AMC blames loss on pics' perf
$8 mil loss in quarter significantly deeper than expected
Just a day earlier, No. 1 U.S. circuit Regal Entertainment had said its better-than-anticipated financial results came despite "minimal" box office improvement over the June-through-September period (Daily Variety, Oct. 22). The observations come despite a 13% uptick in year-to-date B.O. as the summer ended weakly, and September moviegoing is always a little limp.
But AMC's $8 million loss in the quarter was significantly deeper than anticipated. Kansas City, Mo.-based company reported an $8.6 million profit in the same period a year ago.
Revenue dipped 4% to $451.1 million on a pro forma basis that assumes recently acquired General Cinema and Gulf States screens had been part of the circuit a year earlier.
Execs said in a conference call with press and analysts that stiffer competish hurt attendance in some markets including L.A. and San Francisco, where rivals recently opened several new theaters.
Canuck investment
Meanwhile, Canadian financier Gerald Schwartz's Onex, which operates rival circuits including the large Loews Cineplex chain, has disclosed making a 7% investment in AMC.
The exhibition industry has been undergoing dramatic consolidation of disparate circuits, so it's tempting to view Schwartz's AMC investment as the first sign of a possible move to size up Onex's theater holdings. But the type of regulatory filing Onex used to disclose its AMC stake signals only a passive investment and not an acquisition maneuver.
AMC shares have fallen more than 33% this year, so company insiders see the Schwartz move -- disclosed in a filing circulated late Monday -- as a simple investment in under-valued assets. They were valued even less by sesh's end Tuesday, as AMC shares fell 3¢ to $7.79.
