Lions Gate Profit Tops Reduced Estimates as TV Unit Growsby
Shares rise as record TV results overshadow movie division
CEO Feltheimer predicts higher earnings from films this year
Lions Gate Entertainment Corp., the studio that produced “The Hunger Games,” posted fourth-quarter profit that beat recently lowered Wall Street projections as higher TV revenue overcame box-office disappointments.
Earnings excluding some items fell to 26 cents a share in the quarter ended March 31, the Santa Monica, California-based company said Wednesday in a statement. Analysts were projecting profit of 2 cents a share, the average of seven estimates compiled by Bloomberg.
Lions Gate rose 14 percent to $22.60 in extended trading. The stock gained 0.2 percent to $19.76 at the close in New York and was down 39 percent this year.
- Total sales grew 22 percent for the quarter to $791.2 million, beating projections of $740.9 million as TV revenue increased.
- Theatrical revenue amounted to $81.6 million, compared with $80 million a year earlier, Pacific Crest Securities said in a note.
- Revenue from TV production rose 71 percent to $248.8 million, Pacific Crest said.
The company said a new global deal for “Orange Is the New Black,” the series produced for Netflix Inc., contributed to the TV group’s results, along with the acquisition of Pilgrim Studios in November of last year.
“The Divergent Series: Allegiant,” the third film in a four-part saga, grossed $170.2 million in theaters worldwide, according to Box Office Mojo, the lowest tally of the series. The last installment is due in June 2017. “Gods of Egypt,” also released in the quarter, was plagued by controversy over its casting and proved to be a money loser at the box office. It cost $140 million to produce, Box Office Mojo said, and millions more to market. Yet it grossed only $142.2 million globally, a sum the studio splits with theaters.
“Although last year’s film slate didn’t match the performance of previous years, this year’s slate is bigger, more balanced and is expected to generate greater profitability,” Chief Executive Officer Jon Feltheimer said in the statement.