Exhibit 99.1
LIONS GATE ENTERTAINMENT REPORTS THIRD QUARTER
FISCAL 2005 REVENUES OF $190.4 MILLION AND ADJUSTED
EBITDA OF $15.3 MILLION
Company Reports Third Quarter Net Income of $3.4 Million and Adjusted Net
Income of $9.9 Million; 3Q Free Cash Flow From Operations
Generates $32.0 Million
(all amounts in U.S. dollars)
SANTA MONICA, CA, and VANCOUVER, BC, February 9, 2005 – Lions Gate Entertainment (NYSE and TSX: LGF), the premier independent producer and distributor of filmed entertainment, reported revenues of $190.4 million, adjusted EBITDA (earnings before interest, interest rate swap mark-to-market, taxes, depreciation and minority interests, adjusted for stock appreciation rights accrual) of $15.3 million and adjusted net income of $9.9 million, or adjusted basic earnings per share of $0.10, for the third quarter of fiscal 2005 (quarter ended December 31, 2004).
Adjusted net income is prior to a $3.4 million non-cash charge for write-off of deferred financing costs on Lions Gate’s term loan repaid at December 31, 2004, and prior to a $3.2 million charge for stock appreciation rights (SARS). Adjusted EBITDA is prior to the charge for SARS. After inclusion of those charges, net income was $3.4 million and basic earnings per share was $0.03.
Third quarter revenue of $190.4 million increased 170% compared to $70.6 million in the prior year’s third quarter, reflecting Lions Gate’s acquisition and integration of Artisan Entertainment as well as continued growth of the Company’s core businesses. Adjusted EBITDA of $15.3 million compared to EBITDA of negative $30.8 million in the third quarter of fiscal 2004. Adjusted net income of $9.9 million, or adjusted basic earnings per share of $0.10 on 98.1 million weighted average shares outstanding, compared to the prior year third quarter’s adjusted net loss of $33.7 million, or loss per share of $0.43 on 84.4 million weighted average common shares outstanding (after giving effect to modification of warrants and dividends and accretion on the Series A Preferred Shares). There were no charges for SARS and there was a $2.0 million write-off of deferred financing costs included in the prior year’s third quarter. Free cash flow from operations (after debt service) for the current third quarter of $32.0 million compared to negative $25.0 million for the prior year’s third quarter.
The Company continued to achieve growth in all of its core businesses. The nationwide theatrical success of the hit horror film SAW, video releases including OPEN WATER, THE PUNISHER, BARBIE IN THE PRINCE AND THE PAUPER, CARE BEARS: JOURNEY TO JOKE-A-LOT, IT’S A WONDERFUL LIFE, GODSEND and SNL:
WILL FERREL were major revenue drivers in the quarter along with evergreen library sales.
Lions Gate’s nine-month revenues of $610.2 million increased 181% compared to $217.0 million for the nine months ended December 31, 2003, again reflecting the Artisan acquisition as well as continued organic growth of Lions Gate’s core businesses. Adjusted EBITDA of $27.1 million for the nine-month period compared to EBITDA of negative $38.6 million for the previous nine-month period. Adjusted net income of $10.5 million compared to adjusted net loss of $46.8 million for the prior year’s first nine months. Adjusted net income for the 2004 period was prior to the $3.4 million charge for write-off of deferred financing costs on Lions Gate’s term loan repaid at December 31, 2004, and prior to a $7.0 million charge for SARS during the nine-month period. There were no charges for SARS and there was a $2.0 million write-off of deferred financing costs included in the prior year’s nine-month period. Free cash flow (after debt service) for the nine-month period was $81.2 million.
“Our initial five-year business plan, culminating in last year’s integration of Artisan Entertainment, is achieving the strong financial results that we anticipated,” said Lions Gate Chief Executive Officer Jon Feltheimer. “We are entering the next phase of our growth with a full pipeline of product in our core businesses, an eye on accretive strategic acquisitions and a strong platform for expansion into complementary businesses that leverage our key strengths.”
Lions Gate’s upcoming theatrical release slate for the balance of fiscal 05 and fiscal 2006 includes DIARY OF A MAD BLACK WOMAN from Tyler Perry, slated for February 25 release, HOUSE OF D, starring Robin Williams, Anton Yelchin, David Duchovny and Tea Leoni, CRASH, starring Sandra Bullock, Brendan Fraser, Matt Dillon, Don Cheadle and Thandie Newton, this year’s Sundance Film Festival opener HAPPY ENDINGS, starring Maggie Gyllenhaal, Lisa Kudrow and Tom Arnold, recording star Usher’s DYING FOR DOLLY, UNDISCOVERED, starring Pell James, Steven Strait, Kip Pardue and Ashlee Simpson, the recent Sundance acquisitions RIZE and HARD CANDY, and a slate of genre/horror films including SAW 2, Rob Zombie’s THE DEVIL’S REJECTS, HIGH TENSION and UNDEAD.
Upcoming video releases for the rest of fiscal 05 and fiscal 06 reflect a diversified slate that includes the highly-anticipated DVD release of the theatrical film SAW, the next Barbie title, FAIRYTOPIA, the first of eight titles from Lions Gate’s direct-to-video partnership with Marvel, THE AVENGERS, and the hit television comedy series MOONLIGHTING, among numerous other television-to-video titles. Lions Gate Television continues to build its leadership in original programming for cable networks, with the hit series THE DEAD ZONE (USA) and MISSING (Lifetime) in their fourth and second seasons, respectively, and the new comedy series WEEDS slated to debut on Showtime this summer. In addition, Lions Gate Television is producing the reality show THE CUT, hosted by fashion guru Tommy Hilfiger, to debut on CBS in the spring.
Lions Gate senior management will hold its analyst and investor conference call to discuss its third quarter results at 9:00 A.M. EST/6:00 A.M. PST tomorrow, February 10,
2005. Interested parties may participate live in the conference call by calling 1-888-428-4480 (1-612-288-0318 outside the U.S. and Canada). A full digital replay will be available from Thursday morning, February 10, through Thursday, February 17, by dialing 1-800-475-6701 (1-320-365-3844 outside the U.S. and Canada) and using access code #765349.
Lions Gate is the premier independent producer and distributor of motion pictures, television programming, home entertainment, family entertainment and video-on-demand content. Its prestigious and prolific library of approximately 8000 titles is one of the largest in the entertainment industry. The Lions Gate brand name is synonymous with original, daring, quality entertainment in markets around the world.
www.lionsgatefilms.com
* * * * *
For further information, please contact:
Peter D. Wilkes
310-255-3726
pwilkes@lgf.com or
Russell Nelson
310-255-3858
rnelson@lgf.com
The matters discussed in this press release include forward-looking statements. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ materially and adversely from those described in the forward-looking statements as a result of various important factors, including risk factors as set forth in Lions Gate’s 8-K filed with the Securities and Exchange Commission on February 9, 2005. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect any future events or circumstances.
LIONS GATE ENTERTAINMENT CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
| December 31, | March 31, | |||||||
| 2004 | 2004 | |||||||
| (Unaudited) | ||||||||
| (All amounts in thousands, | ||||||||
| except share | ||||||||
| amounts) | ||||||||
ASSETS | ||||||||
| Cash and cash equivalents | $ | 5,139 | $ | 7,089 | ||||
| Restricted cash | 20,000 | — | ||||||
| Accounts receivable, net of reserve for video returns of $54,932 (March 31, 2004 — $46,985) and provision for doubtful accounts of $7,482 (March 31, 2004 — $11,702) | 110,649 | 129,245 | ||||||
| Investment in films and television programs | 366,465 | 406,170 | ||||||
| Property and equipment | 31,426 | 29,661 | ||||||
| Goodwill | 168,705 | 166,804 | ||||||
| Other assets | 22,868 | 23,714 | ||||||
| $ | 725,252 | $ | 762,683 | |||||
LIABILITIES | ||||||||
| Bank loans | $ | 75,102 | $ | 326,174 | ||||
| Accounts payable and accrued liabilities | 112,359 | 129,724 | ||||||
| Film obligations | 168,806 | 114,068 | ||||||
| Subordinated notes | 215,000 | 65,000 | ||||||
| Mortgages payable | 19,063 | 19,041 | ||||||
| Deferred revenue | 39,014 | 38,932 | ||||||
| Minority interests | 150 | 135 | ||||||
| 629,494 | 693,074 | |||||||
| Commitments and Contingencies | ||||||||
SHAREHOLDERS’ EQUITY | ||||||||
| Common shares, no par value, 500,000,000 shares authorized, 100,944,357 at December 31, 2004 and 93,615,896 at March 31, 2004 shares issued and outstanding | 302,856 | 280,501 | ||||||
| Series B preferred shares (10 shares issued and outstanding) | — | — | ||||||
| Accumulated deficit | (203,286 | ) | (203,507 | ) | ||||
| Accumulated other comprehensive loss | (3,812 | ) | (7,385 | ) | ||||
| 95,758 | 69,609 | |||||||
| $ | 725,252 | $ | 762,683 | |||||
LIONS GATE ENTERTAINMENT CORP.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| December 31 , | December 31, | December 31, | December 31, | |||||||||||||
| 2004 | 2003 | 2004 | 2003 | |||||||||||||
| (All amounts in thousands, except per share amounts) | ||||||||||||||||
Revenues | $ | 190,398 | $ | 70,619 | $ | 610,186 | $ | 217,005 | ||||||||
Expenses: | ||||||||||||||||
| Direct operating | 82,461 | 42,535 | 258,610 | 113,131 | ||||||||||||
| Distribution and marketing | 80,263 | 34,660 | 282,546 | 102,910 | ||||||||||||
| General and administration | 15,582 | 9,300 | 49,482 | 23,647 | ||||||||||||
| Severance and relocation costs | — | 5,934 | — | 5,934 | ||||||||||||
| Write-down of other assets | — | 8,064 | — | 8,064 | ||||||||||||
| Depreciation | 835 | 718 | 2,224 | 1,748 | ||||||||||||
| Total expenses | 179,141 | 101,211 | 592,862 | 255,434 | ||||||||||||
Operating Income (Loss) | 11,257 | (30,592 | ) | 17,324 | (38,429 | ) | ||||||||||
Other Expenses (Income): | ||||||||||||||||
| Interest | 8,201 | 4,808 | 19,277 | 9,017 | ||||||||||||
| Interest rate swaps mark-to-market | (419 | ) | (688 | ) | (2,408 | ) | (950 | ) | ||||||||
| Minority interests | (19 | ) | — | 2 | — | |||||||||||
| Other income | — | — | (825 | ) | — | |||||||||||
| Equity interests | — | 948 | 200 | 1,959 | ||||||||||||
| Total other expenses, net | 7,763 | 5,068 | 16,246 | 10,026 | ||||||||||||
Income (Loss) Before Income Taxes | 3,494 | (35,660 | ) | 1,078 | (48,455 | ) | ||||||||||
| Income tax provision | 141 | 84 | 857 | 315 | ||||||||||||
Net Income (Loss) | 3,353 | (35,744 | ) | 221 | (48,770 | ) | ||||||||||
| Modification of warrants | — | (2,031 | ) | — | (2,031 | ) | ||||||||||
| Dividends on Series A preferred shares | — | (66 | ) | — | (320 | ) | ||||||||||
| Accretion and amortization on Series A preferred shares | — | (73 | ) | — | (575 | ) | ||||||||||
Net Income (Loss) Available to Common Shareholders | $ | 3,353 | $ | (37,914 | ) | $ | 221 | $ | (51,696 | ) | ||||||
Basic and Diluted Income (Loss) Per Common Share | $ | 0.03 | $ | (0.45 | ) | $ | 0.00 | $ | (0.81 | ) | ||||||
LIONS GATE ENTERTAINMENT CORP.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
| Accumulated | ||||||||||||||||||||||||||||
| Series B | Other | |||||||||||||||||||||||||||
| Common Shares | Preferred Shares | Accumulated | Comprehensive | |||||||||||||||||||||||||
| Number | Amount | Number | Amount | Deficit | Loss | Total | ||||||||||||||||||||||
| (All amounts in thousands, except share amounts) | ||||||||||||||||||||||||||||
| Balance at March 31, 2003 | 43,231,921 | $ | 159,549 | 10 | $ | — | $ | (108,350 | ) | $ | (7,567 | ) | $ | 43,632 | ||||||||||||||
| Issuance of common shares | 44,951,056 | 103,176 | 103,176 | |||||||||||||||||||||||||
| Exercise of stock options | 955,562 | 2,609 | 2,609 | |||||||||||||||||||||||||
| Exercise of warrants | 275,400 | 1,377 | 1,377 | |||||||||||||||||||||||||
| Modification of stock options | — | 1,740 | 1,740 | |||||||||||||||||||||||||
| Modification of warrants | — | 2,031 | 2,031 | |||||||||||||||||||||||||
| Redemption of Series A preferred shares | — | 566 | 566 | |||||||||||||||||||||||||
| Conversion of Series A preferred shares | 4,201,957 | 9,453 | 9,453 | |||||||||||||||||||||||||
| Net loss available to common shareholders | (95,157 | ) | (95,157 | ) | ||||||||||||||||||||||||
| Foreign currency translation adjustments | (440 | ) | (440 | ) | ||||||||||||||||||||||||
| Net unrealized gain on foreign exchange contracts | 622 | 622 | ||||||||||||||||||||||||||
| Balance at March 31, 2004 | 93,615,896 | 280,501 | 10 | — | (203,507 | ) | (7,385 | ) | 69,609 | |||||||||||||||||||
| Exercise of stock options | 4,091,790 | 11,149 | 11,149 | |||||||||||||||||||||||||
| Exercise of warrants | 3,220,867 | 10,842 | 10,842 | |||||||||||||||||||||||||
| Issued to directors for services | 15,804 | 137 | 137 | |||||||||||||||||||||||||
| Modification of stock options | — | 227 | 227 | |||||||||||||||||||||||||
| Net income available to common shareholders | 221 | 221 | ||||||||||||||||||||||||||
| Foreign currency translation adjustments | 3,497 | 3,497 | ||||||||||||||||||||||||||
| Net unrealized gain on foreign exchange contracts | 76 | 76 | ||||||||||||||||||||||||||
| Balance at December 31, 2004 | 100,944,357 | $ | 302,856 | 10 | $ | — | $ | (203,286 | ) | $ | (3,812 | ) | $ | 95,758 | ||||||||||||||
LIONS GATE ENTERTAINMENT CORP.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
| Nine Months | Nine Months | |||||||
| Ended | Ended | |||||||
| December 31, | December 31, | |||||||
| 2004 | 2003 | |||||||
| (All amounts in thousands) | ||||||||
Operating activities: | ||||||||
| Net income (loss) | $ | 221 | $ | (48,770 | ) | |||
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||
| Depreciation of property and equipment | 2,224 | 1,748 | ||||||
| Amortization and write-off of deferred financing costs | 5,998 | 3,284 | ||||||
| Amortization of films and television programs | 169,163 | 87,188 | ||||||
| Amortization of intangible assets | 1,644 | — | ||||||
| Relocation costs | — | 2,131 | ||||||
| Write-down of other assets | — | 8,064 | ||||||
| Gain on disposition of assets | (666 | ) | — | |||||
| Interest rate swaps mark-to-market | (2,408 | ) | (950 | ) | ||||
| Non-cash stock-based compensation | 364 | 1,064 | ||||||
| Minority interests | 2 | — | ||||||
| Equity interests | 200 | 1,959 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Increase in restricted cash | (20,000 | ) | — | |||||
| Accounts receivable, net | 17,137 | (5,034 | ) | |||||
| Increase in investment in films and television programs | (125,387 | ) | (100,976 | ) | ||||
| Other assets | (1,263 | ) | 3,968 | |||||
| Future income taxes | — | (2,214 | ) | |||||
| Accounts payable and accrued liabilities | (16,157 | ) | 8,334 | |||||
| Film obligations | 51,555 | (11,453 | ) | |||||
| Deferred revenue | 507 | 116 | ||||||
Net cash flows provided by (used in) operating activities | 83,134 | (51,541 | ) | |||||
Financing activities: | ||||||||
| Issuance of common shares | 21,991 | 104,589 | ||||||
| Redemption of Series A preferred shares | — | (18,090 | ) | |||||
| Dividends paid on Series A preferred shares | — | (254 | ) | |||||
| Financing fees | (1,077 | ) | (11,287 | ) | ||||
| Increase (decrease) in bank loans | (251,212 | ) | 82,507 | |||||
| Increase in subordinated notes, net of issue costs | 145,390 | 56,663 | ||||||
| Decrease in production loans | — | (1,273 | ) | |||||
| Decrease in debt | (1,585 | ) | (7,912 | ) | ||||
Net cash flows provided by (used in) financing activities | (86,493 | ) | 204,943 | |||||
Investing activities: | ||||||||
| Cash received from disposition of assets, net | 1,172 | — | ||||||
| Acquisition of Artisan Entertainment Inc, net of cash acquired | — | (149,559 | ) | |||||
| Purchase of property and equipment | (1,952 | ) | (445 | ) | ||||
Net cash flows used in investing activities | (780 | ) | (150,004 | ) | ||||
Net change in cash and cash equivalents | (4,139 | ) | 3,398 | |||||
Foreign exchange effect on cash | 2,189 | (835 | ) | |||||
Cash and cash equivalents — beginning of period | 7,089 | 6,851 | ||||||
Cash and cash equivalents — end of period | $ | 5,139 | $ | 9,414 | ||||
LIONS GATE ENTERTAINMENT CORP.
RECONCILIATION OF NET INCOME (LOSS) TO CANADIAN GAAP
| Net Income (Loss) | ||||||||||||||||
| Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2004 | 2003 | 2004 | 2003 | |||||||||||||
| (All amounts in thousands) | ||||||||||||||||
As reported under U.S. GAAP | $ | 3,353 | $ | (35,744 | ) | $ | 221 | $ | (48,770 | ) | ||||||
| Adjustment for capitalized pre-operating cost | — | (154 | ) | — | (462 | ) | ||||||||||
| Stock-based compensation | (529 | ) | 138 | (1,391 | ) | (478 | ) | |||||||||
| Adjustment for accretion on subordinated notes | (1,946 | ) | (190 | ) | (3,182 | ) | (190 | ) | ||||||||
| Adjustment for amortization of subordinated notes issue costs | 47 | — | 122 | — | ||||||||||||
| Adjustment for amortization and write-off of deferred debt financing costs | (266 | ) | — | (98 | ) | — | ||||||||||
| Provision for debentures and other receivables due from CinéGroupe | — | 8,064 | — | 8,064 | ||||||||||||
| Adjustment for consolidation of CinéGroupe | — | (2,333 | ) | — | (2,333 | ) | ||||||||||
| Adjustment for interest rate swaps mark-to-market | (158 | ) | (688 | ) | (474 | ) | (950 | ) | ||||||||
Net income (Loss) under Canadian GAAP | $ | 501 | $ | (30,907 | ) | $ | (4,802 | ) | $ | (45,119 | ) | |||||
LIONS GATE ENTERTAINMENT CORP.
RECONCILIATION OF EBITDA TO NET INCOME (LOSS)
| Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2004 | 2003 | 2004 | 2003 | |||||||||||||
| (All amounts in thousands) | ||||||||||||||||
EBITDA, as defined | $ | 12,092 | $ | (30,822 | ) | $ | 20,173 | $ | (38,640 | ) | ||||||
| Depreciation | (835 | ) | (718 | ) | (2,224 | ) | (1,748 | ) | ||||||||
| Interest | (8,201 | ) | (4,808 | ) | (19,277 | ) | (9,017 | ) | ||||||||
| Interest rate swaps mark-to-market | 419 | 688 | 2,408 | 950 | ||||||||||||
| Minority interests | 19 | — | (2 | ) | — | |||||||||||
| Income tax provision | (141 | ) | (84 | ) | (857 | ) | (315 | ) | ||||||||
Net Income (Loss) | $ | 3,353 | $ | (35,744 | ) | $ | 221 | $ | (48,770 | ) | ||||||
EBITDA is defined as earnings before interest, interest rate swaps mark-to-market, income tax provision, depreciation and minority interests.
LIONS GATE ENTERTAINMENT CORP.
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED NET INCOME (LOSS)
| Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2004 | 2003 | 2004 | 2003 | |||||||||||||
| (All amounts in thousands) | ||||||||||||||||
Net Income (Loss) | $ | 3,353 | $ | (35,744 | ) | $ | 221 | $ | (48,770 | ) | ||||||
| Stock appreciation rights expense | 3,180 | — | 6,950 | — | ||||||||||||
| Write-off of deferred financing costs | 3,354 | 2,017 | 3,354 | 2,017 | ||||||||||||
Adjusted Net Income (Loss), as defined | $ | 9,887 | $ | (33,727 | ) | $ | 10,525 | $ | (46,753 | ) | ||||||
Adjusted net income (loss) is defined as net income (loss) before stock appreciation rights expense and write-off of deferred financing costs.
LIONS GATE ENTERTAINMENT CORP.
RECONCILIATION OF BASIC INCOME (LOSS) PER COMMON SHARE TO ADJUSTED
BASIC INCOME (LOSS) PER COMMON SHARE
| Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2004 | 2003 | 2004 | 2003 | |||||||||||||
| (All amounts in thousands) | ||||||||||||||||
Basic Income (Loss) Per Common Share | $ | 0.03 | $ | (0.45 | ) | $ | 0.00 | $ | (0.81 | ) | ||||||
| Stock appreciation rights expense per share | 0.03 | — | 0.07 | — | ||||||||||||
| Write-off of deferred financing costs per share | 0.04 | 0.02 | 0.04 | 0.03 | ||||||||||||
Adjusted Basic Income (Loss) Per Common Share, as defined | $ | 0.10 | $ | (0.43 | ) | $ | 0.11 | $ | (0.78 | ) | ||||||
Adjusted basic net income (loss) per common share is defined as basic net income (loss) per common share before stock appreciation rights expense per share and write-off of deferred financing costs per share.
LIONS GATE ENTERTAINMENT CORP.
RECONCILIATION OF ADJUSTED EBITDA TO NET INCOME (LOSS)
| Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2004 | 2003 | 2004 | 2003 | |||||||||||||
| (All amounts in thousands) | ||||||||||||||||
Adjusted EBITDA, as defined | $ | 15,272 | $ | (30,822 | ) | $ | 27,123 | $ | (38,640 | ) | ||||||
| Depreciation | (835 | ) | (718 | ) | (2,224 | ) | (1,748 | ) | ||||||||
| Interest | (8,201 | ) | (4,808 | ) | (19,277 | ) | (9,017 | ) | ||||||||
| Interest rate swaps mark-to-market | 419 | 688 | 2,408 | 950 | ||||||||||||
| Minority interests | 19 | — | (2 | ) | — | |||||||||||
| Income tax provision | (141 | ) | (84 | ) | (857 | ) | (315 | ) | ||||||||
| Stock appreciation rights expense | (3,180 | ) | — | (6,950 | ) | — | ||||||||||
Net Income (Loss) | $ | 3,353 | $ | (35,744 | ) | $ | 221 | $ | (48,770 | ) | ||||||
Adjusted EBITDA is defined as earnings before interest, interest rate swaps mark-to-market, income tax provision, depreciation and minority interests, adjusted for stock appreciation rights expense.
LIONS GATE ENTERTAINMENT CORP.
RECONCILIATION OF NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES TO
FREE CASH FLOW FROM OPERATIONS (AFTER DEBT SERVICE)
| Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| December 31, | December 31, | December 31, | December 31, | |||||||||||||
| 2004 | 2003 | 2004 | 2003 | |||||||||||||
| (All amounts in thousands) | ||||||||||||||||
Net Cash Flows Provided By (Used In) Operating Activities | $ | 33,795 | $ | (24,789 | ) | $ | 83,134 | $ | (51,541 | ) | ||||||
| Purchase of property and equipment | (1,777 | ) | (210 | ) | (1,952 | ) | (445 | ) | ||||||||
Free Cash Flow From Operations (after debt service), as defined | $ | 32,018 | $ | (24,999 | ) | $ | 81,182 | $ | (51,986 | ) | ||||||
Free cash flow is defined as cash flows provided by (used in) operating activities less purchases of property and equipment.
