AMC Entertainment Holdings posted a bigger-than-expected loss as costs rose nearly 60% in the second quarter.
The company also said it will pay a special dividend in the form of preference shares.
Shares of the once-popular meme stock are down 7% in premarket trading, as the move raised concerns about possible stock dilution.
AMC’s preferred shares can be converted into common shares if the investors approve the move.
AMC CEO: FILM PUBLISHERS DESPITE INFLATION
The company will issue one preferred share for each AMC share held.
AMC plans to list about 517 million preferred shares on the New York Stock Exchange under the symbol “APE”.
“This new AMC Preferred Equity gives AMC a currency that can be used in the future to strengthen our balance sheet, including by paying down debt or raising new equity,” said CEO Adam Aron.
AMC REVENUE quintuples as moviegoers return to theaters
Quarterly revenue rose to $1.17 billion, which was higher than the previous estimate of $1.16 billion, while net loss of 24 cents per share was bigger than market expectations of 21 cents, according to Refinitiv data.
|AMC||AMC ENTERTAINMENT HOLDINGS INC||18.67||+0.46||+2.52%|
AMC’s market value had soared last year in a private investor-driven rally, helping it raise billions of dollars in equity even at the expense of investors’ worries about an erosion in the value of the stock.
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During the peak of the coronavirus pandemic, AMC faced heavy losses as restrictions forced theaters to close.
Reuters contributed to this report.