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AMC Entertainment Holdings, Inc. Announces Second Quarter 2016 Results

AMCAMC Entertainment Holdings, one of the world’s leading theatrical exhibition companies and an industry leader in innovation and operational excellence, reported results for the second quarter ended June 30, 2016.

Highlights for the second quarter 2016 include the following:

  • Total revenues were $764.0 million compared to total revenues of $821.1 million for the three months ended June 30, 2015.
  • Admissions revenues were $481.2 million compared to $533.4 million for the same period a year ago. Average ticket price was $9.63 compared to $9.91 for the same period a year ago.
  • Food and beverage revenues were $243.5 million, compared to $250.5 million for the quarter ended June 30, 2015. Food and beverage revenues per patron increased 4.7% to an all-time high record of $4.87. This quarter marks nine of the last ten quarters AMC has set an all-time high record in food and beverage per patron.
  • Net earnings were $24.0 million and diluted earnings per share (“diluted EPS”) were $0.24 compared to $43.9 million and $0.45, respectively, for the three months ended June 30, 2015.
  • Adjusted diluted earnings per share (1) were $0.24 compared to $0.48 for the three months ended June 30, 2015. Included in adjusted diluted earnings per share for the three months ended June 30, 2016 was approximately $5.5 million of merger and acquisition costs.
  • Adjusted EBITDA(1) was $129.6 million compared to $157.8 million for the three months ended June 30, 2015. Adjusted EBITDA Margin (1) for the second quarter was 17.0% compared to 19.2%, for the same period a year ago.
  • Adjusted Free Cash Flow(1) for the quarter ended June 30, 2016 was $40.8 million compared to $68.8 million for the quarter ended June 30, 2015.

“It would ordinarily be difficult to be pleased with a quarter in which a lackluster film slate caused us to share in the industrywide box office revenue decline that was down domestically some 10.7% per screen year-over-year. However, we are encouraged that this trend has already reversed itself with industry box office revenues up more than 7% as of July 29th, and a potentially record setting film slate being close at hand for calendar year 2017,” said Adam Aron, AMC Chief Executive Officer and President.

Aron added, “However, of far greater importance in our view, things that were within our control tell a much different story for AMC. We made progress at AMC in the second quarter in four significant ways. First, our theatre renovations featuring recliner seats, premium large format auditoriums and a refreshed overall decor continued to lead the industry, enhancing our appeal to consumers. Second, thanks to continuing our innovation of the AMC theatre experience, food and beverage revenues per patron were an all-time record for us. Third, we wholly revamped our already popular AMC Stubs® loyalty program, and tested it in 40 theatres in 6 markets. The test was so successful that we have already rolled out the new program nationally across our entire network. Moviegoers are signing up to enroll in the new AMC Stubs® loyalty program at a rate 2 to 3 times than that for the previous program, and the number of our total active members is already up approximately 20% in just a few short months. We believe membership should continue to increase at a brisk pace, and this augers brightly for AMC’s future. And fourth, our executives and staff worked tirelessly to put us in a position to announce in July our acquisition of Odeon & UCI Cinemas in Europe as well as a new merger agreement with Carmike Cinemas here in the United States. When either of these acquisitions close, AMC then becomes overnight the largest movie exhibitor in the world. Taken together, this level of activity and progress is almost breathtaking, enabling AMC to be uniquely positioned to deliver additional value to our guests, associates and shareholders.”

Highlights for the six months ended June 30, 2016 include the following:

  • AMC set all-time high records for the six months ended June 30th period for all revenue segments: total revenues, admissions revenues, food and beverage revenues and other revenues.
  • Total revenues increased 3.8% to $1,530.0 million compared to total revenues of $1,474.2 million for the six months ended June 30, 2015.
  • Admissions revenues grew 1.2% to $963.8 million compared to $952.1 million for the six months ended June 30, 2015. Average ticket price was $9.52 compared to $9.66 for the six months ended June 30, 2015 and attendance grew 2.7% to more the 101 million guests.
  • Food and beverage revenues increased 8.1% to $487.7 million, compared to $451.0 million for the six months ended June 30, 2015. Food and beverage revenues per patron increased 5.2% to a new six month record of $4.82.
  • Net earnings increased 4.4% to $52.3 million and diluted earnings per share grew 3.9% to $0.53 compared to $50.1 million and $0.51, respectively, for the six months ended June 30, 2015.
  • Adjusted diluted earnings per share (1) increased 18.6% to $0.51 compared to the six months ended June 30, 2015. Included in adjusted diluted earnings per share for the six months ended June 30, 2016 was approximately $10.2 million of merger and acquisition costs.
  • Adjusted EBITDA(1) grew 0.9% to $276.0 million compared to $273.5 million and Adjusted EBITDA Margin(1) was 18.0%, compared to 18.5% for the six months ended June 30, 2015.
  • Adjusted EBITDA(1) for the six months ended June 30, 2015, benefited from an $18.1 million gain related to the termination of a post-retirement health benefit plan which caused our net periodic benefit costs to be much lower than normal in the prior year. The gain was recorded as a reduction of general and administrative: other expense. Excluding this gain in the prior year period, Adjusted EBITDA growth, year-over-year for the six months ended June 30, 2016, would have shown an improvement of approximately 8.1%, and Adjusted EBITDA Margin improvement of 70 basis points from 17.3% to 18.0%.
  • Adjusted Free Cash Flow(1) for the six months ended June 30, 2016 increased approximately $25.0 million, or 28.4%, to $112.9 million compared to $87.9 million for the six months ended June 30, 2015.

    (1) (Reconciliations and definitions of non-GAAP financial measures are provided in the financial schedules accompanying this press release.)

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