Smaller Net Loss, Record Revenue at Lionsgate

SANTA MONICA/VANCOUVER: On revenues that were up by 8 percent to $1.6 billion, Lionsgate reported a narrower net loss of $19.5 million in fiscal 2010, as compared with the year-ago loss of $178.5 million.

The independent studio attributed the improved results to gains at its TV production division, as well as the new revenues of $113.6 million from TV Guide Network and TVGuide.com, which offset declines in the motion picture business.

"We had a very strong year with contributions from all of our businesses," said Jon Feltheimer, co-chairman and CEO. "We are particularly pleased by the continued rapid growth of our television business, the ongoing progress of our channel investments and a record library performance despite a challenging industry environment. We are well positioned to continue the positive trend toward topline revenue growth, strong EBITDA and a return to positive free cash flow as we continue to build the longterm value of our business."

Motion-picture revenues fell 9 percent to $1.12 billion, with a smaller slate of films resulting in a 38-percent drop in theatrical revenues to $139.4 million. Home entertainment revenue from both motion pictures and television fell 10 percent to $608.2 million. Television included in motion pictures revenue (primarily pay television) rose 10 percent to $186.7 million. And international motion picture revenues fell 10 percent to $73.4 million.

The television business saw a 58-percent bump in revenues to $350.9 million. Revenue from U.S. TV series licensing was $240 million, a gain of 48 percent, and international revenues gained 70 percent to $42.3 million. Home entertainment revenue from television production was $67.8 million in the fiscal year, a 94-percent increase from the prior year.

In other Lionsgate news, the studio has announced that its shareholders have again rejected Carl Icahn’s tender offer for $7 per share. Icahn has extended his offer to June 16 at 8 p.m. Icahn has also waived the minimum tender condition. Announcing the move, he said: "We continue to be concerned that the Board may engage in an inappropriate dilutive defensive acquisition or other transaction in an attempt to thwart our offer. We will not sit idly by if the Board attempts to employ inappropriate defensive tactics. We will challenge any proposed transaction that we perceive to be abusive of shareholder rights or otherwise disadvantageous to Lionsgate, and will seek to hold the directors personally liable for any breach of their fiduciary duty or actions which oppress Lionsgate shareholders or serve simply to entrench themselves. In addition, we will not hesitate to enforce our rights against any third party that attempts to tortiously interfere with our offer by entering into an inappropriate defensive transaction with Lionsgate."