National CineMedia extends AMC advertising deal to 2042

National CineMedia, Inc. (NASDAQ:NCMI), a leader in cinema advertising, has entered into a significant agreement with American Multi-Cinema, Inc. (AMC) that extends and modifies their existing partnership. According to InvestingPro analysis, while NCMI has faced profitability challenges in recent quarters, analysts project a return to profitability this year. Announced today, the Second Amended and Restated Exhibitor Services Agreement (2025 AMC Agreement) prolongs the collaboration through February 13, 2042.

The new agreement, effective from July 1, 2025, revises the payment structure between National CineMedia, LLC (NCM LLC), the operating unit of National CineMedia, Inc., and AMC. The company’s strong financial position, with liquid assets exceeding short-term obligations and a healthy cash-to-debt ratio as reported by InvestingPro, positions it well for this long-term commitment. Payments will now be based on several factors including theater attendance, operating screens, and revenue generated from advertising in AMC theaters. Additionally, AMC will compensate NCM LLC for on-screen advertising time linked to AMC’s beverage concessionaire commitments.

Under the 2025 AMC Agreement, NCM LLC retains the exclusive rights to display third-party advertising in AMC theater lobbies, with plans to modernize the lobby video screen network. The Pre-Feature Program Show Structure will also be adjusted to align with NCM LLC’s advertising network, affecting the timing and amount of advertising display.

The announcement follows a Termination Agreement in which AMC relinquished its rights and interests in several joint venture agreements with NCM LLC and waived any claims against NCM LLC and National CineMedia, Inc. This agreement also includes the dismissal of ongoing litigation related to NCM LLC’s Chapter 11 plan confirmation.

National CineMedia is set to discuss the anticipated positive impact of the 2025 AMC Agreement on its business during the Q1 2025 earnings call scheduled for May 6, 2025, at 5:00 pm ET. Investors seeking deeper insights into NCMI’s financial health and growth prospects can access comprehensive analysis and additional ProTips through InvestingPro’s detailed research reports, which transform complex Wall Street data into actionable intelligence.

The details of the 2025 AMC Agreement and Termination Agreement will be provided in the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ending March 27, 2025. This strategic move aims to strengthen National CineMedia’s position in cinema advertising by cementing a long-term partnership with AMC, one of the largest movie theater chains in the world.

This news is based on a recent SEC filing by National CineMedia, Inc.

In other recent news, National CineMedia reported its fourth-quarter 2024 earnings, revealing revenue of $86.3 million, which slightly exceeded guidance. Despite a decrease in full-year revenue to $240.8 million from $259.8 million in 2023, the company improved its free cash flow significantly to $54.5 million from a negative $48.8 million the previous year. Benchmark analysts maintained their Buy rating and $8.00 price target for the company, noting strong fourth-quarter advertising performance and disciplined cost management. The analysts highlighted a promising outlook for 2025, with projected box office revenue growth and anticipated expansion in the advertising market. Additionally, National CineMedia made adjustments to its equity structure, increasing its ownership in its subsidiary to 100% and amending its bylaws to streamline governance. The company is also advancing its advertising technology with the launch of NCMx, a programmatic buying platform, and plans to reinstate dividends in 2025 alongside a $100 million buyback program. These developments reflect National CineMedia’s strategic efforts to enhance its market position and financial health.

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