Lionsgate Narrows Q3 Loss to $1.7 Million9 Feb, 2012 By: Erik Gruenwedel
Multiplatform pay-TV channel Epix contributes $7.3M in operating income
A dearth of theatrical releases and subsequent impact on home entertainment contributed to Lionsgate posting third-quarter (ended Dec. 31) revenue of $323 million — down 23.7% from revenue of almost $423 million during the previous-year period.
Santa Monica, Calif.-based Lionsgate generated just $8.4 million in theatrical revenue in the quarter, compared with $53.8 million during the same period the year before.
Regardless, the mini-major narrowed its net loss more than 70% to $1.7 million from a net loss of $6 million the year before. A major income driver in the quarter was multiplatform pay-TV service Epix, which generated operating income of $7.3 million, compared with an operating loss of $11.1 million the year before.
Lionsgate co-owns Epix with MGM and Viacom.
Lionsgate's home entertainment revenue from both motion pictures and television was $162.9 million in the quarter, a 6.6% decrease from home entertainment revenue of $174.4 million during the prior year's quarter.
The decline was attributable primarily to the prior-year quarter’s theatrical slate in home entertainment, including the studio’s top box office draw, The Expendables.
Digital and transactional video-on-demand revenue for the quarter was $62.4 million, an 80% increase from revenue of $15.6 million in the prior year's third quarter.
Digital accounted for 38.3% of home entertainment revenue, compared with 9% last year, while disc revenue declined to $100.5 million (61.7%), compared with $158.8 million the year before.
Meanwhile, Lionsgate CEO Jon Feltheimer remains upbeat on the studio’s future following its acquisition of Summit Entertainment shortly after the close of the quarter.
“We're very excited about the opportunities created by [the] acquisition,” Feltheimer said. “The Feb. 11 home entertainment release of Twilight Saga: Breaking Dawn 1, the March 23 theatrical release of Hunger Games and the Nov. 16 theatrical release of Twilight Saga: Breaking Dawn 2 lead a strong combined slate that we believe will enable us to deliver increased consistency, profitability and value to our shareholders.”
Lionsgate executives will discuss the Q3 results in detail during a Feb. 10 conference call.