NCMI - National CineMedia drops 17% on debt restructuring

2023-04-12 06:14:35 ET

Cinema advertising network in the U.S., National CineMedia ( NASDAQ: NCMI ) announced debt restructuring transactions , whereby the company has filed a voluntary Chapter 11 petition in the US Bankruptcy Court for the Southern District of Texas.

The has entered a restructuring support agreement (or RSA) with the support of its secured lenders, through which all of the company’s debt will be converted into equity of the reorganized company.

The transactions are expected to strengthen the balance sheet and position the company for long-term growth.

The company will operate its business without disruption.

As more brands returned to cinema advertising, NCM ( NCMI ) expects to report total revenue growth of 44.4% to $91.7M in Q4 2022. ( vs. consensus $86.73M )

SA warns that NCM is at a high risk of performing badly due to decelerating momentum and negative EPS revisions when compared to other communication services.

Sell side analyst however give the stock a Buy rating .

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