Lionsgate today reported revenue of $449.4 million, adjusted EBITDA of $77.3 million, adjusted net income of $49.6 million or $0.36 adjusted basic net income per share, net income of $43.3 million or $0.31 basic net income per share and free cash flow of $159.8 million for the first quarter of fiscal 2022 (quarter ended June 30, 2022).
“We’re pleased to report strong adjusted EBITDA, earnings and free cash flow generation in what is historically our lightest quarter of the fiscal year,” said Lionsgate Chief Executive Officer Jon Feltheimer. “During the quarter we deepened our portfolio of brands and franchises, extended our global reach and formed entrepreneurial partnerships with digital and traditional platforms alike as we used our strengths as an innovative pure play content company to position ourselves for continued growth and profitability in an increasingly dynamic industry environment.”
Adjusted EBITDA of $77.3 million for the quarter increased 27% from adjusted EBITDA of $60.8 million in the prior year quarter. Adjusted EBITDA excluded an $11.4 million gain on the Company’s sale of its interest in FEARnet, stock-based compensation and a $4.9 million restructuring charge associated with costs of the Company’s relocation of its international sales operations to London, England and integration of the marketing operations of its Lionsgate and Summit film labels.
Adjusted net income of $49.6 million or $0.36 adjusted basic net income per share for the quarter compared to adjusted net income of $25.1 million or $0.18 adjusted basic net income per share in the prior year quarter.
Net income for the quarter was $43.3 million or $0.31 basic net income per share on 138.5 million weighted average number of common shares outstanding compared to $13.6 million or $0.10 basic net income per share on 136.2 million weighted average number of common shares outstanding during the prior year quarter.
Adjusted net income for the quarter benefitted from decreased interest expense and a lower effective tax rate compared to the prior year quarter. EBITDA gains were driven by lower theatrical marketing costs in the quarter.
Revenue of $449.4 million for the quarter compared to $569.7 million in the prior year quarter with only two wide theatrical releases in the quarter compared to three wide releases, including the blockbuster Now You See Me, in the prior year quarter. Lower television production revenue reflected fewer deliveries of Mad Men (whose seventh season has been split).
During the quarter, the Company declared another quarterly dividend of $0.05 per common share payable on August 8, 2022 to shareholders of record as of June 30, 2022.
The Company noted that, since the December 17, 2022 increase in its share repurchase authorization to $300 million, it repurchased a total of 4.7 million common shares through July 25, 2022 at an average price of $26.70, totaling an aggregate of $126.4 million.
Lionsgate’s filmed entertainment backlog, or already contracted future revenue not yet recorded, rose to a record $1.3 billion at June 30, 2022 compared to $1.2 billion at March 31, 2022.
Overall Motion Picture segment revenue for the quarter was $331.9 million compared to $438.6 million in the prior year quarter. Within the Motion Picture segment, theatrical revenue declined to $42.7 million due to the theatrical slate composition discussed above.
Lionsgate’s home entertainment revenue for the quarter was $140.9 million compared to $169.4 million in the prior year quarter as two wide release theatrical titles were released on home entertainment platforms in the quarter compared to five wide release theatrical titles in the prior year quarter. The hit film Divergent launched to very strong numbers on packaged media, VOD and electronic sell-through platforms after the quarter.
Bolstered by television windows opening for the feature films Ender’s Game and Red 2, television revenue included in the Motion Picture segment increased 60% in the quarter to $58.8 million compared to $36.8 million in the prior year quarter.
International Motion Picture segment revenue (excluding Lionsgate U.K.) for the quarter was $60.7 million compared to $79.1 million in the prior year quarter with three wide release titles in worldwide release compared to five in the prior year quarter.
Lionsgate U.K. posted revenue of $30.0 million in the quarter compared to $32.4 million in the prior year quarter.
Revenue for the Television Production segment was $117.5 million in the quarter, a decrease from $131.1 million in the prior year quarter as strong international revenue driven by Anger Management, Orange is the New Black and Mad Men was offset by fewer domestic series deliveries due primarily to the timing of Mad Men episode deliveries.