AMC's Credit Rating Upgrade to B- but Remains Speculative
S&P Global Ratings upgraded AMC Entertainment’s credit rating from CCC+ to B-, citing improved operating performance, reduced debt levels, and a path toward positive free cash flow. However, the company still remains in speculative or 'junk' grade territory (below BBB-), indicating it is not yet financially secure and more vulnerable to economic downturns. AMC has managed its balance sheet by issuing new shares and converting debt into equity, which reduces default risk but dilutes shareholder ownership. The firm reported a record second-quarter with $1.6 billion in revenue and strong EBITDA growth of 69.6% year-over-year to $321.4 million. Despite improved operations, AMC still faces high fixed costs such as rent ($223.8M Q2) and interest expenses ($275.9M for six months). S&P estimates the company carries about $3.8 billion in debt with over $450 million annual interest expense.
Tickers: $AMC
Topics: AMC debt management S&P Global Ratings stock dilution