AMC Entertainment has used at-the-market stock offerings in the past to raise fresh capital. The latest share issue follows AMC Entertainment converting AMC Preferred Equity Units, or so-called APEs, into the company’s common shares.
The exhibition giant has reiterated in recent announcements that it must keep raising fresh cash to run its business. In the last year, AMC raised $418 million in new equity and retired $548 million of debt since creating the APE units for financial markets. The latest fresh capital raise attempt at AMC Theatres will be watched for clues as to just how much the U.S. exhibition sector has gained from a Hollywood box office rebound at the multiplex as the COVID-19 crisis has faded but the streaming revolution continues. AMC investors are also continuing to face a volatile share price for the cinema giant, given its strong backing from retail investors, current box office trends and its high debt load.
In early 2021, AMC Theatres became a popular stock among “meme” traders after the company appeared close to bankruptcy amid the pandemic fallout at movie theater chains. The stock surge helped the company strengthen its financial position and diversify its revenue streams — the latest initiative is starting to sell branded microwave and ready-to-eat movie popcorn varieties, initially at Walmart.