Lions Gate revenue shrinks, profit rises with only one film release
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With only one new movie hitting theaters and none on DVD, Lions Gate Entertainment Corp. saw its revenue and expenses plummet in the quarter that ended June 30.
The Santa Monica film and television studio reported revenue of $261.3 million in its fiscal first quarter, down 20% from the same period last year. But because of a sharp drop in costs, the studio had a profit of $64.1 million in the quarter, compared with a loss of $64.1 million a year earlier.
Some on Wall Street appeared to have missed how light Lions Gate’s release slate would be during the quarter. The company easily beat analysts’ consensus estimate that it would lose 7 cents a share, instead earning a profit of 9 cents a share. However, its revenue was 18% below what analysts predicted.
Lions Gate’s only theatrical release, the Tyler Perry film “Madea’s Big Happy Family,” was a modest box-office performer. Its $53.3-million domestic gross was the lowest of any of Perry’s movies featuring Madea, except for the 2005 original, “Diary of a Mad Black Woman.”
As a result of the barren slate, Lions Gate’s motion picture revenue dropped 29% for the quarter to $192.6 million. The studio has several high-profile releases coming up, however, including next week’s “Conan the Barbarian,” September’s Taylor Lautner thriller “Abduction,” and March’s heavily hyped “Hunger Games,” based on the first book in the bestselling trilogy by Suzanne Collins.
Televison production revenue increased 27% to $68.7 million in the quarter as the studio delivered new seasons of the successful comedies “Are We There Yet?” and “Tyler Perry’s House of Payne,” and the Showtime drama “Weeds.”
Administrative costs dropped 57%. Last year the company spent millions on attorneys to fight dissident shareholder Carl Icahn and also was contractually obliged to make increased stock-based payments to several senior executives when Icahn’s stake surpassed 33%.
Icahn’s public dispute with Lions Gate over the future of the company halted late last year.
Lions Gate stock closed up 26 cents, or 4%, at $6.62 on Tuesday before financial results were released.
-- Ben Fritz