On May 23, 2024, Lions Gate Entertainment Corp (LGF.B, Financial) released its 8-K filing for the fourth quarter of fiscal 2024, ending March 31, 2024. Lions Gate Entertainment Corp is engaged in the entertainment business, with segments including Motion Picture, Television Production, and Media Networks. The company generates maximum revenue from the Television Production segment, which involves the development, production, and worldwide distribution of television productions.
Performance Overview
Lions Gate Entertainment Corp reported fourth-quarter revenue of $1.1 billion, surpassing the analyst estimate of $1,097.76 million. However, the company faced an operating loss of $60.9 million and a net loss attributable to shareholders of $39.5 million, or $0.22 diluted net loss per share. Adjusted net income attributable to shareholders was $63.4 million, or $0.27 adjusted diluted earnings per share. The quarterly adjusted OIBDA stood at $140.3 million.
Segment Performance
The Studio Business, comprising the Motion Picture and Television Production segments, reported revenue of $879.9 million, a 6.8% increase from the prior year quarter. Segment profit increased by nearly 10% to $134.8 million. The Motion Picture segment saw a revenue decline of 23% to $410.6 million and a segment profit decline of 12% to $82.2 million, attributed to the prior year quarter's release of "John Wick: Chapter Four." However, the Motion Picture Group segment profit for the year was the highest in 10 years at $319.6 million.
The Television Production segment experienced a significant revenue increase of 61% to $469.3 million, with segment profit rising by 83% to $52.6 million, driven by strength in library sales and post-strike content deliveries.
Media Networks Segment
The Media Networks segment reported a 7.1% year-over-year revenue decrease to $361.5 million. Domestic streaming revenue growth was offset by declines in domestic linear and LIONSGATE+ revenue. Segment profit declined by 28.4% to $52.5 million, primarily due to higher domestic content amortization expense.
Financial Achievements
Lions Gate Entertainment Corp achieved a record $339 million in library revenue for the quarter, with trailing 12-month revenue of $886 million. The company reported $397 million of net cash flow provided by operating activities and $230 million in adjusted free cash flow for the full year, ending the quarter with $314 million in unrestricted cash. The backlog from the Motion Picture and Television Production segments was $1.5 billion as of March 31, 2024.
Income Statement Highlights
| Metric | Q4 2024 | Q4 2023 |
|---|---|---|
| Revenue | $1.1 billion | $1.09 billion |
| Operating Loss | -$60.9 million | -$49.6 million |
| Net Loss | -$39.5 million | -$96.8 million |
| Adjusted OIBDA | $140.3 million | $138.0 million |
Balance Sheet and Cash Flow
As of March 31, 2024, Lions Gate Entertainment Corp reported total assets of $7.09 billion, compared to $7.43 billion in the previous year. Total liabilities increased to $7.28 billion from $6.30 billion. The company ended the quarter with $314 million in unrestricted cash.
Commentary
"We reported strong financial results in the fourth quarter to wrap up a great year in which we completed four major transactions, moved closer to a value-defining separation of our studio and STARZ businesses, grossed over a billion dollars at the global box office and grew our film and TV library to record levels," said Lionsgate and Lionsgate Studios CEO Jon Feltheimer.
Analysis
Lions Gate Entertainment Corp's performance in the fourth quarter of fiscal 2024 demonstrates resilience in its Television Production segment, which continues to drive revenue growth. However, challenges in the Motion Picture segment and Media Networks segment highlight the need for strategic adjustments. The company's ability to generate significant cash flow and maintain a strong backlog positions it well for future growth, despite the reported losses.
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Explore the complete 8-K earnings release (here) from Lions Gate Entertainment Corp for further details.
