AMC Entertainment Holdings, Inc. (NYSE:AMC) Q1 2021 Earnings Conference Call May 6, 2021 5:00 PM ET
John Merriwether - Vice President, Investor Relations
Adam Aron - Chief Executive Officer and President
Sean Goodman - Executive Vice President and Chief Financial Officer
Conference Call Participants
Eric Wold - B. Riley
Meghan Durkin - Credit Suisse
Greetings, and welcome to the AMC Entertainment First Quarter 2021 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we’ll conduct a question-and-answer session. [Operator Instructions] As a reminder, this call is being recorded today Thursday, May 6, 2021.
I'd now like to turn the call over to John Merriwether, Vice President, Investor Relations.
Thank you. Good afternoon. I'd like to welcome everyone to AMC's first quarter 2021 earnings webcast. With me this afternoon is Adam Aron, our President and Chief Executive Officer; and Sean Goodman, our Chief Financial Officer.
Before I turn the webcast over to Adam, let me remind everyone that some of the comments made by management today during this webcast may contain forward-looking statements that are based on management's current expectations. Numerous risks, uncertainties and other factors may cause actual results to differ materially from those that might be expressed today. Many of these risks and uncertainties are discussed in our most recent public filings including our most recently filed 10-Q. Several of the factors that will determine the company's future results are beyond the ability of the company to control or predict.
In light of the uncertainties inherent in any forward-looking statements, listeners are cautioned to not place undue reliance on these statements. The company undertakes no obligation to revise or update any forward-looking statements, whether as a result of new information or future events.
On this webcast, we may reference measures, such as adjusted EBITDA, free cash flow, adjusted free cash flow and constant currency, among others, which are non-GAAP financial measures. For a full reconciliation of our non-GAAP measures to GAAP results, please see our earnings release posted in the Investor Relations section of our website earlier today.
After our prepared remarks, there will be a Q&A session. This afternoon's webcast is being recorded, and a replay will be available in the Investor Relations section of our website at amctheaters.com later today.
With that, I'll turn the call over to Adam.
Thank you, John, and good afternoon, everyone. Thank you for joining us today.
For the last year, I've started all our AMC earnings webcasts and all our internal employee meetings by expressing my sincere wishes that you and your families, along with your colleagues and friends all have been and are now still in good health in these challenging COVID times. Today is no different. I so do hope that you all are well.
But with 250 million vaccination doses already in arm in the United States, and more than 1.2 billion doses of the vaccine having been administered globally and given that millions of more vaccine injections are taking place every single day, both at home and abroad, this just may be the last time or close to the last time that we feel the need to do a preamble on these calls about your health. Isn't that a glorious thing to contemplate?
I watch those vaccinations statistics closely all the time, because let's say what it is. Vaccination is our way out of all of this. Count me among the many who continue to marvel and by the way, that's little M, marvel as in being amazed, not capital M, Marvel, through which Disney is going to be releasing some extraordinary movies theatrically this year.
Anyway, I truly marvel that every one of us talking or listening today on this webcast are now in our 14th or 15th-month of living through this real-life horror show repeat of the Spanish flu epidemic of 1918 and 1919. I doubt that anyone, anyone on this call really expected that ever in our lifetimes that we have to deal with something this bad, which is so disruptive to what we think of as normal living and to do that for so long.
Before I leave the vaccination issue though, which is so critical to AMC's recovery for obvious reasons, I said a few months back that Albert Bourla, the CEO of Pfizer, might just be the most important human in directing the comeback on the immediate future of the entire cinema industry. I meant that then, and I mean that still today. Although, he may have to share some credit with Moderna and others in pharma, as well as with those in the Trump administration who made a daring commitment to operation work speed.
But today, we also are so incredibly grateful to the new Biden administration for getting the vaccine rolled out and in arm to so many Americans so quickly. The U.S. is conquering a mind-numbing logistical challenge, and the country doing so is a major reason why I am truly and absolutely optimistic, hopeful and confident in AMC's recovery.
Turning more directly to AMC. As I look back on the odyssey of the past year for AMC, there's just no other way to say it than this. It is simply and utterly astonishing. What AMC has accomplished since March of 2020, astonishing. It should take your breath away. It certainly did mine. And I say that not trying to have any sense of braggadocio, it's just the truth.
And even as we say that when we look back at what we've accomplished in such challenging times, we're not wearing rose-colored glasses. We're not sugarcoating our reality. We know that AMC is losing money today, not making money today. And we know, too, and are so very well aware that there is enormous work ahead for us to steer AMC through to a recovery.
But what gives us the confidence that recovery is finally in our reach, and that going forward, we will maneuver our way to get AMC through these waters, is this. Just look at what this management team already has pulled off in these unparalleled times.
At AMC, we were within months or weeks of running out of cash, five different times between April of 2020 and January of 2021. There are a lot of smart people on this call. And many of you were certain that AMC would collapse. Why? To use a billiards metaphor because to succeed, we would have had to run the table about 10 times in a row. We would've had to execute flawlessly on so many different dimensions, but that's the thing here at AMC that's precisely what we did.
My goodness, the strength and circumstances of AMC are so much radically different and radically improved on May 6 than they were just months ago on November 6tor December 6 or on January 6.
Six months ago, in this very quarterly earnings call forum, I was quoting Winston Churchill's famous, we will fight on the beaches, speech to discuss the wartime mentality that we had at AMC to successfully tackle our seemingly to many insurmountable challenges. Well, we know with the benefit of hindsight that Sir Winston won his war, and we have every confidence in looking ahead that AMC will win out.
We certainly are well on our way. Here's where we've ended up coming out of Q1 and moving into Q2 in calendar year 2021. As of March 31, 2021, we are strong. Almost all of our U.S. theaters are now open. And ever so importantly, our theaters in New York and Los Angeles are open, where in both markets AMC is the number one player and which together represent about a third of our total U.S. business activity. And our market share in the United States has soared increasing by about 25% compared to pre-pandemic levels.
AMC's U.S. market share was about 26%, 27% a year back. Recently, we've enjoyed a share that is more around the 33% level. We've taken share from those who stayed closed, or those have gone bankrupt, or those whose marketing prowess is not as imaginative as that of AMC or from those whose theaters are not as nice as ours, given our substantial reinvestment in them over the past many years.
And even as others finally reopened, we believe we will permanently keep some, not all, but some of that increased market share that we've been capturing of late. Now that more and more people are discovering and experiencing AMC for themselves firsthand.
Our Middle Eastern theaters too are all open. Our theaters in Spain and Portugal are open, and much more of our European state, most notably in the United Kingdom, comes back up in a big way just two weeks from now. And crucially, big new titles are starting to come out too, as you know, and people are coming to our theaters again.
Our business for the opening of Godzilla vs. Kong was five times that of the average first quarter attendants. The Mortal Kombat Demon Slayer weekend two weeks ago was our biggest attended weekend at AMC since March of 2020, 13 months ago.
WatchTV Now, as I did last night, you'll see trailer after trailer before your eyes, starting to create the hype for all the big movies being released to theaters in May, June, July, and beyond. And critically important too, critically important for AMC. At the end of Q1, AMC had more than $1 billion of immediately available liquidity. That is the highest quarter and liquidity that AMC has ever had in our entire 101-year history.
In our new equity raise announced just last week, we had already brought in another $153 million at an average share price of $9.85 [ph] per share as of yesterday in just five trading days. That number is now $172 million in the door for AMC, as of market close today. This takes our total amount raised to approximately $2.9 billion in fresh equity and debt capital over the last year, including the conversion of $600 million of convertible notes into equity at a price of $13.51 per share.
And wait to hear this, literally tomorrow, Friday, May 7, we will cross the $2 billion mark of cash raised through equity or debt about four fifths [ph] of that being equity rather than debt, since December 14, 2020, only five months ago, $2 billion in the door boosting our liquidity since December 14. And that's an addition to all that we did from a capital perspective between April and November of 2020, which was about another $2 billion in addition. I spelled out in more detail in our press release today.
Taking step after step, this was the AMC to-do-list over the past year. Closing theaters and reopening them, closing them again and reopening them again, got reps in late having to furlough our entire U.S. workforce and then bring our workforce back and dealing with all the extremely important insensitive issues associated with all that.
Designing our AMC Safe & Clean protocols with Clorox and Harvard School of Public Health faculty at our side joined the hip with us to prove that we could reopen responsibly. Navigating with studios, both with carrot and stick in defending theatrical exhibition and defending AMC, but also understanding and accommodating their desire to creatively address windows and simultaneously beef up their screening platforms.
Prepare for hyper aggressive and innovative marketing activity when new major titles come to our theater in quantity, as they are starting to do now. Professionally handle a change of control from Wanda, who was a terrific partner for us for many years, and who remains still our single largest shareholder to a shareholder base, primarily individual shareholders, about 3 million strong, most of whom live in North America and Europe.
And above all else, build up liquidity, bolster cash, cut spending, defer obligations, renegotiate theater leases from our landlord community who I might tangentially add heroically really had our back in 2020 and to whom we are ever so grateful now, and we'll be perpetually grateful to, as we return to our former self. But the lift continues. We had to raise equity and debt, all the while deleveraging to the tune of some $1,255 million in debt that was either forgiven by our lenders or converted as stead to equity.
Why am I sharing all of that with you now today? Well, some of this new information for many of you and some of it you already know. But in a simple summary, here's the point that I've been trying to make. When you look at it all as one interwoven tapestry, our dedicated, experienced AMC management team and employees coupled with the biggest and best collection of theater assets in our industry, both in the U.S. and globally, had enormous challenges to deal with in 2020, and we performed beyond all expectations over the past year.
Of course, it's clear that challenges are new, are still out there a plenty for AMC to deal with. A recovery in the movie theater industry has not yet started. It's just about to start. You can feel it, you can taste it. You can see it just over the horizon, but it hasn't actually started yet. And literally no one knows what the pace faster slope of that recovery will be. It's clear to us that there'll be much more flawless execution needed at AMC and by AMC to energize this recovery and to benefit from this recovery.
But think about all of this, the passion, the energy, the drive, the creativity, the work ethic, the smarts, and the sheer will that AMC displayed in 2020 to make it through this pandemic. That is precisely what we're going to display again at AMC in 2021 and again, in 2022. No resting on recent laurels here, no taking a year sabbatical, no coasting, no mailing it in. We all know this is a, what have you done for me lately world? And we will give it our all to make people as impressed with AMC's accomplishments this year in 2021 and next year in 2022, as they were with the strides AMC made in 2020.
In November of 1942, two and a half years before World War II ended in Europe. My favorite Winston Churchill set in yet another of his famous speeches quote, Now this is not the end. It's not even the beginning of the end, but it is perhaps the end of the beginning. It took him another two and a half years, but Sir Winston won his titanic fight.
Indeed, it's going to take us a while to, but hear me now and write it down and hold us to it. As you think about COVID, it's aftermath and the structural changes in our industry that may come our way. I believe that AMC will win our war too.
I'm now going to turn the call over to Sean to update you on where we are financially. And then we're going to head pretty quickly after that the Q&A. Sean?
Thanks Adam, and thank you to everyone for joining us this afternoon. And I also do hope that you and your families have been keeping safe and well during this time.
The COVID-19 crisis has continued to severely impact our business during the first quarter. We ended the quarter with nearly 99% of our U.S. circuit open, but we also contended with a combination of significant capacity limitations, reduced operating hours of our own accord to decrease costs, the sizeable number of our theaters that we closed for much of the quarter, the continued closure of the vast majority of our international theaters, and all of this combined with a limited number of new title releases. So, not surprisingly so significantly impacted our attendance levels for the quarter.
The very low attendance levels ultimately make this quarter's financial results of somewhat limited relevance. The data is, of course, score to see in our press release. So, I'm really not going to dig into it in much detail on this call. I'll focus my comments with you this afternoon and stayed on our prospects looking ahead.
But before I do say that, I do want to mention two first quarter statistics that are particularly encouraging. Compare to the first quarter of 2019, before the onset of COVID, our domestic average ticket prices were up more than 11% and our domestic food and beverage revenue per patron, in our very high margin food and beverage business, was up more than 45%. Clearly, guests returning to our theaters, our eager to participate in the full theatrical experience, including enjoyment of our innovative and tasty competition offering.
The key performance indicators that drove these two improved metrics for the quarter benefited from a higher proportion of evening and weekend shows, strategic ticket and food and beverage pricing adjustments, the success of our very popular private theater rental program, and increased usage of our mobile AMC app for bus tickets and food and beverage purchases.
We use the time period of this pandemic to rollout mobile, food and beverage ordering on our smartphone app at basically all of our US AMC and AMC Classic theaters. Our industry-leading smartphone app now makes it ever so easy to convenient the order food and beverage items at the same time as purchasing tickets, where the food and beverage items fully prepared and waiting for our guests either to collect when they arrive at our theaters or delivered to their seats. Similarly, during the height of the pandemic, we dramatically upgraded our mobile IT platforms for our U.K. guests, the U.K. being our second largest country territory.
Now moving on from the quarter's results, let's talk more broadly about AMC's overall liquidity, financial prospects -- financial position and prospects ahead. In our press release issued earlier today, we've provided a comprehensive list of the decisive actions that we took over the last 13 months to improve our liquidity position for success in 2021 and beyond.
These actions included raising $2.95 billion of capital, which includes the conversion of $600 million of convertible debt to equity at a price of $13.51 per share, securing more than $1.2 billion of creditor and landlord concessions, obtaining more than $150 million of assistance from European governments, and generating $80 million strategic asset sales.
So, as of March 31st, we had $813 million of cash, $29 million of restricted cash and approximately $212 million available under our revolving credit facility, given that we paid down our revolver balance during the first quarter. This gives us total liquidity on March 31st, 2021 of $1.025 billion. As Adam said earlier, this is the highest amount of quarter and liquidity that AMC has ever had in our 101-year history.
The monthly cash burn in Q1 came out at approximately $120 million per month. Now that this is after normalizing for the impact of capital in the quarter. Of course, it goes without saying that with all the debt and equity capital that we raised during the quarter, our cash position greatly increased during the quarter, not decreased.
As previously announced last week we launched an at the market or ATM program to issue up to 43 million shares to further enhance the financial strength and strategic flexibility of AMC during what continued to be challenging times. As of the close of the market today, in just six trading days we sold approximately 17.5 million shares for gross proceeds of approximately $172 million at an average price of $9.77 per share. Needless to say, from a liquidity perspective, it has been a good week for AMC.
At the end of the first quarter, we had deferred rent obligations of approximately $470 million. This is up from $450 million at the end of Q4, 2020. Repayment terms continued to be an average of 27 months. And although, a number of agreements have repayment periods that extend through the remaining lease term, which in some cases is well in excess of 10 years.
I reminded that the rent expense shown on the face of the income statement represents our rent obligation for the quarter, as opposed to cash rent paid. For the first quarter, actual cash rent paid was approximately $40 million less than what is shown on the face of the income statement.
While future rent payments will continue to depend on ongoing discussions with our landlords, we anticipate that our quarterly cash rent payments during the remainder of 2021 will be meaningfully higher than Q1's levels. And also that the cash rent in the second half of 2021 will be higher than the income statement rent both because attendance levels are expected to increase, and we will also be repaying some rent deferred from prior period.
Shifting to capital expenditures. As previously stated, we have continued to limit capital expenditures to minimum maintenance levels, really eliminating all, but essential and previously committed CapEx. During the first quarter, our CapEx spend was only $8.2 million net of landlord contributions. This is $67.4 million lower than the same quarter a year ago.
As a reminder, net CapEx for the whole of 2021 is expected to be approximately $100 million. And going forward, our CapEx will ratchet up or down based on the speed of our recovery, and we expect 2022 CapEx to be between $100 million and $150 million. These numbers are orders of magnitude to lower than the AMC CapEx programs two, three and four years ago.
Overall, we're in a solid financial position to continue to withstand COVID related disruptions to our business and to capitalize on the expected return to more normal attendance levels stated in the year. At the same time, we believe that it is important to continue to take strategic actions to further strengthen our balance sheet and enhance our liquidity profile, so as to optimally position ourselves for long-term sustainable success in the post-COVID world.
With that, I'd now pass the call back over to Adam.
Thank you, Sean. Two very quick points, but important points before we open it up to your questions. First, on AMC's continuing liquidity. Let's assume that our current 43 million share at the market equity raise continues to go well. Let's also assume that the domestic box-office as a proxy for the industry's overall health has some semblance of a recovery starting in the second half of 2021. How do we define some semblance of recovery? A domestic box-office, meaning the box-office for the U.S. and Canada hitting $5 billion or more in 2021 and a domestic box-office of $8 billion or more in 2022.
How reasonable is an $8 billion placeholder for 2022? We all have our opinions, some more informed than others, but literally no one knows for sure. After all, 2020 was a disaster and there are a myriad of predictions as to how quickly a recovery in movie theater ticket sales will occur. Still reflect on this. Absent a global pandemic, the domestic box-office has exceeded $8 billion every year between 2001 and 2019, 19 years in a row. It is exceeded $9 billion every year between 2006 and 2019, 14 years in a row. It is exceeded $10 billion every year between 2009 and 2019, 11 years in a row; and is exceeded $11 billion every year between 2015 and 2019, five years in a row.
And finally, also assume that everything else more or less works out along the lines of our current expectations. In that scenario, when looking at our liquidity, we can say now that AMC will have materially extended our liquidity runway all the way through the end of 2022. And given our sizable market share, our domestic box-office in 2021, above $5 billion or domestic box-office in 2022 above $8 billion would put a lot of extra money into AMC's profit.
Second point, AMC now has an army of passionate, interested individual shareholders, some 3 million strong. The exact number was 3.2 million shareholders on March 11th, the last time we got an investor count. They owned more than four fifths of our then 450 million outstanding shares as of that March 11th date. Since then a lot of AMC shares have changed hands.
So, we actually delayed our annual meeting of shareholders to July 29th with a new record date of June 2, and we'll get an updated count of shares outstanding. As of that date, June 2, we'll also get the number of shareholders and their contact information in early June. We did all this in parts so that we could give our current investors the opportunity to make their important voices heard. So, we already know this well before June 2.
These individual investors likely hold a majority of our shares. They own AMC. We work for them. I work for them. So, by definition, their interests and passions are important to AMC. Their interests and passions are important to me.
Many of you remember the extraordinary and heartwarming 1988 movie Gorillas in the Mist nominated for five Oscars. Starring Sigourney Weaver, Gorillas in the Mist showcase the extraordinary life story of American primatologist, Dian Fossey, who dedicated her life to saving the endangered gorilla species, especially where they commonly reside in Central Africa, mostly in Rwanda and the Democratic Republic of Congo. With all that support over decades, the gorilla population quintupled -- more than quintupled actually, but even so there are still fewer than 1,100 gorillas alive today in this part of Africa. Saving these beautiful creatures is a noble goal. Many of our investors too have embraced Dian Fossey's caused and raised substantial moneys for it.
Each year AMC raises third-party money from our suppliers and others such that are off balance sheet charitable foundation, AMC Cares can provide financial support to worthy causes. I am pleased to announce today that AMC Cares will make a $50,000 cash donation to the Dian Fossey Gorilla Fund. And that I also am pleased to announce today that out of my pocket, personally, I will match that AMC Cares donation dollar for dollar, bringing the total contribution from AMC Cares and for me, up to $100,000.
AMC is going to become one of only seven platinum sponsors of the Dian Fossey Gorilla Fund, the highest tier of their sponsorships. And I will join its digit society, its highest tier of personal donors. The digit society, by the way, Harold's digit. Digit was Dian Fossey's favorite gorilla when she was alive. Above and beyond those cash donations, we already started discussing with the Fossey Fund other ways that AMC can be of help.
Within the boundaries, of course, of the law integrity and ethics, as well as the exercise of wise judgment on behalf of all stake holding constituencies in the free market capitalist system, the shareholder is king. As I said before, the interest of our shareholders become our interest, the passions of our shareholders become our passions too.
With that operator, we're ready to go to Q&A.
Certainly, and thank you very much. [Operator Instructions]
First question comes from Eric Wold with B. Riley. Your line is open.
Thank you. Good afternoon, Adam and Sean. I appreciate taking the time for question. A couple of questions. I guess, one, maybe as the markets start to reopen, a question on your two largest state, how are you interpreting the new social distancing capacity rules in New York City? What it actually means for capacity limits near-term? And then on California, do you plan on going to 100% capacity when allowed to in mid-June, or are there some local restrictions that may not allow that?
So, Eric, whatever the capacity limitations are, they are a lot higher than 0%, which is where it was like eight weeks ago, and 25% where it's been recently and 50% -- in New York, especially the capacity -- we expect that the capacity limit will be removed, but the enforcement of a six-foot social distancing rule will continue to be enforced by governmental authorities, which of course, we will respect. And we've already made the decision, as some of you know, to continue a mandatory math policy, deep into the summer at the very least, maybe beyond that, as we learn more about, not the pace of our recovery, but the pace of the nation's recovery from the spread of the COVID-19 vaccine.
So, I think, clearly, capacity limitations are going up. That's true in New York. That's true in LA. We intend to be very cautious. I am immensely proud of how much effort AMC put into AMC Safe & Clean. But we opened our theaters back in August and we still have not heard of one documented case of COVID-19 being transmitted guest to guest at our theaters. That's so -- and that's such a tribute to our people at our theaters who worked so hard to operate their theaters cleanly, operate their theaters responsibly, operate their theaters safely.
With this commitment to safety, at extraordinary expense, I might add, that AMC has shown over -- since last August, protocols that we started working on last May, we're not -- no, we're not about to blow it now by taking unnecessary risks. So, we'll follow the science very carefully. We're listening to our Harvard faculty very carefully. It's interesting that people we've been working with at the School of Public Health were so far ahead of the rest of the country, that airborne transmission was the real thing to worry about here rather than from a touch.
And you'll recall back last spring, the whole world was worrying about what you touched. And, in fact, we were out buying thousands of MERV 13 air filters for our HVAC systems, because we were way upfront that in addition to cleaning and sanitizing and wipes and gels and mask and social distancing, boy, we needed high-tech solutions too to make sure that the transmission of the virus through the air was greatly minimized at AMC.
So, looking ahead, I'm sure the capacity limits are going to rise all across the country. We all know what President Biden has said. 4th of July is going to be a great weekend in the United States he says. We know that there were 250 million injections in arm in the United States 48 hours ago. And they are more than that today. And there will be a lot more than that by the end of May and by the end of June and all this bodes well for taking capacity levels up, but we're only going to do it safely. We think our associates deserve it and our customers deserve it.
The other thing to remember, in our case, we have the opportunity to be so forgiving on capacity limitations, because as you've heard me say before, we only sold -- we sold more movie tickets than anybody in the world, and we only sold 17% of our available seats in 2019. We have so many showtimes where these capacity limitations don't cost us a thing.
So, that's how I’d answer your question. We're upbeat. Capacity limits are going to rise in jurisdiction after jurisdiction, month to month as vaccinations rise, as the infection spread diminishes.
Thank you. Maybe just one more, if I may. I guess, can you talk about what you're seeing in the current labor market and hiring hourly employees to come back to the theater? Are you needing to push up wage rates at all through track workers? And then kind of taking it from the reverse, obviously, you're trying to get out of this pandemic in a more efficient manner. Eventually, you -- will you have the same number of hourly workers on hand, kind of when things ramp back up as you did 2019, or will the number actually be lower?
So, let's talk about how difficult it is or is not to hire. And then, I'll talk about the -- our staffing levels. In the next several weeks, we're going to be hiring between 5,000 and 10,000 people to beef up our staffing levels, as we approach the summer season, when we see a lot of new movies being released and a lot more people coming to our theaters.
Fortunately, for us, AMC has always been a very happy place to work. Morale with our theaters has always been high. Our theater general managers just devote so much effort to the care and attention. They direct as what we call our film crew at our theaters. And so, if anybody's going to get employees to come back, I believe it will be us.
We have seen some wage pressure by other employers in some low counts. But we ourselves have not felt much wage pressure yet. How that will change over the next six, eight months, we'll all learn together. But I know that as captain of the ship. I'm relaxed about hiring talented people to work at our theaters and our operations department is nervous as all get up about it. And that's because I get to tell them to hire the people and they got to go figure out how to do it. But they've done it really well for a lot of years. I think they're going to get it done again.
Here's a little fact that you may not know about companies like ours, who tend to pay starting job wages. Not necessarily minimum wage, some cases, minimum wage, other pace -- other times higher than minimum wage, but still these are first jobs for a lot of young people in the country.
The turnover in that workforce, what I might call the starting wage workforce, is like it turned -- I don't mean just for AMC, I'm talking about across the country. It turns over every four to six months. And while our theater managers might stay with us for 30 years and while our supervisors might stay with us for 20 years, and our hourly managers might stay with us for 20 years, a lot of our film crew, cashiers, ticket takers, popcorn poppers, they're with us for six, nine months, they had a great work experience and they move on. So actually pre-pandemic, AMC was hiring about 50,000 people a year, every single year to step up our theaters.
So, we've got a lot of practice at it. We know how to do it. I'm confident we'll staff as needed, and that we will be able to do it without massive wage pressure. Where the wage pressure will come in is as more and more laws are passed raising the minimum wage. Because not only will it raise the minimum wage, it will raise wages that are close to minimum wage. But that's a problem for 2022 or 2023, more than it's a problem for June of 2021.
As for staffing levels, we worked really hard during this horrible pandemic to get more efficient than we've ever been before. And we skinny down our overhead a lot. In our corporate headquarters in Leawood, Kansas, our management staffing is about a third less than it was two years ago. And the company is the same size.
And in our theater manager counts, the way we manage our theaters, general managers, senior managers, supervisors, hourly managers, we're also down roughly a third in terms of a supervisory workforce, but I don't expect that we'll cut line staffing very much. Now, we certainly have -- since last March when we shut all our theaters and when we reopened our theaters, we were really tight on reducing operating hours and reducing days that our theaters were open.
So, while some state circuit stayed closed, AMC made the decision that all of our theaters would open when governments allowed them to, but not necessarily open seven days a week, 14 hours a day. Some of our theaters were open seven days a week. Some of our theaters were open five days a week. Some of our theaters were open three days a week. For months and months, even though we were open, we only had one or two showtimes a day at our theaters, when historically we would have had four or five showtimes a day. So, we were able to ratchet down staffing levels, commensurate with a much lower demand levels, and much lower attendance levels that we are experiencing here before. But we do expect that that's about to change.
Big new movies are coming out. Thank you, Universal for F9. Thank you, Disney for Black Widow. Thank you, Warner for the movies they're bringing to our theaters and to Paramount and Sony and Lionsgate and all the studios we work with. A lot of new movies are coming. The number of guests coming to our theaters should geometrically increase, and we will have to raise our staffing levels to serve them well. But, of course, as we raise our costs, we're also be raising our revenues, because those people will be paying customers. I especially like seeing to paying customers.
Just look at the food and beverage revenue per patron that we put on the board in the first quarter, the numbers continue to be historically high. Our food and beverage business is a high margin business. And these people haven't been deprived of their -- AMC perfectly popcorn accompanied by a nice 54-ounce cup of Coca-Cola. They're heading to the concession stand and they are getting the whole AMC experience. And so, we do need to make sure that we staff up so that we can let them buy these food and beverage items from us, with a high margins they bring in.
Perfect. Very helpful. Thank you, Adam.
Thank you, Eric.
And our next question comes from Meghan Durkin with Credit Suisse. Your line is open.
Hi, guys. Adam, I wanted to ask about the new shareholder base quickly. So, how do you see this going? I mean, if management thinks that increasing the share authorization is the best move for the company, but the new shareholders don't. Then, what is the way forward from there?
And then for Sean, quick one. Are you still expecting to crossover and turn cash flow positive in 4Q 2021? That's it for me.
Thank you, Meghan. I'll take the first one. If management thinks something and the owners of our business thinks something else, in the free market system, guess who wins? Guess who always win? The owners of the business, because the management work for the owners. Now, we can try to explain, and we can try to persuade. And we can also listen, and we can adjust our strategies. There are a lot of ways to skin a cat. And I'm quite optimistic about the new shareholder base of AMC.
Just go on Twitter, just go on Reddit, just go on YouTube, read what these people write. They love AMC. This is -- and these are not people who are just going to be investors in AMC. These are going to be customers of AMC who come to our theaters and enjoy watching movies at our theaters as paying guests. So, I love the idea that we have a compassionate, committed, enthusiastic shareholder base, and I'm sure that as we work together, management and ownership, we'll come to the right answer.
Look at what we've achieved as -- the whole point of my prepared remarks, look at what we've achieved in the last year. We're going to achieve good things in the next year and the year after that too. The only thing that'll be different though, is before, when I wanted to talk to the company's ownership, I could fly to Beijing and I could sit down with three or four people and they had 75% of the votes, or I could talk to some of you analysts who were in frequent contact with people who also had huge percentage votes of our company’s shareholding base.
We are going non-deal road shows with you all and meet this institutional investor, that institutional investor and make our case and make our pitch. Well, it's going to be a little different now, because I don't have five people in one office. I don't have 15 securities analysts who talked to all these institutions. We've got 3.2. I would say we have. As on March 11, we had 3.2 million people who we're going to have to talk to, to explain what the company's up to, what the company's doing, what the company wants to do, why we want to do it, how it impacts them and do they agree with it?
And so, you're going to see a lot more outreach to literally millions of investors in our company. And it's going to be quite public. I've started tweeting again. Back when I ran the Philadelphia 76ers, I was tweeting 15 times a day. And I don't think I've tweeted 15 times a year in the last five years at AMC, but I started tweeting again. And we are communicating with our shareholder base. Some of you saw -- you may have seen a YouTube interview that I did, try getting four minutes on CNBC. That's pretty hard. Well, we got 90 minutes on YouTube and it had 250,000 views. And on YouTube, they get to grade it. They give you a thumbs up or a thumbs down. And the last time I looked, over 20,000 people took the time to rate it this 90-minute interview and 99.4% of them gave us the thumbs up.
So, it's going to change the way we communicate and it's going to change who we communicate to. But I'm very confident that the outcome will have a happy ending.
Meghan, so to your question on the cash flow forecast for 2021, what I'll say is, firstly that our overall forecast for 2021 remains the same as it was when we last spoke on the previous earnings call. There's an assumption behind that. The assumption is that the domestic box-office is around $5 billion level and international is somewhere -- some of that. The timing of the cash flow is obviously going to be very dependent on the timing of specific from leases.
What we see from the timing on the predictions for the remainder of this year is that our Q2 cash flow will be pretty similar to Q1. Q -- the second half of the year overall will be significantly better than the first half of the year, but you're going to see Q3 is going to be better than Q2, quite a lot better than Q2 and Q4 is going to be better than Q3, but exactly whether or not we will be breaking Q4 really does depend on how the final film slate ends up at the end of the day here.
Okay. Thanks guys.
And we have time for one last question, which will come from Chad Beynon with Macquarie. Your line is open.
Hey, this is Aaron on for Chad. You guys had some really strong ticket and concession pricing, obviously, in the quarter. Can you share how much of that strength was driven by the strategic pricing adjustments you mentioned? And do you think this is sustainable going forward when demand starts returning full and other entertainment options open up?
So, I'll let Sean give you the specific as to what part of this high food and beverage spend per patron was priced rather than quantity. But I will tell you that the lion's share of this massive surge in food and beverage purchasing is that more people are going to the concession stand and they're buying more things when they get there.
I remember being kind of astonished when I joined AMC five years ago, that almost a third of our entire clientele went to a theater, watched the movie and didn't get anything, never bought any food and beverage items. And so, one of the ways to increase -- and of course -- but our food and beverage revenues are divided by our whole -- our total patron count. So, that which is being bought by the people who buy as being blended with the nothing, that was bought by a third of our clientele.
Well, people have been so deprived of something that they love. People love going to the movies, all the talk about streaming that we hear, people love going to theaters. It happens a billion times in the United States in 2019. And what we're seeing now is how they've been deprived of enjoying movies on the big screen, and going back to theaters, people want the whole enchilada. They want the whole thing. They want popcorn. They want a drink. They want candy. They want hot dogs. They want nachos, everything that we have. And some of our more imaginative food and beverage items, they want those too. Flatbread pizza, give me another. And so what we're seeing is more people are going the concession stand and then when they get there, they're -- if in the old days they bought two items; today, they're buying three.
So, I think that trend is going to continue for quite some time, because when you think of this recovery, this rolling recovery that we're imagining for our industry and for our company, they really starts kicking in Memorial Day weekend and runs in the second half of 2022. A lot of people are going to be coming back to the theaters for the first time again in a year, when they show up in July or when they show up in August. Even though some people in our theaters will have been coming every month since February or March. And so, I think it has to be a lot of this splurging going on.
And so, I would expect that we would see elevated food and beverage spending levels for quite some time. Will it be at this high level? And will it stay at this high level forever? We're all going to find out together. No one's got a perfect crystal ball to understand what the future will bring. But we're pretty optimistic that at least as the recovery begins, food and beverage spending will be higher than what we've seen in more routine times.
As for pricing, Sean?
Yeah. Adam explain the drivers of the food and beverage statistics very well there. As to pricing, that was the least significant impact. The much more significant impacts were as Adam said, people were buying and the number of guests going to the concession and actually buying products as well. So, the price adjustment was very, very small in the total drivers there, less than 10% of the total increase.
Ladies and gentlemen, we thank you all for joining us today. It's been a wild ride and that wild ride is going to continue, but we are very much hopeful that recovery is right around the corner. Thank you for being with us today.
And all, that does conclude the conference call for today. We thank you very much for your participation and ask that you please disconnect.