‘Knives Out’ Boosts Lionsgate Revenues Above Wall Street Projections
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Citing strong performance from “Knives Out,” Lionsgate has posted revenues and operating income above Wall Street projections for its third fiscal quarter that ended on Dec. 31.
Revenue were $998.5 million, 8% above Wall Street forecasts, and adjusted operating income of $124.5 million beat estimates by 11%. Subscribers from Starz, Starzplay Arabia and Pantaya reached 28.5 million in the quarter and global OTT subscribers reached 8.6 million for am 8% gain in global subscribers. Adjusted earnings per share were 14 cents, well below forecasts for 18 cents.
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“Knives Out” has grossed $155 million in North America and $294 million worldwide. Rian Johnson received an Oscar nomination in the Best Original Screenplay category for the murder mystery, which stars Daniel Craig, Jamie Lee Curtis, Chris Evans and Ana de Armas.
“Our Motion Picture Group turned in a strong performance in the quarter, led by the worldwide box office success of ‘Knives Out’ while our Television Group secured a number of important scripted series and pilot commitments and Starz continued to grow its over-the-top platform worldwide,” said Lionsgate CEO Jon Feltheimer. “Our Starzplay international rollout remains on track to achieve financial and subscriber targets that we expect to translate into meaningful incremental value creation.”
Lionsgate’s film operation saw revenue rise 30% to $473.9 million with segment profit of $49 million with the studio crediting the strong performance of “Knives Out” along with the ancillary results for “John Wick: Chapter 3 – Parabellum.” Earlier this week, it released the first trailer for “Spiral,” its reboot of the “Saw” franchise with Chris Rock and Samuel L. Jackson starring. “Spiral” will be released on May 15.
Feltheimer said during the conference call that the studio is planning production starts for both “John Wick 4” and a “Knives Out” sequel. Joe Drake, president of the Lionsgate Motion Picture Group, said the studio will announce a release date for “Chaos Walking” within the next few days. Tom Holland and Daisy Ridley are starring in the sci-fi movie, directed by Doug Liman, which was originally set to be released last year.
“We’ve two of our biggest stars on the planet today leading that,” Drake added.
The media networks segment, driven by Starz, reported a 4.3% gain in revenues to $382.4 million while networks profit declined 24% to $102.1 million. Lionsgate said the drop in profit was due to the company’s investment in Starzplay International, which is expected to see subscriber growth to between 15 and 25 million over the next five years.
Lionsgate announced shortly after the earnings announcement that the Starzplay international streaming service will split first pay streaming rights in the UK to Lionsgate’s recently released and upcoming feature films.
The TV production segment reported a loss of $5.7 million, which Lionsgate said was due to the timing of production schedules and episodic deliveries. Revenue for TV production was $189.4 million. New series launches included “Zoey’s Extraordinary Playlist” at NBC, “Mythic Quest: Raven’s Banquet” at Apple, and “Manhunt: Deadly Games” at Spectrum. New series ordered included “First Ladies” at Showtime and “Run The World” for Starz.
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