Lionsgate reports year-end loss of $74 mil

Exceeds revenue and free cash flow estimates

TORONTO -- Lionsgate reported on Friday a year-end loss on sharply higher theatrical distribution and marketing costs, but said it exceeded revenue and free cash flow estimates.

Vancouver-based Lionsgate reported a loss of $74 million on revenue of $1.36 billion for the fiscal year ended March 31, 2008, compared with earnings of $24.5 million on revenue of $976.7 million for same period of 2007.

Lionsgate posted free cash flow of $137 million for fiscal 2008, a key metric for the company. That surpassed guidance of $120 million, as did a record $511.5 million in fourth quarter revenue after the September 2007 acquisition of Mandate Pictures.

But growing its theatrical slate forced higher distribution and marketing expenses, which came to $635.6 million in fiscal 2008, against a year-earlier $404.4 million.

Year-end motion picture revenue rose 34% to a record $1.15 billion, against a year-earlier $858.2 million. Lionsgate generated about $450 million at the North American theatrical boxoffice in fiscal 2008.

Overall home entertainment revenue climbed 18% to a record $623.5 million from $528.3 million in 2007, while DVD revenue came to a record $263.7 million at the year-end.

TV revenue in the motion picture segment rose 6% to $115.9 million, against a year-earlier $109.3 million.

Lionsgate also reported $158.7 million in international revenue for fiscal 2008, with Lionsgate U.K. contributing $64.6 million in full-year revenue.

On the TV side, production revenue jumped 77% to $210.1 million, from $118.5 million in 2007.

Ahead of an analyst call Monday morning, Lionsgate CEO Jon Feltheimer in a statement forecast continued double-digit revenue growth in fiscal 2009.

"We continue to leverage our vast array of content for large niche audiences into a fast-growing channel business, digital distribution platforms and emerging international opportunities that, in addition to the continued successful operation of our existing core businesses, all set the foundation for long-term profitability and enhanced global recognition of the Lionsgate brand," he added.