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The surge in AMC Entertainment’s stock price has been good for Imax’s business, Imax CEO Richard Gelfond said on Monday.
“AMC is our partner, not our competitor,” Gelfond said on “Squawk Box”. “I think their rating is driven by their fan base and their fan base likes Adam Aron, and they love the asset and they’ve pushed this stock to higher valuation ranges – and, you know, that’s is good for them. We have been a beneficiary of that because they are our partner. They are rolling out a lot of screens in the future and their liquidity is good for us. “
Imax, with operations in 84 countries and territories, has an “asset-type model” with no real estate deals or net debt, making it a “totally different type of business” from AMC, Gelfond said.
AMC shares have climbed around 2,000% this year in a frenzy mostly driven by equity-obsessed retail traders. AMC raised new capital during the surge, including June share sales of $ 230.5 million to Mudrick Capital Management and $ 587.4 million as part of an additional share offering.
The chain of theaters announced at the beginning of last week that it would not seek to issue more shares after the opinion of its shareholders. This prompted Loop Capital Markets to say that investors are making a “huge mistake” as shareholders are generally not in favor of more stock offerings as more stocks can dilute the value of current holdings.
Gelfond’s comments came after a record-breaking Covid-era theatrical release of Marvel’s “Black Widow”, which won $ 80 million at the domestic box office when it debuted in 4,100 theaters. About 81% of theaters were open to the public throughout the weekend, according to data from Comscore.
The domestic release surpassed ticket sales for Universal’s “F9” which received $ 70 million when it launched at the box office last month, which replaced revenue from “A Quiet Place Part II”.
“Black Widow” grossed $ 78 million in international ticket sales outside of North America.
“It’s a very good predictable model,” said Gelfond. “I always said it wouldn’t be a switch. It won’t be someday that we get back to normal. It’s more of a faucet. From my perspective, it looks like the faucet is working just fine.”
Imax made $ 12 million worldwide, including North America, on “Black Widow” over the weekend. In a press release, the company said the hit film “broke pandemic era records for Imax across the board.”
Walt Disney also reported more than $ 60 million in global sales for “Black Widow” through Disney + Premier Access, marking the first time that Disney has reported concurrent streaming revenue. However, Dsney’s next Marvel movie “Shang-Chi and the Ten Rings” will only be released in theaters.
Going forward, Gelfond believes the theater industry will consolidate more around films like “Black Widow,” with mid-tier and smaller films released only through streaming.
“I think the mix in the multiplexes will change in terms of the type of movies, but the blockbusters are going to boost the activity of the multiplexes, and certainly the activity of Imax,” said Gelfond.
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