AMC Entertainment CEO Adam Aron asks retail shareholders to back down – Deadline

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In a sign that managing 4 million retail shareholders isn’t all fun and games, AMC Entertainment CEO Adam Aron said most of the advice he receives in voluminous correspondence on social media are “well-meaning,” but “some may be thrown at us with the intent to actually harm me or the business. This is the first time he has publicly denounced a problem with the new fan-run regime.

The giant cinema chain’s shareholder base has completely turned around since the pandemic. Institutions have been mostly replaced by individual retail traders from Reddit chatrooms and social media who started piling up in stocks in early 2021 in the “meme stocks” phenomenon. It’s an incredibly unusual change that Aron handled deftly (he explained how in an interview with CinemaCon’s Deadline). Meme investors saved AMC from bankruptcy, squeezing short sellers, who borrow shares betting the price will fall. But the continued volatility has generated hard-to-prove financial manipulation conspiracy theories among some of the circuit’s shareholders.

“I think it’s well known that I write my own tweets and actively read my incoming Twitter feed. So literally thousands of thousands of times I have personally seen your comments and advice. I see your frustrations with your perception of how the market works or doesn’t work, your anxiety about the number of so-called “undelivered” stocks, or your concern about something that, by its very name, looks worrisome – gloomy trading pools,” he said on a conference call this afternoon after strong first-quarter results. “Your anger and anger at short sellers is evident. I hear your suggestions that we should ask for more government regulation of the market or take more corporate action. »

“While most [advice] comes constructively, some comes with hostility or with threats,” he said.

“All I can say [is] I greatly appreciate that you care so deeply. Plus, running a company with such broad interests as AMC is an art form, not a science. There is real wisdom in knowing what to do and what not to do… That said, silence should not be interpreted as inaction. We are constantly exploring the smartest courses of action and I promise you we will pounce, but only when the time is right,” he said, without elaborating.

Furious shareholders also turned on Twitter when Aron sold shares last year and in early 2022 after announcing he would. Today he pointed out that “Even with my well-disclosed stock sales in advance, I still have an interest in 2.9 million AMC shares… My motivation is to think and act as a shareholder.

Elsewhere in his comments, he was keen to draw attention to the fact that movies from Netflix, Apple, and Amazon streamers aren’t playing in AMC theaters because they don’t accept the studio window. “If we can convince streamers that it’s in their interest to show their movies in theaters, that could be another way to get more movies into our theaters.”

“We continue to make it very clear that we would be very happy to show some of their biggest and best films, but in doing so we must respect our long-time partners in the industry. We cannot have a separate set of rules,” he said.

Aron and Chief Financial Officer Sean Goodman said the theater business continued to strengthen, with the second half looking stronger than the much improved first. Aron predicted that the 2022 box office will be close to double 2021 and four times 2020. He believes the fourth quarter of 2022 will “finally reach or approach” the pre-pandemic level.

Home delivery and retail sales of AMC popcorn and snacks will begin by the end of the year, and an AMC-branded credit card is expected to be offered “within a year.” Investors can expect the company to add more movie theaters and sign more unlikely deals like the investment in Hycroft Mining – which Goodman said led to a $63 million gain on Friday on earnings from the Nevada gold mine share price.

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