(Reuters) – AMC Entertainment Holdings Inc said the roll-out of COVID-19 vaccines and the release of major movies, including Walt Disney Co’s “Black Widow”, would boost sales this year, sending the company’s shares up 9%.
AMC’s shares have more than doubled in the last 12 months, with the recent surge coming as a result of being one of the so-called “stonks” – a term used to describe stocks with convoluted prospects that are popular with retail traders on online forums.
The health crisis devastated the film industry last year, forcing AMC and its rivals to raise new capital to stay afloat, but analysts polled by Refinitiv expect AMC’s revenue to more than double this year.
“For all the talk of the steps we at AMC have taken to bolster our position, the real salvation of our company will be because of vaccination,” Chief Executive Officer Adam Aron told analysts.
The cinema chain’s move to implement COVID-19 safety protocols encouraged more than eight million customers to return to its theaters during the fourth quarter, AMC said.
AMC added several major releases that were delayed would hit AMC’s big screens May onwards, with films such as “Godzilla vs. Kong”, “Top Gun: Maverick”, “Black Widow” and “F9” expected to boost sales in the coming months.
The cinema chain in recent weeks reopened many theaters, with about 90% of its U.S. theaters open as of Friday. It expects its European theaters to reopen in time for major releases.
“Our focus is no longer on survival, but now has turned instead to directing a surge in movie-going and on the recovery of AMC,” Aron said.
AMC’s fourth-quarter revenue slumped 88.8% to $162.5 million, beating estimates of $142.4 million, according to Refinitiv IBES. Excluding items, AMC lost $3.15 per share, smaller than expectations for a loss of $3.16 per share.
(Reporting by Eva Mathews and Praveen Paramasivam in Bengaluru; Editing by Shounak Dasgupta and Amy Caren Daniel)
