Lionsgate reports loss in first 2012 quarter despite success of The Hunger Games
Lionsgate posted financial results for the first quarter of the year. The surprise came when realizing that even with the huge success of The Hunger Games, the studio is reporting a loss of $22.7 million. The reports took into account all movements from January 1st to March 31st, so in this quarter only the first week of the The Hunger Games box office was contemplated. The reason there was a loss, though, has to do with strong write-downs Lionsgate took, including the acquisition of Summit Entertainment at the beginning of the year. From The Hollywood Reporter:
Missing the street consensus, Vancouver-based Lionsgate reported a loss of $22.7 million for the three months to March 31, compared to a profit of $48.6 million in the same period of 2011.
Q4 revenue rose sharply to $645.2 million, from a year-earlier $376.9 million.
Lionsgate used momentum from The Hunger Games to take opportune write-downs, including $51 million for Summit Entertainment acquisition costs.
These are not bad news at all, though. The success brought by The Hunger Games will have a bigger impact in the months and years to come, considering it’s built a franchise that includes lots of merchandising and two sequels (probably three). Also, in the near future Lionsgate will still receive the revenue from the Blu-ray and DVD sales, which hits shelves August 18.