×
You will be redirected back to your article in seconds

Lionsgate Shares Plummet Following Disappointing Earnings

Lionsgate shares have been hammered in the wake of disappointing earnings and the company indicating that performance is tracking under previous forecasts.

Shares slid by 27%, falling $6.92 to $18.53 in trading on the New York Stock Exchange for its lowest close in more than three years. The stock’s low trade came at $16.21 before the issue rebounding in the last hour of trading.

The company had cited a soft performance by its movies — mostly notably “The Hunger Games: Mockingjay Part 2” — as the key reason for falling short of Wall Street expectations in its earnings for its third fiscal quarter, reported after the market closed Thursday. The fourth and final “Hunger Games” movie grossed $650 million worldwide, the lowest total of the four titles in the hit Jennifer Lawrence franchise.

Lionsgate CEO Jon Feltheimer provided specifics of the impact during an earnings call Friday with analysts. “‘Mockingjay 2’ is underperforming our ultimate profit margins by over $100 million, much of which hit in our guidance period,” he explained.

Feltheimer also said the studio is tracking below its previous forecast for $1.1 billion to $1.2 billion in adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) in fiscal 2016, ending March 31. He did not offer specific numbers and said Lionsgate would not offer more financial guidance until May, when it will have the results of “Gods of Egypt,” which opens Feb. 26, and “Allegiant” — the third movie in the “Divergent” franchise — which debuts on March 16.

Lionsgate often updates its guidance on EBITDA on its analyst conference calls.

Lionsgate disclosed in a regulatory filing on Thursday that it plans to restart talks to acquire Starz a year after making an investment in the premium cable network. Lionsgate execs offered little guidance on that front during the conference call and would not indicate whether any talks have commenced.

Shares of Starz dropped 20% to $24.83. Lionsgate has a 15% voting stake in Starz.

J.P. Morgan analyst Alexia Quadrani reiterated her “overweight” rating Friday and said the price makes Lionsgate valuation “extremely attractive at these levels with likely stronger growth and margin expansion ahead.”

 

 

More Film

  • Shailene Woodley probation Dakota Pipeline protest

    Cannes: Infotainment China Media Snaps Up "Misanthrope"

    Chinese sales and distribution company Infotainment China Media has bought the China rights to “Misanthrope,” the new serial killer thriller starring Shailene Woodley, from FilmNation Entertainment at Cannes. Woodley (“Big Little Lies”, the “Divergent” franchise”) will play a cop recruited by the FBI to hunt down a murderer. Damian Szifron (“Wild Tales”) and Jonathan Wakeham [...]

  • Watch Karen O & Danger Mouse’s

    Watch Karen O & Danger Mouse’s ‘Encounter With Lux Prima’ Documentary (EXCLUSIVE)

    Karen O & Danger Mouse’s “Lux Prima” is one of the year’s best albums so far — but it’s more than an album. “An Encounter with Lux Prima – The Art of Collaboration,” a short documentary chronicling the 18-month development of their multisensory art installation “An Encounter With Lux Prima” premieres today exclusively on Variety. [...]

  • Willem Dafoe Talks 'The Lighthouse' and

    Willem Dafoe on His New Films 'The Lighthouse' and 'Tommaso,' Robert Pattinson as Batman

    Willem Dafoe has spent the last two awards seasons on the campaign trail. The actor earned back-to-back Oscar nominations for his work in 2017’s “The Florida Project” and for last year’s “At Eternity’s Gate.” And if the critical reaction to “The Lighthouse” is any indication, he’ll be back on it soon. “The Lighthouse” is director [...]

  • Official First Look at the Women

    'Terminator: Dark Fate': Linda Hamilton, Arnold Schwarzenegger Return in First Trailer

    The Resistance’s war against Skynet rages on with the sixth installment of the “Terminator” series, “Terminator: Dark Fate.” The first trailer for the latest movie dropped on Thursday. The clip opens with two franchise newcomers, Mackenzie Davis and Natalia Reyes, as they’re being pursued by a Terminator (Gabriel Luna), one that seems to have some [...]

  • Malcom McLaren’s Son Joe Corré Preps

    Malcom McLaren’s Son Joe Corré Preps ‘Wake Up Punk’ Feature Doc (EXCLUSIVE)

    Malcolm McLaren and Vivienne Westwood’s son Joe Corré has voiced his opposition to a Sex Pistols feature film in the works, and is about to launch his own project, “Wake Up Punk.” The feature documentary will follow events after his decision to burn punk memorabilia worth millions of pounds. John Lydon has already tweeted that [...]

More From Our Brands

Access exclusive content