Lionsgate has released its third-quarter financial results while exploring a possible sale or spinoff of premium cable and streaming platform Starz or its studio business.
The studio’s third-quarter net income rose to $16.6 million as total revenue for the three months to December 31, 2022 grew to $1 billion, compared to $885.4 million a year earlier, compared to a loss of $45.6 million a year ago.
Lionsgate reported adjusted earnings per share at 26 cents, compared with a per-share loss of 12 cents a year ago, which beat an analyst estimate of 38 cents in the latest fiscal quarter.
“We reported a strong financial quarter with record 12-month library revenue, reaffirming the value of our intellectual properties. We are entering our fourth quarter with encouraging signs across all of our businesses: domestic box office booming as we bring our biggest slate in years to theaters; renewals of six major Lionsgate television series during or shortly after the end of the quarter; And STARZ economics have improved due to its international restructuring,” Lionsgate CEO John Feltheimer said in a statement.
Lionsgate gave little away as it explored its options for Starz, including a possible separation of the pay TV and streaming business and its studio operations. It appears that Target is creating two standalone companies so that investors can value the Starz and studio properties separately.
But its latest financial results included an $80.8 million content write-down as it restructures its Lionsgate+ business, or formerly the STARZPLAY international division, after removing some TV series from its service.
Also during the latest quarter, the Media Networks division, primarily Starz, saw segment revenue of $380.3 million compared to $388.9 million a year ago. The studio business, made up of the film and TV production divisions, saw a 25 percent increase in revenue to $894.2 million.
And motion picture segment revenue increased 5 percent to $288.8 million.
While some see Starz as a potential contender as a streaming platform, others are looking at Lionsgate and its programming library as a potential indie studio acquisition, as digital titans like Apple and Amazon muscle in on Hollywood.
Lionsgate is touting its 17,000-strong programming library as difficult to replicate and an attractive target for a big media player bolting on indie studios. And despite volatile financial markets, the entertainment industry has recently seen a spate of mergers and acquisitions as major players dive into the streaming space and indie studios are bought up for scale and content.
Source: www.bing.com
