Consolidating Financial Information - Convertible Senior Subordinated Notes | Consolidating Financial Information — Convertible Senior Subordinated Notes The January 2012 4.00% Notes and the April 2013 1.25% Notes by their terms, are fully and unconditionally guaranteed by the Company. LGEI, the issuer of the January 2012 4.00% Notes and the April 2013 1.25% Notes that are guaranteed by the Company, is 100% owned by the parent company guarantor, Lions Gate Entertainment Corp. The following tables present condensed consolidating financial information as of June 30, 2016 and March 31, 2016 , and for the three months ended June 30, 2016 and 2015 for (1) the Company, on a stand-alone basis, (2) LGEI, on a stand-alone basis, (3) the non-guarantor subsidiaries of the Company (including the subsidiaries of LGEI), on a combined basis (collectively, the “Non-guarantor Subsidiaries”) and (4) the Company, on a consolidated basis. As of June 30, 2016 Lions Gate Entertainment Corp. Lions Gate Entertainment Inc. Non-guarantor Subsidiaries Consolidating Adjustments Lions Gate Consolidated (Amounts in thousands) BALANCE SHEET Assets Cash and cash equivalents $ 1,142 $ 28,469 $ 40,286 $ — $ 69,897 Restricted cash — 10,801 — — 10,801 Accounts receivable, net 458 2,499 896,764 — 899,721 Investment in films and television programs, net — 6,407 1,422,872 — 1,429,279 Property and equipment, net — 36,261 6,554 — 42,815 Investments 40,072 15,734 437,333 — 493,139 Goodwill 10,172 — 524,608 — 534,780 Other assets 2,198 39,855 31,173 (5,261 ) 67,965 Deferred tax assets 1,526 150,358 14,979 — 166,863 Subsidiary investments and advances 1,672,210 1,657,629 3,173,843 (6,503,682 ) — $ 1,727,778 $ 1,948,013 $ 6,548,412 $ (6,508,943 ) $ 3,715,260 Liabilities and Shareholders' Equity (Deficiency) Senior revolving credit facility $ 220,970 $ — $ — $ — $ 220,970 5.25% Senior Notes 221,240 — — — 221,240 Term Loan 388,701 — — — 388,701 Accounts payable and accrued liabilities 26,796 67,910 194,100 — 288,806 Participations and residuals — 3,556 647,142 — 650,698 Film obligations and production loans — — 560,877 — 560,877 Convertible senior subordinated notes — 100,555 — — 100,555 Deferred revenue — 4,111 317,455 — 321,566 Intercompany payable — 2,136,356 2,478,793 (4,615,149 ) — Redeemable noncontrolling interest — — 91,776 — 91,776 Total shareholders' equity (deficiency) 870,071 (364,475 ) 2,258,269 (1,893,794 ) 870,071 $ 1,727,778 $ 1,948,013 $ 6,548,412 $ (6,508,943 ) $ 3,715,260 Three Months Ended June 30, 2016 Lions Gate Entertainment Corp. Lions Gate Entertainment Inc. Non-guarantor Subsidiaries Consolidating Adjustments Lions Gate Consolidated (Amounts in thousands) STATEMENT OF INCOME Revenues $ — $ 5,223 $ 548,352 $ — $ 553,575 EXPENSES: Direct operating 6 974 365,296 — 366,276 Distribution and marketing — 486 124,553 — 125,039 General and administration 432 46,337 32,010 (112 ) 78,667 Depreciation and amortization — 3,601 2,015 — 5,616 Total expenses 438 51,398 523,874 (112 ) 575,598 OPERATING INCOME (LOSS) (438 ) (46,175 ) 24,478 112 (22,023 ) Other expenses (income): Interest expense 11,131 57,084 45,719 (98,700 ) 15,234 Interest and other income (53,943 ) 73 (45,642 ) 98,563 (949 ) Total other expenses (income) (42,812 ) 57,157 77 (137 ) 14,285 INCOME (LOSS) BEFORE EQUITY INTERESTS AND INCOME TAXES 42,374 (103,332 ) 24,401 249 (36,308 ) Equity interests income (loss) (40,588 ) 35,351 11,488 4,595 10,846 INCOME (LOSS) BEFORE INCOME TAXES 1,786 (67,981 ) 35,889 4,844 (25,462 ) Income tax provision (benefit) 532 (27,393 ) 14,226 (13,667 ) (26,302 ) NET INCOME (LOSS) 1,254 (40,588 ) 21,663 18,511 840 Less: Net loss attributable to noncontrolling interest — — — 414 414 Net income (loss) attributable to Lions Gate Entertainment Corp. shareholders $ 1,254 $ (40,588 ) $ 21,663 $ 18,925 $ 1,254 Three Months Ended June 30, 2016 Lions Gate Entertainment Corp. Lions Gate Entertainment Inc. Non-guarantor Subsidiaries Consolidating Adjustments Lions Gate Consolidated STATEMENT OF COMPREHENSIVE INCOME (LOSS) (Amounts in thousands) NET INCOME (LOSS) $ 1,254 $ (40,588 ) $ 21,663 $ 18,511 $ 840 Foreign currency translation adjustments, net of tax (4,326 ) (7,019 ) (10,973 ) 17,992 (4,326 ) Net unrealized gain on available-for-sale securities, net of tax 16,904 — 16,904 (16,904 ) 16,904 Net unrealized gain on foreign exchange contracts, net of tax (2,603 ) — (2,603 ) 2,603 (2,603 ) COMPREHENSIVE INCOME (LOSS) 11,229 (47,607 ) 24,991 22,202 10,815 Less: Comprehensive loss attributable to noncontrolling interest — — — 414 414 Comprehensive income (loss) attributable to Lions Gate Entertainment Corp. shareholders $ 11,229 $ (47,607 ) $ 24,991 $ 22,616 $ 11,229 Three Months Ended June 30, 2016 Lions Gate Entertainment Corp. Lions Gate Entertainment Inc. Non-guarantor Subsidiaries Consolidating Adjustments Lions Gate Consolidated (Amounts in thousands) STATEMENT OF CASH FLOWS NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES $ (36,973 ) $ 2,424 $ 177,638 $ — $ 143,089 INVESTING ACTIVITIES: Investment in equity method investees — — (4,172 ) — (4,172 ) Purchases of property and equipment — (2,046 ) (860 ) — (2,906 ) NET CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES — (2,046 ) (5,032 ) — (7,078 ) FINANCING ACTIVITIES: Senior revolving credit facility - borrowings 185,000 — — — 185,000 Senior revolving credit facility - repayments (121,000 ) — — — (121,000 ) Production loans - borrowings — — 63,263 — 63,263 Production loans - repayments — — (222,730 ) — (222,730 ) Dividends paid (13,210 ) — — — (13,210 ) Distributions from noncontrolling interest — — (2,159 ) — (2,159 ) Exercise of stock options 423 — — — 423 Tax withholding required on equity awards (13,752 ) — — — (13,752 ) NET CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES 37,461 — (161,626 ) — (124,165 ) NET CHANGE IN CASH AND CASH EQUIVALENTS 488 378 10,980 — 11,846 FOREIGN EXCHANGE EFFECTS ON CASH — — 309 — 309 CASH AND CASH EQUIVALENTS — BEGINNING OF PERIOD 654 28,091 28,997 — 57,742 CASH AND CASH EQUIVALENTS — END OF PERIOD $ 1,142 $ 28,469 $ 40,286 $ — $ 69,897 As of March 31, 2016 Lions Gate Entertainment Corp. Lions Gate Entertainment Inc. Non-guarantor Subsidiaries Consolidating Adjustments Lions Gate Consolidated (Amounts in thousands) BALANCE SHEET Assets Cash and cash equivalents $ 654 $ 28,091 $ 28,997 $ — $ 57,742 Restricted cash — 2,906 — — 2,906 Accounts receivable, net 676 1,579 1,047,034 — 1,049,289 Investment in films and television programs, net — 6,407 1,471,889 — 1,478,296 Property and equipment, net — 36,171 7,213 — 43,384 Investments 40,072 15,354 408,920 — 464,346 Goodwill 10,172 — 524,608 — 534,780 Other assets 314 42,143 32,015 (5,397 ) 69,075 Deferred tax assets 1,502 121,725 11,194 — 134,421 Subsidiary investments and advances 1,584,187 1,518,348 3,094,974 (6,197,509 ) — $ 1,637,577 $ 1,772,724 $ 6,626,844 $ (6,202,906 ) $ 3,834,239 Liabilities and Shareholders' Equity (Deficiency) Senior revolving credit facility $ 156,136 $ — $ — $ — $ 156,136 5.25% Senior Notes 220,796 — — — 220,796 Term Loan 388,207 — — — 388,207 Accounts payable and accrued liabilities 22,165 89,903 265,630 — 377,698 Participations and residuals — 3,663 603,695 — 607,358 Film obligations and production loans — — 715,018 — 715,018 Convertible senior subordinated notes — 99,984 — — 99,984 Deferred revenue — 4,833 323,411 — 328,244 Intercompany payable — 1,906,899 2,415,792 (4,322,691 ) — Redeemable noncontrolling interest — — 90,525 — 90,525 Total shareholders' equity (deficiency) 850,273 (332,558 ) 2,212,773 (1,880,215 ) 850,273 $ 1,637,577 $ 1,772,724 $ 6,626,844 $ (6,202,906 ) $ 3,834,239 Three Months Ended June 30, 2015 Lions Gate Entertainment Corp. Lions Gate Entertainment Inc. Non-guarantor Subsidiaries Consolidating Adjustments Lions Gate Consolidated (Amounts in thousands) STATEMENT OF INCOME Revenues $ — $ 2,105 $ 406,999 $ (163 ) $ 408,941 EXPENSES: Direct operating — (1,504 ) 231,814 — 230,310 Distribution and marketing — 522 71,402 — 71,924 General and administration 858 36,916 23,332 (394 ) 60,712 Depreciation and amortization — 1,551 279 — 1,830 Total expenses 858 37,485 326,827 (394 ) 364,776 OPERATING INCOME (LOSS) (858 ) (35,380 ) 80,172 231 44,165 Other expenses (income): Interest expense 8,985 53,542 42,160 (92,062 ) 12,625 Interest and other income (50,534 ) (162 ) (41,841 ) 91,937 (600 ) Total other expenses (income) (41,549 ) 53,380 319 (125 ) 12,025 INCOME (LOSS) BEFORE EQUITY INTERESTS AND INCOME TAXES 40,691 (88,760 ) 79,853 356 32,140 Equity interests income (loss) 677 89,484 11,848 (90,621 ) 11,388 INCOME (LOSS) BEFORE INCOME TAXES 41,368 724 91,701 (90,265 ) 43,528 Income tax provision (benefit) 684 47 6,092 (3,979 ) 2,844 NET INCOME (LOSS) 40,684 677 85,609 (86,286 ) 40,684 Less: Net loss attributable to noncontrolling interest — — — — — Net income (loss) attributable to Lions Gate Entertainment Corp. shareholders $ 40,684 $ 677 $ 85,609 $ (86,286 ) $ 40,684 Three Months Ended June 30, 2015 Lions Gate Entertainment Corp. Lions Gate Entertainment Inc. Non-guarantor Subsidiaries Consolidating Adjustments Lions Gate Consolidated STATEMENT OF COMPREHENSIVE INCOME (LOSS) (Amounts in thousands) NET INCOME (LOSS) $ 40,684 $ 677 $ 85,609 $ (86,286 ) $ 40,684 Foreign currency translation adjustments, net of tax 45,731 45,915 (1,543 ) (86,613 ) 3,490 Net unrealized gain on available-for-sale securities, net of tax — — 42,234 — 42,234 Net unrealized gain on foreign exchange contracts, net of tax — — 7 — 7 COMPREHENSIVE INCOME (LOSS) $ 86,415 $ 46,592 $ 126,307 $ (172,899 ) $ 86,415 Less: Comprehensive loss attributable to noncontrolling interest — — — — — Comprehensive income (loss) attributable to Lions Gate Entertainment Corp. shareholders $ 86,415 $ 46,592 $ 126,307 $ (172,899 ) $ 86,415 Three Months Ended June 30, 2015 Lions Gate Entertainment Corp. Lions Gate Entertainment Inc. Non-guarantor Subsidiaries Consolidating Adjustments Lions Gate Consolidated (Amounts in thousands) STATEMENT OF CASH FLOWS NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES $ 10,380 $ 62,627 $ (103,890 ) $ — $ (30,883 ) INVESTING ACTIVITIES: Investment in equity method investees — — (800 ) — (800 ) Purchases of property and equipment — (3,124 ) (124 ) — (3,248 ) NET CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES — (3,124 ) (924 ) — (4,048 ) FINANCING ACTIVITIES: Term Loan - borrowings, net of deferred financing costs of $616 24,384 — — — 24,384 Convertible senior subordinated notes - repurchases — (5 ) — — (5 ) Production loans - borrowings — — 203,087 — 203,087 Production loans - repayments — — (74,276 ) — (74,276 ) Dividends paid (10,187 ) — — — (10,187 ) Excess tax benefits on equity-based compensation awards — 45 — — 45 Exercise of stock options 3,118 — — — 3,118 Tax withholding required on equity awards (16,082 ) — — — (16,082 ) NET CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES 1,233 40 128,811 — 130,084 NET CHANGE IN CASH AND CASH EQUIVALENTS 11,613 59,543 23,997 — 95,153 FOREIGN EXCHANGE EFFECTS ON CASH (1 ) — (1,299 ) — (1,300 ) CASH AND CASH EQUIVALENTS — BEGINNING OF PERIOD 3,499 47,290 51,908 — 102,697 CASH AND CASH EQUIVALENTS — END OF PERIOD $ 15,111 $ 106,833 $ 74,606 $ — $ 196,550 |