HOW TO DEMOLISH SHAREHOLDERS: A FULL ANALYSIS OF BUSINESS PERFORMANCE - PART 1
In today’s episode of Exposing AMC Wallstreet shills we gonna talk about the three most common narratives from the seemingly unbreakable protectors of every action of CEO ADAM ARON.
In today’s episode of "Exposing #AMC Wallstreet shills" we gonna talk about the three most common narratives from the seemingly unbreakable protectors of every action of CEO Adam Aron
Why is the AMC price so low? Because it is being manipulated by market makers & hedge funds. It’s definitely not the result of the poor decisions & actions of CEO Adam Aron.
Without diluting the stock, AMC would have been bankrupt. That’s why dilution is "good" & necessary.
CEO Adam Aron is a good CEO because he creates shareholder value & he improves the business.
ADAM "ANTARA" "66 CENTS" ARON - THE DILUTION KING
But before we dive into that narratives presented by CEO Adam Aron Astroturfers (PR Campaign Apes), I want you to ask yourself these simple questions:
Has Kenny the power over #AMC’s profitability? No. Who has? CEO Adam Aron.
Has Kenny the power over #AMC’s business contracts? No. Who has? CEO Adam Aron.
Has Kenny the power to take on toxic company debt? No. Who has? CEO Adam Aron.
Has Kenny the power to sell off #AMC property? No. Who has? CEO Adam Aron.
Has Kenny the power to spend the companies’ cash? No. Who has? CEO Adam Aron.
I assume, that for a reasonable person, it should be clear now, that the power a CEO has over a company exceeds many times the price manipulative power a market maker has over a company. Theoretically Kenny can naked short #AMC as long & as hard as he wants, not having the capability to demise their business profits.
Farewell, but we are NOT going to look at the #AMC share price. We will challenge EVERY ASPECT OF POWERS of powers a CEO has – a market maker & naked short seller like Kenny do NOT have.
Lets take a closer look into some charts & business topics only CEO Adam Aron has authority over, because of course CEO Adam Aron cares about you, your money, & your future. As he said on July 6th 2021 in his Tweet:
ADAM ARON TWEET July 6, 2021
First we are going to analyze the chart – “Net Earnings Per Quarter”.
#AMC Net earnings per quarter
Well according to this chart, it seems that #AMC had already a serious cold before COVID-19 came.
Every point above the blue line is in the profit zone & every point below that line is in the LOSSES zone.
Yes of course COVID-19 had a serious impact on the business fundamentals – but the company was unprofitable before that time. Its clearly to see.
From 2016 Q1 – 2019 Q4- PREPANDEMIC LEVELS!
Sum of Profitable quarters = $209,367,000
Sum of UNPROFITABLE quarters = -$623,900,000
CEO Adam Aron came, made his Apollo magic – & the profits were….down the toilet. But that is not quite correct. He was just funneling the money from shareholders to debtholders – from A to B. Transfer of wealth – remember?
To be completely fair, how could the company survive if not taking more debt?
If you ask that question, I assume you have no business & life experience at all. In your personal household – if you spent more than you can afford FOR YEARS – would you continue to take on more credit card debt? Or would you cut your spending? If its about survival, you have to cut your spending. You have to shut down theaters, quitting jobs, making hard business decisions.
But hey, this is not the case for Adam. If you have rich parents, you just go & take the money from your parents, right? Or as CEO Adam Aron said so well on May 5, 2021:
“…capitalize on the opportunities ahead.”
Has Adam cut spending at #AMC? Lets take a look…
#AMC RENT COSTS PER QUARTER
Interesting, so the costs of “Rent” increased since Adam took over with the aggressive growth strategy & of course because of so called “leaseback agreements”.
That means #AMC sells own property to lease that property than – it would be the same if you sell your house, you stay in that house & pay then rent. What a brilliant business idea – isn’t it? I mean, c’mon, this is GENIUS!
The Rent costs decreased during COVID-19 – it means, the landlords gave #AMC any room to reduce the rent while Theaters were closed. Landlords deferred 450 million in rent costs. That doesn’t mean #AMC has not to pay, but they have more time to pay the full rent they owe. But maybe this chart is unfair – #AMC has nearly doubled their screens since 2016, so lets take a look at the rent per dcreen operated.
#AMC RENT COSTS PER QUARTER PER SCREEN OPERATED
That is interesting – isn’t it? I mean, look how the “Rent Per Screen Operated” reaches 2016/2019 figures again DURING the Pandemic – Q1 2021…
so at this field of competence CEO Adam Aron has no competence in.
In Q4 of 2016 the rent per screen reached its lowest point, because of the “Property net” that was acquired through Carmike & Odeon. After that a silent slowly continuous selling of #AMC’s property followed, so that the Property worth from 2017 Q2 declined by 52%.
#AMC Property, Net Per Quarter Per Screen Operated
Astoundingly good performance. Isn’t it? I mean, c’mon, you would also sell your house to live in rent until you die, wouldn’t you? To cut costs because of unprofitability its always better to sell your property & take on debt or rent…GENIUS. Thats how a professional manager creates value - for someone else I guess.
Honestly I wouldn’t be surprised if those leaseback contracts were in any way tied to Apollo & private equity bought that property to get a nice money stream – because CEO Adam Aron would never make contracts beneficial for landlords…noooo. We will see.
If we compare the sell-off of property with the screen dispositions, we see that since Q1 of 2018 there was no Quarter without any screen dispositions. The correlation to the value drop of Property net is absent & could be explained through the disposition of rented property also. If we look at the “screens per theatre” it went significantly down from 14 to 11 (3 screens less on average) & is a sign that #AMC has acquired more “small” theaters than big ones. This average has not increased.
The next interesting chart is the “Film Exhibition Costs” – the more films #AMC is presenting in their overall theaters, the more these costs will have a negative impact on #AMC’s balance sheet. We can see that with the aggressive growth strategy the film exhibitions costs were rising since the end of 2016. During COVID-19 these costs were near the 0-line & very tiny. After that they began to rise again as Theaters opened again & #AMC showed more films. In Q2/Q3 2023 these costs nearly arrived at pre pandemic levels. That means, the amount of films shown is not the problem anymore.
But this chart has limited explanatory power. COVID-19 was like a huge negative Catalyst for #AMC. If I know Hollywood is shorting me with Films, so why should I operate all my theaters in full capacity, if I know, people have less reasons (Films to watch!) to go to theaters?
Lets see how this costs are attributed to attendance numbers & screens operated.
Ok, to understand this graphic some must grasp the way Film Exhibitions Costs work. If Hollywood releases a film & its played in theaters, every sale of a movie ticket creates revenue for the industry. #AMC has to give a certain amount of that ticket sale revenue to Hollywood. The sum of revenue generated by all theater tickets sales (not only #AMC) we can see for each movie in the BOX-office. So, what is a better situation for a theater company – having half full theaters or having full sold theaters & operating near max capacity?
In the first 3 quarters of 2016 #AMC had a much lower overall capacity but a higher occupancy rate of the theaters. That’s why their movie distribution costs per screen are the highest so far, you have a few theaters & a lot of ticket sales. This is also clear, if we look at the Film Exhibition costs per Customer, this are fixed costs for every customers – because #AMC paid this amount to Hollywood. Therefore, the lower the per customer costs, the more effective.
Lets take the attendance per screen operated into the analysis:
As I already mentioned, the attendance per screen operated before the aggressive acquisition of CEO Adam Aron had a significantly higher occupancy rate reached its highest point in Q3 2016 (100% - our baseline). During the timeframe of 2017 – Q4 2019 the occupancy rate dropped on average by -20%. The attendance per screen in 2023 is still not high enough to generate profits & stagnates at a -20-40% level.
Is the orange line below (attendance) the green bar (attendance per screen operated) that means, the theaters are more crowded with people, which is positive & effective for a theater company. If the orange line is above (attendance) the green bar (attendance per screen operated) that means, the theaters are not at full capacity, which is NEGATIVE & ineffective for a theater company.
The lesson is clear, in this field of competence CEO Adam Aron has no competence in. I mean, c’mon, because...
Here Part 1 of my series ends. You can reach the other parts here
Part 2:
Part 3:
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