 

Depreciation and amortization

 

50,102

 

55,031

 

197,537

 

209,451

 

Impairment of long-lived assets

 

 

 

 

285

 

Certain operating expenses (2)

 

4,194

 

6,411

 

13,913

 

16,696

 

Equity in earnings of non-consolidated entities

 

(9,292

)

(898

)

(47,435

)

(15,760

)

Cash distributions from non-consolidated entities

 

10,701

 

10,184

 

31,501

 

29,794

 

Investment expense (income)

 

1,322

 

291

 

(2,084

)

224

 

Other expense (income)

 

3

 

 

(127

)

2,882

 

General and administrative expense-unallocated:

 

 

 

 

 

 

 

 

 

Merger, acquisition and transaction costs

 

931

 

2,862

 

2,883

 

10,036

 

Management Fee

 

 

 

 

3,750

 

Stock-based compensation expense (3)

 

12,000

 

 

12,000

 

1,321

 

Adjusted EBITDA (1)

 

$

112,938

 

$

114,815

 

$

448,136

 

$

438,326

 

 


(1)We present Adjusted EBITDA as a supplemental measure of our performance that is commonly used in our industry. We define Adjusted EBITDA as earnings (loss) from continuing operations plus (i) income tax provision (benefit), (ii) interest expense and (iii) depreciation and amortization, as further adjusted to eliminate the impact of certain items that we do not consider indicative of our ongoing operating performance and to include any cash distributions of earnings from our equity method investees. These further adjustments are itemized below. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.   Adjusted EBITDA is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to net earnings (loss) as an indicator of operating performance or as an alternative to cash flow provided by operating activities as a measure of liquidity (as determined in accordance with GAAP). Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. We have included Adjusted EBITDA because we believe it provides management and investors with additional information to measure our performance and liquidity, estimate our value and evaluate our ability to service debt.

 

Adjusted EBITDA has important limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under U.S. GAAP. For example, Adjusted EBITDA:

 

·                  does not reflect our capital expenditures, future requirements for capital expenditures or contractual commitments;

·                  does not reflect changes in, or cash requirements for, our working capital needs;

·                  does not reflect the significant interest expenses, or the cash requirements necessary to service interest or principal payments, on our debt;

·                  excludes income tax payments that represent a reduction in cash available to us;

·                  does not reflect any cash requirements for the assets being depreciated and amortized that may have to be replaced in the future; and

·                  does not reflect management fees that were paid to our former sponsors.

 

(2)Amounts represent preopening expense, theatre and other closure expense, deferred digital equipment rent expense, and disposition of assets and other gains included in operating expenses.

(3) Non-cash expense included in General and administrative: Other

 

-more-

 



 

GAAP Results 2012

(dollars in thousands)

(unaudited)

 

 

 

 

 

From Inception

 

 

 

Four Quarters

 

 

 

December 30, 2011

 

March 30, 2012

 

August 31, 2012

 

Ended

 

 

 

through

 

through

 

through

 

December 31, 2012

 

 

 

March 29, 2012

 

August 30, 2012

 

December 31, 2012

 

Pro Forma

 

 

 

(Predecessor)

 

(Predecessor)

 

(Successor)

 

 

 

Revenues

 

 

 

 

 

 

 

 

 

Admissions

 

$

425,826

 

$

816,031

 

$

548,632

 

$

1,790,489

 

Food and beverage

 

171,599

 

342,130

 

229,739

 

743,468

 

Other theatre

 

39,018

 

47,911

 

33,121

 

120,050

 

 

 

 

 

 

 

 

 

 

 

Total Revenues

 

636,443

 

1,206,072

 

811,492

 

2,654,007

 

 

 

 

 

 

 

 

 

 

 

Operating costs and expenses

 

 

 

 

 

 

 

 

 

Film exhibition costs

 

221,191

 

436,539

 

291,561

 

949,291

 

Food and beverage costs

 

22,620

 

47,326

 

30,545

 

100,491

 

Operating expense

 

171,352

 

297,328

 

230,434

 

699,114

 

Rent

 

110,719

 

189,086

 

143,374

 

443,179

 

General and administrative:

 

 

 

 

 

 

 

 

Merger, acquisition and transaction costs

 

2,253

 

4,417

 

3,366

 

10,036

 

Management fee

 

1,250

 

2,500

 

 

3,750

 

Other

 

15,621

 

27,023

 

29,110

 

71,754

 

Depreciation and amortization

 

56,847

 

80,971

 

71,633

 

209,451

 

Impairment of long-lived assets

 

285

 

 

 

285

 

Operating costs and expenses

 

602,138

 

1,085,190

 

800,023

 

2,487,351

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

34,305

 

120,882

 

11,469

 

166,656

 

Other expense (income)

 

 

 

 

 

 

 

 

 

Other expense

 

1,536

 

960

 

49

 

2,545

 

Interest expense:

 

 

 

 

 

 

 

 

Corporate borrowings

 

42,346

 

67,614

 

45,259

 

155,219

 

Capital and financing lease obligations

 

1,488

 

2,390

 

1,873

 

5,751

 

Equity in (earnings) of non-consolidated entities

 

(10,695

)

(7,545

)

2,480

 

(15,760

)

Investment expense (income)

 

(25

)

(41

)

290

 

224

 

Total other expense

 

34,650

 

63,378

 

49,951

 

147,979

 

 

 

 

 

 

 

 

 

 

 

Earnings from continuing operations before income taxes

 

(345

)

57,504

 

(38,482

)

18,677

 

Income tax provision (benefit)

 

505

 

2,500

 

3,500

 

6,505

 

 

 

 

 

 

 

 

 

 

 

Earnings from continuing operations

 

(850

)

55,004

 

(41,982

)

12,172

 

Earnings (loss) from discontinued operations, net of income taxes

 

(620

)

35,153

 

(688

)

33,845

 

 

 

 

 

 

 

 

 

 

 

Net earnings

 

$

(1,470

)

$

90,157

 

$

(42,670

)

$

46,017

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share:

 

 

 

 

 

 

 

 

 

Earnings from continuing operations

 

$

(0.01

)

$

0.86

 

$

(0.56

)

$

0.18

 

Earnings (loss) from discontinued operations

 

(0.01

)

0.55

 

(0.01

)

0.50

 

Net earnings (loss) per share

 

$

(0.02

)

$

1.41

 

$

(0.57

)

$

0.68

 

 

 

 

 

 

 

 

 

 

 

Average shares outstanding diluted

 

63,335

 

63,715

 

74,988

 

67,230

 

 

###