41 jobs eliminated ahead of earnings report
Lionsgate is cutting 8% of its staff, which had grown from 350 to 550 over the past four years.In all, 41 positions are being eliminated, with 17 rank-and-file staffers laid off. (The disparity in those numbers results from the fact that positions remain in the budget regardless of whether there are actually people occupying them.) The cuts span all divisions, and almost all are at the indie’s Santa Monica headquarters. On Friday, a company rep confirmed reports of the cuts, which come just before Lionsgate reports second-quarter earnings today. The goal of the shrinkage is to keep overhead expenses at 8%-9% of corporate revenue. As market conditions deteriorated over the summer, the company instituted a hiring freeze, but in the current economic environment, layoffs proved inevitable. Since merging with Artisan in 2004, Lionsgate has grown both organically and through acquisitions. It bought companies such as Debmar-Mercury and Redbus in the U.K. and Mandate Pictures in the U.S., adding employees and costs to the books along with realizing efficiencies. Like many companies in the media and entertainment space, Lionsgate has had a volatile autumn. On the plus side, “Saw V” opened to $30.5 million. and chairman-chief exec Jon Feltheimer reupped through 2013. The company’s already undernourished stock, however, has fallen more than 25% in the past month to a level at which corporate raider Carl Icahn saw fit to boost his stake. The decline also triggered an automatic sale of shares by Michael Burns, the company’s vice chairman. Shares closed up a penny Friday at $6.62.