AMC Networks Inc. ("AMC Networks" or the "Company") (NASDAQ: AMCX)
today reported financial results for the third quarter ended
September 30, 2023.
Chief Executive Officer Kristin
Dolan said: “During this period of experimentation and
change in our industry, we continue to execute on our plan and
effectively manage the business with a focus on high-quality
programming, strong partnerships and profitability. In addition to
introducing an ad-supported version of AMC+, we extended our
leadership in TV advertising through the launch of programmatic
buying on our linear networks, an industry first. Partnership
examples included a promotional pop-up on Max and strong presence
on the new Xumo offering from Comcast and Charter. The Walking
Dead: Daryl Dixon was the biggest ever debut for AMC+, one of many
programming highlights in the quarter. We are well-positioned to
achieve our free cash flow goals for the year and remain focused on
responsible content investment and monetization across a wide array
of distribution platforms and licensing opportunities.”
Operational Highlights:
- Launched ad-supported version of
AMC+, bringing ads to the Company’s entire distribution ecosystem
and enhancing future bundling opportunities.
- Enabled programmatic ad buying on
linear networks, a major industry first that boosts the value and
relevance of linear advertising and follows the company’s
pioneering work in addressable advertising.
- Worked with Warner Bros. Discovery
to add seven of AMC Networks’ high-quality series to the Max
platform as a limited promotional pop-up at no additional cost to
Max subscribers.
- Increased exposure drove viewership
increases on AMC+ across important franchises including Fear the
Walking Dead, Anne Rice's Interview with the Vampire and Anne
Rice's Mayfair Witches.
- Completed a multi-year renewal with
recently-merged Rogers-Shaw, the largest cable provider in Canada,
for continued carriage of AMC.
- Renewed acclaimed drama Dark Winds,
which achieved 100-point scores on Rotten Tomatoes for its first
two seasons on AMC and AMC+.
- Premiered The Walking Dead: Daryl
Dixon, the #1 most viewed premiere in the history of AMC+ and the
most watched season of any new show ever on the platform.
- WE tv successfully launched new
series Toya & Reginae, which gained viewers week to week and
continues to perform remarkably well across sister-streamer
ALLBLK.
- Hit series Harry Wild, starring
Jane Seymour, recently returned for a second season on Acorn
TV.
Financial Highlights – Third Quarter
Ended September 30, 2023:
- Net cash provided by operating
activities of $106 million; Free Cash Flow(1) of $99 million,
reflecting expense savings and improved working capital
management.
- Operating income of $121 million;
Adjusted Operating Income(1) of $177 million decreased 9% from the
prior year. Adjusted Operating Income margin of 28% was consistent
with the prior year period. Adjusted Operating Income benefited
from continued cost management measures.
- Net revenues of $637 million
decreased 7% from the prior year, largely driven by lower domestic
advertising revenues and affiliate revenues, partly offset by
streaming revenue growth.
- Streaming revenues of $142 million
increased 9% from the prior year, primarily driven by
year-over-year streaming subscriber growth and our continued focus
on higher value subscribers.
- Diluted EPS of
$1.44; Adjusted EPS(1) of $1.85.
Dollars in thousands, except per share amounts |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2023 |
|
|
2022 |
|
Change |
|
|
2023 |
|
|
2022 |
|
Change |
Net Revenues |
$ |
636,954 |
|
$ |
681,843 |
|
(6.6)% |
|
$ |
2,033,029 |
|
$ |
2,132,025 |
|
(4.6)% |
Operating Income |
$ |
120,850 |
|
$ |
150,677 |
|
(19.8)% |
|
$ |
399,855 |
|
$ |
478,557 |
|
(16.4)% |
Adjusted Operating Income |
$ |
177,268 |
|
$ |
194,305 |
|
(8.8)% |
|
$ |
569,808 |
|
$ |
601,031 |
|
(5.2)% |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Earnings Per Share |
$ |
1.44 |
|
$ |
1.94 |
|
(25.8)% |
|
$ |
5.40 |
|
$ |
6.23 |
|
(13.3)% |
Adjusted Earnings Per Share |
$ |
1.85 |
|
$ |
2.09 |
|
(11.5)% |
|
$ |
6.49 |
|
$ |
6.69 |
|
(3.0)% |
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
$ |
106,092 |
|
$ |
19,417 |
|
n/m |
|
$ |
131,139 |
|
$ |
36,591 |
|
n/m |
Free Cash Flow |
$ |
99,150 |
|
$ |
7,461 |
|
n/m |
|
$ |
102,747 |
|
$ |
3,081 |
|
n/m |
(1) See page 5 of this earnings release for a
discussion of non-GAAP financial measures used in this release.
This discussion includes the definition of Adjusted Operating
Income, Adjusted EPS and Free Cash Flow.
Segment Results:(dollars in
thousands)
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2023 |
|
|
|
2022 |
|
|
Change |
|
|
2023 |
|
|
|
2022 |
|
|
Change |
Net Revenues: |
|
|
|
|
|
|
|
|
|
|
|
Domestic Operations |
$ |
541,198 |
|
|
$ |
587,389 |
|
|
(7.9)% |
|
$ |
1,734,871 |
|
|
$ |
1,814,034 |
|
|
(4.4)% |
International and Other |
|
97,598 |
|
|
|
99,270 |
|
|
(1.7)% |
|
|
304,974 |
|
|
|
334,892 |
|
|
(8.9)% |
Inter-segment Eliminations |
|
(1,842 |
) |
|
|
(4,816 |
) |
|
61.8 |
% |
|
|
(6,816 |
) |
|
|
(16,901 |
) |
|
59.7 |
% |
Total Net Revenues |
$ |
636,954 |
|
|
$ |
681,843 |
|
|
(6.6)% |
|
$ |
2,033,029 |
|
|
$ |
2,132,025 |
|
|
(4.6)% |
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income (Loss): |
|
|
|
|
|
|
|
|
|
|
|
Domestic Operations |
$ |
161,627 |
|
|
$ |
186,609 |
|
|
(13.4)% |
|
$ |
523,645 |
|
|
$ |
573,943 |
|
|
(8.8)% |
International and Other |
|
7,985 |
|
|
|
8,291 |
|
|
(3.7)% |
|
|
10,422 |
|
|
|
39,733 |
|
|
(73.8)% |
Corporate / Inter-segment Eliminations |
|
(48,762 |
) |
|
|
(44,223 |
) |
|
(10.3)% |
|
|
(134,212 |
) |
|
|
(135,119 |
) |
|
0.7 |
% |
Total Operating Income |
$ |
120,850 |
|
|
$ |
150,677 |
|
|
(19.8)% |
|
$ |
399,855 |
|
|
$ |
478,557 |
|
|
(16.4)% |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Operating Income (Loss): |
|
|
|
|
|
|
|
|
|
|
|
Domestic Operations |
$ |
185,011 |
|
|
$ |
206,701 |
|
|
(10.5)% |
|
$ |
589,205 |
|
|
$ |
635,409 |
|
|
(7.3)% |
International and Other |
|
13,067 |
|
|
|
13,310 |
|
|
(1.8)% |
|
|
53,390 |
|
|
|
55,509 |
|
|
(3.8)% |
Corporate / Inter-segment Eliminations |
|
(20,810 |
) |
|
|
(25,706 |
) |
|
19.0 |
% |
|
|
(72,787 |
) |
|
|
(89,887 |
) |
|
19.0 |
% |
Total Adjusted Operating Income |
$ |
177,268 |
|
|
$ |
194,305 |
|
|
(8.8)% |
|
$ |
569,808 |
|
|
$ |
601,031 |
|
|
(5.2)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic Operations
Third Quarter Results:
-
Domestic Operations revenues decreased 8% from the prior year to
$541 million.
-
Distribution and other revenues decreased 3% to $394 million.
-
Content licensing revenues increased 7% to $62 million due to the
timing and availability of deliveries in the period.
-
Subscription revenues decreased 5% to $332 million due to declines
in the linear subscriber universe, partially offset by streaming
revenue growth.
-
Streaming revenues increased 9% to $142 million, primarily driven
by year-over-year streaming subscriber growth and our continued
focus on higher value subscribers.
-
Streaming subscribers increased 4% to 11.1 million as compared to
10.7 million subscribers in the prior year period. As compared to
2Q'23 subscribers of 11.0 million, third quarter subscribers
sequentially increased 1%.
-
Affiliate revenue decreased 13% due to basic subscriber declines
including the 3% revenue impact of a strategic non-renewal that
occurred at the end of 2022.
-
Advertising revenues decreased 18% to $147 million due to
anticipated linear ratings declines, a challenging ad market and
fewer original programming episodes within the quarter, partly
offset by digital and advanced advertising revenue growth.
-
Operating income decreased 13% to $162 million.
-
Adjusted Operating Income decreased 10% to $185 million, with a
margin of 34%. The decrease in Adjusted Operating Income was
primarily attributable to a decrease in advertising and affiliate
revenues, partly offset by increased streaming revenues and
continued cost management measures.
International and Other
Third Quarter Results:
-
International and Other revenues decreased 2% from the prior year
to $98 million.
-
Distribution and other revenues decreased 4% to $78 million,
primarily due to lower production volumes at 25/7 Media, partially
offset by higher subscription revenues at AMCNI.
-
Subscription revenues increased 6% to $56 million, primarily due to
the favorable impact of foreign currency translation at AMCNI.
-
Content licensing and other revenues decreased 24% to $22 million
due to a reduction in the volume of productions at 25/7 Media.
-
Advertising revenues increased 11% to $19 million, primarily due to
the favorable impact of foreign currency translation and digital
and advanced advertising growth in the U.K.
-
Operating income decreased 4% to $8 million.
-
Adjusted Operating Income decreased 2% to $13 million, with a
margin of 13%. The decrease in Adjusted Operating Income was
primarily attributable to an increase in SG&A expense,
partially offset by an increase in subscription revenue at
AMCNI.
Other Matters
Full Redemption of 5.00% Senior Notes due
2024
The Company announced today that it has given
notice of its intention to redeem the remaining $400 million
outstanding principal amount of its 5.00% Senior Notes due 2024
(CUSIP Number 00164V AD5) (the “Notes”) on December 12, 2023 (the
“Redemption Date”). The Notes will be redeemed at a redemption
price of 100.000% of the principal amount of the Notes plus accrued
and unpaid interest to, but excluding, the Redemption Date.
AMC Networks has instructed U.S. Bank National
Association, as the trustee for the Notes (the “Trustee”), to
distribute a notice of redemption to all registered holders of the
Notes on November 3, 2023.
Restructuring and Other Related Charges
On November 28, 2022, the Company commenced a
restructuring plan designed to achieve significant cost reductions
in light of “cord cutting” and the related impacts being felt
across the media industry as well as the broader economic outlook.
During the third quarter of 2023, the Company substantially
completed the plan and exited a portion of its office space in its
corporate headquarters in New York and office space in Silver
Spring, Maryland and Woodland Hills, California. In connection with
exiting a portion of the New York office, the Company recorded
impairment charges of $11.6 million, consisting of $9.1 million for
operating lease right-of use assets and $2.5 million for leasehold
improvements.
Stock Repurchase Program & Outstanding
Shares
As previously disclosed, the Company's Board of
Directors has authorized a program to repurchase up to $1.5 billion
of the Company’s outstanding shares of common stock. The Stock
Repurchase Program has no pre-established closing date and may be
suspended or discontinued at any time. During the quarter ended
September 30, 2023, the Company did not repurchase any shares.
As of September 30, 2023, the Company had $135 million of
authorization remaining for repurchase under the Stock Repurchase
Program.
As of October 27, 2023, the Company had
32,073,020 shares of Class A Common Stock and 11,484,408 shares of
Class B Common Stock outstanding.
Please see the Company’s Form 10-Q for the
period ended September 30, 2023, which will be filed later
today, for further details regarding the above matters.
Description of Non-GAAP
Measures
The Company defines Adjusted Operating Income
(Loss), which is a non-GAAP financial measure, as operating income
(loss) before share-based compensation expense or benefit,
depreciation and amortization, impairment and other charges
(including gains or losses on sales or dispositions of businesses),
restructuring and other related charges, cloud computing
amortization, and including the Company’s proportionate share of
adjusted operating income (loss) from majority-owned equity method
investees. From time to time, we may exclude the impact of certain
events, gains, losses, or other charges (such as significant legal
settlements) from AOI that affect our operating performance.
Because it is based upon operating income (loss), Adjusted
Operating Income (Loss) also excludes interest expense (including
cash interest expense) and other non-operating income and expense
items. The Company believes that the exclusion of share-based
compensation expense or benefit allows investors to better track
the performance of the various operating units of the business
without regard to the effect of the settlement of an obligation
that is not expected to be made in cash.
The Company believes that Adjusted Operating
Income (Loss) is an appropriate measure for evaluating the
operating performance of the business segments and the Company on a
consolidated basis. Adjusted Operating Income (Loss) and similar
measures with similar titles are common performance measures used
by investors, analysts, and peers to compare performance in the
industry.
Internally, the Company uses net revenues and
Adjusted Operating Income (Loss) measures as the most important
indicators of its business performance and evaluates management’s
effectiveness with specific reference to these indicators. Adjusted
Operating Income (Loss) should be viewed as a supplement to and not
a substitute for operating income (loss), net income (loss), and
other measures of performance presented in accordance with U.S.
generally accepted accounting principles ("GAAP"). Since Adjusted
Operating Income (Loss) is not a measure of performance calculated
in accordance with GAAP, this measure may not be comparable to
similar measures with similar titles used by other companies. For a
reconciliation of operating income (loss) to Adjusted Operating
Income (Loss), please see page 8-9 of this release.
The Company defines Free Cash Flow, which is a
non-GAAP financial measure, as net cash provided by operating
activities less capital expenditures, all of which are reported in
our Consolidated Statement of Cash Flows. The Company believes the
most comparable GAAP financial measure of its liquidity is net cash
provided by operating activities. The Company believes that Free
Cash Flow is useful as an indicator of its overall liquidity, as
the amount of Free Cash Flow generated in any period is
representative of cash that is available for debt repayment,
investment, and other discretionary and non-discretionary cash
uses. The Company also believes that Free Cash Flow is one of
several benchmarks used by analysts and investors who follow the
industry for comparison of its liquidity with other companies in
the industry, although the Company’s measure of Free Cash Flow may
not be directly comparable to similar measures reported by other
companies. For a reconciliation of net cash provided by operating
activities to Free Cash Flow, please see page 11 of this
release.
The Company defines Adjusted Earnings per
Diluted Share (“Adjusted EPS”), which is a non-GAAP financial
measure, as earnings per diluted share excluding the following
items: amortization of acquisition-related intangible assets;
impairment and other charges (including gains or losses on sales or
dispositions of businesses); non-cash impairments of goodwill,
intangible and fixed assets; restructuring and other related
charges; and the impact associated with the modification of debt
arrangements, including gains and losses related to the
extinguishment of debt; as well as the impact of taxes on the
aforementioned items. The Company believes the most comparable GAAP
financial measure is earnings per diluted share. The Company
believes that Adjusted EPS is one of several benchmarks used by
analysts and investors who follow the industry for comparison of
its performance with other companies in the industry, although the
Company’s measure of Adjusted EPS may not be directly comparable to
similar measures reported by other companies. For a reconciliation
of earnings per diluted share to Adjusted EPS, please see page
12-13 of this release.
Forward-Looking Statements
This earnings release may contain statements
that constitute forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These
statements are based on management's current expectations and are
subject to uncertainty and changes in circumstances. Investors are
cautioned that any such forward-looking statements are not
guarantees of future performance or results and involve risks and
uncertainties and that actual results or developments may differ
materially from those in the forward-looking statements as a result
of various factors, including financial community and rating agency
perceptions of the Company and its business, operations, financial
condition and the industries in which it operates and the factors
described in the Company’s filings with the Securities and Exchange
Commission, including the sections entitled "Risk Factors" and
"Management’s Discussion and Analysis of Financial Condition and
Results of Operations" contained therein. The Company disclaims any
obligation to update any forward-looking statements contained
herein.
Conference Call Information
AMC Networks will host a conference call today
at 8:30 a.m. ET to discuss its third quarter 2023 results. To
listen to the call, please visit investors.amcnetworks.com.
About AMC Networks Inc.
AMC Networks (Nasdaq: AMCX) is a global
entertainment company known for its popular and critically
acclaimed content. Its brands include targeted streaming services
AMC+, Acorn TV, Shudder, Sundance Now, ALLBLK and the anime-focused
HIDIVE streaming service, in addition to AMC, BBC AMERICA (operated
through a joint venture with BBC Studios), IFC, SundanceTV, WE tv,
IFC Films and RLJE Films. AMC Studios, the Company’s in-house
studio, production and distribution operation, is behind some of
the biggest titles and brands known to a global audience, including
The Walking Dead, the Anne Rice catalog and the Agatha Christie
library. The Company also operates AMC Networks International, its
international programming business, and 25/7 Media, its production
services business.
Contacts
Investor Relations |
|
Corporate Communications |
Nicholas Seibert |
|
Georgia Juvelis |
nicholas.seibert@amcnetworks.com |
|
georgia.juvelis@amcnetworks.com |
|
|
|
AMC NETWORKS
INC.CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share
amounts)(unaudited)
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenues, net |
$ |
636,954 |
|
|
$ |
681,843 |
|
|
$ |
2,033,029 |
|
|
$ |
2,132,025 |
|
Operating expenses: |
|
|
|
|
|
|
|
Technical and operating (excluding depreciation and
amortization) |
|
284,900 |
|
|
|
293,459 |
|
|
|
933,590 |
|
|
|
903,468 |
|
Selling, general and administrative |
|
187,232 |
|
|
|
207,972 |
|
|
|
567,136 |
|
|
|
670,444 |
|
Depreciation and amortization |
|
28,009 |
|
|
|
29,735 |
|
|
|
79,629 |
|
|
|
79,556 |
|
Impairment and other charges |
|
5,400 |
|
|
|
— |
|
|
|
30,282 |
|
|
|
— |
|
Restructuring and other related charges |
|
10,563 |
|
|
|
— |
|
|
|
22,537 |
|
|
|
— |
|
Total operating expenses |
|
516,104 |
|
|
|
531,166 |
|
|
|
1,633,174 |
|
|
|
1,653,468 |
|
Operating income |
|
120,850 |
|
|
|
150,677 |
|
|
|
399,855 |
|
|
|
478,557 |
|
Other income (expense): |
|
|
|
|
|
|
|
Interest expense |
|
(38,757 |
) |
|
|
(34,308 |
) |
|
|
(115,304 |
) |
|
|
(97,085 |
) |
Interest income |
|
11,686 |
|
|
|
3,625 |
|
|
|
26,944 |
|
|
|
8,552 |
|
Miscellaneous, net |
|
(2,211 |
) |
|
|
(1,546 |
) |
|
|
12,518 |
|
|
|
3,540 |
|
Total other expense |
|
(29,282 |
) |
|
|
(32,229 |
) |
|
|
(75,842 |
) |
|
|
(84,993 |
) |
Income from operations before income taxes |
|
91,568 |
|
|
|
118,448 |
|
|
|
324,013 |
|
|
|
393,564 |
|
Income tax expense |
|
(23,671 |
) |
|
|
(28,456 |
) |
|
|
(82,725 |
) |
|
|
(103,118 |
) |
Net income including noncontrolling interests |
|
67,897 |
|
|
|
89,992 |
|
|
|
241,288 |
|
|
|
290,446 |
|
Net income attributable to noncontrolling interests |
|
(4,473 |
) |
|
|
(5,326 |
) |
|
|
(4,015 |
) |
|
|
(18,163 |
) |
Net income attributable to AMC Networks’ stockholders |
$ |
63,424 |
|
|
$ |
84,666 |
|
|
$ |
237,273 |
|
|
$ |
272,283 |
|
|
|
|
|
|
|
|
|
Net income per
share attributable to AMC Networks’ stockholders: |
|
|
|
|
Basic |
$ |
1.44 |
|
|
$ |
1.96 |
|
|
$ |
5.42 |
|
|
$ |
6.32 |
|
Diluted |
$ |
1.44 |
|
|
$ |
1.94 |
|
|
$ |
5.40 |
|
|
$ |
6.23 |
|
|
|
|
|
|
|
|
|
Weighted average common shares: |
|
|
|
|
|
|
|
Basic |
|
43,951 |
|
|
|
43,238 |
|
|
|
43,786 |
|
|
|
43,070 |
|
Diluted |
|
44,041 |
|
|
|
43,732 |
|
|
|
43,905 |
|
|
|
43,707 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL DATA
(Dollars in
thousands)(Unaudited)
|
Three Months Ended September 30, 2023 |
|
Domestic Operations |
|
International and Other |
|
Corporate / Inter-segment Eliminations |
|
Consolidated |
Operating income (loss) |
$ |
161,627 |
|
|
$ |
7,985 |
|
|
$ |
(48,762 |
) |
|
$ |
120,850 |
Share-based compensation expenses |
|
3,494 |
|
|
|
815 |
|
|
|
2,069 |
|
|
|
6,378 |
Depreciation and amortization |
|
11,536 |
|
|
|
4,271 |
|
|
|
12,202 |
|
|
|
28,009 |
Restructuring and other related charges (credits) |
|
(783 |
) |
|
|
(4 |
) |
|
|
11,350 |
|
|
|
10,563 |
Impairment and other charges |
|
5,400 |
|
|
|
— |
|
|
|
— |
|
|
|
5,400 |
Cloud computing amortization |
|
5 |
|
|
|
— |
|
|
|
2,331 |
|
|
|
2,336 |
Majority owned equity investees AOI |
|
3,732 |
|
|
|
— |
|
|
|
— |
|
|
|
3,732 |
Adjusted operating
income (loss) |
$ |
185,011 |
|
|
$ |
13,067 |
|
|
$ |
(20,810 |
) |
|
$ |
177,268 |
|
Three Months Ended September 30, 2022 |
|
Domestic Operations |
|
International and Other |
|
Corporate / Inter-segment Eliminations |
|
Consolidated |
Operating income (loss) |
$ |
186,609 |
|
$ |
8,291 |
|
$ |
(44,223 |
) |
|
$ |
150,677 |
Share-based compensation expenses |
|
3,155 |
|
|
537 |
|
|
3,358 |
|
|
|
7,050 |
Depreciation and amortization |
|
12,141 |
|
|
4,482 |
|
|
13,112 |
|
|
|
29,735 |
Cloud computing amortization |
|
5 |
|
|
— |
|
|
2,047 |
|
|
|
2,052 |
Majority owned equity investees AOI |
|
4,791 |
|
|
— |
|
|
— |
|
|
|
4,791 |
Adjusted operating
income (loss) |
$ |
206,701 |
|
$ |
13,310 |
|
$ |
(25,706 |
) |
|
$ |
194,305 |
|
|
|
|
|
|
|
|
|
|
|
|
|
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL DATA
(Dollars in
thousands)(Unaudited)
|
Nine Months Ended September 30, 2023 |
|
Domestic Operations |
|
International and Other |
|
Corporate / Inter-segment Eliminations |
|
Consolidated |
Operating income (loss) |
$ |
523,645 |
|
$ |
10,422 |
|
$ |
(134,212 |
) |
|
$ |
399,855 |
Share-based compensation expenses |
|
10,133 |
|
|
2,500 |
|
|
7,038 |
|
|
|
19,671 |
Depreciation and amortization |
|
35,053 |
|
|
13,944 |
|
|
30,632 |
|
|
|
79,629 |
Restructuring and other related charges |
|
3,940 |
|
|
1,642 |
|
|
16,955 |
|
|
|
22,537 |
Impairment and other charges |
|
5,400 |
|
|
24,882 |
|
|
— |
|
|
|
30,282 |
Cloud computing amortization |
|
15 |
|
|
— |
|
|
6,800 |
|
|
|
6,815 |
Majority owned equity investees AOI |
|
11,019 |
|
|
— |
|
|
— |
|
|
|
11,019 |
Adjusted operating income (loss) |
$ |
589,205 |
|
$ |
53,390 |
|
$ |
(72,787 |
) |
|
$ |
569,808 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, 2022 |
|
Domestic Operations |
|
International and Other |
|
Corporate / Inter-segment Eliminations |
|
Consolidated |
Operating income (loss) |
$ |
573,943 |
|
$ |
39,733 |
|
$ |
(135,119 |
) |
|
$ |
478,557 |
Share-based compensation expenses |
|
10,000 |
|
|
1,758 |
|
|
12,104 |
|
|
|
23,862 |
Depreciation and amortization |
|
37,716 |
|
|
14,018 |
|
|
27,822 |
|
|
|
79,556 |
Cloud computing amortization |
|
17 |
|
|
— |
|
|
5,306 |
|
|
|
5,323 |
Majority owned equity investees AOI |
|
13,733 |
|
|
— |
|
|
— |
|
|
|
13,733 |
Adjusted operating income (loss) |
$ |
635,409 |
|
$ |
55,509 |
|
$ |
(89,887 |
) |
|
$ |
601,031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL DATA
(Dollars in
thousands)(Unaudited)
Capitalization |
September 30, 2023 |
|
Cash and cash equivalents |
$ |
955,187 |
|
|
|
|
Credit facility debt (a) |
$ |
615,938 |
|
Senior notes (a) |
|
2,200,000 |
|
Total debt |
$ |
2,815,938 |
|
|
|
|
Net debt |
$ |
1,860,751 |
|
|
|
|
Finance leases |
|
20,074 |
|
Net debt and finance leases |
$ |
1,880,825 |
|
|
|
|
|
Twelve Months Ended September 30, 2023 |
|
Operating Income (GAAP) |
$ |
8,214 |
|
Share-based compensation expense |
|
25,795 |
|
Depreciation and amortization |
|
107,300 |
|
Restructuring and other related charges |
|
471,503 |
|
Impairment and other charges |
|
70,999 |
|
Cloud computing amortization |
|
8,834 |
|
Majority owned equity investees |
|
14,534 |
|
Adjusted Operating Income (Non-GAAP) |
$ |
707,179 |
|
|
|
|
Leverage ratio (b) |
|
2.7 |
x |
(a) Represents the aggregate principal amount of
the debt.(b) Represents net debt and finance leases divided by
Adjusted Operating Income for the twelve months ended
September 30, 2023. This ratio differs from the calculation
contained in the Company's credit facility. No adjustments have
been made for consolidated entities that are not 100% owned.
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL DATA
(Dollars in thousands)
(Unaudited)
Free Cash Flow (1) (2) |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net cash provided by operating activities |
$ |
106,092 |
|
|
$ |
19,417 |
|
|
$ |
131,139 |
|
|
$ |
36,591 |
|
Less: capital expenditures |
|
(6,942 |
) |
|
|
(11,956 |
) |
|
|
(28,392 |
) |
|
|
(33,510 |
) |
Free Cash Flow |
$ |
99,150 |
|
|
$ |
7,461 |
|
|
$ |
102,747 |
|
|
$ |
3,081 |
|
Supplemental Cash Flow Information |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Restructuring initiatives (3) |
$ |
(13,084 |
) |
|
$ |
— |
|
|
$ |
(101,590 |
) |
|
$ |
— |
|
Distributions to noncontrolling interests |
|
(20,459 |
) |
|
|
(3,093 |
) |
|
|
(47,546 |
) |
|
|
(28,232 |
) |
|
(1) Beginning with the first quarter of 2023, we adjusted our free
cash flow definition to exclude distributions to non-controlling
interests which are discretionary in nature. Prior period amounts
have been adjusted to conform to the current period
presentation. |
(2) Free Cash Flow includes the impact of certain cash receipts or
payments (such as restructuring initiatives, significant legal
settlements, and programming write-offs) that affect
period-to-period comparability. |
(3) Restructuring initiatives includes cash payments of $9.1
million and $61.3 million for content impairments and other exit
costs for the three and nine months ended September 30, 2023,
respectively, and $4.0 million and $40.3 million for severance and
employee-related costs, for the three and nine months ended
September 30, 2023, respectively. |
|
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL DATA
(Dollars in thousands, except per share amounts)
(Unaudited)
Adjusted Earnings Per Share |
|
Three Months Ended September 30, 2023 |
|
Income from operations before income taxes |
|
Income tax expense |
|
Net (income) loss attributable to noncontrolling interests |
|
Net income attributable to AMC Networks' stockholders |
|
Diluted EPS attributable to AMC Networks' stockholders |
Reported Results (GAAP) |
$ |
91,568 |
|
$ |
(23,671 |
) |
|
$ |
(4,473 |
) |
|
$ |
63,424 |
|
$ |
1.44 |
Adjustments: |
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
|
9,839 |
|
|
(2,291 |
) |
|
|
(1,329 |
) |
|
|
6,219 |
|
|
0.14 |
Restructuring and other related charges |
|
10,563 |
|
|
(2,618 |
) |
|
|
— |
|
|
|
7,945 |
|
|
0.18 |
Impairment and other charges |
|
5,400 |
|
|
(1,343 |
) |
|
|
— |
|
|
|
4,057 |
|
|
0.09 |
Impact of debt modification |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
Adjusted Results (Non-GAAP) |
$ |
117,370 |
|
$ |
(29,923 |
) |
|
$ |
(5,802 |
) |
|
$ |
81,645 |
|
$ |
1.85 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, 2022 |
|
Income from operations before income taxes |
|
Income tax expense |
|
Net (income) loss attributable to noncontrolling interests |
|
Net income attributable to AMC Networks' stockholders |
|
Diluted EPS attributable to AMC Networks' stockholders |
Reported Results (GAAP) |
$ |
118,448 |
|
$ |
(28,456 |
) |
|
$ |
(5,326 |
) |
|
$ |
84,666 |
|
$ |
1.94 |
Adjustments: |
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
|
10,235 |
|
|
(2,016 |
) |
|
|
(1,680 |
) |
|
|
6,539 |
|
|
0.15 |
Restructuring and other related charges |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
Impairment and other charges |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
Impact of debt modification |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
Adjusted Results (Non-GAAP) |
$ |
128,683 |
|
$ |
(30,472 |
) |
|
$ |
(7,006 |
) |
|
$ |
91,205 |
|
$ |
2.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL DATA
(Dollars in thousands, except per share amounts)
(Unaudited)
Adjusted Earnings Per Share |
|
Nine Months Ended September 30, 2023 |
|
Income from operations before income taxes |
|
Income tax expense |
|
Net (income) loss attributable to noncontrolling interests |
|
Net income attributable to AMC Networks' stockholders |
|
Diluted EPS attributable to AMC Networks' stockholders |
Reported Results (GAAP) |
$ |
324,013 |
|
$ |
(82,725 |
) |
|
$ |
(4,015 |
) |
|
$ |
237,273 |
|
$ |
5.40 |
Adjustments: |
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
|
30,726 |
|
|
(6,466 |
) |
|
|
(4,738 |
) |
|
|
19,522 |
|
|
0.44 |
Restructuring and other related charges |
|
22,537 |
|
|
(5,395 |
) |
|
|
(204 |
) |
|
|
16,938 |
|
|
0.39 |
Impairment and other charges |
|
30,282 |
|
|
(3,518 |
) |
|
|
(15,949 |
) |
|
|
10,815 |
|
|
0.25 |
Impact of debt modification |
|
605 |
|
|
(147 |
) |
|
|
— |
|
|
|
458 |
|
|
0.01 |
Adjusted Results (Non-GAAP) |
$ |
408,163 |
|
$ |
(98,251 |
) |
|
$ |
(24,906 |
) |
|
$ |
285,006 |
|
$ |
6.49 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, 2022 |
|
Income from operations before income taxes |
|
Income tax expense |
|
Net (income) loss attributable to noncontrolling interests |
|
Net income attributable to AMC Networks' stockholders |
|
Diluted EPS attributable to AMC Networks' stockholders |
Reported Results (GAAP) |
$ |
393,564 |
|
$ |
(103,118 |
) |
|
$ |
(18,163 |
) |
|
$ |
272,283 |
|
$ |
6.23 |
Adjustments: |
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
|
31,195 |
|
|
(6,162 |
) |
|
|
(5,040 |
) |
|
|
19,993 |
|
|
0.46 |
Restructuring and other related charges |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
Impairment and other charges |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
Impact of debt modification |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
Adjusted Results (Non-GAAP) |
$ |
424,759 |
|
$ |
(109,280 |
) |
|
$ |
(23,203 |
) |
|
$ |
292,276 |
|
$ |
6.69 |
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