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Investing.com - Benchmark maintained its Hold rating on AMC Entertainment (NYSE:AMC) ahead of the company’s upcoming earnings report on August 6. The theater chain, which generated $4.55 billion in revenue over the last twelve months, continues to face challenges with profitability and cash management according to InvestingPro data.
The research firm significantly raised its quarterly revenue forecast for AMC to $1,329 million, up from its previous estimate of $1,140 million, based on industry data showing stronger-than-expected theater attendance.
Benchmark estimates AMC delivered nearly 37% year-over-year domestic admission growth per screen in the second quarter, substantially exceeding its prior projection of 12.5% growth.
The firm also revised its adjusted EBITDA forecast upward to $154 million from $75 million previously, reflecting the improved revenue outlook.
Benchmark now anticipates AMC’s adjusted EBITDA margin will reach 11.6% for the quarter, a substantial improvement from its earlier estimate of 6.6%.
In other recent news, AMC Entertainment has made significant financial strides with the announcement of a debt restructuring agreement aimed at strengthening its balance sheet. This agreement involves approximately $223 million in new financing, primarily to refinance debt maturing in 2026, and the immediate conversion of at least $143 million of existing debt into equity. Additionally, the company plans to redeem its outstanding 2026 notes, contingent on the completion of a private offering expected to generate $223 million in gross proceeds. In a move to further stabilize its financial position, AMC has entered into a Transaction (JO:NTUJ) Support Agreement with key creditor groups, resolving ongoing litigation and securing support from a significant portion of its noteholders.
AMC has also seen a positive outlook from analysts, with Wedbush upgrading the stock from Neutral to Outperform, citing a more consistent film release schedule and strategic expansion plans. The analyst highlighted AMC’s premium screen advantage and noted that the company has addressed near-term debt concerns. The theater chain plans to close underperforming locations and invest in its most productive theaters, with revenue per screen already surpassing 2019 levels. AMC’s CEO, Adam Aron, emphasized the company’s improved box office performance and projected strong growth in the coming years. These developments indicate a strategic focus on financial recovery and operational efficiency for AMC Entertainment.
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