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Lionsgate (LGF.A) Q3 Earnings Top Estimates, Revenues Fall Y/Y
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Lionsgate (LGF.A - Free Report) reported third-quarter fiscal 2024 adjusted earnings of 27 cents per share, beating the Zacks Consensus Estimate by 12.5% but declining 10% year over year.
Revenues decreased 2.5% year over year to $975.1 million and lagged the consensus mark by 5.94%.
Segment Details
Studio business (71% of revenues) revenues decreased 22.7% year over year to $691.6 million.
Motion Picture (64.1% of Studio revenues) revenues surged 53.5% year over year to $443.2 million. The segment benefited from the strong box office collection of The Hunger Games: The Ballad of Songbirds & Snakes.
Lions Gate Entertainment Corp. Price, Consensus and EPS Surprise
Television Production (36% of Studio revenues) revenues plunged 59% year over year to $248.4 million. The acquisition of eOne from Hasbro has helped Lionsgate integrate more than 6,000 new titles into its library.
Media Networks segment (42.8% of revenues) reported revenues of $417.2 million, which increased 9.7% year over year.
Starz Networks’ revenues inched up 0.3% year over year to $342.7 million. LIONSGATE+ revenues in the quarter rose 93% year over year to $74.5 million.
Total global subscribers, including STARZPLAY Arabia (a non-consolidated equity method investee), decreased sequentially to 27.92 million, primarily due to linear and over-the-top (OTT) pressures domestically.
Total OTT subscribers increased 7.8% year over year to 15.88 million. Starz gained 700K North American OTT subscribers.
Operating Details
In third-quarter fiscal 2024, Lionsgate’s adjusted OIBDA decreased 10.1% year over year to $150.9 million.
Direct operating expenses, as a percentage of revenues, declined 610 basis points (bps) to 52.4%.
Distribution and marketing expenses, as a percentage of revenues, increased 550 bps to 22.6%.
Moreover, general & administrative expenses, as a percentage of revenues, increased 90 bps year over year to 12.4%.
Lionsgate reported an operating loss of $43.5 million in the reported quarter against an operating income of $7.8 million reported in the year-ago quarter.
Balance Sheet & Cash Flow
As of Dec 31, 2023, Lionsgate had cash and cash equivalents of $283 million compared with $223.6 million as of Sep 30, 2023.
Net cash flow provided by operating activities was $71.1 million at the end of the fiscal third quarter compared with $301.1 million of cash flow used at the end of the previous quarter.
Adjusted free cash flow was $63.9 million compared with a free cash flow of $133.4 million in the previous quarter.
Lionsgate has increased equity investment in 3 Arts.
Moreover, Lionsgate took a significant step toward the separation of Lionsgate and Starz by announcing Lionsgate Studios as an independent, publicly traded, pure-play content company.
Guidance
For fiscal 2024, Lionsgate still expects adjusted EBITDA between $400 million and $450 million, which, at the midpoint, reflects nearly 19% year-over-year growth.
Zacks Rank & Stocks to Consider
Lionsgate currently carries a Zacks Rank #3 (Hold).
Image: Bigstock
Lionsgate (LGF.A) Q3 Earnings Top Estimates, Revenues Fall Y/Y
Lionsgate (LGF.A - Free Report) reported third-quarter fiscal 2024 adjusted earnings of 27 cents per share, beating the Zacks Consensus Estimate by 12.5% but declining 10% year over year.
Revenues decreased 2.5% year over year to $975.1 million and lagged the consensus mark by 5.94%.
Segment Details
Studio business (71% of revenues) revenues decreased 22.7% year over year to $691.6 million.
Motion Picture (64.1% of Studio revenues) revenues surged 53.5% year over year to $443.2 million. The segment benefited from the strong box office collection of The Hunger Games: The Ballad of Songbirds & Snakes.
Lions Gate Entertainment Corp. Price, Consensus and EPS Surprise
Lions Gate Entertainment Corp. price-consensus-eps-surprise-chart | Lions Gate Entertainment Corp. Quote
Television Production (36% of Studio revenues) revenues plunged 59% year over year to $248.4 million. The acquisition of eOne from Hasbro has helped Lionsgate integrate more than 6,000 new titles into its library.
Media Networks segment (42.8% of revenues) reported revenues of $417.2 million, which increased 9.7% year over year.
Starz Networks’ revenues inched up 0.3% year over year to $342.7 million. LIONSGATE+ revenues in the quarter rose 93% year over year to $74.5 million.
Total global subscribers, including STARZPLAY Arabia (a non-consolidated equity method investee), decreased sequentially to 27.92 million, primarily due to linear and over-the-top (OTT) pressures domestically.
Total OTT subscribers increased 7.8% year over year to 15.88 million. Starz gained 700K North American OTT subscribers.
Operating Details
In third-quarter fiscal 2024, Lionsgate’s adjusted OIBDA decreased 10.1% year over year to $150.9 million.
Direct operating expenses, as a percentage of revenues, declined 610 basis points (bps) to 52.4%.
Distribution and marketing expenses, as a percentage of revenues, increased 550 bps to 22.6%.
Moreover, general & administrative expenses, as a percentage of revenues, increased 90 bps year over year to 12.4%.
Lionsgate reported an operating loss of $43.5 million in the reported quarter against an operating income of $7.8 million reported in the year-ago quarter.
Balance Sheet & Cash Flow
As of Dec 31, 2023, Lionsgate had cash and cash equivalents of $283 million compared with $223.6 million as of Sep 30, 2023.
Net cash flow provided by operating activities was $71.1 million at the end of the fiscal third quarter compared with $301.1 million of cash flow used at the end of the previous quarter.
Adjusted free cash flow was $63.9 million compared with a free cash flow of $133.4 million in the previous quarter.
Lionsgate has increased equity investment in 3 Arts.
Moreover, Lionsgate took a significant step toward the separation of Lionsgate and Starz by announcing Lionsgate Studios as an independent, publicly traded, pure-play content company.
Guidance
For fiscal 2024, Lionsgate still expects adjusted EBITDA between $400 million and $450 million, which, at the midpoint, reflects nearly 19% year-over-year growth.
Zacks Rank & Stocks to Consider
Lionsgate currently carries a Zacks Rank #3 (Hold).
AMC Networks (AMCX - Free Report) , Roku (ROKU - Free Report) and Genasys (GNSS - Free Report) are some better-ranked stocks that investors can consider in the broader Zacks Consumer Discretionary sector, 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.
Shares of AMC Networks have declined 9.3% year to date. AMCX is set to report its fourth-quarter 2023 results on Feb 9.
Shares of Roku have gained 3.3% year to date. ROKU is slated to report its fourth-quarter 2023 results on Feb 15.
Shares of Genasys have declined 23.2% year to date. GNSS is set to report its first-quarter fiscal 2024 results on Feb 13.