Lionsgate Hails Better-Than-Expected Financials

SANTA MONICA: Amid its battle with Carl Icahn, Lionsgate—which has confirmed that it is appealing the Canadian ruling over its ‘poison pill’ defense—has announced that its fiscal 2010 results are better than expected, with an EBITDA of more than $115 million.

The preliminary results—the final fiscal 2010 and Q4 results will be released June 1—show an adjusted EBITDA that is more than 50-percent higher than the forecast $75 million. The results were driven by the television business, record library revenues and higher home-entertainment revenues.

"Our preliminary fiscal 2010 financial results show that our strong product pipelines, coupled with the continued recovery of the retail and advertising markets, are helping our home entertainment and television businesses to outperform our previous expectations," said Lionsgate’s co-chairman and CEO, Jon Feltheimer. "The continued growth of VOD and other on-demand revenue streams has also been a recent catalyst for strong revenue and EBITDA performance.  As these trends continue, we are targeting another strong EBITDA performance as well as a return to positive free cash flow in fiscal 2011. We remain on track to achieve the significant free cash flow generation for fiscal 2013 to 2015 of $100 million to $125 million annually (before contributions from TV Guide Network, EPIX and FEARnet) as outlined in our most recent investor presentation."
 
The independent studio is currently embroiled in a battle with billionaire financier Carl Icahn, who is attempting to take control of the company. Lionsgate has filed an application with the British Columbia Court of Appeal over the BCSC decision to reject its Shareholder Rights Plan. The application will be heard May 3. As such, Lionsgate has opted to reschedule its special shareholders meeting to May 12.

"Lionsgate is filing an application for leave to appeal to the British Columbia Court of Appeal as the Company believes that its shareholders’ right to vote is paramount and the BCSC’s decision regarding the Shareholder Rights Plan should have been withheld until Lionsgate shareholders had the opportunity to consider and to vote at the Special Meeting of Shareholders," a company statement said. "The Board is extending the shareholder vote to the date immediately prior to the earliest date the Icahn Group can complete its subsequent offering period under its tender offer. Lionsgate believes that there are shareholders who, without the protection of the Shareholder Rights Plan, may be coerced to tender into the offer. The Company wants to provide shareholders an opportunity to obtain the information necessary to make an informed and non-coerced decision. The Board recommends that shareholders vote FOR the approval of the Shareholder Rights Plan at the Special Meeting of Shareholders. In addition, the Board recommends that shareholders reject the Icahn Group’s offer by not tendering."