Lions Gate Results May Put More Pressure on Studio to Seek Deal

(Bloomberg) -- Lions Gate Entertainment Corp., which held talks to sell its Starz pay-TV network to CBS Corp., posted fourth-quarter sales and profit that missed analysts’ forecasts, underscoring the challenges facing the independent studio as competitor bulk up through mergers.

• A smaller film slate and a drop in TV production revenue led to lower sales and profit for the period ended March 31, as theatrical releases like “Cold Pursuit” failed to click with moviegoers. Sales in the TV division, which makes “Orange Is the New Black” for Netflix, slumped 11. At the same time, Lions Gate was boosting its investment in Starz.

Key Insights

Market Reaction

• Lions Gate fell as much as 8.7 to $14.60 in extended trading after results came out, before recovering. The stock advanced 15% on May 17, when the talks with CBS were first reported.

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• To see the company’s statement, click here.
• For its major shareholders, click here.

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