Lions Gate Entertainment (LGF-A) 8-K Lions Gate Reports Revenues of $194.2 Million for First Quarter of Fiscal 2006

EXHIBIT 99.1

LIONS GATE REPORTS REVENUES OF $194.2 MILLION
FOR FIRST QUARTER OF FISCAL 2006

Net Loss Is $21.8 Million And EBITDA Is Negative $16.8 Million

Company Reports Positive Free Cash Flow of $29.5 Million For Quarter

First Quarter Analyst Call Will Be Held on Wednesday, August 10, 2005
At 9:00 AM EDT/6:00 AM PDT

(all amounts in U.S. dollars)

SANTA MONICA, CA, and NORTH VANCOUVER, BC, August 9, 2005 – Lions Gate Entertainment (NYSE and TSX: LGF) today reported revenues of $194.2 million, net loss of $21.8 million, and negative EBITDA (earnings before interest expense, interest rate swaps mark-to-market, interest income, income tax provision, depreciation and minority interests) of $16.8 million for the first quarter of fiscal 2006 (quarter ended June 30, 2005). The Company also reported positive free cash flow of $29.5 million for the quarter.

Revenues of $194.2 million compared to revenues of $188.7 million in the prior year’s first quarter, an increase of 2.9%. Net loss of $21.8 million, or net loss per share of $0.21 on 101.9 million weighted average common shares outstanding, compared to net loss of $11.5 million in the prior year’s first quarter, or net loss per share of $0.12 on 94.9 million weighted average common shares outstanding. EBITDA of negative $16.8 million compared to EBITDA of negative $7.3 million in the first quarter of fiscal 2005.

Key revenue drivers in the quarter came from all core businesses, including the theatrical hit CRASH, the new DVD releases of DIARY OF A MAD BLACK WOMAN and several popular plays from Tyler Perry’s catalogue released on DVD, ALONE IN THE DARK and BEYOND THE SEA. Previously released DVD titles including SAW, FINAL CUT and OPEN WATER also made significant revenue contributions in the quarter. First quarter results included $45.9 million in television production revenue generated primarily by U.S. deliveries of Lions Gate’s one-hour drama series THE CUT, WILDFIRE, MISSING and THE DEAD ZONE and the half-hour drama series WEEDS.

“Our financial results continued to reflect our core business ability to generate strong positive free cash flow and revenue,” said Lions Gate Chief Executive Officer Jon Feltheimer. “Our fiscal year is again heavily backloaded, and we again anticipate stronger EBITDA and net income performance throughout the rest of the year as recent product moves through higher-margin windows and as we release our direct-to-video films and our family entertainment product.”

Feltheimer also noted that, as of June 30, 2005, Lions Gate remained in a strong cash position ($138 million) and the Company’s filmed entertainment backlog of $138.5 million (future revenue not yet recorded from executed contracts for the licensing of films and television product for television exhibition and in international markets) was significantly higher than the backlog of $100.3 million as of March 31, 2005, due primarily to contracts entered into on the theatrical releases SAW, SAW II and DIARY OF A MAD BLACK WOMAN and the television series MISSING and WILDFIRE. He concluded, “Lions Gate is well positioned to continue executing the growth initiatives it has targeted in underserved markets and complementary new businesses.”

Motion picture revenue of $147.0 million in the first quarter decreased 7.6% compared to $159.1 million in the prior year’s quarter due to a decline in theatrical revenue as the quarter’s North American feature film releases CRASH, HIGH TENSION and RIZE compared unfavorably to the wide releases THE PUNISHER ™, FAHRENHEIT 9/11 and GODSEND in the prior year’s quarter. International theatrical revenue also declined as international sales of HOTEL RWANDA compared unfavorably to international sales of THE PUNISHER ™, GODSEND and THE PRINCE AND ME in the prior year’s quarter. However, home entertainment revenue was buoyed by successful DVD releases such as DIARY OF A MAD BLACK WOMAN, other Tyler Perry catalogue plays on DVD, ALONE IN THE DARK, BEYOND THE SEA and additional contributions from earlier DVD releases such as SAW, THE FINAL CUT and OPEN WATER.

Television production revenue of $45.9 million in the first quarter increased 60.5% from $28.6 million in the prior year’s quarter, propelled by deliveries of all five of Lions Gate’s prime time cable and broadcast network television series – THE DEAD ZONE (USA), MISSING (Lifetime), WILDFIRE (ABC Family), WEEDS (Showtime) and THE CUT (CBS). The Company noted that first cycle television series sales are typically among its lower-margin revenue generators.

Lions Gate senior management will hold its analyst and investor conference call to discuss fiscal 2006 first quarter financial results at 9:00 AM EDT/6:00 AM PDT on Wednesday, August 10, 2005. Interested parties may participate live in the conference call by calling 1-888-428-4471 (1-612-332-0530 outside the U.S. and Canada). A full digital replay will be available from Wednesday morning, August 10, through Wednesday, August 17, by dialing 1-800-475-6701 (1-320-365-3844 outside the U.S. and Canada) and using access code #791115.

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 is a valuable source of stable, recurring revenue and is a foundation for the growth of the Company’s core businesses. The Lions Gate brand name is synonymous with original, daring, quality entertainment in markets around the world.

www.lgf.com
*          *          *          *          *

For further information, please contact:

Peter D. Wilkes
310-255-3726
pwilkes@lgf.com

The matters discussed in this press release include forward-looking statements. In some cases, forward-looking statements can be identified by terms such as “will,” “may,” “anticipate,” “positioned” and the negative of these terms. 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 but not limited to the possibility of budget overruns, the uncertainty of commercial success of the motion pictures and television programming we distribute, high costs associated with negotiating acquisitions and integrating new businesses, substantial competition and the other risk factors set forth in Lions Gate’s Form 8-K filed with the Securities and Exchange Commission on June 29, 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

	June 30,			March 31,
	2005			2005
	(Unaudited)
	(Amounts in thousands,
	of U.S. dollars
	except share amounts)
ASSETS
Cash and cash equivalents	$	138,272		$	112,839
Restricted cash		968			2,913
Accounts receivable, net of reserve for video returns of $51,208 (March 31, 2005 — $58,449) and provision for doubtful accounts of $6,133 (March 31, 2005 — $6,102)		102,439			150,019
Investment in films and television programs		365,595			367,376
Property and equipment		30,188			30,842
Goodwill		161,182			161,182
Other assets		31,417			29,458
	$	830,061		$	854,629
LIABILITIES
Bank loans	$	—		$	1,162
Accounts payable and accrued liabilities		139,605			134,200
Film obligations		144,188			130,770
Subordinated notes		385,000			390,000
Mortgages payable		18,109			18,640
Deferred revenue		48,286			62,459
Minority interests		—			259
Commitments and Contingencies		735,188			737,490
SHAREHOLDERS’ EQUITY
Common shares, no par value, 500,000,000 shares authorized, 101,873,874 at June 30, 2005 and 101,843,708 at March 31, 2005 shares issued and outstanding		305,812			305,662
Series B preferred shares (10 shares issued and outstanding)		—			—
Restricted common share units		2,099			—
Unearned compensation		(2,099	)		—
Accumulated deficit		(205,045	)		(183,226	)
Accumulated other comprehensive loss		(5,894	)		(5,297	)
		94,873			117,139
	$	830,061		$	854,629

LIONS GATE ENTERTAINMENT CORP.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months Ended			Three Months Ended
	June 30, 2005			June 30, 2004
	(Amounts in thousands of U.S. dollars,
	except per share amounts)
Revenues	$	194,229		$	188,724
Expenses:
Direct operating		100,264			80,810
Distribution and marketing		93,481			98,066
General and administration		17,329			17,127
Depreciation		748			675
Total expenses		211,822			196,678
Operating Loss		(17,593	)		(7,954	)
Other Expense (Income):
Interest expense		4,884			5,461
Interest rate swaps mark-to-market		337			(2,060	)
Interest income		(1,065	)		(37	)
Minority interests		—			(123	)
Total other expenses, net		4,156			3,241
Loss Before Income Taxes		(21,749	)		(11,195	)
Income tax provision		(70	)		(267	)
Net Loss	$	(21,819	)	$	(11,462	)
Basic and Diluted Loss Per Common Share	$	(0.21	)	$	(0.12	)

LIONS GATE ENTERTAINMENT CORP.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

									Restricted											Accumulated
									Common								Comprehensive			Other
	Common Shares								Share		Unearned			Accumulated			Income			Comprehensive
	Number		Amount		Number		Amount		Units		Compensation			Deficit			(Loss)			(Loss)			Total
	(Amounts in thousands of U.S. dollars, except share amounts)
Balance at March 31, 2004		93,615,896	$	280,501		10	$	—						$	(203,507	)				$	(7,385	)	$	69,609
Exercise of stock options		4,991,141		13,871																				13,871
Exercise of warrants		3,220,867		10,842																				10,842
Issuance to directors for services		15,804		137																				137
Modification of stock options		—		311																				311
Comprehensive income (loss):
Net income															20,281		$	20,281						20,281
Foreign currency translation adjustments																		2,374			2,374			2,374
Net unrealized loss on foreign exchange contracts																		(286	)		(286	)		(286	)
Comprehensive income																	$	22,369						—
Balance at March 31, 2005		101,843,708	$	305,662		10	$	—						$	(183,226	)				$	(5,297	)	$	117,139
Exercise of stock options		23,916		61																				61
Issuance to directors for services		6,250		62																				62
Modification of stock options		—		27																				27
Issuance of restricted share units									$	2,099	$	(2,099	)											—
Comprehensive income (loss):
Net loss															(21,819	)		(21,819	)					(21,819	)
Foreign currency translation adjustments																		(831	)		(831	)		(831	)
Net unrealized gain on foreign exchange contracts																		234			234			234
Comprehensive loss																	$	(22,416	)					—
Balance at June 30, 2005		101,873,874	$	305,812		10	$	—	$	2,099	$	(2,099	)	$	(205,045	)				$	(5,894	)	$	94,873

LIONS GATE ENTERTAINMENT CORP.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Three Months Ended			Three Months Ended
	June 30, 2005			June 30, 2004
	(Amounts in thousands of U.S. dollars)
Operating Activities:
Net loss	$	(21,819	)	$	(11,462	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation of property and equipment		748			675
Amortization of deferred financing costs		898			838
Amortization of films and television programs		65,376			60,225
Amortization of intangible assets		548			548
Non-cash stock-based compensation		89			—
Interest rate swaps mark-to-market		337			(2,060	)
Minority interests		—			(123	)
Changes in operating assets and liabilities:
Decrease in restricted cash		1,945			—
Accounts receivable, net		40,774			24,767
Increase in investment in films and television programs		(69,195	)		(45,790	)
Other assets		(140	)		87
Accounts payable and accrued liabilities		9,114			(17,372	)
Film obligations		15,247			22,412
Deferred revenue		(13,755	)		6,662
Net Cash Flows Provided By Operating Activities		30,167			39,407
Investing Activities:
Cash received from sale of investment		2,011			—
Purchases of property and equipment		(629	)		(45	)
Net Cash Flows Provided By (Used In) Investing Activities		1,382			(45	)
Financing Activities:
Issuance of common shares		61			10,651
Financing fees		—			(346	)
Repayment of subordinated notes		(5,000	)		—
Decrease in bank loans		—			(34,285	)
Repayment of mortgages payable		(285	)		(241	)
Net Cash Flows Used In Financing Activities		(5,224	)		(24,221	)
Net Change In Cash And Cash Equivalents		26,325			15,141
Foreign Exchange Effects On Cash		(892	)		(171	)
Cash And Cash Equivalents — Beginning Of Period		112,839			7,089
Cash And Cash Equivalents — End Of Period	$	138,272		$	22,059

LIONS GATE ENTERTAINMENT CORP.

RECONCILIATION OF EBITDA TO NET LOSS

	Three			Three
	Months			Months
	Ended			Ended
	June 30,			June 30,
	2005			2004
	(Amounts in thousands of U.S. dollars)
EBITDA, as defined	$	(16,845	)	$	(7,279	)
Depreciation		(748	)		(675	)
Interest expense		(4,884	)		(5,461	)
Interest rate swaps mark-to-market		(337	)		2,060
Interest income		1,065			37
Minority interests		—			123
Income tax provision		(70	)		(267	)
Net Loss	$	(21,819	)	$	(11,462	)

EBITDA is defined as earnings before interest expense, interest rate swaps mark-to-market, interest income, income tax provision, depreciation and minority interests.

LIONS GATE ENTERTAINMENT CORP.

RECONCILIATION OF NET CASH FLOWS PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW
FROM OPERATIONS (AFTER DEBT SERVICE)

	Three Months			Three Months
	Ended			Ended
	June 30,			June 30,
	2005			2004
	(Amounts in thousands of U.S. dollars)
Net Cash Flows Provided By Operating Activities	$	30,167		$	39,407
Purchases of property and equipment		(629	)		(45	)
Free Cash Flow From Operations (after debt service), as defined	$	29,538		$	39,362

Free cash flow is defined as net cash flows provided by operating activities less purchases of property and equipment.