AMC Networks Shares Walk Higher on Q4/FY Earnings and Increased Streaming Subscribers

Source: Streetwise Reports   02/26/2021

AMC Networks Inc. shares traded 25% higher after the company reported Q4/20 and FY/20 financial results that included strong earnings in Q4/20 and an increase to more than 6 million aggregate streaming services subscribers.

Global entertainment company AMC Networks Inc. (AMCX:NASDAQ), which is known for its highly popular cable and streaming networks AMC, IFC, WE tv, SundanceTV and BBC AMERICA produced together with BBC Studios and many others, today announced financial and operating results for the fourth quarter and full year 2020 ended December 31, 2020.

The company’s President and CEO Josh Sapan commented, “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,” Sapan added.

AMC Networks highlighted that at the close of December 2020 it had greater than 6 million AMC Networks Streaming Services subscribers in aggregate across its AMC+, Acorn TV, Shudder, Sundance Now and ALLBLK streaming services. The company advised that this represents a 157% year-over-year increase in the number of its streaming service subscribers.

The company touched on several operating achievements during 2020 and stated that it successfully launched the AMC+ bundled streaming offering with many cable providers including Comcast, DISH Network, Sling TV, AT&T’s DIRECTV as well as with new age platforms that included Apple TV Channels, Roku and Amazon Prime Video Channels. The firm advised that it also renewed eight major carriage arrangements with network distribution partners in the U.S. and Canada, including three of the top five Multichannel Video Programming Distributors (MVPDs).

The company noted that in H2/20 it resumed production on several of its most watched and critically acclaimed TV shows including “The Walking Dead” and added that three other shows, “Gangs of London”, “A Discovery of Witches” and “Riviera” broke into the top ten most watched series on AMC+ and that together with “The Walking Dead” greatly enhanced viewer engagement.

The company stated that for FY/20 it earned revenues totaling $2.8 billion. The firm reported operating income for FY/20 of $443 million and adjusted operating income of $767 million. The company advised further that for FY/20 it posted diluted earnings per share (EPS) of $4.64 and adjusted EPS of $7.76.

AMC Networks indicated that during Q4/20 it had revenues of $780 million. During Q4/20 the company listed that operating income was $81 million and adjusted operating income came in at $133 million. Diluted EPS and adjusted EPS were $2.09 and $2.72, respectively.

The company noted that even though Q4/20 net revenues decreased by 0.6% to $780 million, compared to Q4/19, operating income increased 95.1%, or by $40 million to $81 million during the same period. The firm reported that this resulted in Q4/20 net income of $95 million, or $2.09 per diluted share, compared to a net loss of $9 million, or $0.15 per diluted share, in Q4/19.

The company stated that “for FY/20 it recognized a gain of $76 million related to its shares of FuboTV Inc.” The firm explained that it sold approximately 3.6 million shares of FUBO common stock in December 2020 and January 2021 in multiple transactions which allowed it to realize total gross proceeds of $96 million in January 2021. The company advised that it no longer owns any FuboTV shares.

The company said that in 2020 it repurchased 14.8 million of its own shares which represented a significant return of capital to stockholders. Over the course of the year the firm stated that it paid $354 million to acquire the shares at an average price of $23.91 per share.

AMC Networks began the day with a market capitalization of around $2.2 billion with approximately 41.24 million shares outstanding and a short interest of about 19.5%. AMCX shares opened greater than 7% higher today at $57.00 (+$3.93, +7.41%) over yesterday’s $53.07 closing price. The stock has traded today between $56.50 to $70.71 per share and is currently trading at $66.50 (+$13.43, +25.31%).

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