Studio counters Icahn with upbeat numbers
A day after Carl Icahn promised a proxy fight, Lionsgate offered a confident outlook for the minimajor as a counter-attack to the takeover threat.
In a Wednesday conference call with analysts, Lionsgate co-chair and CEO Jon Feltheimer contended that shareholders had “rejected” Icahn’s hostile bid of $7 a share with less than 4% tendering their shares.
“Lionsgate shareholders have demonstrated that they believe the offer is financially inadequate,” he added. Feltheimer said results for the fiscal year ended March 31 showed that the four major Lionsgate businesses — the 12,000-title library, TV production, channel distribution business and feature films — were robust “despite a difficult retail environment.”
Countering charges of overspending and inefficiency, Feltheimer noted that a recent SmarTrend report found Lionsgate had the top revenue per employee figure among studios at better than $2 million.
Feltheimer also defended Lionsgate’s efforts to expand its library, touting the company as the “distributor of choice” for third parties. As for TV, Feltheimer said revenues have grown at a compound rate of better than 40%. He named “Weeds,” “Mad Men,” “Nurse Jackie” and the new “Running Wild” as success stories. He defended last year’s $255 million purchase of TV Guide — a major point of attack for Icahn — as being executed “at the right time and the right price.”
Feltheimer said Lionsgate will continue to release 13 to 14 films a year with an average risk of $13 million each. He noted that two most recent releases — “Kick-Ass” and “Why Did I Get Married Two” — have been “solidly profitable” as have nine of the last 13 Lionsgate films.