AMC Networks Inc. (“AMC Networks” or the “Company”) (NASDAQ: AMCX)
today reported financial results for the second quarter ended June
30, 2020.
President and Chief Executive Officer Josh Sapan said: “Amidst a
continuing challenged and uncertain environment, AMC Networks
delivered solid results in the 2nd quarter exceeding our financial
expectations for the quarter and expectations on several key
metrics, including advertising. We continue to maintain a strong
financial profile, with a solid balance sheet and liquidity, and we
continue to generate healthy levels of free cash flow. We remain
focused on our strategic priorities and are making progress on our
major initiatives – which include creating great content and
monetizing that content across an expanding array of platforms.
Last week, AMC Networks was recognized with 18 Emmy nominations,
including two out of the eight nominations for Outstanding Drama,
for our original series Better Call Saul and Killing Eve,
demonstrating our continued ability to stand out in a crowded
landscape with compelling character-driven stories that drive the
cultural conversation. In addition, we have made particular
progress during this COVID period with strong growth across our
targeted SVOD services - Acorn TV, Shudder, Sundance Now and UMC –
as consumers increasingly subscribe to both our targeted offerings
in addition to general entertainment SVOD services.”
Second Quarter Financial
Highlights:
- Net revenues of $646 million
- Operating income of $49 million; Adjusted Operating Income1 of
$225 million
- Diluted EPS of $0.28; Adjusted EPS1 of $2.39
- Cash Provided by Operating Activities of $227 million and Free
Cash Flow1 of $210 million for the three months ended June 30,
2020
Operational
Highlights:
- The Company continued to make significant progress on its
digital initiatives:-- Targeted streaming services Acorn TV,
Shudder, Sundance Now and UMC delivered impressive year-over-year
growth in revenues and subscribers-- The Company launches new
subscription video on demand (SVOD) bundles AMC+ and WE tv+--
The Company acquires the streaming rights to Mad Men, widely
recognized as one of the most acclaimed shows in the history of
TV
- The Company continued to make significant progress on its
advanced advertising initiatives:-- The Company joined
leading advanced advertising consortiums OpenAP and Xandr--
The Company joined the OnAddressability initiative with several of
its major distribution partners to further advance its
addressability capabilities-- The Company furthered its AVOD
strategy with launches on Pluto TV and Dish’s Sling Free
services
- The Company received 18 Emmy Nominations across its portfolio
of brands, including 8 nominations for AMC’s Better Call Saul and 8
nominations for BBC America’s Killing Eve, reflecting its continued
content creation success
Consolidated Results
Second quarter net revenues decreased 16.3%, or $126 million, to
$646 million over the second quarter of 2019. The decrease in net
revenues reflected a decrease of 18.0% at National Networks and a
decrease of 10.3% at International and Other. Operating income was
$49 million, a decrease of 71.3%, or $121 million, versus the prior
year period. The operating income decrease reflected a
decrease of 12.4% at National Networks and an increase of $112
million in operating loss at International and Other. The increase
in operating loss at International and Other was primarily related
to $130 million in impairment charges incurred in the second
quarter related to AMC Networks International. See the “Other
Matters” section of the release for further details regarding the
impairment charges. Adjusted Operating Income1 was $225 million, a
decrease of 2.7%, or $6 million, versus the prior year period. The
decrease in adjusted operating income reflected a decrease of 11.2%
at National Networks partially offset by an increase of $3 million
at International and Other and an increase of $17 million in
Inter-segment Eliminations versus the prior year period.
For the six months ended June 30, 2020, net revenues decreased
11.3%, or $176 million, to $1.381 billion, operating income
decreased 46.6%, or $193 million, to $222 million, and adjusted
operating income decreased 14.7%, or $77 million, to $448
million.
Second quarter net income was $15 million ($0.28 per diluted
share), compared with $129 million ($2.25 per diluted share) in the
prior year period. EPS primarily reflected an increase in
impairment charges as well as an increase in income tax expense
partially offset by a decrease in restructuring and other related
charges as well as an increase in miscellaneous, net. Second
quarter Adjusted EPS1 was $126 million ($2.39 per diluted share),
compared with $149 million ($2.60 per diluted share) in the prior
year period. The decrease in adjusted EPS was primarily related to
an increase in income tax expense partially offset by an increase
in miscellaneous, net.
Net income for the six months ended June 30, 2020 was $84
million ($1.54 per diluted share), compared with $272 million
($4.73 per diluted share) in the prior year period. Adjusted EPS
for the six months ended June 30, 2020 was $209 million ($3.83 per
diluted share), compared with $301 million ($5.24 per diluted
share) in the prior year period.
For the six months ended June 30, 2020, net cash provided by
operating activities was $425 million, an increase of $136 million
versus the prior year period. The increase was primarily the result
of a decrease in working capital and tax payments partially offset
by a decrease in adjusted operating income. Free Cash Flow1 for the
six months ended June 30, 2020 was $392 million, an increase of
$163 million versus the prior year period. The increase primarily
reflects the increase in net cash provided by operating activities
as well as a decrease in capital expenditures.
- 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
(Loss), Adjusted EPS and Free Cash Flow.
Segment Results
(dollars
in thousands) |
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2020 |
|
2019 |
|
Change |
|
2020 |
|
2019 |
|
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
National Networks |
|
$ |
495,850 |
|
|
$ |
604,739 |
|
|
(18.0 |
%) |
|
$ |
1,062,789 |
|
|
$ |
1,220,858 |
|
|
(12.9 |
%) |
|
International and Other |
|
|
160,980 |
|
|
|
179,526 |
|
|
(10.3 |
%) |
|
|
331,473 |
|
|
|
350,615 |
|
|
(5.5 |
%) |
|
Inter-segment
eliminations |
|
|
(10,539 |
) |
|
|
(11,966 |
) |
|
n/m |
|
|
|
(13,596 |
) |
|
|
(14,953 |
) |
|
n/m |
|
Total Net
Revenues |
|
$ |
646,291 |
|
|
$ |
772,299 |
|
|
(16.3 |
%) |
|
$ |
1,380,666 |
|
|
$ |
1,556,520 |
|
|
(11.3 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
(Loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
National Networks |
|
$ |
187,532 |
|
|
$ |
214,198 |
|
|
(12.4 |
%) |
|
$ |
382,756 |
|
|
$ |
465,702 |
|
|
(17.8 |
%) |
|
International and Other |
|
|
(138,973 |
) |
|
|
(27,284 |
) |
|
n/m |
|
|
|
(158,424 |
) |
|
|
(41,031 |
) |
|
n/m |
|
|
Inter-segment
eliminations |
|
|
243 |
|
|
|
(16,657 |
) |
|
n/m |
|
|
|
(2,560 |
) |
|
|
(9,551 |
) |
|
n/m |
|
Total Operating
Income (Loss) |
|
$ |
48,802 |
|
|
$ |
170,257 |
|
|
(71.3 |
%) |
|
$ |
221,772 |
|
|
$ |
415,120 |
|
|
(46.6 |
%) |
Adjusted Operating
Income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
National Networks |
|
$ |
209,934 |
|
$ |
236,472 |
|
|
(11.2 |
%) |
|
$ |
427,522 |
|
|
$ |
513,159 |
|
|
(16.7 |
%) |
|
International and Other |
|
|
15,101 |
|
|
11,830 |
|
|
27.7 |
% |
|
|
22,770 |
|
|
|
21,772 |
|
|
4.6 |
% |
|
Inter-segment
eliminations |
|
|
243 |
|
|
(16,657 |
) |
|
n/m |
|
|
|
(2,560 |
) |
|
|
(10,246 |
) |
|
n/m |
|
Total Adjusted
Operating Income |
|
$ |
225,278 |
|
$ |
231,645 |
|
|
(2.7 |
%) |
|
$ |
447,732 |
|
|
$ |
524,685 |
|
|
(14.7 |
%) |
National NetworksNational Networks principally
consists of the Company’s five nationally distributed programming
networks, AMC, BBC AMERICA, IFC, SundanceTV and WE tv; and AMC
Studios, the Company’s television production business.
National Networks revenues for the second quarter 2020 decreased
18.0% to $496 million, operating income decreased 12.4% to $188
million, and adjusted operating income decreased 11.2% to $210
million, all compared to the prior year period.
National Networks revenues for the six months ended June 30,
2020 decreased 12.9% to $1.063 billion, operating income decreased
17.8% to $383 million, and adjusted operating income decreased
16.7% to $428 million, all compared to the prior year period.
Second quarter revenues reflected a 14.6% decrease in
advertising revenues to $187 million. The decrease in advertising
revenues was primarily related to the impact of the COVID-19
pandemic, which resulted in lower demand, as well as the timing of
the airing of original programming. Distribution revenues decreased
19.9% to $308 million. The decrease in distribution revenues was
attributable to a decrease in both subscription revenues and
content licensing revenues.
Second quarter operating income and adjusted operating income
reflected the decrease in revenues partially offset by a decrease
in operating expenses. The decrease in operating expenses was
primarily attributable to lower programming expenses. Programming
expenses included charges of $7 million in the current year period
related to the write-off of programming assets, as compared to
charges of $10 million in the prior year period. Advertising and
marketing expenses also decreased as compared to the prior year
period.
International and OtherInternational and Other
principally consists of AMC Networks International, the Company’s
international programming business; AMC Networks SVOD, the
Company’s targeted subscription streaming services, Acorn TV,
Shudder, Sundance Now and UMC (Urban Movie Channel); Levity
Entertainment Group, the Company’s production services and comedy
venues business; and IFC Films, the Company’s independent film
distribution business.
International and Other revenues for the second quarter of 2020
decreased 10.3% to $161 million, operating loss increased $112
million to a loss of $139 million, and adjusted operating income
increased $3 million to $15 million, all compared to the prior year
period.
International and Other revenues for the six months ended June
30, 2020 decreased 5.5% to $331 million, operating loss increased
$117 million to a loss of $158 million, and adjusted operating
income increased $1 million to $23 million, all compared to the
prior year period.
Second quarter revenues primarily reflected an increase at AMC
Networks SVOD more than offset by a decrease at Levity
Entertainment and, to a lesser extent, a decrease at the Company’s
international programming networks.
Second quarter operating income and adjusted operating income
reflected the decrease in revenues more than offset by a decrease
in operating expenses. Operating income also reflected an increase
in impairment charges of $130 million related to AMC Networks
International.
Other Matters
COVID-19
As previously disclosed, the impact of COVID-19 and measures to
prevent its spread are affecting the Company’s businesses in a
number of ways. Beginning in mid-March, the Company experienced
adverse advertising sales impacts; suspended content production,
which has led to delays in the creation and availability of some of
its television programming; and temporarily closed its comedy
venues. Operationally, nearly all Company employees are working
remotely, and the Company has restricted business travel. The
Company has evaluated and continues to evaluate the potential
impact of the COVID-19 pandemic on its consolidated financial
statements. The Company cannot reasonably predict the ultimate
impact of the COVID-19 pandemic, including the extent of any
adverse impact on its business, results of operations and financial
condition, which will depend on, among other things, the duration
and spread of the pandemic, the impact of governmental regulations
that have been, and may continue to be, imposed in response to the
pandemic, the effectiveness of actions taken to contain or mitigate
the outbreak, the availability, safety and efficacy of a vaccine,
and global economic conditions. The Company believes that the
COVID-19 pandemic has had a material impact on its operations.
However, the Company does not expect the COVID-19 pandemic and its
related economic impact to affect its liquidity position or its
ongoing ability to meet the covenants in its debt instruments.
Stock Repurchase Program
As previously disclosed, the Company’s Board of Directors
authorized a program to repurchase up to $1.5 billion of its
outstanding shares of common stock. The Company will determine the
timing and the amount of any repurchases based on its evaluation of
market conditions, share price, and other factors. The stock
repurchase program has no pre-established closing date and may be
suspended or discontinued at any time. During the second quarter,
the Company repurchased approximately 688,000 shares for $17
million. As of July 31, 2020, the Company had $386 million
available under its stock repurchase authorization.
Impairment Charges
As a result of the continuing impact of the COVID-19 pandemic,
management assessed the value of the goodwill and long-lived assets
recorded on its balance sheet. As a result of this assessment, the
Company recorded impairment charges of $130 million in the second
quarter of 2020 related to the AMC Networks International
business.
Please see the Company’s Form 10-Q for the period ended June 30,
2020 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
depreciation and amortization, cloud computing amortization,
share-based compensation expense or benefit, impairment charges
(including gains or losses on sales or dispositions of businesses),
restructuring and other related charges, and including the
Company’s proportionate share of adjusted operating income (loss)
from majority owned equity method investees. 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 of this release.
The Company defines Free Cash Flow (“Free Cash Flow”), which is
a non-GAAP financial measure, as net cash provided by operating
activities less capital expenditures and cash distributions to
noncontrolling interests, 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 9 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
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 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 pages 10-11 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 second quarter 2020 results. To listen to the
call, visit http://www.amcnetworks.com or dial 877-347-9170,
using the following passcode: 3287042.
About AMC Networks Inc.
AMC Networks is a global entertainment company known for
delivering high-quality content to audiences and a valuable
platform to distributors and advertisers. The Company, which
operates several of the most recognizable brands in entertainment,
manages its business through two operating segments: (i) National
Networks, which principally includes AMC, BBC AMERICA, IFC,
SundanceTV and WE tv; and AMC Studios, the Company’s television
production business; and (ii) International and Other, which
principally includes AMC Networks International, the Company’s
international programming business; AMC Networks SVOD, the
Company's targeted subscription streaming services, Acorn TV,
Shudder, Sundance Now and UMC (Urban Movie Channel); Levity
Entertainment Group, the Company’s production services and comedy
venues business; and IFC Films, the Company's independent film
distribution business. For more information on AMC Networks, please
visit the Company’s website at www.amcnetworks.com.
|
|
|
|
Contacts |
|
|
|
Investor Relations |
|
|
Corporate Communications |
Seth Zaslow (646) 273-3766 |
|
|
Georgia Juvelis (917) 542-6390 |
seth.zaslow@amcnetworks.com |
|
|
georgia.juvelis@amcnetworks.com |
|
|
|
|
AMC NETWORKS
INC.CONSOLIDATED STATEMENTS OF
INCOME(In thousands, except per share
amounts)(unaudited)
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
|
|
|
|
|
|
|
Revenues, net. |
$ |
646,291 |
|
|
$ |
772,299 |
|
|
$ |
1,380,666 |
|
|
$ |
1,556,520 |
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
Technical and operating (excluding depreciation and
amortization) |
|
282,503 |
|
|
|
385,623 |
|
|
|
626,563 |
|
|
|
725,771 |
|
Selling, general and administrative |
|
155,163 |
|
|
|
173,364 |
|
|
|
339,812 |
|
|
|
345,876 |
|
Depreciation and amortization |
|
25,905 |
|
|
|
25,893 |
|
|
|
52,635 |
|
|
|
49,949 |
|
Impairment charges |
|
130,411 |
|
|
|
- |
|
|
|
130,411 |
|
|
|
- |
|
Restructuring and other related charges |
|
3,507 |
|
|
|
17,162 |
|
|
|
9,473 |
|
|
|
19,804 |
|
|
|
597,489 |
|
|
|
602,042 |
|
|
|
1,158,894 |
|
|
|
1,141,400 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
48,802 |
|
|
|
170,257 |
|
|
|
221,772 |
|
|
|
415,120 |
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
Interest expense |
|
(34,301 |
) |
|
|
(39,716 |
) |
|
|
(71,865 |
) |
|
|
(79,361 |
) |
Interest income |
|
3,727 |
|
|
|
4,745 |
|
|
|
8,282 |
|
|
|
8,945 |
|
Loss on extinguishment of debt |
|
- |
|
|
|
- |
|
|
|
(2,908 |
) |
|
|
- |
|
Miscellaneous, net |
|
8,713 |
|
|
|
(2,697 |
) |
|
|
(21,226 |
) |
|
|
(15,482 |
) |
|
|
(21,861 |
) |
|
|
(37,668 |
) |
|
|
(87,717 |
) |
|
|
(85,898 |
) |
|
|
|
|
|
|
|
|
Income from operations before income taxes |
|
26,941 |
|
|
|
132,589 |
|
|
|
134,055 |
|
|
|
329,222 |
|
Income tax benefit (expense) |
|
(9,707 |
) |
|
|
1,396 |
|
|
|
(43,295 |
) |
|
|
(45,080 |
) |
Net income including noncontrolling interests |
|
17,234 |
|
|
|
133,985 |
|
|
|
90,760 |
|
|
|
284,142 |
|
Net income attributable to noncontrolling interests |
|
(2,273 |
) |
|
|
(5,242 |
) |
|
|
(7,132 |
) |
|
|
(12,002 |
) |
Net income attributable to AMC Networks’ stockholders |
$ |
14,961 |
|
|
$ |
128,743 |
|
|
$ |
83,628 |
|
|
$ |
272,140 |
|
|
|
|
|
|
|
|
|
Net income per share attributable to AMC Networks’
stockholders: |
|
|
|
|
|
|
|
Basic |
$ |
0.29 |
|
|
$ |
2.28 |
|
|
$ |
1.55 |
|
|
$ |
4.81 |
|
Diluted |
$ |
0.28 |
|
|
$ |
2.25 |
|
|
$ |
1.54 |
|
|
$ |
4.73 |
|
|
|
|
|
|
|
|
|
Weighted average common shares: |
|
|
|
|
|
|
|
Basic |
|
52,311 |
|
|
|
56,590 |
|
|
|
53,894 |
|
|
|
56,589 |
|
Diluted |
|
52,797 |
|
|
|
57,335 |
|
|
|
54,429 |
|
|
|
57,529 |
|
|
|
|
|
|
|
|
|
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL
DATA(Dollars in
thousands)(Unaudited)
|
Three Months Ended June 30, 2020 |
|
National Networks |
|
International and Other |
|
Inter-segment eliminations |
|
Consolidated |
|
|
|
|
|
|
|
|
Operating income (loss) |
$ |
187,532 |
|
$ |
(138,973 |
) |
|
$ |
243 |
|
$ |
48,802 |
Share-based compensation expense |
|
12,366 |
|
|
2,869 |
|
|
|
- |
|
|
15,235 |
Depreciation and amortization |
|
8,822 |
|
|
17,083 |
|
|
|
- |
|
|
25,905 |
Impairment charges |
|
- |
|
|
130,411 |
|
|
|
- |
|
|
130,411 |
Restructuring and other related charges |
|
1,214 |
|
|
2,293 |
|
|
|
- |
|
|
3,507 |
Majority owned equity investees AOI |
|
- |
|
|
1,418 |
|
|
|
- |
|
|
1,418 |
Adjusted operating income (loss) |
$ |
209,934 |
|
$ |
15,101 |
|
|
$ |
243 |
|
$ |
225,278 |
|
Three Months Ended June 30, 2019 |
|
National Networks |
|
International and Other |
|
Inter-segment eliminations |
|
Consolidated |
|
|
|
|
|
|
|
|
Operating income (loss) |
$ |
214,198 |
|
$ |
(27,284 |
) |
|
$ |
(16,657 |
) |
|
$ |
170,257 |
Share-based compensation expense |
|
13,821 |
|
|
2,904 |
|
|
|
- |
|
|
|
16,725 |
Depreciation and amortization |
|
8,179 |
|
|
17,714 |
|
|
|
- |
|
|
|
25,893 |
Impairment charges |
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
Restructuring and other related charges |
|
274 |
|
|
16,888 |
|
|
|
- |
|
|
|
17,162 |
Majority owned equity investees AOI |
|
- |
|
|
1,608 |
|
|
|
- |
|
|
|
1,608 |
Adjusted operating income (loss) |
$ |
236,472 |
|
$ |
11,830 |
|
|
$ |
(16,657 |
) |
|
$ |
231,645 |
|
Six Months Ended June 30, 2020 |
|
National Networks |
|
International and Other |
|
Inter-segment eliminations |
|
Consolidated |
|
|
|
|
|
|
|
|
Operating income (loss) |
$ |
382,756 |
|
$ |
(158,424 |
) |
|
$ |
(2,560 |
) |
|
$ |
221,772 |
Share-based compensation expense |
|
24,832 |
|
|
5,915 |
|
|
|
- |
|
|
|
30,747 |
Depreciation and amortization |
|
17,211 |
|
|
35,424 |
|
|
|
- |
|
|
|
52,635 |
Impairment charges |
|
- |
|
|
130,411 |
|
|
|
- |
|
|
|
130,411 |
Restructuring and other related charges |
|
2,723 |
|
|
6,750 |
|
|
|
- |
|
|
|
9,473 |
Majority owned equity investees AOI |
|
- |
|
|
2,694 |
|
|
|
- |
|
|
|
2,694 |
Adjusted operating income (loss) |
$ |
427,522 |
|
$ |
22,770 |
|
|
$ |
(2,560 |
) |
|
$ |
447,732 |
|
Six Months Ended June 30, 2019 |
|
National Networks |
|
International and Other |
|
Inter-segment eliminations |
|
Consolidated |
|
|
|
|
|
|
|
|
Operating income (loss) |
$ |
465,702 |
|
$ |
(41,031 |
) |
|
$ |
(9,551 |
) |
|
$ |
415,120 |
Share-based compensation expense |
|
30,090 |
|
|
6,534 |
|
|
|
- |
|
|
|
36,624 |
Depreciation and amortization |
|
16,791 |
|
|
33,158 |
|
|
|
- |
|
|
|
49,949 |
Impairment charges |
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
Restructuring and other related charges |
|
576 |
|
|
19,923 |
|
|
|
(695 |
) |
|
|
19,804 |
Majority owned equity investees AOI |
|
- |
|
|
3,188 |
|
|
|
- |
|
|
|
3,188 |
Adjusted operating income (loss) |
$ |
513,159 |
|
$ |
21,772 |
|
|
$ |
(10,246 |
) |
|
$ |
524,685 |
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL
DATA (In
thousands)(Unaudited)
Capitalization |
June 30, 2020 |
|
|
Cash and cash equivalents |
$ |
889,887 |
Credit facility debt (a) |
$ |
712,500 |
Senior notes (a) |
|
2,200,000 |
Other debt |
|
6,000 |
Total debt |
$ |
2,918,500 |
|
|
Net debt |
$ |
2,028,613 |
|
|
Finance leases |
|
32,532 |
Net debt and finance leases |
$ |
2,061,145 |
|
|
|
Twelve Months Ended June 30, 2020 |
Operating Income (GAAP) |
$ |
431,929 |
Share-based compensation expense |
|
58,256 |
Depreciation and amortization |
|
103,784 |
Impairment charges |
|
237,014 |
Restructuring and other related charges |
|
30,583 |
Majority owned equity investees AOI |
|
5,471 |
Adjusted Operating Income
(Non-GAAP) |
$ |
867,037 |
|
|
Leverage ratio (b) |
2.4 x |
- Represents the aggregate principal amount of the debt.
- Represents net debt and finance leases divided by Adjusted
Operating Income for the twelve months ended June 30, 2020. 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.
|
Free Cash
Flow |
Six Months Ended June 30, |
|
|
2020 |
|
|
|
2019 |
|
Net cash provided by operating activities. |
$ |
424,912 |
|
|
$ |
288,937 |
|
Less: capital expenditures |
|
(22,172 |
) |
|
|
(49,463 |
) |
Less: distributions to noncontrolling interests. |
|
(10,607 |
) |
|
|
(10,129 |
) |
Free cash flow |
$ |
392,133 |
|
|
$ |
229,345 |
|
Adjusted Earnings Per Diluted
Share
|
|
Three Months Ended June 30, 2020 |
|
|
Income from operations before income taxes |
|
Income tax expense |
|
Net income attributable to noncontrolling interests |
|
Net income attributable to AMC Networks’ stockholders |
|
Diluted EPS attributable to AMC Networks’ stockholders |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported Results (GAAP) |
|
$ |
26,941 |
|
$ |
(9,707 |
) |
|
$ |
(2,273 |
) |
|
$ |
14,961 |
|
$ |
0.28 |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
|
|
10,962 |
|
|
(1,855 |
) |
|
|
(3,027 |
) |
|
|
6,080 |
|
|
0.12 |
Impairment charges |
|
|
130,411 |
|
|
(27,984 |
) |
|
|
- |
|
|
|
102,427 |
|
|
1.94 |
Restructuring and other related charges |
|
|
3,507 |
|
|
(799 |
) |
|
|
13 |
|
|
|
2,721 |
|
|
0.05 |
Loss on extinguishment of debt |
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
- |
Adjusted Results
(Non-GAAP) |
|
$ |
171,821 |
|
$ |
(40,345 |
) |
|
$ |
(5,287 |
) |
|
$ |
126,189 |
|
$ |
2.39 |
|
|
Three Months Ended June 30, 2019 |
|
|
Income from operations before income taxes |
|
Income tax expense |
|
Net income attributable to noncontrolling interests |
|
Net income attributable to AMC Networks’ stockholders |
|
Diluted EPS attributable to AMC Networks’ stockholders |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported Results (GAAP) |
|
$ |
132,589 |
|
$ |
1,396 |
|
|
$ |
(5,242 |
) |
|
$ |
128,743 |
|
$ |
2.25 |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
|
|
12,037 |
|
|
(1,983 |
) |
|
|
(3,027 |
) |
|
|
7,027 |
|
|
0.12 |
Impairment charges |
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
- |
Restructuring and other related charges |
|
|
17,162 |
|
|
(3,902 |
) |
|
|
(18 |
) |
|
|
13,242 |
|
|
0.23 |
Loss on extinguishment of debt |
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
- |
Adjusted Results
(Non-GAAP) |
|
$ |
161,788 |
|
$ |
(4,489 |
) |
|
$ |
(8,287 |
) |
|
$ |
149,012 |
|
$ |
2.60 |
|
|
Six Months Ended June 30, 2020 |
|
|
Income from operations before income taxes |
|
Income tax expense |
|
Net income attributable to noncontrolling interests |
|
Net income attributable to AMC Networks’ stockholders |
|
Diluted EPS attributable to AMC Networks’ stockholders |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported Results (GAAP) |
|
$ |
134,055 |
|
$ |
(43,295 |
) |
|
$ |
(7,132 |
) |
|
$ |
83,628 |
|
$ |
1.54 |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
|
|
23,094 |
|
|
(3,949 |
) |
|
|
(6,054 |
) |
|
|
13,091 |
|
|
0.24 |
Impairment charges |
|
|
130,411 |
|
|
(27,984 |
) |
|
|
- |
|
|
|
102,427 |
|
|
1.88 |
Restructuring and other related charges |
|
|
9,473 |
|
|
(2,298 |
) |
|
|
13 |
|
|
|
7,188 |
|
|
0.13 |
Loss on extinguishment of debt |
|
|
2,908 |
|
|
(733 |
) |
|
|
- |
|
|
|
2,175 |
|
|
0.04 |
Adjusted Results
(Non-GAAP) |
|
$ |
299,941 |
|
$ |
(78,259 |
) |
|
$ |
(13,173 |
) |
|
$ |
208,509 |
|
$ |
3.83 |
|
|
Six Months Ended June 30, 2019 |
|
|
Income from operations before income taxes |
|
Income tax expense |
|
Net income attributable to noncontrolling interests |
|
Net income attributable to AMC Networks’ stockholders |
|
Diluted EPS attributable to AMC Networks’ stockholders |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported Results (GAAP) |
|
$ |
329,222 |
|
$ |
(45,080 |
) |
|
$ |
(12,002 |
) |
|
$ |
272,140 |
|
$ |
4.73 |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
|
|
22,292 |
|
|
(3,844 |
) |
|
|
(4,534 |
) |
|
|
13,914 |
|
|
0.24 |
Impairment charges |
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
- |
Restructuring and other related charges |
|
|
19,804 |
|
|
(4,301 |
) |
|
|
(96 |
) |
|
|
15,407 |
|
|
0.27 |
Loss on extinguishment of debt |
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
- |
Adjusted Results
(Non-GAAP) |
|
$ |
371,318 |
|
$ |
(53,225 |
) |
|
$ |
(16,632 |
) |
|
$ |
301,461 |
|
$ |
5.24 |
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