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Lionsgate (LGF.A) Q2 Earnings Lag Estimates, Revenues Fall Y/Y

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Lionsgate (LGF.A - Free Report) reported an adjusted loss of 12 per share for the second quarter of fiscal 2023, which lagged the Zacks Consensus Estimate by 45.45%. The company reported a earnings  of 15 cents in the year-ago quarter.

Revenues decreased 0.02% year over year to $875 million and lagged the consensus mark by 2.52%.

The decline in revenues comes from the strategic decision to exit seven international territories and six markets in Continental Europe and Japan, which has already begun.

Segment Details

Motion Picture (25.6% of revenues) revenues decreased 32.3% year over year to $224 million. The segment generated a profit of $55.5 million, down 45.5% year over year.

Television Production (49.2% of revenues) revenues increased 28.2% year over year to $430.9 million. Segmental profit was $13.6 million, which decreased 52.3% year over year.

The Media Networks segment (42.6% of revenues) reported revenues of $396.1 million, up 3% year over year. Segmental profit increased 281.8% to $21 million.

Starz Networks’ revenues decreased 0.3% year over year to $357.5 million.

STARZPLAY International revenues in the quarter rose 47.9% year over year to $38.6 million.

The fiscal second quarter’s total global subscribers were 37.8 million, including STARZPLAY Arabia. Total Global Media Networks OTT subscribers grew 1 million sequentially to 27.3 million subscribers. This represents year-over-year global OTT subscriber growth of 52%, comprised domestic OTT growth of 18% and international OTT growth of nearly 100%.

Lions Gate Entertainment Corp. Price, Consensus and EPS Surprise


Operating Details

Lionsgate’s adjusted OIBDA decreased 56.2% year over year to $47.4 million in the reported quarter.

Direct operating expenses, as a percentage of revenues, expanded 10% year over year to 64.4% from 12.8% in the previous quarter.

Distribution and marketing expenses, as a percentage of revenues, contracted 3.3% to 21.1%.

Moreover, general & administrative expenses, as a percentage of revenues, decreased 150 basis points year over year to 13.9%.

The company reported an operating loss of $1747.6 million in the reported quarter against an operating profit of $29.8 million in the year-ago quarter.

Balance Sheet & Cash Flow

As of Sep 30, 2022, Lionsgate had cash and cash equivalents of $557.1 million compared with $378.5 million as of Jun 30, 2022.

Net cash outflow from operating activities was $139.2 million at the end of the fiscal second quarter compared with $16.1 million of cash flow provided at the end of the previous quarter.

Adjusted free cash flow was $123.5 million against a free cash flow of $195.2 million in the previous quarter.

Zacks Rank & Stocks to Consider

Lionsgate currently has a Zacks Rank #4 (Sell).

Some better-ranked stocks in the Consumer Discretionary sector are AMC Entertainment (AMC - Free Report) , Reservoir Media (RSVR - Free Report) and American Public Education (APEI - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

AMC Entertainment, Reservoir Media and American Public Education are each scheduled to report quarterly results on Nov 8.

The Zacks Consensus Estimate for AMC Entertainment’s third-quarter 2022 loss is pegged at 27 cents per share, down from a loss of 25 cents over the past 30 days.

The Zacks Consensus Estimate for Reservoir Media’s third-quarter 2022 earnings is pegged at 5 cents per share, unchanged over the past 30 days.

The consensus mark for American Public Education’s third-quarter 2022 earnings is pegged at 25 cents per share, unchanged in the past 30 days.


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