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Investors will receive one preferred share for each share of common stock they own.
Jeenah Moon/Bloomberg
AMC Entertainment
finally giving the “monkeys” what they want. The movie theater company tied its second-quarter earnings report with news that it is giving shareholders a special dividend of AMC Preferred Equity Units.
AMC’s preferred stock will trade on the New York Stock Exchange under the ticker symbol “APE” beginning August 22. AMC (stock: AMC ) said it will issue 516.82 million APE shares—one for every share of outstanding common stock. The preferred stock will be convertible into common stock, but only if AMC stockholders vote to increase the number of authorized shares of common stock. AMC withdrew a shareholder request last year to increase its potential share count, citing a lack of investor support.
The Wall Street Journal, citing a person familiar with the matter, reported that the preferred equity units would allow the company to work around restrictions placed on the sale of common stock. The firm could sell an additional 4.5 billion APE units after it distributes the initial 517 million, the Journal notes. AMC struggled through the pandemic, selling millions of shares in 2021 to help stay afloat as theaters remained closed.
The special dividend will go to shareholders of record on August 15 and will be paid at the close of business on August 19. The ex-dividend date is August 22. If you sell your AMC shares from Aug. 16 to Aug. 22, the person you sold to is entitled to the preferred stock, although AMC suggests investors trading during this period consult their broker.
A non-tradable share or dividend token has been a popular demand among some AMC shareholders on sites like Twitter and Reddit. Such users, who call themselves “monkey” often spread conspiracy theories about fake AMC and
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the shares. The newspaper, citing the person in the know, reported that the company hopes that the dividend, which will be given to legitimate shareholders, will put an end to such theories about fake shares. Shareholders on AMC’s Investor Connection Page will also receive an NFT.
A spokesman for AMC did not return a request seeking comment on the Gazette’s report.
AMC CEO Adam Aron in the announcement called the preferred dividend exclusively for shareholders “perhaps the single largest action we will take in all of 2022 to fundamentally strengthen AMC for the long term.”
“This new AMC preferred capital gives AMC a currency that can be used in the future to strengthen our balance sheet, including paying down debt or raising new capital,” Aron said. “As a result, this dramatically reduces any short-term survival risk for AMC as we continue to work our way through this pandemic.”
AMC also reported a second-quarter net loss of $121.6 million, or 24 cents per share on revenue of $1.2 billion. Analysts had expected sales of $1.17 billion, according to FactSet. The firm’s non-GAAP net loss was 20 cents per share and topped consensus estimates for an adjusted loss of 23 cents per share, according to FactSet. Aron noted that his investment in Nevada gold and silver miner Hycroft Mining ( HYCM ) led to writedowns. Hycroft shares fell more than 48% during the quarter.
Aron noted that AMC’s global attendance reached 59 million people, up 168% from the second quarter of 2021. He also said that food and beverage revenue per customer was $7.52, up from $5.58 in the comparable pre-pandemic quarter of 2019.
AMC stock fell 4.9% in after-hours markets.
Write Connor Smith at [email protected]