Carmike shares plunge after 1st-quarter results disappoint investors

Carmike shares plunge after weak 1Q results

NEW YORK — Shares of Carmike Cinemas Inc. took a nosedive amid a broader market downturn Tuesday after the movie theater operator posted a first-quarter loss, hurt by higher costs for blockbusters and 3-D movies, as well as poor weather.

The company late Monday reported a loss of 27 cents per share.

Excluding special items, its loss was 13 cents per share, according to Wedbush Morgan analyst Chris White, who has an “Underperform” rating on the stock.

“Revenues were roughly in line with expectations, as weaker attendance was roughly offset by stronger-than-expected pricing, particularly for concessions,” the analyst wrote in a note to investors.

Carmike said its total attendance fell 6 percent to 12 million, but each patron spent more, about $10.34 each, up from $9.57 a year earlier.

White said the cost — and therefore earnings — volatility that Carmike sees “warrants a lower valuation multiple for the shares.” He lowered his share price target to $15 from $16.50.

“During the last three quarters, Carmike has lost money twice and been very profitable once, and the company’s other operating expenses (not film margins or concessions) are a big driver of the variance,” the analyst wrote.

Shares of Carmike sank $3.91, or 23 percent, to $13.15 in afternoon trading. The stock has traded between $4.40 and $19 in the past 52 weeks. Stocks plunged worldwide Tuesday as investors feared that Europe’s attempt to contain Greece’s debt crisis would fail.