AMC Networks Inc. (“AMC Networks” or the “Company”) (NASDAQ: AMCX)
today reported financial results for the full year and fourth
quarter ended December 31, 2020.
President and Chief Executive Officer Josh Sapan
said: “2020 was a year of strong performance for AMC Networks, as
we continued to transform our company while successfully navigating
what has been a uniquely challenging and uncertain operating
environment. AMC Networks is now the worldwide leader in targeted
streaming and, with the addition of our new AMC+ premium bundled
offering, streaming is now the most significant growth area of our
company. Our distribution relationships are strong, now supported
by our streaming offerings, with our ability to complete several
renewals in 2020 underscoring the continued strength and attractive
value of our linear cable channels. Our digital advertising
initiatives are a key priority, including expanded distribution of
our content on AVOD and FAST platforms. Our proven and continued
ability to create and selectively curate must-have content is
allowing us to feed the content pipeline supporting all of our
offerings. Our strategy is providing us with strong tailwinds and
we believe there are significant and sustainable opportunities
before us as we continue to reconstitute our company.”
Full Year Operational
Highlights:
- Ended 2020 with
more than 6 million aggregate AMC Networks Streaming Services
subscribers across the Company’s AMC+, Acorn TV, Shudder, Sundance
Now and ALLBLK streaming services, representing year-over-year
aggregate subscriber growth of 157%.
- Launched the
AMC+ bundled streaming offering with Comcast, DISH Network and
Sling TV and AT&T’s DIRECTV platforms, as well as on Amazon
Prime Video Channels, Apple TV Channels and Roku’s distribution
platforms.
- Renewed eight
major carriage arrangements with our network distribution partners
in the United States and Canada, including three of the top five
MVPDs.
- Reached
agreements with and launched content on leading ad-supported video
on demand (AVOD) and free ad-supported streaming (FAST) channels
platforms, including PlutoTV, Amazon’s IMDb TV, Sling TV, Samsung
TV Plus and VIZIO SmartCast.
- Completed two
first-to-market national linear addressable campaigns, a
significant and long-awaited step to unleash the potential of
addressable advertising on television at scale.
- Resumed
production of multiple shows in Q3 and Q4, including “The Walking
Dead”, “Fear The Walking Dead”, “Creepshow” and the upcoming “Kevin
Can F**k Himself”, among others.
- “Gangs of
London,” “A Discovery of Witches” and “Riviera” broke into the top
ten most watched series on AMC+, and along with “The Walking Dead,”
worked to drive viewer engagement.
Full Year Financial
Highlights:
- Revenues of $2.8
billion
- Operating income
of $443 million; Adjusted Operating Income2 of $767 million
- Diluted EPS of
$4.64; Adjusted EPS2 of $7.76
- Net cash
provided by operating activities of $749 million; Free Cash Flow of
$686 million
Fourth Quarter Financial
Highlights:
- Revenues of $780
million
- Operating income
of $81 million; Adjusted Operating Income of $133 million
- Diluted EPS of
$2.09; Adjusted EPS of $2.72
Fourth Quarter Results
Fourth quarter net revenues decreased 0.6%, or
$5 million, to $780 million over the fourth quarter of 2019. The
decrease in net revenues reflected a decrease of 3.0% at National
Networks and an increase of 7.5% at International and Other.
Operating income was $81 million, an increase of 95.1%, or $40
million, versus the prior comparable period. The operating income
increase reflected a $41 million improvement in operating loss at
International and Other, driven by a $107 million impairment charge
in the prior comparable period, partially offset by a decrease of
7.9% in National Networks operating income. Adjusted Operating
Income was $133 million, a decrease of 33.3%, or $67 million,
versus the prior comparable period. National Networks Adjusted
Operating Income decreased 4.7%, largely due to lower distribution
and advertising revenues, partially offset by a decrease in
SG&A expenses. International and Other Adjusted Operating
Income decreased $69 million versus the prior comparable period
resulting in an Adjusted Operating Loss of $55 million, largely due
to increased marketing expense associated with the launch of AMC+,
partially offset by higher subscription revenues at AMC Networks
Streaming Services.
Fourth quarter net income was $95 million ($2.09
per diluted share), compared with a net loss of $9 million (-$0.15
per diluted share) in the prior comparable period. The increase in
EPS was primarily related to mark-to-market gains on investments in
the current period, higher impairment charges in the prior
comparable period, as well as an improvement in operating income.
Fourth quarter adjusted net income was $123 million (Adjusted
EPS of $2.72 per diluted share), compared with $96 million
(Adjusted EPS of $1.69 per diluted share) in the prior comparable
period. The increase in Adjusted EPS was primarily related to
mark-to-market gains on investments and a reduction in shares
outstanding, partially offset by declines in Adjusted Operating
Income and higher income tax expense.
Full Year Results
Full year 2020 net revenues decreased 8.0%, or
$245 million, to $2.815 billion compared to full year 2019,
reflecting a decrease of 11.5% at National Networks and an increase
of 1.7% at International and Other. Operating income was $443
million, a decrease of $183 million, versus the prior year.
National Networks operating income decreased 18.4% and
International and Other operating loss increased $54 million versus
the prior year. Adjusted Operating Income was $767 million, a
decrease of 18.8%, or $177 million, versus the prior year. National
Networks Adjusted Operating Income decreased 15.9% largely driven
by decreases in distribution revenues and advertising revenues
partially offset by decreased operating expenses. Decreases in
distribution revenues reflect lower subscription revenues driven by
subscriber universe declines and decreased content licensing
revenues due to a reduction in the number of original programs
distributed as a result of COVID-19 related production delays.
Advertising revenues decreases were largely due to shifts in the
timing of original programming as a result of production delays
caused by the pandemic, resulting in lower inventory, partially
offset by increased CPMs. International and Other Adjusted
Operating Income decreased $54 million resulting in an Adjusted
Operating Loss of $4 million, versus the prior year. International
and Other Adjusted Operating Loss was primarily driven by increased
marketing expense associated with AMC Networks Streaming Services
including the launch of AMC+, lower subscription and advertising
revenues at AMCNI, and COVID-19 related venue closures at Levity,
partially offset by higher subscription revenues from AMC Networks
Streaming Services.
Full year net income was $240 million ($4.64 per
diluted share), compared with $380 million ($6.67 per diluted
share) in the prior year. The decrease in EPS was primarily related
to a decrease in operating income and an increase in income tax
expense, partially offset by a reduction in shares outstanding and
mark-to-market gains on investments. Full year adjusted net income
was $401 million (Adjusted EPS of $7.76 per diluted share),
compared with $529 million (Adjusted EPS of $9.27 per diluted
share) in the prior year. The decrease in Adjusted EPS was
primarily related to a decrease in operating income and an increase
in income tax expense, partially offset by a reduction in shares
outstanding and mark-to-market gains on investments.
For the full year 2020, net cash provided by
operating activities was $749 million, an increase of $265 million
versus the prior year. The increase was primarily the result of a
decrease in working capital, partially offset by a decrease in
Adjusted Operating Income. Free Cash Flow for the full year
2020 was $686 million, an increase of $310 million versus the prior
year. The increase primarily reflected the increase in net cash
provided by operating activities and a decrease in capital
expenditures.
Segment Results(dollars in
thousands)
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
2020 |
|
2019 |
|
Change |
|
2020 |
|
2019 |
|
|
Change |
Net
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
National Networks |
$ |
571,231 |
|
|
|
$ |
589,195 |
|
|
|
(3.0 |
) |
% |
|
$ |
2,096,169 |
|
|
|
$ |
2,369,044 |
|
|
|
(11.5 |
) |
% |
International and Other |
215,762 |
|
|
|
200,687 |
|
|
|
7.5 |
|
% |
|
746,527 |
|
|
|
734,143 |
|
|
|
1.7 |
|
% |
Inter-segment eliminations |
(6,718 |
) |
|
|
(4,678 |
) |
|
|
n/m |
|
(27,740 |
) |
|
|
(42,866 |
) |
|
|
n/m |
Total Net Revenues |
$ |
780,275 |
|
|
|
$ |
785,204 |
|
|
|
(0.6 |
) |
% |
|
$ |
2,814,956 |
|
|
|
$ |
3,060,321 |
|
|
|
(8.0 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
(Loss): |
|
|
|
|
|
|
|
|
|
|
|
National Networks |
$ |
143,827 |
|
|
|
$ |
156,242 |
|
|
|
(7.9 |
) |
% |
|
$ |
656,425 |
|
|
|
$ |
804,422 |
|
|
|
(18.4 |
) |
% |
International and Other |
(77,002 |
) |
|
|
(117,510 |
) |
|
|
(34.5 |
) |
% |
|
(224,228 |
) |
|
|
(170,039 |
) |
|
|
31.9 |
|
% |
Inter-segment eliminations |
14,570 |
|
|
|
2,987 |
|
|
|
n/m |
|
10,447 |
|
|
|
(9,106 |
) |
|
n/m |
Total Operating Income
(Loss) |
$ |
81,395 |
|
|
|
$ |
41,719 |
|
|
|
95.1 |
|
% |
|
$ |
442,644 |
|
|
|
$ |
625,277 |
|
|
|
(29.2 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Operating
Income (Loss): |
|
|
|
|
|
|
|
|
|
|
|
National Networks |
$ |
173,354 |
|
|
|
$ |
181,957 |
|
|
|
(4.7 |
) |
% |
|
$ |
760,053 |
|
|
|
$ |
903,526 |
|
|
|
(15.9 |
) |
% |
International and Other |
(54,536 |
) |
|
|
14,955 |
|
|
|
(464.7 |
) |
% |
|
(3,889 |
) |
|
|
50,193 |
|
|
|
(107.7 |
) |
% |
Inter-segment eliminations |
14,570 |
|
|
|
3,059 |
|
|
|
n/m |
|
10,447 |
|
|
|
(9,729 |
) |
|
|
n/m |
Total Adjusted Operating
Income |
$ |
133,388 |
|
|
|
$ |
199,971 |
|
|
|
(33.3 |
) |
% |
|
$ |
766,611 |
|
|
|
$ |
943,990 |
|
|
|
(18.8 |
) |
% |
National Networks
National Networks principally consists of the
Company’s five nationally distributed programming networks, AMC, WE
tv, BBC AMERICA, IFC and SundanceTV; and AMC Studios, the Company’s
television production business.
Fourth Quarter Results
National Networks revenues for the fourth
quarter 2020 decreased 3.0% to $571 million, operating income
decreased 7.9% to $144 million, and Adjusted Operating Income
decreased 4.7% to $173 million, all compared to the prior
comparable period.
Fourth quarter revenues reflected a 1.2%
decrease in distribution revenues to $334 million. The decrease in
distribution revenues was attributable to a 1.8% decrease in
content licensing and a 1.1% decrease in subscription revenues.
Advertising revenues decreased 5.5% to $237 million. The decrease
in advertising revenues was primarily related to shifts in the
timing of original programming as a result of production delays
caused by the pandemic, resulting in lower inventory, partially
offset by CPM increases driven by healthy scatter pricing.
Fourth quarter operating income and Adjusted
Operating Income reflected the decrease in revenues, partially
offset by a decrease in SG&A expense. Programming expenses
declined 1.2% compared to the prior comparable period. Programming
expenses includes programming write-offs of $54 million, an
increase of $31 million compared to the prior comparable period.
Programming write-offs are based on management’s periodic
assessment of programming usefulness.
Full Year Results
National Networks revenues for the full year
2020 decreased 11.5% to $2.096 billion, operating income decreased
18.4% to $656 million, and Adjusted Operating Income decreased
15.9% to $760 million, all compared to the prior year.
Full year revenues reflected a 11.7% decrease in
distribution revenues to $1.294 billion. The decrease in
distribution revenues was attributable to a 7.5% decrease in
subscription revenues and a 22.1% decrease in content licensing
revenues. Subscription revenues decreased primarily due to
subscriber universe declines. Content licensing revenues decreased
due to a reduction in the number of original programs as a result
of COVID-19 related production delays. Advertising revenues
decreased 11.3% to $802 million. The decrease in advertising
revenues was primarily related shifts in the timing of original
programming as a result of production delays caused by the
pandemic, resulting in lower inventory, partially offset by CPM
increases.
Full year 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
expense, lower marketing and personnel expenses. Programming
expenses included write-offs of $85.5 million in the current year
period related to the write-off of programming assets, as compared
to write-offs of $37.9 million in the prior year. Operating income
also reflected an increase in depreciation and amortization and
restructuring and other related charges and a decrease in
share-based compensation expense.
International and Other
International and Other principally consists of
AMC Networks International, the Company's international programming
business; AMC Networks Streaming Services, the Company’s
subscription streaming business; Levity, the Company’s production
services and comedy venues business; and IFC Films, the Company’s
independent film distribution business.
Fourth Quarter Results
International and Other revenues for the fourth
quarter of 2020 increased 7.5% to $216 million, operating loss
improved $41 million resulting in an operating loss of $77 million,
and Adjusted Operating Income decreased $69 million resulting in an
Adjusted Operating Loss of $55 million, all compared to the prior
comparable period.
Fourth quarter revenues primarily reflected an
increase of subscription revenues at AMC Networks Streaming
Services.
Fourth quarter operating loss and Adjusted
Operating Loss reflected the increase in AMC Networks Streaming
Services revenues as well as an increase in operating expenses
including programming expense as well as increased marketing
expense. The increase in operating expenses was primarily
attributable to an increase marketing expense at AMC Networks
Streaming Services and the launch of AMC+.
Full Year Results
International and Other revenues for the full
year 2020 increased 1.7% to $747 million, operating loss increased
31.9% to a loss of $224 million, and Adjusted Operating Income
decreased $54 million resulting in an Adjusted Operating Loss of $4
million, all compared to the prior year.
Full year revenues primarily reflected increased
subscription revenues at AMC Networks Streaming Services, partially
offset by lower revenues at Levity due to venue closures and lower
subscription and advertising revenues at AMC Networks
International. Full year AMC Networks Streaming Services revenues
increased, primarily driven by an increase in paying
subscribers.
Full year operating loss and Adjusted Operating
Loss reflected the increase in revenues, increase in operating
expenses including programming expense as well as increased
marketing expense. The increase in operating expenses was primarily
attributable to an increase in marketing expense at AMC Networks
Streaming Services.
Other Matters
Sale of FuboTV Inc. Shares
For the year ended December 31, 2020, AMC
Networks recognized a gain of $76 million related to its shares of
FuboTV Inc. AMC Networks sold 3,593,494 shares of FUBO common stock
in multiple transactions occurring in December 2020 and January
2021. Realizing total gross proceeds of $96 million in January
2021. As of the date of this release, AMC Networks does not hold
any shares of FuboTV common stock.
Amendment to Amended and Restated Credit Agreement
As previously disclosed, on February 8, 2021,
AMC Networks entered into Amendment No. 1 to AMC Networks’ existing
Credit Agreement. Amendment No. 1 extends the maturity dates of the
$675 million Term Loan A Facility and $500 million Revolving Credit
Facility under the Credit Agreement to February 8, 2026, and makes
certain other amendments to the covenants and other provisions of
the Credit Agreement.
Senior Notes Issuance / Debt Redemption
As previously disclosed, on February 8, 2021,
AMC Networks issued, $1.0 billion aggregate principal amount of
4.25% senior notes due February 15, 2029 in a registered public
offering and received net proceeds of $982.3 million, after
deducting underwriting discounts, commissions and expenses. The
Company intends to use such proceeds to redeem (i) the remaining
$400 million principal amount of the Company’s 4.75% senior notes
due 2022 and (ii) $600 million principal amount of the Company’s
5.00% senior notes due 2024 on February 26, 2021.
Stock Repurchase Program
As previously disclosed, the Company’s Board of
Directors authorized a program to repurchase up to $1.5 billion of
the Company’s 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 full
year 2020, the Company repurchased 14.8 million shares of its Class
A common stock for $354 million representing an average purchase
price of $23.91 per share (inclusive of shares repurchased in a
“modified Dutch auction” tender offer, which was completed in
October 2020). As of December 31, 2020, the Company had $135
million available for repurchase under the stock repurchase
program.
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 2020, the
Company experienced adverse advertising sales impacts; suspended
content production, which led to delays in the creation and
availability of some of its television programming; and temporarily
closed its comedy venues. In the third quarter of 2020, the Company
commenced production activities, however substantially all Company
employees continue to work remotely, and the Company continues to
restrict 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 vaccines, 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.
Restructuring and Other Related Charges
In November 2020, management commenced a
restructuring plan (the “2020 Plan”) designed to streamline the
Company’s operations through a reduction of its domestic workforce.
The 2020 Plan is intended to improve the organizational design of
the Company through the elimination of certain roles and
centralization of certain functional areas of the Company. In
connection with the 2020 Plan, the Company incurred severance and
other personnel costs of $21.2 million. Additional restructuring
and other related charges for the year ended December 31, 2020 were
$13.9 million, which related to costs associated with the
termination of distribution in certain territories, as well as
severance and other personnel related costs associated with
previously disclosed restructuring activities.
Please see the Company’s Form 10-K for the
period ended December 31, 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 10 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 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 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 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 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 full year and fourth quarter 2020
results. To listen to the call, visit http://www.amcnetworks.com or
dial 833-714-3268, using the following conference ID: 5976434.
About AMC Networks Inc.
AMC Networks is a global entertainment company
known for its popular and critically-acclaimed content. Its
portfolio of brands includes AMC, BBC AMERICA (operated through a
joint venture with BBC Studios), IFC, SundanceTV, WE tv, IFC Films,
and a number of fast-growing streaming services, including the AMC+
premium streaming bundle, Acorn TV, Shudder, Sundance Now and
ALLBLK (formerly branded “UMC”). AMC Studios, the Company’s
in-house studio, production and distribution operation, is behind
award-winning owned series and franchises, including The Walking
Dead, the highest-rated series in cable history. The Company also
operates AMC Networks International, its international programming
business, and Levity Entertainment Group, its production services
and comedy venues business.
Contacts
Investor Relations |
Corporate Communications |
Nicholas Seibert (646)
740-5749 |
Georgia Juvelis (917)
542-6390 |
nicholas.seibert@amcnetworks.com |
georgia.juvelis@amcnetworks.com |
AMC NETWORKS
INC.CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share
amounts)(unaudited)
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Revenues, net |
$ |
780,275 |
|
|
|
$ |
785,204 |
|
|
|
$ |
2,814,956 |
|
|
|
$ |
3,060,321 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
Technical and operating (excluding depreciation and
amortization) |
441,212 |
|
|
|
426,222 |
|
|
|
1,401,591 |
|
|
|
1,506,985 |
|
|
Selling, general and administrative |
220,239 |
|
|
|
174,211 |
|
|
|
708,820 |
|
|
|
679,444 |
|
|
Depreciation and amortization |
24,424 |
|
|
|
25,530 |
|
|
|
104,606 |
|
|
|
101,098 |
|
|
Impairment charges |
(8,184 |
) |
|
|
106,603 |
|
|
|
122,227 |
|
|
|
106,603 |
|
|
Restructuring and other related charges |
21,189 |
|
|
|
10,919 |
|
|
|
35,068 |
|
|
|
40,914 |
|
|
|
698,880 |
|
|
|
743,485 |
|
|
|
2,372,312 |
|
|
|
2,435,044 |
|
|
Operating income |
81,395 |
|
|
|
41,719 |
|
|
|
442,644 |
|
|
|
625,277 |
|
|
Other income (expense): |
|
|
|
|
|
|
|
Interest expense |
(33,327 |
) |
|
|
(38,816 |
) |
|
|
(138,610 |
) |
|
|
(157,798 |
) |
|
Interest income |
18,756 |
|
|
|
11,136 |
|
|
|
30,032 |
|
|
|
24,707 |
|
|
Loss on extinguishment of debt |
— |
|
|
|
— |
|
|
|
(2,908 |
) |
|
|
— |
|
|
Miscellaneous, net |
81,309 |
|
|
|
10,972 |
|
|
|
71,221 |
|
|
|
(6,000 |
) |
|
|
66,738 |
|
|
|
(16,708 |
) |
|
|
(40,265 |
) |
|
|
(139,091 |
) |
|
Income from operations before
income taxes |
148,133 |
|
|
|
25,011 |
|
|
|
402,379 |
|
|
|
486,186 |
|
|
Income tax expense |
(49,901 |
) |
|
|
(24,663 |
) |
|
|
(145,391 |
) |
|
|
(78,470 |
) |
|
Net income including
noncontrolling interests |
98,232 |
|
|
|
348 |
|
|
|
256,988 |
|
|
|
407,716 |
|
|
Net income attributable to
noncontrolling interests |
(3,521 |
) |
|
|
(8,925 |
) |
|
|
(17,009 |
) |
|
|
(27,230 |
) |
|
Net income (loss) attributable
to AMC Networks’ stockholders |
$ |
94,711 |
|
|
|
$ |
(8,577 |
) |
|
|
$ |
239,979 |
|
|
|
$ |
380,486 |
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share attributable to AMC Networks’
stockholders: |
|
|
|
|
Basic |
$ |
2.15 |
|
|
|
$ |
(0.15 |
) |
|
|
$ |
4.70 |
|
|
|
$ |
6.77 |
|
|
Diluted |
$ |
2.09 |
|
|
|
$ |
(0.15 |
) |
|
|
$ |
4.64 |
|
|
|
$ |
6.67 |
|
|
|
|
|
|
|
|
|
|
Weighted average common
shares: |
|
|
|
|
|
|
|
Basic |
43,990 |
|
|
|
55,807 |
|
|
|
51,016 |
|
|
|
56,205 |
|
|
Diluted |
45,228 |
|
|
|
56,501 |
|
|
|
51,733 |
|
|
|
57,037 |
|
|
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL DATA
(Dollars in
thousands)(Unaudited)
|
Three Months Ended December 31, 2020 |
|
National Networks |
|
International and Other |
|
Inter-segment eliminations |
|
Consolidated |
Operating income (loss) |
$ |
143,827 |
|
|
$ |
(77,002 |
) |
|
|
$ |
14,570 |
|
|
$ |
81,395 |
|
Share-based compensation expense |
7,782 |
|
|
1,985 |
|
|
|
— |
|
|
9,767 |
|
Depreciation and amortization |
9,906 |
|
|
14,518 |
|
|
|
— |
|
|
24,424 |
|
Impairment charges |
— |
|
|
(8,184 |
) |
|
|
— |
|
|
(8,184 |
) |
Restructuring and other related charges |
11,839 |
|
|
9,350 |
|
|
|
— |
|
|
21,189 |
|
Cloud computing amortization |
— |
|
|
200 |
|
|
|
— |
|
|
200 |
|
Majority owned equity investees AOI |
— |
|
|
4,597 |
|
|
|
— |
|
|
4,597 |
|
Adjusted operating income (loss) |
$ |
173,354 |
|
|
$ |
(54,536 |
) |
|
|
$ |
14,570 |
|
|
$ |
133,388 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, 2019 |
|
National Networks |
|
International and Other |
|
Inter-segment eliminations |
|
Consolidated |
Operating income (loss) |
$ |
156,242 |
|
|
$ |
(117,510 |
) |
|
|
$ |
2,987 |
|
|
$ |
41,719 |
|
Share-based compensation expense |
11,203 |
|
|
2,465 |
|
|
|
— |
|
|
13,668 |
|
Depreciation and amortization |
7,834 |
|
|
17,696 |
|
|
|
— |
|
|
25,530 |
|
Impairment charges |
— |
|
|
106,603 |
|
|
|
— |
|
|
106,603 |
|
Restructuring and other related charges |
6,678 |
|
|
4,169 |
|
|
|
72 |
|
|
10,919 |
|
Majority owned equity investees AOI |
— |
|
|
1,532 |
|
|
|
— |
|
|
1,532 |
|
Adjusted operating income (loss) |
$ |
181,957 |
|
|
$ |
14,955 |
|
|
|
$ |
3,059 |
|
|
$ |
199,971 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended December 31, 2020 |
|
National Networks |
|
International and Other |
|
Inter-segment eliminations |
|
Consolidated |
Operating income (loss) |
$ |
656,425 |
|
|
$ |
(224,228 |
) |
|
|
$ |
10,447 |
|
|
$ |
442,644 |
|
Share-based compensation expense |
42,536 |
|
|
10,372 |
|
|
|
— |
|
|
52,908 |
|
Depreciation and amortization |
40,539 |
|
|
64,067 |
|
|
|
— |
|
|
104,606 |
|
Impairment charges |
— |
|
|
122,227 |
|
|
|
— |
|
|
122,227 |
|
Restructuring and other related charges |
20,553 |
|
|
14,515 |
|
|
|
— |
|
|
35,068 |
|
Cloud computing amortization |
— |
|
|
200 |
|
|
|
— |
|
|
200 |
|
Majority owned equity investees AOI |
— |
|
|
8,958 |
|
|
|
— |
|
|
8,958 |
|
Adjusted operating income (loss) |
$ |
760,053 |
|
|
$ |
(3,889 |
) |
|
|
$ |
10,447 |
|
|
$ |
766,611 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended December 31, 2019 |
|
National Networks |
|
International and Other |
|
Inter-segment eliminations |
|
Consolidated |
Operating income (loss) |
$ |
804,422 |
|
|
$ |
(170,039 |
) |
|
|
$ |
(9,106 |
) |
|
$ |
625,277 |
|
Share-based compensation expense |
52,977 |
|
|
11,156 |
|
|
|
— |
|
|
64,133 |
|
Depreciation and amortization |
32,674 |
|
|
68,424 |
|
|
|
— |
|
|
101,098 |
|
Impairment charges |
— |
|
|
106,603 |
|
|
|
— |
|
|
106,603 |
|
Restructuring and other related charges |
13,453 |
|
|
28,084 |
|
|
|
(623 |
) |
|
40,914 |
|
Majority owned equity investees AOI |
— |
|
|
5,965 |
|
|
|
— |
|
|
5,965 |
|
Adjusted operating income (loss) |
$ |
903,526 |
|
|
$ |
50,193 |
|
|
|
$ |
(9,729 |
) |
|
$ |
943,990 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMC NETWORKS
INC.SUPPLEMENTAL FINANCIAL DATA
(In thousands)(Unaudited)
Capitalization |
December 31, 2020 |
|
Cash and cash equivalents |
$ |
888,526 |
|
|
|
|
|
Credit facility debt (a) |
$ |
675,000 |
|
|
Senior notes (a) |
2,200,000 |
|
|
Total debt |
$ |
2,875,000 |
|
|
|
|
|
Net debt |
$ |
1,986,474 |
|
|
|
|
|
Finance leases |
31,494 |
|
|
Net debt and finance leases |
$ |
2,017,968 |
|
|
|
|
|
|
Twelve Months Ended December 31, 2020 |
|
Operating Income (GAAP) |
$ |
442,644 |
|
|
Share-based compensation expense |
52,908 |
|
|
Depreciation and amortization |
104,606 |
|
|
Impairment charges |
122,227 |
|
|
Restructuring and other related charges |
35,068 |
|
|
Cloud computing amortization |
200 |
|
|
Majority owned equity investees |
8,958 |
|
|
Adjusted Operating Income (Non-GAAP) |
$ |
766,611 |
|
|
|
|
|
Leverage ratio (b) |
2.6 |
|
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 December 31, 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 |
Twelve Months Ended December 31, |
|
2020 |
|
2019 |
Net cash provided by operating activities |
$ |
748,736 |
|
|
|
483,748 |
|
|
Less: capital expenditures |
(46,595 |
) |
|
|
(91,604 |
) |
|
Less: distributions to noncontrolling interests |
(15,819 |
) |
|
|
(15,558 |
) |
|
Free cash flow |
$ |
686,322 |
|
|
|
$ |
376,586 |
|
|
Adjusted
Earnings Per Diluted Share |
|
Three Months Ended December 31, 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) |
$ |
148,133 |
|
|
$ |
(49,901 |
) |
|
|
$ |
(3,521 |
) |
|
|
$ |
94,711 |
|
|
$ |
2.09 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
9,582 |
|
|
(1,025 |
) |
|
|
(3,028 |
) |
|
|
5,529 |
|
|
0.13 |
|
Impairment charges |
(8,184) |
|
|
15,419 |
|
|
|
— |
|
|
|
7,235 |
|
|
0.16 |
|
Restructuring and other related charges |
21,189 |
|
|
(4,540 |
) |
|
|
(1,317 |
) |
|
|
15,332 |
|
|
0.34 |
|
Loss on extinguishment of debt |
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
Adjusted Results
(Non-GAAP) |
$ |
170,720 |
|
|
$ |
(40,047 |
) |
|
|
$ |
(7,866 |
) |
|
|
$ |
122,807 |
|
|
$ |
2.72 |
|
|
Three Months Ended December 31, 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) |
$ |
25,011 |
|
|
$ |
(24,663 |
) |
|
|
$ |
(8,925 |
) |
|
|
$ |
(8,577 |
) |
|
$ |
(0.15 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
11,934 |
|
|
(2,057 |
) |
|
|
(3,027 |
) |
|
|
6,850 |
|
|
0.12 |
|
Impairment charges |
106,603 |
|
|
(17,147 |
) |
|
|
— |
|
|
|
89,456 |
|
|
1.58 |
|
Restructuring and other related charges |
10,919 |
|
|
(2,595 |
) |
|
|
(442 |
) |
|
|
7,882 |
|
|
0.14 |
|
Loss on extinguishment of debt |
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
Adjusted Results
(Non-GAAP) |
$ |
154,467 |
|
|
$ |
(46,462 |
) |
|
|
$ |
(12,394 |
) |
|
|
$ |
95,611 |
|
|
$ |
1.69 |
|
|
Twelve Months Ended December 31, 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) |
$ |
402,379 |
|
|
$ |
(145,391 |
) |
|
|
$ |
(17,009 |
) |
|
|
$ |
239,979 |
|
|
$ |
4.64 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
42,224 |
|
|
(6,438 |
) |
|
|
(12,109 |
) |
|
|
23,677 |
|
|
0.46 |
|
Impairment charges |
122,227 |
|
|
(12,565 |
) |
|
|
— |
|
|
|
109,662 |
|
|
2.12 |
|
Restructuring and other related charges |
35,068 |
|
|
(7,889 |
) |
|
|
(1,304 |
) |
|
|
25,875 |
|
|
0.50 |
|
Loss on extinguishment of debt |
2,908 |
|
|
(733 |
) |
|
|
— |
|
|
|
2,175 |
|
|
0.04 |
|
Adjusted Results
(Non-GAAP) |
$ |
604,806 |
|
|
$ |
(173,016 |
) |
|
|
$ |
(30,422 |
) |
|
|
$ |
401,368 |
|
|
$ |
7.76 |
|
|
Twelve Months Ended December 31, 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) |
$ |
486,186 |
|
|
$ |
(78,470 |
) |
|
|
$ |
(27,230 |
) |
|
|
$ |
380,486 |
|
|
$ |
6.67 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangible assets |
46,169 |
|
|
(7,778 |
) |
|
|
(10,588 |
) |
|
|
27,803 |
|
|
0.49 |
|
Impairment charges |
106,603 |
|
|
(17,147 |
) |
|
|
— |
|
|
|
89,456 |
|
|
1.57 |
|
Restructuring and other related charges |
40,914 |
|
|
(9,214 |
) |
|
|
(555 |
) |
|
|
31,145 |
|
|
0.55 |
|
Loss on extinguishment of debt |
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
Adjusted Results
(Non-GAAP) |
$ |
679,872 |
|
|
$ |
(112,609 |
) |
|
|
$ |
(38,373 |
) |
|
|
$ |
528,890 |
|
|
$ |
9.27 |
|
(1) AMC Networks Streaming Services
subscribers represent total company aggregate paid streaming
subscribers.(2) See page 7 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.
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