10q10k10q10k.net

What changed in STARZ ENTERTAINMENT CORP /CN/'s 10-K — 2022 vs 2023

vs

Paragraph-level year-over-year comparison of STARZ ENTERTAINMENT CORP /CN/'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+805 added−760 removedSource: 10-K (2023-05-25) vs 10-K (2022-05-26)

Top changes in STARZ ENTERTAINMENT CORP /CN/'s 2023 10-K

805 paragraphs added · 760 removed · 115 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

86 edited+29 added−302 removed46 unchanged
Biggest changeStarz’s currently announced fiscal 2023 STARZ Originals line-up is as follows: Title Gaslit Season 1 Who Is Ghislaine Maxwell (limited series) Becoming Elizabeth Season 1 P-Valley Season 2 Power Book III: Raising Kanan Season 2 Dangerous Liaisons Season 1 Serpent Queen Season 1 The BMF Documentary: Blowing Money Fast Step Up Season 3 BMF Season 2 Party Down Season 3 Power Book II: Ghost Season 3 Total Episodes: 99 15 Table of Contents Starz’s fiscal 2022 STARZ Originals line-up was as follows: Title Confronting a Serial Killer Season 1 The Girlfriend Experience Season 3 Run the World Season 1 Little Birds (limited series) Blindspotting Season 1 Power Book III: Raising Kanan Season 1 Heels Season 1 BMF Season 1 Hightown Season 2 Power Book II: Ghost Season 2 Power Book IV: Force Season 1 Shining Vale Season 1 Outlander Season 6 Total Episodes: 109 Lionsgate and Starz television programming have earned 241 Emmy® Award nominations including 38 wins, as well as numerous Golden Globe ® Awards, NAACP Awards, GLAAD Awards, Screen Actors Guild Awards nomination and wins.
Biggest changeStarz’s fiscal 2023 STARZ Originals line-up was as follows: Title Gaslit Season 1 P-Valley Season 2 Becoming Elizabeth Season 1 Who Is Ghislaine Maxwell (limited series) Power Book III: Raising Kanan Season 2 Serpent Queen Season 1 Step Up Season 3 The BMF Documentary: Blowing Money Fast Dangerous Liaisons Season 1 BMF Season 2 Party Down Season 3 Power Book II: Ghost Season 3 Total Episodes: 99 Output and Content License Agreements 17 Table of Contents The majority of acquired content on our services consists of movies that have been released theatrically.
Diversity Equity & Inclusion We believe that embracing diversity, promoting a culture of inclusivity and accelerating the representation of women and historically excluded groups in our workforce is crucial to our success.
Diversity, Equity and Inclusion We believe that embracing diversity, promoting a culture of inclusivity and accelerating the representation of women and historically excluded groups in our workforce is crucial to our success.
Through our local office in Mumbai, we manage the following activities: • License our feature films, television series, library content to local linear and digital platforms; • Appoint and work closely with theatrical distribution partners to maximize box office for our films; • Partner with local production companies, as well as develop in-house, Indian local language television series and feature films for distribution across other media platforms; • Continue to expand our STARZ’s offering in the region and across emerging Asian markets (branded as Lionsgate Play), through our direct-to-consumer launch and in collaboration with telco partners, Amazon and Apple TV; and • Explore investment opportunities throughout the South Asian and South East Asian media market.
Through our local office in Mumbai, we manage the following activities: • License our feature films, television series, library content to local linear and digital platforms; • Appoint and work closely with theatrical distribution partners to maximize box office for our films; • Partner with local production companies, as well as develop in-house, Indian local language television series and feature films for distribution across other media platforms; • Continue to expand our STARZ’s offering in the region and across emerging Asian markets (branded as Lionsgate Play), through our direct-to-consumer launch and in collaboration with telco and broadband partners, Amazon and Apple TV; and • Explore investment opportunities throughout the South Asian and South East Asian media market.
STARZPLAY provides subscribers with access to STARZ original series, often airing day-and-date with the U.S., a rich and diverse library of television series, feature films and documentaries from Lionsgate and other Studios, and first-run, exclusive third-party programming, including locally produced television shows that align with the STARZ brand – STARZPLAY Originals.
LIONSGATE+ provides subscribers with access to STARZ original series, often airing day-and-date with the U.S., a rich and diverse library of television series, feature films and documentaries from Lionsgate and other studios, and first-run, exclusive third-party programming, including locally produced television shows that align with the STARZ brand – LIONSGATE+ Originals.
Other revenues are derived from, among others, the licensing of our film and television and related content (e.g., games, music, location-based entertainment royalties, etc.) to other ancillary markets. Television Production: Our Television Production segment includes revenues derived from the following: • Television.
Among others, the licensing of our film and television and related content (e.g., games, music, location-based entertainment royalties, etc.) to other ancillary markets. Television Production: Our Television Production segment includes revenues derived from the following: • Television.
There may be further material changes in the law and regulatory requirements. JOINT VENTURES, PARTNERSHIPS AND OWNERSHIP INTERESTS Our joint ventures, partnerships and ownership interests support our strategy of being a multiplatform global industry leader in entertainment.
There may be further material changes in the law and regulatory requirements in the future. JOINT VENTURES, PARTNERSHIPS AND OWNERSHIP INTERESTS Our joint ventures, partnerships and ownership interests support our strategy of being a multiplatform global industry leader in entertainment.
Television Production - Other Other revenues are derived from, among others, the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from our interest in 3 Arts Entertainment, a talent management company. 3 Arts Entertainment receives commission revenue from talent representation and are producers on a number of television shows and films where they receive an executive producer fee and back-end participations.
Television Production - Other Other revenues are derived from, among others, the licensing of our television programs to other ancillary distributors, the sales and licensing of music from the television broadcasts of our productions, and from our interest in 3 Arts Entertainment, a talent management company. 3 Arts Entertainment receives commission revenue from talent representation and are producers on a number of television shows and films where they receive an executive producer fee and back-end participations.
We license rights in all media on a territory-by-territory basis (other than the territories where we self-distribute) of (i) our in-house Lionsgate and Summit Entertainment feature film product, and (ii) films produced by third parties such as Silver Reel, Buzzfeed, Gold Circle Films, Ace Entertainment and other independent producers.
We license rights in all media on a territory-by-territory basis (other than the territories where we self-distribute) of (i) our in-house Lionsgate and Summit Entertainment feature film product, and (ii) films produced by third parties such as Silver Reel, Buzzfeed, Ace Entertainment and other independent producers.
Television revenues are derived from the licensing to domestic markets (linear pay, basic cable, free television and syndication) of scripted and unscripted series, television movies, mini-series and non-fiction programming. Television revenues include fixed fee arrangements as well as arrangements in which we earn advertising revenue from the exploitation of certain content on television networks.
The licensing to domestic markets (linear pay, basic cable, free television and syndication) of scripted and unscripted series, television movies, mini-series and non-fiction programming. Television revenues include fixed fee arrangements as well as arrangements in which we earn advertising revenue from the exploitation of certain content on television networks.
Employee Resource Groups We are proud to provide our employees with an array of Employee Resource Groups (“ERGs”) which offer them the chance to establish a greater presence at Lionsgate and an opportunity to enhance cross-cultural awareness, develop leadership skills and network across the Company’s various business units and levels.
Employee Resource Groups We provide our employees with an array of Employee Resource Groups (“ERGs”) which offer them the chance to establish a greater presence at Lionsgate and an opportunity to enhance cross-cultural awareness, develop leadership skills and network across the Company’s various business units and levels.
Available Information Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Exchange Act, are available, free of charge, on our website at investors.lionsgate.com as soon as reasonably practicable after we electronically file such material 23 Table of Contents with, or furnish it to, the Securities and Exchange Commission (the “SEC”).
Available Information Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Exchange Act, are available, free of charge, on our website at investors.lionsgate.com as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission (the “SEC”).
Key components of the framework 22 Table of Contents include bias free job descriptions, inclusive hiring training, external diversity partners, diverse candidate slates, and diverse, cross-functional interview panels. • Supplier Diversity Program: The mission of our Supplier Diversity Program is to actively establish relationships with diverse businesses and to continuously strive to increase spend with diverse suppliers, while delivering more competitive pricing, quality, service, innovation and creativity in procurement of services.
Key components of the framework 21 Table of Contents include bias free job descriptions, inclusive hiring training, external diversity partners, diverse candidate slates, and diverse, cross-functional interview panels. • Supplier Diversity and Inclusion Program: The mission of our Supplier Diversity and Inclusion Program is to actively establish relationships with diverse businesses and to continuously strive to increase spend with diverse suppliers, while delivering more competitive pricing, quality, service, innovation and creativity in procurement of services.
Our wholesale distributors manage the technology and infrastructure associated with the exhibition of STARZPLAY in exchange for recurring license fees. Our affiliation agreements expire at various dates through 2026. We work with distributors to increase the number of subscribers to our services.
Our wholesale distributors manage the technology and infrastructure associated with the exhibition of LIONSGATE+ in exchange for recurring license fees. Our affiliation agreements expire at various dates through 2026. We work with distributors to increase the number of subscribers to our services.
We have announced multiple live entertainment projects, including Wonder and Nashville for Broadway, as well as a live dance show inspired by our Step Up film franchise in partnership with Channing Tatum and Free Association.
We have announced multiple live entertainment projects, including Wonder , Nashville and La La Land for Broadway, as well as a live dance show inspired by our Step Up film franchise in partnership with Channing Tatum and Free Association.
This strategy, combined with a proven management team, will ensure Starz Networks’ services remain a “must have” for subscribers and a meaningful profit center for our distributors. Affiliation agreements Our services are distributed pursuant to affiliation agreements with our distributors.
We believe this strategy, combined with a proven management team, will ensure Starz Networks’ services remain a “must have” for subscribers and a meaningful profit center for our distributors. Affiliation Agreements Our services are distributed pursuant to affiliation agreements with our distributors.
Distributors report the number of subscribers to our services and pay for services, generally, on a monthly basis. The agreements are structured on a country-by-country basis, to be multi-year agreements with staggered expiration dates by distributor.
Distributors report the number of subscribers to our services and pay for services, generally, on a monthly basis. The agreements are structured on a country-by-country basis, to be multi-year agreements with staggered expiration dates across our distributors.
We generally distribute motion pictures directly to movie theaters in the U.S. whereby the exhibitor retains a portion of the gross box office receipts and the balance is remitted to the distributor. Concurrent with their release in the U.S., films are generally released in Canada and may also be released in one or more other foreign markets.
We generally distribute motion pictures directly to movie theaters in the U.S. whereby the exhibitor retains a portion of the gross box office receipts and the balance is remitted to the distributor. Concurrent with their release in the U.S., films are generally released in Canada and may also be released in one or more foreign countries.
We currently produce, syndicate and distribute nearly 80 television shows on more than 35 networks (including programming produced by Pilgrim Media Group, of which we own a majority interest).
Television Production - Television Lionsgate Television We currently produce, syndicate and distribute nearly 80 television shows on more than 35 networks (including programming produced by Pilgrim Media Group, of which we own a majority interest).
Television revenues are primarily derived from the licensing of our theatrical productions and acquired films to the linear pay, basic cable and free television markets. In addition, when a license in our traditional pay television window is made to a subscription video-on-demand ("SVOD") or other digital platform, the revenues are included here. • International.
The licensing of our theatrical productions and acquired films to the linear pay, basic cable and free television markets. In addition, when a license in our traditional pay television window is made to a subscription video-on-demand ("SVOD") or other digital platform, the revenues are included here. • International.
We have made arrangements at a vendor’s facility to uplink our linear channels to these satellites in the event we are unable to do so from our uplink center. Regulatory Matters In the U.S., the Federal Communications Commission (the “FCC”) regulates several aspects of our and our distribution ecosystem’s operations and programming.
We have made arrangements at a vendor’s facility to uplink our linear channels to these satellites in the event we are unable to do so from our primary uplink facilities. Regulatory Matters In the U.S., the Federal Communications Commission (the “FCC”) regulates several aspects of our and our distribution ecosystem’s operations and programming.
The table below depicts our 17 existing linear services, their respective on-demand services, and the STARZ app, and highlights some of their key attributes. 13 Table of Contents Demographics and Strategy Designed to complement any basic television offering across both wholesale and retail OTT, as well as traditional MVPD distribution platforms, STARZ is a best-in-class subscription service delivering premium original series and hit movies with appeal to women and diverse audiences worldwide.
The table below depicts the STARZ app and our 17 existing linear services, their respective on-demand services, and highlights some of their key attributes. 15 Table of Contents Demographics and Strategy Designed to complement any television offering for general audiences across both wholesale and retail OTT, as well as traditional MVPD distribution platforms, STARZ is a best-in-class subscription service delivering premium original series and hit movies with appeal to women and diverse audiences worldwide.
The STARZ app: • Is available for purchase as a standalone OTT service for $8.99/month; • Is available on a wide array of platforms and devices including Amazon Fire, iOS, Android and Roku, among others; • Includes on-demand streaming and downloadable access for internet-free viewing; • Offers instant access to thousands of selections each month (including STARZ original series and commercial free movies); and • Is available as an additional benefit to paying MVPD subscribers of the Starz Networks’ linear premium services.
The STARZ app: • Is available for purchase as a standalone OTT service for a recurring monthly fee; • Is available on a wide array of platforms and devices including Amazon Fire, iOS, Android and Roku, among others; • Includes on-demand streaming and downloadable access for internet-free viewing; • Offers instant access to thousands of selections each month (including STARZ original series and commercial free movies); and • Is available as an additional benefit to paying MVPD subscribers of the Starz Networks’ linear premium services.
We also made changes to release dates as well as release strategies of several of our films by releasing solely and/or earlier on streaming platforms, initially releasing on premium video-on-demand ("PVOD"), premium electronic sell-through (“PEST”), or by licensing directly to streaming platforms.
We also made changes to release dates as well as release strategies of several of our films by releasing solely and/or earlier on streaming platforms, initially releasing on premium video-on-demand (“PVOD”), premium electronic sell-through, or by licensing directly to streaming platforms.
Motion Picture - Television We license our theatrical productions and acquired films to the domestic linear pay, basic cable and free television markets. For additional information regarding such distribution, see Motion Picture-Home Entertainment - Digital Media above. 8 Table of Contents Motion Picture - International Our international sales operations are headquartered at our offices in London, England.
Motion Picture - Television We license our theatrical productions and acquired films to the domestic linear pay, basic cable and free television markets. For additional information regarding such distribution, see Motion Picture-Home Entertainment - Digital Media above. Motion Picture - International Our international sales operations are headquartered at our offices in London, England.
Starz Original Programming Starz Networks contracts with our Television Production segment and other independent production companies to produce original programming that appears on our Starz services.
Starz Networks contracts with Lionsgate’s Television Production segment and other independent studios and production companies to produce original programming that appears on our Starz services.
Our services are offered directly to consumers via the STARZ app at www.starz.com or through our retail partners (such as Apple and Google) for a monthly fee, or by our distributors to their subscribers either at a fixed monthly price as part of a programming tier, package or bundle with other products or services, or on an a la carte basis.
Our services are offered directly to consumers via the STARZ app and via our website at www.starz.com as well as through our retail partners (such as Apple and Google) for a recurring fee, or by our distributors to their subscribers either at a recurring price as part of a programming tier, package or bundle with other products or services, or on an a la carte basis.
In addition, we have revenue sharing arrangements with certain digital media platforms which generally provide that, in exchange for a nominal or no upfront sales price, we share in the rental or sales revenues generated by the platform on a title-by-title basis. 4 Table of Contents • Television .
In addition, we have revenue sharing arrangements with certain digital media platforms which generally provide that, in exchange for a nominal or no upfront sales price, we share in the rental or sales revenues generated by the platform on a title-by-title basis. • Television .
Affiliation agreements Our services are distributed pursuant to affiliation agreements with our distributors under a wholesale license, where STARZPLAY is sold as an a la carte channel or bundled within our distributors’ platforms, including Amazon and Apple, as well as local IPTV and Telco partners.
Affiliation Agreements Our services are distributed pursuant to affiliation agreements with our distributors under a wholesale license, where LIONSGATE+ is sold as an a la carte channel or bundled within our distributors’ platforms, including Amazon and Apple, as well as local IPTV, cable, satellite and telco partners.
Regulation The regulation of programming services, cable television systems, direct broadcast satellite providers, broadcast television licensees and online services is subject to the political process and has been in constant flux historically.
Regulation 18 Table of Contents The regulation of programming services, cable television systems, direct broadcast satellite providers, broadcast television licensees and online services is subject to the political process and has been in constant flux historically.
Motion Picture - Other Global Live, Interactive and Location Based Entertainment Our Global Live, Interactive and Location Based Entertainment division drives incremental revenue and builds consumer engagement across our entire portfolio of properties via licensing and launching live shows and experiences, location-based entertainment destinations, games, physical and digital merchandise, and through select strategic partnerships and investments.
Motion Picture - Other Global Products and Experiences Our Global Products and Experiences division drives incremental revenue and builds consumer engagement across our entire portfolio of properties via licensing and launching live shows and experiences, location-based entertainment destinations, games, physical and digital merchandise, and through select strategic partnerships and investment s.
International revenues are derived from (i) licensing of our productions, acquired films, our catalog product and libraries of acquired titles to international distributors, on a territory-by-territory basis, and (ii) the direct distribution of our productions, acquired films, and our catalog product and libraries of acquired titles in the United Kingdom. • Other .
The (i) licensing of our productions, acquired films, our catalog product and libraries of acquired titles to international distributors, on a territory-by-territory basis, and (ii) the direct distribution of our productions, acquired films, and our catalog product and libraries of acquired titles in the United Kingdom. • Other .
Television revenues also include revenue from licenses to SVOD platforms in which the initial license of a television series is to an SVOD platform. • International. International revenues are derived from the licensing and syndication to international markets of scripted and unscripted series, television movies, mini-series and non-fiction programming. • Home Entertainment.
Television revenues also include revenue from licenses to SVOD platforms in which the initial license of a television series is to an SVOD platform. • International. The licensing and syndication to international markets of scripted and unscripted series, television movies, mini-series and non-fiction programming. 6 Table of Contents • Home Entertainment.
Our Global Live Entertainment business focuses on licensing, developing, and producing live stage shows, concerts, and live immersive experiences and events based on our theatrical and television content.
Within the division, our Global Live Entertainment business focuses on licensing, developing, and producing live stage shows, concerts, and live immersive experiences and events based on our theatrical and television content.
Subscription video-on demand services to which we license our content include, among others, Netflix, Hulu, Amazon Prime, Peacock, Paramount+ and HBO Max; ad-supported video-on-demand services to which we license our content include, among others, The Roku Channel, Tubi TV, YouTube, IMDb, and Pluto; and linear networks to which we distribute our content include, among others, pay television networks such as STARZ, EPIX, HBO and Showtime, and basic cable network groups such as NBCUniversal Cable Entertainment, Paramount Global Domestic Media Networks, Disney Media & Entertainment Distribution Networks, Turner Entertainment Networks, A+E Networks and AMC Networks, as well as Bounce, Telemundo and UniMás.
SVOD services to which we license our content include, among others, Netflix, Hulu, Amazon’s Prime Video, Peacock, Paramount+ and Max; ad-supported video-on-demand services to which we license our content include, among others, The Roku Channel, Tubi TV, YouTube, Freevee, Samsung and Pluto; and linear networks to which we distribute our content include, among others, pay television networks such as STARZ, EPIX, HBO and Showtime, and basic cable network groups such as NBCUniversal Cable Entertainment, Paramount Global Domestic Media Networks, Disney Media & Entertainment Distribution Networks, Warner Media Entertainment Networks, A+E Networks and AMC Networks, as well as Bounce, Telemundo and UniMás.
Our affiliation agreements expire at various dates through 2026. 14 Table of Contents We work with our distributors to increase the number of subscribers to our services. To accomplish this, we may help fund the distributors’ efforts to market our services or may permit distributors to offer limited promotional periods with discounted or no payment of subscriber fees.
Our affiliation agreements expire at various dates into 2027. 16 Table of Contents We work with our distributors to increase the number of subscribers to our services. To accomplish this, we may help fund the distributors’ efforts to market our services or may permit distributors to offer limited promotional periods with discounted or no payment of subscriber fees.
All content available on STARZPLAY is available with sub-titles and/or local language dubbing for each country. Our distribution strategy is led with a wholesale model and supplemented through direct OTT retail sales. We expect to launch with additional wholesale partners and potentially deploy the STARZPLAY app in additional countries in the coming years.
All content available on LIONSGATE+ is available with sub-titles and/or local language dubbing for each country. Our distribution strategy is led with a wholesale model and supplemented through direct OTT retail sales. We expect to launch with additional wholesale and retail partners in the coming years.
Digital Media Lionsgate directly distributes content (including certain titles not distributed theatrically or on physical media) across a wide range of global distribution platforms and networks on an on-demand basis (whereby the viewer controls the timing of playback) through dozens of transactional (transactional video-on-demand and electronic-sell-through), subscription, ad-supported and free video-on-demand platforms.
We directly distribute this and other content (including certain titles not distributed theatrically or on physical media) across a wide range of global distribution platforms and networks on an on-demand basis (whereby the viewer controls the timing of playback) through dozens of transactional (transactional video-on-demand and electronic-sell-through), subscription, ad-supported and free video-on-demand platforms.
Human Capital Management Employees As of May 20, 2022, we had 1,448 full-time employees in our worldwide operations. We also utilize many consultants in the ordinary course of our business and hire additional employees on a project-by-project basis in connection with the production of our motion pictures and television programming.
Human Capital Management Employees As of May 23, 2023, we had approximately 1,500 full-time employees in our worldwide operations. We also utilize many consultants in the ordinary course of our business and hire additional employees on a project-by-project basis in connection with the production of our motion pictures and television programming.
Home entertainment revenues are derived from the sale or rental of our film productions and acquired or licensed films and certain television programs (including theatrical and direct-to-video releases) on packaged media and through digital media platforms (including pay-per-view and video-on-demand platforms, electronic sell through, and digital rental).
The sale or rental of our film productions and acquired or licensed films and certain television programs (including theatrical and direct-to-video releases) on packaged media and through digital media platforms (including pay-per-view and video-on-demand platforms, electronic sell through, and digital rental).
Third party films for which we were engaged as exclusive sales agent and/or released by us internationally in fiscal 2022 included Paradise Highway . Through our territory-by-territory sales and output arrangements, we generally cover a substantial portion of the production budget or acquisition cost of new theatrical releases which we license and distribute internationally.
Third party films for which we were engaged as exclusive sales agent and/or released by us internationally in fiscal 2023 included Paradise Highwa y. 10 Table of Contents Through our territory-by-territory sales and output arrangements, we generally cover a substantial portion of the production budget or acquisition cost of new theatrical releases which we license and distribute internationally.
Our flagship premium service STARZ had 21.0 million subscribers as of March 31, 2022 (not including subscribers who receive programming free as part of a promotional offer). STARZ offers premium original series and recently released and library movies without advertisements.
Our flagship premium service STARZ had 20.3 million subscribers as of March 31, 2023 (not including subscribers who receive programming free as part of a promotional offer). STARZ offers premium original series and recently released and library movies without advertisements.
We also maintain the following recruitment and hiring initiatives: • Internship Programs: We maintain an internship program designed to increase inclusion across the entertainment industry by placing qualifying students in positions at Lionsgate and various other studios. • Targeted Recruitment: We continue recruitment efforts that include collaborating with diverse partner organizations, college campus diversity organizations for underrepresented groups, as well as historically black colleges in our search for new employees and interns. • Inclusive Hiring Process: We implement inclusive hiring practices to ensure that we are attracting the best talent in the industry through a more equitable, inclusive, and accessible approach.
We also maintain the following recruitment and hiring initiatives: • Internship Programs: We maintain an internship program designed to increase inclusion across the entertainment industry. • Targeted Recruitment: We maintain recruitment efforts that include collaborating with diverse partner organizations, college campus diversity organizations for underrepresented groups, as well as historically black colleges in our search for new employees and interns. • Inclusive Hiring Process: We implement inclusive hiring practices to ensure that we are attracting the best talent in the industry through an equitable, inclusive, and accessible approach.
Our film, television, subscription and location-based entertainment businesses are backed by a 17,000-title library and a valuable collection of iconic film and television franchises. We manage and report our operating results through three reportable business segments: Motion Picture , Television Production and Media Networks . We refer to our Motion Picture and Television Production segments collectively as our Studio Business.
Our film, television, subscription and location-based entertainment businesses are backed by an 18,000-title library and a valuable collection of iconic film and television franchises. We manage and report our operating results through three reportable business segments: Motion Picture , Television Production and Media Networks .
As a result of the COVID-19 global pandemic, in certain circumstances, our distribution strategy has and may continue to change, and certain films intended for theatrical release may be licensed to other platforms. 6 Table of Contents Producing, marketing and distributing films can involve significant risks and costs, and can cause our financial results to vary depending on the timing of a film’s release.
In certain circumstances, our distribution strategy has and may continue to change, and certain films intended for theatrical release may be licensed to other platforms. Producing, marketing and distributing films can involve significant risks and costs, and can cause our financial results to vary depending on the timing of a film’s release.
Music Our music department creatively manages music for our theatrical and television slates, including overseeing songs, scores and soundtracks for all of our theatrical productions, co-productions and acquisitions, as well as music staffing, scores and soundtracks for all of our television productions.
Music We manage music for our theatrical and television slates, including overseeing songs, scores and soundtracks for all of our theatrical productions, co-productions and acquisitions, as well as music staffing, scores and soundtracks for all of our television productions.
Lionshares We are committed to acting responsibly and making a positive difference in the local and global community through Lionshares, the umbrella for our companywide commitment to our communities. Lionshares is a volunteer program that seeks to provide opportunities for employees within the Lionsgate family to partner with a diverse range of charitable organizations.
Community Involvement We are committed to acting responsibly and making a positive difference in the local and global community through Lionshares , our volunteer program that seeks to provide opportunities for employees to partner with a diverse range of charitable organizations.
Media Networks - Starz - International Starz is available in 60+ countries outside the U.S. through our four (4) international branded services: STARZPLAY in Western Europe, Latin America and Japan; STARZ in Canada; LIONSGATE PLAY in India; and through our STARZPLAY Arabia joint venture in the Middle East and North Africa.
Media Networks - LIONSGATE+ - International Starz is available in nearly 50 countries outside the U.S. through our four (4) international branded services: LIONSGATE+ in the UK, Ireland, Latin America and Australia; STARZ in Canada; LIONSGATE PLAY in India; and through our STARZPLAY Arabia joint venture in the Middle East and North Africa.
The rights agreements for library content are of varying duration and generally permit Starz’s services to exhibit these movies, series and other programming during certain window periods. 16 Table of Contents A summary of significant output and library programming agreements (including a library agreement with Lionsgate) are as follows: Significant output programming agreements Significant library programming agreements Studio Studio Lionsgate Paramount Sony Warner Bros Universal Twentieth Century Fox MGM Sony Pictures Lionsgate Universal Our output agreements generally require us to pay for movies at rates calculated on a pricing grid that is based on each film’s domestic box office performance (subject to maximum amounts payable per movie and a cap on the number of movies that can be put to Starz each year).
A summary of significant output and library programming agreements (including a library agreement with Lionsgate) are as follows: Significant output programming agreements Significant library programming agreements Studio Studio Lionsgate Paramount Sony Warner Bros Universal Twentieth Century Fox MGM Sony Pictures Lionsgate Universal Our output agreements generally require us to pay for movies at rates calculated on a pricing grid that is based on each film’s domestic box office performance (subject to maximum amounts payable per movie and a cap on the number of movies that can be put to Starz each year).
The STARZPLAY app: • Is currently available in eighteen (18) countries across Europe and Latin America, including France, Germany, Spain, the UK, Netherlands, Mexico, and Brazil, Argentina, etc.; • Is offered directly via the STARZPLAY website or via retail storefronts such as the Apple Store, Play Store, Roku Channels, LG, and Amazon Fire; • Includes a language toggle allowing users to select their preferred language for viewing; • Offers instant access to approximately 1,000 selections each month (including original series and commercial free movies); and • Is available for purchase as a standalone OTT service for £5.99 in the UK, €4.99 in Europe and ~$4.50 in Latin America.
The LIONSGATE+ app: • Is currently available in twenty-one (21) countries across Europe and Latin America, including the UK, Mexico, Brazil, and Argentina; • Is offered directly via the LIONSGATE+ website or via retail storefronts such as the Apple Store, Play Store, Roku Channels, LG, Samsung and Amazon Fire; • Includes a language toggle allowing users to select their preferred language for viewing; • Offers instant access to approximately 1,000 selections each month (including original series and commercial free movies); and • Is available for purchase as a standalone OTT service for a recurring monthly fee.
Starz Networks’ revenues are derived from the domestic distribution of our STARZ branded premium subscription video services through over-the-top ("OTT") platforms and U.S. multichannel video programming distributors (“MVPDs”) including cable operators, satellite television providers and telecommunications companies (collectively, “Distributors”) on a direct-to-consumer basis through the Starz App. • STARZPLAY International .
The domestic distribution of our STARZ branded premium subscription video services through over-the top ("OTT") streaming platforms and distributors, on a direct-to-consumer basis through the Starz app, and through U.S. multichannel video programming distributors (“MVPDs”) including cable operators, satellite television providers and telecommunications companies (collectively, “Distributors”) (and in the aggregate, the “Starz Domestic Platform”). • LIONSGATE+ .
With respect to benefits, we offer a comprehensive benefits package which includes family forming benefits, mental health support, resources for caregiving (children and adult family), online fitness and meditation classes, and new parent coaching.
Other Employee Benefits and Programs We offer a comprehensive benefits package which includes health, dental and vision insurance, family forming benefits, mental health support, resources for caregiving (children and adult family), online fitness and meditation classes, and new parent coaching.
Across our digital platforms, the STARZ app provides an alternative for subscribers looking for a competitively priced option. Subscribers have access to a vast library of quality content and a top-rated user experience, along with the ability to download and watch STARZ original series, blockbuster theatricals and favorite classic TV series and movies without an internet connection.
Subscribers have access to a vast library of quality content and a top-rated user experience, along with the ability to download and watch STARZ original series, blockbuster theatricals and favorite classic TV series and movies without an internet connection.
We distribute or sell content directly to retailers such as Wal-Mart, Best Buy, Target, Amazon and others who buy large volumes of our DVDs/Blu-ray discs to sell directly to consumers. We also directly distribute content to the rental market through Redbox, Netflix and others.
Fulfillment of physical distribution services are substantially licensed to Sony Pictures Home Entertainment. We distribute or sell content directly to retailers such as Wal-Mart, Best Buy, Target, Amazon and others who buy large volumes of our discs to sell directly to consumers. We also directly distribute content to the rental market through Redbox, Netflix and others.
Theatrical revenues are derived from the domestic theatrical release of motion pictures licensed to theatrical exhibitors on a picture-by-picture basis (distributed by us directly in the United States and through a sub-distributor in Canada). • Home Entertainment .
Studio Business Motion Picture: Our Motion Picture segment includes revenues derived from the following: • Theatrical . The domestic theatrical release of motion pictures licensed to theatrical exhibitors on a picture-by-picture basis (distributed by us directly in the U.S. and through a sub-distributor in Canada).
STARZPLAY International revenues are primarily derived from OTT distribution of the Company's STARZ branded premium subscription video services outside of the U.S.
The OTT distribution of the Company's STARZ branded premium subscription video services outside of the U.S.
Output and Content License Agreements The majority of content on our services consists of movies that have been released theatrically. Starz has an exclusive multiyear output licensing agreement with Lionsgate for Lionsgate label titles theatrically released in the U.S. starting January 1, 2022, and for Summit label titles theatrically released in the U.S. starting January 1, 2023.
Starz has an exclusive multiyear output licensing agreement with Lionsgate for Lionsgate label titles theatrically released in the U.S. starting January 1, 2022, and for Summit label titles theatrically released in the U.S. starting January 1, 2023.
Home entertainment revenue consists of packaged media and digital revenue. Packaged Media Packaged media distribution involves the marketing, promotion, sale and/or lease of DVDs/Blu-ray discs to wholesalers and retailers who then sell or rent the DVDs/Blu-ray discs to consumers for private viewing. Fulfillment of physical distribution services are substantially licensed to Twentieth Century Fox Home Entertainment.
Home entertainment revenue consists of packaged media and digital revenue. Packaged Media Packaged media distribution involves the marketing, promotion, sale and/or lease of DVDs/Blu-ray/4K Ultra HD discs to wholesalers and retailers in the U.S. and Canada who then sell or rent such discs to consumers for private viewing.
STARZPLAY App To enhance our subscriber reach, we modified our domestic (U.S.) STARZ retail app for deployment internationally to include, among other new features, full European Union General Data Protection Regulation compliance, support for fourteen (14) languages, multiple audio/closed captioning options and a variety of potential carrier/billing integrations.
LIONSGATE+ App To enhance our subscriber reach, we modified our domestic (U.S.) STARZ retail app for deployment internationally to include, among other new features, full European Union General Data Protection Regulation compliance, support for local languages, multiple audio/closed captioning options and a variety of potential carrier/billing integrations. 19 Table of Contents The LIONSGATE+ app is the single destination for direct OTT subscribers to stream on-demand or download our original series and movie content.
Within the Motion Picture segment, revenues were generated from the following: • Theatrical, 5.5%; • Home Entertainment, 51.6%; • Television, 21.8%; • International, 19.8%; and • Motion Picture-Other, 1.3%. 5 Table of Contents Within the Television Production segment, revenues were generated from the following: • Television, 71.5%; • International, 16.8%; • Home Entertainment, 6.0%; and • Television Production-Other, 5.6%.
Within the Motion Picture segment, revenues were generated from the following: • Theatrical, 9.1%; • Home Entertainment, 45.1%; • Television, 16.5%; • International, 27.6%; and • Motion Picture-Other, 1.7%. Within the Television Production segment, revenues were generated from the following: • Television, 65.0%; • International, 15.8%; • Home Entertainment, 13.9%; and • Television Production-Other, 5.3%.
We also self-distribute motion pictures in the United Kingdom and Ireland through Lions Gate International UK (“Lionsgate UK”). Lionsgate UK has established a reputation in the United Kingdom as a leading producer, distributor and acquirer of commercially successful and critically acclaimed product.
Lionsgate UK has established a reputation in the United Kingdom as a leading producer, distributor and acquirer of commercially successful and critically acclaimed product.
Premium content that targets all adults is the foundation of our international content strategy. We believe this allows us to operate as a complementary service, not a direct competitor, with other higher priced, broad-based video services.
We believe this allows us to operate as a complementary service, not a direct competitor, with other higher priced, broad-based video services.
Financial information for our segments is set forth in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in this Annual Report.
We refer to our Motion Picture and Television Production segments collectively as our Studio Business and our Media Networks segment as our Media Networks Business . Financial information for our segments is set forth in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in this Annual Report.
We received the designation as a “Best Place to Work for LGBTQ Equality” for 2022. Corporate History We are a corporation organized under the laws of the Province of British Columbia, resulting from the merger of Lions Gate Entertainment Corp. and Beringer Gold Corp. on November 13, 1997.
Corporate History We are a corporation organized under the laws of the Province of British Columbia, resulting from the merger of Lions Gate Entertainment Corp. and Beringer Gold Corp. on November 13, 1997. Beringer Gold Corp. was incorporated under the Business Corporation Act (British Columbia) on May 26, 1986 as IMI Computer Corp.
HBO Max Serpent Queen Starz Step Up Starz Swimming with Sharks Roku The First Lady Showtime Welcome to Flatch Fox Zoey's Extraordinary Playlist NBC Zoey's Extraordinary Christmas Roku 11 Table of Contents Fiscal 2022 Unscripted - Lionsgate Title Network De Viaje con los Derbez Pantaya Selling Sunset Netflix The Real Dirty Dancing Fox Fiscal 2022 Unscripted - Pilgrim Media Group Title Network Ghost Hunters Discovery Hoffman Family Gold Discovery Horse for Dogs Animal Planet My Big Fat Fabulous Life TLC Renovation Impossible Discovery Street Outlaws Discovery Street Outlaws: America's List Discovery Street Outlaws: Farm Truck & AZN Discovery Street Outlaws: Fastest in America Discovery Street Outlaws: Gone Girl Discovery Street Outlaws: Memphis Discovery Street Outlaws: No Prep Kings Grudge Night Discovery The Ultimate Fighter ESPN+ UFO Live Discovery Wicked Tuna Nat Geo Wicked Tuna Outer Banks Nat Geo Zombie Flippers A&E Fiscal 2022 Syndication - Debmar-Mercury Title Central Ave Family Feud Nick Cannon Schitt's Creek Wendy Williams Starz Original Programming For information regarding production of Starz original programming, see Media Networks - Starz Networks - Starz Original Programming.
Goldman Peacock Power Book II: Ghost STARZ Power Book III: Raising Kanan STARZ Power Book IV: Force STARZ P-Valley STARZ Run the World STARZ Serpent Queen STARZ The First Lady Showtime We Thought We Were Done NBC Welcome to Flatch Fox 13 Table of Contents Fiscal 2023 Fiscal 2023 Unscripted - Pilgrim Media Group Syndication - Debmar-Mercury Title Network Title Fox Nation - Jussie Smollet Fox Nation Family Feud Ghost Hunters 3.0 Discovery Nick Cannon Hoffman Family Gold Discovery Schitt's Creek Horse for Dogs Animal Planet Sherri Shepherd My Big Fat Fabulous Life TLC Wendy Williams Renovation Impossible Discovery Power Slap: Road to the Title TBS Steve Austin A&E Street Outlaws Discovery Street Outlaws: America's List Discovery Street Outlaws: Endgame Discovery Street Outlaws: Farm Truck & AZN Discovery Street Outlaws: Fastest in America Discovery Street Outlaws: Gone Girl Discovery Street Outlaws: No Prep Kings Grudge Night Discovery The Ultimate Fighter ESPN+ UFO Live Discovery Wicked Tuna Nat Geo Wicked Tuna Outer Banks Nat Geo Zombie Flippers A&E Hoffman Family Gold Fox Nation Starz Original Programming For information regarding production of Starz original programming, see Media Networks - Starz Networks - Starz Original Programming.
The ERGs are voluntary, employee-led groups that foster a diverse, engaging, and inclusive workplace. • Lionsgate Early Career Group aims to inspire curiosity and networking to foster growth for professionals in early stages of their careers. • Lionsgate Multicultural Employee Resource Group advocates for a more inclusive workplace and entertainment landscape through programs that educate, activate and celebrate multicultural diversity and its global impact. • Lionsgate Parents Group aims to bring together parents, expecting parents, caregivers, and allies to ensure our community fosters an environment that supports all families. • Lionsgate Pride supports, develops and inspires future LGBTQIA leaders within the Company and the industry. • Lionsgate Vets creates a community of veterans and their supporters working together to enhance veteran presence and engage the industry from the unique perspective of a military background. • Lionsgate Women’s Empowerment Group creates a community that improves the prominence of female leaders and empowers women at all levels within the Company and the industry.
This consists of resource groups for the Asian American Pacific Islander community, the Black community and the Latine community. • Lionsgate Parents and Caregivers Group aims to bring together parents, expecting parents, caregivers, and allies to ensure our community fosters an environment that supports all families. • Lionsgate Pride supports, develops and inspires future LGBTQIA leaders within the Company and the industry. • Lionsgate Vets creates a community of veterans and their supporters working together to enhance veteran presence and engage the industry from the unique perspective of a military background. • Lionsgate Women’s Empowerment Group creates a community that improves the prominence of female leaders and empowers women at all levels within the Company and the industry.
Other revenues are derived from, among others, the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from commissions and executive producer fees earned related to talent management. Media Networks Our Media Networks segment includes revenues derived from the following: • Starz Networks.
The sale or rental of television production movies or series on packaged media and through digital media platforms. • Other . Among others, the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from commissions and executive producer fees earned related to talent management.
The remainder of this section addresses the offerings operated by STARZPLAY in the 35-country footprint across Western Europe, Latin America and Japan. 17 Table of Contents International Strategy STARPLAY is quickly growing its distribution by strategically positioning itself as a complementary pure-play premium content service offered at a competitive subscription price, made available through a diverse ecosystem of wholesale and retail distribution partners.
International Strategy LIONSGATE+ is quickly growing its distribution by strategically positioning itself as a complementary pure-play premium content service offered at a competitive subscription price, made available through a diverse ecosystem of wholesale and retail distribution partners. Premium content that targets all adults is the foundation of our international content strategy.
Our output agreements for Lionsgate and Summit feature films currently cover Scandinavia and France. These output agreements generally include all rights for all media (including home entertainment and television rights). We also distribute theatrical titles in Latin America through our partnership with International Distribution Company, as well as theatrical rights in Canada through our partnership with Mongrel Media and Cineplex.
Our output agreements for Lionsgate and Summit feature films currently cover Scandinavia and France. These output agreements generally include all rights for all media (including home entertainment and television rights).
After initial exhibition, we distribute programming to subsequent buyers, both domestically and internationally, including basic cable network, premium subscription services or digital platforms (known as “off-network syndicated programming”). 10 Table of Contents Off-network syndicated programming can be sold in successive cycles of sales which may occur on an exclusive or non-exclusive basis.
Each of these platforms may acquire a mix of original and library programming. After initial exhibition, we distribute programming to subsequent buyers, both domestically and internationally, including basic cable network, premium subscription services or digital platforms (known as “off-network syndicated programming”).
Our Interactive Entertainment business focuses on growing a slate that includes games across PC/console, mobile, virtual reality and more, integration of our properties into with marquee games such as Call of Duty , Dead By Daylight and the upcoming Evil Dead: The Game , as well as NFT projects, including as part of a first look deal with Autograph.
Our Interactive Entertainment business focuses on growing a slate that includes games across PC/console, mobile, virtual reality and more, both through stand-alone games based solely on our content and the integration of our properties with marquee games such as Call of Duty , Dead By Daylight and Evil Dead: The Game , as well as Web3 projects, including the SANDBOX. 11 Table of Contents Our Location Based Entertainment business licenses and produces our Lionsgate, theatrical, and television brands for theme parks, destinations, and stand-alone attractions and experiences.
We are focused on developing and distributing authentic and engaging programming that resonates with women, African American, Latinx and LGBTQIA audiences, all of which have been traditionally underserved in the premium television space. Driven primarily by growing multiplatform viewership amongst these target audiences, Starz is positioned to continue to capture the digital television transition.
We are focused on developing and distributing authentic and engaging programming that resonates with women, African American, Latinx and LGBTQIA audiences, all of which have been traditionally underserved in the premium television space. Across our digital platforms, the STARZ app provides an alternative for subscribers looking for a competitively priced option.
In addition, television programming is sold on home entertainment (packaged media and via digital delivery) and across all other applicable ancillary revenue streams including music publishing, touring and integration. As with film production, we use tax credits, subsidies, and other incentive programs for television production in order to maximize our returns and ensure fiscally responsible production models.
As with film production, we use tax credits, subsidies, and other incentive programs for television production in order to maximize our returns and ensure fiscally responsible production models.
Roadside Attractions We hold an interest in Roadside Attractions, an independent theatrical distribution company. 21 Table of Contents Intellectual Property We currently use and own or license a number of trademarks, service marks, copyrights, domain names and similar intellectual property in connection with our businesses and own registrations and applications to register them both domestically and internationally.
As a result, we may, from time to time, determine to sell individual properties, libraries or other assets or businesses or enter into additional joint ventures, strategic transactions and similar arrangements for individual properties, libraries or other assets or businesses. 20 Table of Contents Intellectual Property We currently use and own or license a number of trademarks, service marks, copyrights, domain names and similar intellectual property in connection with our businesses and own registrations and applications to register them both domestically and internationally.
In fiscal 2022, scripted and unscripted programming produced, co-produced or distributed by us and our affiliated entities (see Starz Original Programming below for original programming that appears on our STARZ services), as well as programming syndicated by our wholly-owned subsidiary, Debmar-Mercury, included the following: Fiscal 2022 Scripted - Lionsgate Title Network Acapulco Apple Black Mafia Family Starz Blindspotting Starz Dear White People Netflix Ghosts CBS Heels Starz Hightown Starz Home Economics ABC Julia Child HBO Max Love Life HBO Max Macgyver CBS Minx HBO Max Mythic Quest Apple Power Book II: Ghost Starz Power Book III: Raising Kanan Starz Power Book IV: Force Starz P-Valley Starz Run the World Starz Santa Inc.
For the fiscal year ended March 31, 2023, scripted and unscripted programming produced, co-produced or distributed by us and our affiliated entities (see Starz Original Programming below for original programming that appears on our STARZ services), as well as programming syndicated by our wholly-owned subsidiary, Debmar-Mercury, included the following: 12 Table of Contents Fiscal 2023 Fiscal 2023 Scripted - Lionsgate Unscripted - Lionsgate Title Network Title Network Acapulco Apple 1619 Hulu Black Mafia Family STARZ Derbez Family Vacation Pantaya Blindspotting STARZ Hip Hop Homicides WE TV Dangerous Liaisons STARZ House of Ho Max Ghosts CBS Selling Sunset Netflix Heels STARZ Selling the OC Netflix Hightown STARZ Home Economics ABC Julia Max Love & Death Max Minx STARZ Mythic Quest Apple Party Down STARZ Paul T.
Segment Revenue For the year ended March 31, 2022, contributions to the Company’s consolidated revenues from its reporting segments included Motion Picture 32.9%, Television Production 42.5% and Media Networks 42.6%, and intersegment revenue eliminations represented (18.0)% of consolidated revenues.
The Starz Domestic Platform together with the LIONSGATE+ platforms are referred to as the “Starz Platforms.” Segment Revenue For the year ended March 31, 2023, contributions to the Company’s consolidated revenues from its reporting segments included Motion Picture 34.3%, Television Production 45.7% and Media Networks 40.1%, and intersegment revenue eliminations represented (20.1)% of consolidated revenues.
The SEC maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC at www.sec.gov . ITEM 1A. RISK FACTORS. You should carefully consider the following risks as well as other information included in, or incorporated by reference into this Form 10-K.
The SEC maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC at www.sec.gov .
We sell our services on a direct-to-consumer basis and through various other platforms, including OTT providers (such as Amazon, Apple, Google and Hulu), MVPDs, including cable operators (such as Comcast and Charter), satellite television providers (such as DIRECTV and DISH Network), and telecommunications companies (such as AT&T and Verizon).
MEDIA NETWORKS Media Networks - Starz Networks - United States Starz Networks is a leading provider of premium subscription video programming to consumers in the U.S. We sell our services on a direct-to-consumer basis and through various distributors, including OTT providers (such as Amazon, Apple, Google and Hulu) and MVPDs (such as Comcast, Charter, DIRECTV and DISH Network).
After the pause in television production in fiscal 2021 due to the COVID-19 global pandemic, Lionsgate UK television programming (developed in-house and through Lionsgate UK’s interest and partnerships) that continued, began production, was produced or was broadcast in fiscal 2022, included the following: 12 Table of Contents Fiscal 2022 Television - Lionsgate UK Title Network Partner(s) The Pact BBC Wales Little Door Motherland Series 3 BBC BBC, Merman The Goes Wrong Show Series 2 BBC Mischief Screen, Big Talk, BBC Son of a Critch CBC Project 10, CBC The Pact Series 2 BBC Little Door Television Production - Home Entertainment For information regarding television production home entertainment revenue, see Motion Picture - Home Entertainment above.
For the fiscal year ended March 31, 2023, Lionsgate UK television programming that was acquired, began production, continued production after delays due to the COVID-19 global pandemic, was produced or was broadcast, included the following: 14 Table of Contents Fiscal 2023 Television - Lionsgate UK Title Network Partner(s) The Pact Series 2 BBC Little Door Motherland 2022 Christmas Special BBC BBC, Merman Northern Lights TG4 Deadpan Son of a Critch 2 CBC Project 10 Leopard Skin Peacock Skinny Leopard Wong & Winchester Rogers & Québecor Pixcom International Workin’ Moms Netflix & CBC Coldsprings Media, Wolf + Rabbit Entertainment Dark City: The Cleaner Sky NZ Endeavour Ventures Prosper Stan Lingo Pictures Television Production - Home Entertainment For information regarding television production home entertainment revenue, see Motion Picture - Home Entertainment above.
STUDIO BUSINESS: MOTION PICTURE Motion Picture - Theatrical Production and Acquisition We take a disciplined approach to theatrical production, with the goal of producing content that can be distributed through various domestic and international platforms.
The extension of our portfolio of brands and franchises, creation of new intellectual properties and rigorous focus on retaining key rights to our content is designed to create incremental long-term value for our shareholders through a combination of current releases and one of the most valuable film and television libraries in the world. 7 Table of Contents STUDIO BUSINESS: MOTION PICTURE Motion Picture - Theatrical Production and Acquisition We take a disciplined approach to theatrical production, with the goal of producing content that can be distributed through various domestic and international platforms.
These satellites feed our signals to various swaths of the Americas. We lease these transponders under agreements that have termination dates in 2023. We currently are evaluating our options regarding transponder leasing arrangements following the expiration of the current agreements. We transmit to these satellites from our uplink center in Englewood, Colorado.
These satellites feed our signals to various swaths of the Americas. We lease these transponders under recently renewed multi-year agreements. We currently transmit to these satellites from our uplink center in Englewood, Colorado, but will be moving our primary uplink facilities from the Englewood location and outsourcing them to a third party starting in the fall of 2023.

… 337 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

3 edited+282 added−329 removed0 unchanged
Biggest changeThe 5.500% Senior Notes contain certain restrictions and covenants that, subject to certain exceptions, limit the Company’s ability to incur additional indebtedness, pay dividends or repurchase the Company’s common shares, make certain loans or investments, and sell or otherwise dispose of certain assets subject to certain conditions, among other limitations.
Biggest changeWhile the Senior Credit Facilities and the indentures that govern the Senior Notes limit the ability of our subsidiaries to incur consensual restrictions on their ability to pay dividends or make other intercompany payments to us, these limitations are subject to qualifications and exceptions.
A film group or individual film or television program is evaluated for impairment when events or changes in circumstances indicate that the fair value of an individual film or film group is less than its unamortized cost.
Unamortized production costs are evaluated for impairment each reporting period on a project-by-project basis when events or changes in circumstances indicate that the fair value of a film is less than its unamortized cost.
Food and Drug Administration ("FDA")-approved COVID-19 vaccines), and global economic conditions related to the COVID-19 global pandemic. All of these impacts could place limitations on our ability to execute on our business plan and materially and adversely affect our business, financial condition and results of operations.
We have incurred and we may continue to incur additional costs to address any government regulations and the safety of our employees and talent. All of these impacts could place limitations on our ability to execute our business plan and materially and adversely affect our business, financial condition and results of operations.
Removed
In connection with the disruptions associated with the COVID-19 global pandemic and measures to prevent its spread and mitigate its effects both domestically and internationally, and the related economic disruption, certain incremental costs were incurred and expensed, as presented in the table below: Year Ended March 31, 2022 2021 2020 COVID-19 related charges (benefit) included in: Direct operating expense (1) $ (3.6) $ 50.6 $ 46.0 Distribution and marketing expense (2) 0.2 16.9 4.2 Restructuring and other (3) 1.1 3.0 0.3 Total COVID-19 related charges (benefit) $ (2.3) $ 70.5 $ 50.5 ___________ (1) Amounts reflected in direct operating expense include incremental costs associated with the pausing and restarting of productions including paying/hiring certain cast and crew, maintaining idle facilities and equipment costs, net of insurance recoveries.
Added
ITEM 1A. RISK FACTORS. You should carefully consider the following risks as well as other information included in, or incorporated by reference into this Form 10-K. The risk and uncertainties described below are not the only ones facing the Company; additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business.
Removed
In fiscal 2021 and 2020, these amounts also included film impairment due to changes in 45 Table of Contents performance expectations resulting from circumstances associated with the COVID-19 global pandemic. In the fiscal year ended March 31, 2022, insurance recoveries exceeded the incremental costs expensed in the year, resulting in a net benefit included in direct operating expense.
Added
If any of these risks and uncertainties occur, they could adversely affect our business, financial condition, operating results, liquidity and prospects. 23 Table of Contents Risks Related to Our Business We face substantial capital requirements and financial risks. The production, acquisition and distribution of motion picture and television content requires substantial capital and may subject us to financial risks.
Removed
(2) Amounts reflected in distribution and marketing expense primarily consist of contractual marketing spends for film releases and events that have been canceled or delayed and will provide no economic benefit.
Added
A significant amount of time may elapse between our expenditure of funds and the receipt of revenues after release or distribution of such content and we cannot assure you that we are able to successfully implement arrangements to reduce the risks of production exposure such as tax credit, government or industry programs.
Removed
(3) Amounts reflected in restructuring and other represent certain incremental general and administrative costs associated with the COVID-19 global pandemic, such as costs related to transitioning the Company to a remote-work environment, costs associated with return-to-office safety protocols and other incremental general and administrative costs associated with the COVID-19 global pandemic.
Added
Additionally, we may experience delays and increased expenditures due to disruptions or events beyond our control and if a production incurs substantial budget overruns, we may have to seek additional financing or fund the overrun itself. We cannot make assurances regarding the availability of such additional financing on terms acceptable to us, or that we will recoup these costs.
Removed
We expect to incur additional incremental costs related to the COVID-19 global pandemic in future periods, especially if there is a continued spread of recent and new variants. We are in the process of seeking additional insurance recovery for some of the costs already incurred and expect to seek insurance recovery for any additional incremental costs.
Added
Increased costs or budget overruns incurred with respect to a particular film may prevent a picture from being completed or released or may result in a delayed release and the postponement to a potentially less favorable date, all of which could cause a decline in box office performance, and, thus, the overall financial success of such film.
Removed
The ultimate amount of insurance recovery cannot be estimated at this time. See further discussion in the Results of Operations section below. The economic impact of the COVID-19 global pandemic and resulting societal changes will depend on numerous evolving factors that cannot be predicted with certainty.
Added
Any of the foregoing could have a material adverse effect on our business, financial condition, operating results, liquidity and prospects. We may incur significant write-offs if our projects do not perform well enough to recoup costs. We are required to amortize capitalized production costs over the expected revenue streams as we recognize revenue from films or other projects.
Removed
There are a number of ways in which these uncertainties resulting from the COVID-19 global pandemic have impacted our current results of operations and could continue to impact our future results of operations.
Added
The amount of production costs that will be amortized each quarter depends on, among other things, how much future revenue we expect to receive from each project.
Removed
These impacts include the incremental costs and losses presented in the table above, lower revenues from the closure or reopenings of movie theaters and postponement of theatrical releases, partially offset by lower theatrical production and marketing costs, or lower box office revenues from pre-pandemic levels due to shifts in viewing; increased expenses associated with new health and safety protocols on motion picture and television productions; changes in the timing of revenues for motion pictures and television productions associated with delays in production, delivery and/or release; and while STARZ initially experienced an increase in viewership during the fiscal year ended March 31, 2021 of its content, future growth could be impacted by whether productions that have resumed will be paused again, and future consumer viewing patterns as the pandemic eases.
Added
These events and changes in circumstances include, among others, an adverse change in the expected performance of a film prior to its release, actual costs substantially in excess of budgeted cost for the film, delays or changes in release plans and actual performance subsequent to the film’s release being less than previously expected performance estimates.
Removed
We expect that the ultimate impact of these disruptions, including the extent of any adverse impact on our business, results of operations and financial condition, will depend on, among other things, the duration and spread of the pandemic (including recent and new variants), the impact of governmental regulations that have been, and may continue to be, imposed in response to the pandemic, the effectiveness of actions taken to contain or mitigate the outbreak (including the availability, effectiveness and/or public acceptance of any U.S.
Added
In any given quarter, if we lower our previous forecast with respect to total anticipated revenue from any film or other project or increase our previous forecast of cost of making or distribution of the film, we may be required to accelerate amortization or record impairment charges with respect to the unamortized costs, even if we previously recorded impairment charges for such film or other project.
Removed
We have implemented policies, procedures and protocols to address the situation and expect to continue to adjust our current policies and procedures as more information and guidance become available.
Added
Such impairment charges could adversely impact our business, operating results and financial condition. Changes in our business strategy, plans for growth or restructuring may increase our costs or otherwise affect our profitability.
Removed
In addition, resurgences of COVID-19, and the discovery and spread of recent and new variants of the virus, may result in the re-imposition of certain restrictions and may lead to more restrictions being implemented again to reduce the spread of COVID-19. These measures could result in further interruptions to our operations.
Added
As changes in our business environment occur, we may adjust our business strategies to meet these changes, which may include growing a particular area of business or restructuring a particular business or asset.
Removed
Due to the evolving and uncertain nature of this situation, we are not able to estimate the full extent of the impact on our operating results, cash flows and financial position, particularly over the near to medium term. Revenues Our revenues are derived from the Motion Picture, Television Production and Media Networks segments, as described below.
Added
In addition, external events including changing technology, changing consumer patterns, acceptance of our theatrical and television offerings and changes in macroeconomic conditions may impair the value of our assets. When these occur, we may incur costs to change our business strategy and may need to write down the value of assets.
Removed
We refer to our Motion Picture and Television Production segments collectively as our Studio Business. Our revenues are derived from the U.S., Canada, the United Kingdom and other foreign countries. None of the non-U.S. countries individually comprised greater than 10% of total revenues for the years ended March 31, 2022, 2021 and 2020.
Added
We may also make investments in existing or new businesses, including investments in the international expansion of our business and in new business lines (e.g., our direct-to-consumer and licensed offerings).
Removed
Studio Business Motion Picture: Our Motion Picture segment includes revenues derived from the following: • Theatrical. Theatrical revenues are derived from the domestic theatrical release of motion pictures licensed to theatrical exhibitors on a picture-by-picture basis (distributed by us directly in the U.S. and through a sub-distributor in Canada).
Added
Some of these investments may have negative or low short-term returns and the ultimate prospects of the businesses may be uncertain or, in international markets, may not develop at a rate that supports our level of investment.
Removed
The revenues from Canada are reported net of distribution fees and release expenses of the Canadian sub-distributor. The financial terms that we negotiate with our theatrical exhibitors in the U.S. generally provide that we receive a percentage of the box office results. • Home Entertainment.
Added
In any of these events, our costs may increase, we may have significant charges associated with the write-down of assets, or returns on new investments may be lower than prior to the change in strategy, plans for growth or restructuring.
Removed
Home entertainment revenues are derived from the sale or rental of our film productions and acquired or licensed films and certain television programs (including theatrical and direct-to-video releases) on 46 Table of Contents packaged media and through digital media platforms (including pay-per-view and video-on-demand platforms, electronic sell through, and digital rental).
Added
In March 2023, we announced that we had confidentially submitted a draft registration statement on Form 10 with the SEC relating to the proposed spin-off of our studio business, consisting of our Television Production and Motion Picture segments.
Removed
In addition, we have revenue sharing arrangements with certain digital media platforms which generally provide that, in exchange for a nominal or no upfront sales price, we share in the rental or sales revenues generated by the platform on a title-by-title basis. • Television.
Added
The proposed spin-off will be subject to the satisfaction of a number of conditions and our board of directors may decide not to proceed with the spin-off at any time.
Removed
Television revenues are primarily derived from the licensing of our theatrical productions and acquired films to the linear pay, basic cable and free television markets. In addition, when a license in our traditional pay television window is made to a subscription video-on-demand ("SVOD") or other digital platform, the revenues are included here. • International.
Added
A failure to satisfy required conditions, or disruptions in market conditions, could delay the completion of the proposed spin-off for a significant period of time or prevent it from occurring at all.
Removed
International revenues are derived from (1) licensing of our productions, acquired films, our catalog product and libraries of acquired titles to international distributors, on a territory-by-territory basis; and (2) the direct distribution of our productions, acquired films, and our catalog product and libraries of acquired titles in the United Kingdom. • Other.
Added
Additionally, the proposed spin-off is complex in nature, and unanticipated developments or changes, including disruptions in general market conditions, changes in law or challenges in executing the spin-off, may affect our ability to complete the spin-off on the terms or on the timeline we announced, or at all.
Removed
Other revenues are derived from, among others, the licensing of our film and television and related content (games, music, location-based entertainment royalties, etc.) to other ancillary markets. Television Production: Our Television Production segment includes revenues derived from the following: • Television.
Added
These or other developments could cause us not to realize some of all of the expected benefits, or to realize them on a different timeline than expected. Although we intend for the spin-off to be tax-free to shareholders for U.S. federal income tax purposes, we expect to incur non-U.S. cash taxes on the preparatory restructuring.
Removed
Television revenues are derived from the licensing to domestic markets (linear pay, basic cable, free television and syndication) of scripted and unscripted series, television movies, mini-series and non-fiction programming. Television revenues include fixed fee arrangements as well as arrangements in which we earn advertising revenue from the exploitation of certain content on television networks.
Added
Moreover, there can be no assurance that the proposed spinoff will qualify as tax-free to shareholders for U.S. federal income tax purposes. If we are unable to complete the proposed spin-off, we will have incurred costs without realizing the benefits of such transaction.
Removed
Television revenues also include revenue from licenses to SVOD platforms in which the initial license of a television series is to an SVOD platform. • International. International revenues are derived from the licensing and syndication to international markets of scripted and unscripted series, television movies, mini-series and non-fiction programming. • Home Entertainment.
Added
Whether or not the spin-off is completed, our businesses may face material challenges as a result of the spin-off, including the diversion of management’s attention from ongoing business concerns and impact on the businesses of the Company; 24 Table of Contents maintaining employee morale and retaining and attracting key management and other employees; retaining existing or attracting new business and operational relationships, including with customers, suppliers, employees and other counterparties; establishing transition service agreements and standalone readiness for key functions, and potential negative reactions from investors or the financial community.
Removed
Home entertainment revenues are derived from the sale or rental of television production movies or series on packaged media and through digital media platforms. • Other.
Added
Moreover, completion of the spin-off will result in independent public companies that are smaller, less diversified companies with more limited businesses. As a result, each company may be more vulnerable to global economic trends, geopolitical risks and changing market conditions, which could have a material adverse effect on its business, financial condition, cash flows and results of operations.
Removed
Other revenues are derived from, among others, the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from commissions and executive producer fees earned related to talent management. Media Networks Our Media Networks segment includes revenues derived from the following: • Starz Networks.
Added
Each of the separate companies will also incur ongoing costs, including costs of operating as independent public companies, that the separated businesses will no longer be able to share.
Removed
Starz Networks’ revenues are derived from the domestic distribution of our STARZ branded premium subscription video services through over-the-top ("OTT") platforms and U.S. multichannel video programming distributors (“MVPDs”) including cable operators, satellite television providers and telecommunications companies (collectively, “Distributors”) and on a direct-to-consumer basis through the Starz App. • STARZPLAY International.
Added
Additionally, we cannot predict whether the market value of our common shares and the common shares of each of the new independent companies after the spin-off will be, in the aggregate, less than, equal to or greater than the market value of our common shares prior to the spin-off. Our revenues and results of operations may fluctuate significantly.
Removed
STARZPLAY International revenues are primarily derived from OTT distribution of the Company's STARZ branded premium subscription video services outside of the U.S.
Added
Our results of operations depend significantly upon the commercial success of the motion picture, television and other content that we sell, license or distribute, which cannot be predicted with certainty.
Removed
Through March 31, 2021, our Media Networks segment also included revenues derived from Other Streaming Services, which represented revenues derived primarily from our formerly majority owned premium Spanish language streaming services business, Pantaya, which included subscriber based streaming revenue and other distribution revenue. We sold our interest in Pantaya on March 31, 2021, for approximately $123.6 million in cash.
Added
The underperformance at the box office of one or more motion pictures in any period may cause our revenue and earnings results for that period (and potentially, subsequent periods) to be less than anticipated.
Removed
Under the terms of the purchase agreement, control of Pantaya transferred to Hemisphere Media Group on March 31, 2021, with the cash consideration transferred on April 1, 2021. See Note 2 to our consolidated financial statements for further information.
Added
Our results of operations also fluctuate due to the timing, mix, number and availability of our theatrical motion picture and home entertainment releases, as well as license periods for content.
Removed
Expenses Our primary operating expenses include direct operating expenses, distribution and marketing expenses and general and administration expenses. 47 Table of Contents Direct operating expenses include amortization of film and television production or acquisition costs, amortization of programming production or acquisition costs and programming related salaries, participation and residual expenses, provision for doubtful accounts, and foreign exchange gains and losses.
Added
Moreover, low ratings for television programming produced by us may lead to the cancellation of a program resulting in significant programming impairments in a given period and can negatively affect license fees for the cancelled program in future periods.
Removed
Participation costs represent contingent consideration payable based on the performance of the film or television program to parties associated with the film or television program, including producers, writers, directors or actors.
Added
In addition, the comparability of our results may be affected by changes in accounting guidance or changes in our ownership of certain assets and businesses.
Removed
Residuals represent amounts payable to various unions or “guilds” such as the Screen Actors Guild - American Federation of Television and Radio Artists, Directors Guild of America, and Writers Guild of America, based on the performance of the film or television program in certain ancillary markets or based on the individual’s (i.e., actor, director, writer) salary level in the television market.
Added
As a result of the factors above, our results of operations may fluctuate and differ from period to period, and therefore may not be indicative of the results for any future periods or directly comparable to prior reporting periods. We do not have long-term arrangements with many of our production or co-financing partners.
Removed
Distribution and marketing expenses primarily include the costs of theatrical prints and advertising (“P&A”) and premium video-on-demand ("Premium VOD") expense and of DVD/Blu-ray duplication and marketing. Theatrical P&A includes the costs of the theatrical prints delivered to theatrical exhibitors and the advertising and marketing cost associated with the theatrical release of the picture.
Added
We typically do not enter into long-term production contracts with the creative producers of motion picture and television content that we produce, acquire or distribute. Moreover, we generally have certain derivative rights that provide us with distribution rights to, for example, prequels, sequels and remakes of certain content we produce, acquire or distribute.
Removed
Premium VOD expense represents the advertising and marketing cost associated with the Premium VOD release of the picture. DVD/Blu-ray duplication represents the cost of the DVD/Blu-ray product and the manufacturing costs associated with creating the physical products. DVD/Blu-ray marketing costs represent the cost of advertising the product at or near the time of its release or special promotional advertising.
Added
There is no guarantee that we will produce, acquire or distribute future content by any creative producer or co-financing partner, and a failure to do so could adversely affect our business, financial condition, operating results, liquidity and prospects.
Removed
Marketing costs for Media Networks includes advertising, consumer marketing, distributor marketing support and other marketing costs. In addition, distribution and marketing costs includes our Media Networks segment operating costs for the direct-to-consumer service, transponder expenses and maintenance and repairs. General and administration expenses include salaries and other overhead.
Added
We rely on a few major retailers and distributors and the loss of any of those could reduce our revenues and operating results. A small number of retailers and distributors account for a material percentage of the revenues in home entertainment for our Motion Picture segment. We do not have long-term agreements with retailers.
Removed
CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our accounting policies are more fully described in Note 1 to our consolidated financial statements.
Added
In addition, in fiscal 2023, we generated over 10% of our revenue from one external customer.
Removed
As disclosed in Note 1 to our consolidated financial statements, the preparation of our financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.
Added
We cannot assure you that we will continue to maintain favorable relationships with our retailers and distributors or that they will not be adversely affected by economic conditions, including as a result of global pandemics, such as COVID-19, wars, such as Russia’s invasion of Ukraine (including sanctions therefrom), rising interest rates, inflation or a recession.
Removed
The application of the following accounting policies, which are important to our financial position and results of operations, requires significant judgments and estimates on the part of management. As described more fully below, these estimates bear the risk of change due to the inherent uncertainty of the estimate.
Added
A significant portion of our library revenues comes from a small number of titles. We depend on a limited number of titles in any given fiscal quarter for the majority of the revenues generated by our library. In addition, many of the titles in our library are not presently distributed and generate substantially no revenue.
Removed
In some cases, changes in the accounting estimates are reasonably likely to occur from period to period. In addition, the evolving and uncertain nature of the COVID-19 global pandemic could materially impact our estimates, particularly those that require consideration of forecasted financial information, in the near to medium term. Accordingly, actual results could differ materially from our estimates.
Added
Moreover, our rights to the titles in our library vary; in some cases, we only hold the right to distribute titles in certain media and territories for a limited term.
Removed
To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations will be affected. We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis.

… 534 more changes not shown on this page.

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed2 unchanged
Biggest changeIn addition, we lease the following properties used by our Motion Picture, Television Production and Media Networks segments: • 280,000 square feet at 8900 Liberty Circle, Englewood, Colorado (per a lease that expires in December 2023); • 100,119 square feet at 6363 South Fiddler’s Green Circle, Greenwood Village, Colorado (per a lease that expires in September 2034); • 93,670 square feet at 12020 Chandler Blvd., Valley Village, California (per a lease that expires in December 2027); • 60,116 square feet at 1647 Stewart Street, Santa Monica, California (per a lease that expires in December 2028); • 34,332 square feet at 530 Fifth Avenue, New York, New York (per a lease that expires in August 2028); • 25,346 square feet at 9460 Wilshire Blvd., Beverly Hills, California (per a lease that expires in February 2026); • 11,243 square feet at 45 Mortimer Street, London, United Kingdom (per a lease that expires in July 2029); • 7,500 square feet at Unit 502, Crest Audeus, Fun Republic Lane, Andheri West, Mumbai, India (per a lease that expires in August 2024); • 2,700 square feet at 27 West 24th Street, New York, New York (per a lease that expires in May 2023); • 1,968 square feet at 1235 Bay Street, Toronto, Ontario (per a lease that expires in December 2022); • 1,645 square feet at A6 Gonti Road, Beijing, China (per a lease that expires in December 2022); and • 975 square feet at 3 Boulevard Royal, Luxembourg City, Luxembourg (per a lease that expires in May 2024).
Biggest changeIn addition, we lease the following properties used by our Motion Picture, Television Production and Media Networks segments: • 280,000 square feet at 8900 Liberty Circle, Englewood, Colorado (per a lease that expires in December 2023); • 100,119 square feet at 6363 South Fiddler’s Green Circle, Greenwood Village, Colorado (per a lease that expires in September 2034); • 93,670 square feet at 12020 Chandler Blvd., Valley Village, California (per a lease that expires in December 2027); • 60,116 square feet at 1647 Stewart Street, Santa Monica, California (per a lease that expires in December 2028); • 34,332 square feet at 530 Fifth Avenue, New York, New York (per a lease that expires in August 2028); • 25,346 square feet at 9460 Wilshire Blvd., Beverly Hills, California (per a lease that expires in February 2026); • 11,243 square feet at 45 Mortimer Street, London, United Kingdom (per a lease that expires in July 2029); • An aggregate of 18,220 square feet for properties located in Los Angeles, California (per a lease that expires in April 2026), Mumbai, India (per a lease that expires in August 2024), New York, New York (per a lease that expires in May 2025), Toronto, Canada (per a lease that expires in June 2025), Beijing, China (per a lease that expires in December 2023) and Luxembourg City, Luxembourg (per a lease that expires in May 2024).

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed2 unchanged
Biggest changeFor a discussion of certain claims and legal proceedings, see Note 17 - Commitments and Contingencies to our consolidated financial statements, which discussion is incorporated by reference into this Part I, Item 3, Legal Proceedings. 39 Table of Contents ITEM 4. MINE SAFETY DISCLOSURES. Not Applicable. 40 Table of Contents PART II
Biggest changeFor a discussion of certain claims and legal proceedings, see Note 17 - Commitments and Contingencies to our consolidated financial statements, which discussion is incorporated by reference into this Part I, Item 3, Legal Proceedings. ITEM 4. MINE SAFETY DISCLOSURES. Not Applicable. 40 Table of Contents PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

1 edited+0 added−0 removed0 unchanged
Biggest changeItem 4. Mine Safety Disclosures 39 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 41 Item 6. Selected Financial Data 44 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 44 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 75 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 40 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 41 Item 6. [Reserved] 44 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 44 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 77 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

7 edited+0 added−2 removed31 unchanged
Biggest changeAdditionally, during the three months ended March 31, 2022, no Class A voting shares and 27,106 Class B non-voting shares were withheld upon the vesting of restricted share units and share issuances to satisfy minimum statutory federal, state and local tax withholding obligations. 42 Table of Contents Unregistered Sales of Equity Securities On April 2, 2021, the Company entered into an amendment to the Amended and Restated Limited Liability Company Operating Agreement of Pilgrim Media Group, LLC dated as of November 12, 2015 (the “Agreement”).
Biggest changeAdditionally, during the three months ended March 31, 2023, no Class A voting shares and 217,666 Class B non-voting shares were withheld upon the vesting of restricted share units and share issuances to satisfy minimum statutory federal, state and local tax withholding obligations. 42 Table of Contents Unregistered Sales of Equity Securities None.
Securities Authorized for Issuance Under Equity Compensation Plans The information required by this item is incorporated by reference to our Proxy Statement for our 2022 Annual General Meeting of Stockholders to be filed with the SEC within 120 days after the end of the fiscal year ended March 31, 2022.
Securities Authorized for Issuance Under Equity Compensation Plans The information required by this item is incorporated by reference to our Proxy Statement for our 2023 Annual General Meeting of Stockholders to be filed with the SEC within 120 days after the end of the fiscal year ended March 31, 2023.
Such purchases will be structured as permitted by securities laws and other legal requirements. The share repurchase program has no expiration date. No common shares were purchased by us during the three months ended March 31, 2022.
Such purchases will be structured as permitted by securities laws and other legal requirements. The share repurchase program has no expiration date. No common shares were purchased by us during the three months ended March 31, 2023.
All values assume that $100 was invested on March 31, 2017 in our common shares and each applicable index and all dividends were reinvested.
All values assume that $100 was invested on March 31, 2018 in our common shares and each applicable index and all dividends were reinvested.
Stock Performance Graph The following graph compares our cumulative total shareholder return with those of the NYSE Composite Index and the S&P Movies & Entertainment Index for the period commencing March 31, 2017 and ending March 31, 2022.
Stock Performance Graph The following graph compares our cumulative total shareholder return with those of the NYSE Composite Index and the S&P Movies & Entertainment Index for the period commencing March 31, 2018 and ending March 31, 2023.
Holders As of May 20, 2022, there were approximately 529 and 711 shareholders of record of our Class A voting shares and Class B non-voting shares, respectively.
Holders As of May 23, 2023, there were approximately 576 and 1,469 shareholders of record of our Class A voting shares and Class B non-voting shares, respectively.
The comparisons shown in the graph below are based on historical data and we caution that the stock price performance shown in the graph below is not indicative of, and is not intended to forecast, the potential future performance of our common shares. 43 Table of Contents 3/17 3/18 3/19 3/20 3/21 3/22 Lions Gate Entertainment Corporation-Class A $100.00 $97.59 $59.54 $23.15 $56.91 $61.86 Lions Gate Entertainment Corporation-Class B $100.00 $99.14 $62.67 $23.16 $53.54 $62.38 NYSE Composite $100.00 $111.00 $116.14 $96.72 $149.97 $163.63 Dow Jones US Media Sector $100.00 $93.92 $105.10 $90.46 $159.14 $132.79 The graph and related information are being furnished solely to accompany this Form 10-K pursuant to Item 201(e) of Regulation S-K.
The comparisons shown in the graph below are based on historical data and we caution that the stock price performance shown in the graph below is not indicative of, and is not intended to forecast, the potential future performance of our common shares. 3/18 3/19 3/20 3/21 3/22 3/23 Lions Gate Entertainment Corporation-Class A $100.00 $61.01 $23.72 $58.32 $63.39 $43.18 Lions Gate Entertainment Corporation-Class B $100.00 $63.21 $23.36 $54.00 $62.92 $43.45 NYSE Composite $100.00 $104.63 $87.13 $135.10 $147.41 $139.37 Dow Jones US Media Sector $100.00 $111.90 $96.31 $169.44 $138.88 $103.91 43 Table of Contents The graph and related information are being furnished solely to accompany this Form 10-K pursuant to Item 201(e) of Regulation S-K.
Removed
In consideration for certain amendments under the Agreement, the Company issued a warrant to purchase 459,217 Class B non-voting shares to Pilgrim Media Group Holdings, LLC and a warrant to purchase 40,783 Class B non-voting shares to Whirlwind Entertainment Group, Inc.
Removed
The Company’s Class B non-voting shares issued pursuant to the Agreement were issued as a private placement in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

6 edited+377 added−3 removed1 unchanged
Biggest changeWe experienced delays in theatrical distribution of our films, both domestically and internationally, as well as delays in the production of film and television content (resulting in continued changes in future release dates for some titles and series). Although film and television production have generally resumed, we continue to see disruption of production activities depending on local circumstances.
Biggest changeWe experienced delays in theatrical distribution of our films, both domestically and internationally, as well as delays in the production of film and television content (resulting in changes in future release dates for some titles and series). Although film and television production have generally resumed in full, disruption of production activities could occur again, depending on local circumstances.
A discussion and analysis of our financial condition and results of operation for the fiscal year ended March 31, 2020 and year-to-year comparisons between fiscal 2021 and fiscal 2020 can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2021 , and is herein incorporated by reference.
A discussion and analysis of our financial condition and results of operation for the fiscal year ended March 31, 2021 and year-to-year comparisons between fiscal 2022 and fiscal 2021 can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2022 , and is herein incorporated by reference.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. This section of our Annual Report Form 10-K includes a discussion and analysis of our financial condition and results of operation for the fiscal years ended March 31, 2022 and 2021, and year-to-year comparisons between fiscal 2022 and fiscal 2021.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. This section of our Annual Report Form 10-K includes a discussion and analysis of our financial condition and results of operation for the fiscal years ended March 31, 2023 and 2022, and year-to-year comparisons between fiscal 2023 and fiscal 2022.
The Company’s film, television, subscription and location-based entertainment businesses are backed by a 17,000-title library and a valuable collection of iconic film and television franchises. We classify our operations through three reporting segments: Motion Picture, Television Production, and Media Networks (see further discussion below).
The Company’s film, television, subscription and location-based entertainment businesses are backed by an 18,000-title library and a valuable collection of iconic film and television franchises. We classify our operations through three reporting segments: Motion Picture, Television Production, and Media Networks (see further discussion below).
COVID-19 Global Pandemic Since fiscal 2020, the economic, social and regulatory impacts associated with the ongoing COVID-19 global pandemic (including its variants), continued measures to prevent its spread, and the resulting economic uncertainty, have affected our business in a number of ways.
COVID-19 Global Pandemic Since fiscal 2020, the economic, social and regulatory impacts associated with the COVID-19 global pandemic (including its variants), measures to prevent its spread, and the resulting economic uncertainty, affected our business in a number of ways.
The full extent of impacts related to the COVID-19 global pandemic on our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately predict. See
The full extent of the impacts related to COVID-19 and its variants on our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately predict.
Removed
We also cannot predict whether productions that have resumed will be paused again, or the impact of incremental costs required to adhere to health and safety protocols. Additionally, although the lifting of the quarantines have enabled many theaters to reopen, we are unable to predict how shifting government mandates or guidance regarding COVID-19 restrictions will impact patronage and theater capacity.
Added
Proposed Spin-off of Studio Business In March 2023, we announced that we had confidentially submitted a draft registration statement on Form 10 with the SEC relating to the proposed spin-off of our studio business, consisting of our Television Production and Motion Picture segments.
Removed
In turn, production delays (and fewer theatrical releases) have limited the availability of film content to be sold in distribution windows subsequent to the theatrical release, and have resulted in delays of release of new television content, including on our STARZ platform.
Added
The proposed spin-off will be subject to the satisfaction of a number of conditions and our board of directors may decide not to proceed with the spin-off at any time.
Removed
The impact of these disruptions and the extent of their adverse impact on our financial and operating results will be dictated by the length of time that such disruptions continue, which will, in turn, depend on the currently unknowable duration and severity of the impacts of COVID-19 and its variants, and among other things, the impact of governmental actions imposed in response to COVID-19 and individuals’ and companies’ responses regarding health matters going forward.
Added
A failure to satisfy required conditions, or disruptions in market conditions, could delay the completion of the proposed spin-off for a significant period of time or prevent it from occurring at all.
Added
Additionally, the proposed spin-off is complex in nature, and unanticipated developments or changes, including disruptions in general market conditions, changes in law or challenges in executing the spin-off, may affect our ability to complete the spin-off on the terms or on the timeline we announced, or at all.
Added
These or other developments could cause us not to realize some of all of the expected benefits, or to realize them on a different timeline than expected. Media Networks Restructuring and Goodwill Impairment Media Networks Restructuring.
Added
In fiscal 2023, for the second quarter ended September 30, 2022, due to the macro and microeconomic conditions, including the competitive environment, continued inflationary trends and recessionary economies worldwide and its impact on our growth in subscribers worldwide, we began a plan to restructure our LIONSGATE+ business (formerly STARZPLAY International).
Added
This restructuring includes exiting the business in seven international territories (France, Germany, Italy, Spain, Benelux, the Nordics and Japan).
Added
During the third quarter ended December 31, 2022, due to the continuing macro and micro economic conditions which led to the LIONSGATE+ restructuring, we expanded our restructuring plan discussed above to identify additional cost-saving initiatives, which included a strategic review of content performance across Starz’s domestic and international platforms, resulting in certain programming being removed from those platforms and written down to fair value.
Added
As a result of these restructuring initiatives, we recorded content impairment charges related to the Media Networks segment in fiscal 2023 of $379.3 million. The Company also incurred severance cost under these restructuring initiatives. These charges are included in restructuring and other in the consolidated statement of operations (see Note 15 to our consolidated financial statements).
Added
The Company is substantially complete with executing its LIONSGATE+ restructuring plan including exiting the territories discussed above, negotiating certain content related contractual commitments and performing its strategic review of content performance for consideration of removal from the Company's various platforms.
Added
As of March 31, 2023, a portion of the territories had been exited, with the remaining territories fully exited in May 2023. The Company estimates it will incur additional charges ranging from approximately $20 million to $50 million related to certain contractual content commitments or programming content impairment charges, among other items, as the Company fully implements the plan.
Added
Of these total estimated future charges, the net future cash outlay is estimated to range from approximately $20 million to $50 million, which includes content commitments on content in territories being exited and estimates of payments on content that may be abandoned as part of the ongoing strategic review, as well as the incremental cost related to the restructuring.
Added
Of the content impairment charges recorded in fiscal 2023, approximately $90 million reflects the future cash to be paid for the remaining amounts payable for this content. As the Company continues to fully implement the plan, including further strategic review of content performance, the Company may incur additional content impairment charges beyond these estimates.
Added
The Company 45 Table of Contents expects the restructuring plan to be substantially completed by June 30, 2023, however certain settlements of contractual commitments could extend beyond that date. Goodwill Impairment.
Added
The Company's Starz domestic operations have also been impacted by these current market conditions, and the Company has revised its subscriber growth and forecasted cash flow assumptions and implemented certain cost-saving measures.
Added
These changes in forecasted cash flow resulted in an impairment of $1.475 billion of goodwill related to the Media Networks reporting unit in the second quarter of fiscal 2023 (quarter ended September 30, 2022). See Item 2.
Added
Management's Discussion and Analysis, "Critical Accounting Policies and Estimates", Goodwill and Indefinite-Lived Intangible Assets and Note 1 to our consolidated financial statements for further information.
Added
Additionally, although theaters have generally reopened, we are not able to accurately predict if and at what level consumers will return to movie theaters. We have incurred and may incur additional costs to address any government regulations and the safety of our employees and talent.
Added
To the extent that the costs are related to implementing production safety protocols, or other such costs that add value to the film or television program, the costs are capitalized as part of the cost of the film or television program.
Added
Incremental direct operating costs associated with the pausing and restarting of productions, including paying/hiring certain cast and crew, maintaining idle facilities and equipment costs, contractual marketing spends for film releases and events that have been canceled or delayed that will provide no economic benefit, and certain incremental general and administrative costs associated with the COVID-19 global pandemic, such as costs related to transitioning the Company to a remote-work environment, costs associated with return-to-office safety protocols and other incremental general and administrative costs associated with the COVID-19 global pandemic, are expensed as incurred.
Added
In fiscal 2022 and 2023, these costs have decreased due to the lessening severity of the COVID-19 global pandemic, and we expect these costs to continue to decrease if the severity of the COVID-19 global pandemic continues to decline.
Added
We have received some insurance recovery and are in the process of seeking additional insurance recovery for some of the costs incurred. The ultimate amount of insurance recovery cannot be estimated at this time.
Added
The following table presents certain incremental costs incurred and expensed, net of insurance recoveries, and the line item in our consolidated statements of operations such amounts are included in, due to the disruptions associated with the COVID-19 global pandemic: Year Ended March 31, 2023 2022 2021 (Amounts in millions) COVID-19 related charges (benefit) included in: Direct operating expense (1) $ (11.6) $ (3.6) $ 50.6 Distribution and marketing expense — 0.2 16.9 Restructuring and other 0.1 1.1 3.0 Total COVID-19 related charges (benefit) $ (11.5) $ (2.3) $ 70.5 ___________ (1) In the fiscal years ended March 31, 2023 and 2022, insurance recoveries exceeded the incremental costs expensed in the year, resulting in a net benefit included in direct operating expense (insurance recoveries in fiscal 2023, 2022 and 2021 amounted to $14.1 million, $22.1 million and immaterial amounts, respectively).
Added
In fiscal 2021, these amounts also included film impairment due to changes in performance expectations resulting from circumstances associated with the COVID-19 global pandemic. See further discussion in the Results of Operations section below. 46 Table of Contents Revenues Our revenues are derived from the Motion Picture, Television Production and Media Networks segments, as described below.
Added
We refer to our Motion Picture and Television Production segments collectively as our Studio Business. Our revenues are derived from the U.S., Canada, the United Kingdom and other foreign countries. None of the non-U.S. countries individually comprised greater than 10% of total revenues for the years ended March 31, 2023, 2022 and 2021.
Added
Studio Business Motion Picture: Our Motion Picture segment includes revenues derived from the following: • Theatrical. Theatrical revenues are derived from the domestic theatrical release of motion pictures licensed to theatrical exhibitors on a picture-by-picture basis (distributed by us directly in the U.S. and through a sub-distributor in Canada).
Added
The revenues from Canada are reported net of distribution fees and release expenses of the Canadian sub-distributor. The financial terms that we negotiate with our theatrical exhibitors in the U.S. generally provide that we receive a percentage of the box office results. • Home Entertainment.
Added
Home entertainment revenues are derived from the sale or rental of our film productions and acquired or licensed films and certain television programs (including theatrical and direct-to-video releases) on packaged media and through digital media platforms (including pay-per-view and video-on-demand platforms, electronic sell through, and digital rental).
Added
In addition, we have revenue sharing arrangements with certain digital media platforms which generally provide that, in exchange for a nominal or no upfront sales price, we share in the rental or sales revenues generated by the platform on a title-by-title basis. • Television.
Added
Television revenues are primarily derived from the licensing of our theatrical productions and acquired films to the linear pay, basic cable and free television markets. In addition, when a license in our traditional pay television window is made to a subscription video-on-demand ("SVOD") or other digital platform, the revenues are included here. • International.
Added
International revenues are derived from (1) licensing of our productions, acquired films, our catalog product and libraries of acquired titles to international distributors, on a territory-by-territory basis; and (2) the direct distribution of our productions, acquired films, and our catalog product and libraries of acquired titles in the United Kingdom. • Other.
Added
Other revenues are derived from, among others, the licensing of our film and television and related content (games, music, location-based entertainment royalties, etc.) to other ancillary markets. Television Production: Our Television Production segment includes revenues derived from the following: • Television.
Added
Television revenues are derived from the licensing to domestic markets (linear pay, basic cable, free television and syndication) of scripted and unscripted series, television movies, mini-series and non-fiction programming. Television revenues include fixed fee arrangements as well as arrangements in which we earn advertising revenue from the exploitation of certain content on television networks.
Added
Television revenues also include revenue from licenses to SVOD platforms in which the initial license of a television series is to an SVOD platform. • International. International revenues are derived from the licensing and syndication to international markets of scripted and unscripted series, television movies, mini-series and non-fiction programming. • Home Entertainment.
Added
Home entertainment revenues are derived from the sale or rental of television production movies or series on packaged media and through digital media platforms. • Other.
Added
Other revenues are derived from, among others, the licensing of our television programs to other ancillary markets, the sales and licensing of music from the television broadcasts of our productions, and from commissions and executive producer fees earned related to talent management. Media Networks Our Media Networks segment includes revenues derived from the following: • Starz Networks.
Added
Starz Networks’ revenues are derived from the domestic distribution of our STARZ branded premium subscription video services through over-the-top ("OTT") streaming platforms and distributors, on a direct-to-consumer basis through the Starz App, and through U.S. multichannel video programming distributors (“MVPDs”) 47 Table of Contents including cable operators, satellite television providers and telecommunications companies (collectively "Distributors") (in the aggregate, the "Starz Domestic Platform"). • LIONSGATE+.
Added
LIONSGATE+ revenues are primarily derived from OTT distribution of the STARZ branded premium subscription video services outside of the U.S. The Starz Domestic Platform together with the LIONSGATE+ platforms are referred to as the "Starz Platforms". Expenses Our primary operating expenses include direct operating expenses, distribution and marketing expenses and general and administration expenses.
Added
Direct operating expenses include amortization of film and television production or acquisition costs, amortization of programming production or acquisition costs and programming related salaries, participation and residual expenses, provision for doubtful accounts, and foreign exchange gains and losses.
Added
Participation costs represent contingent consideration payable based on the performance of the film or television program to parties associated with the film or television program, including producers, writers, directors or actors.
Added
Residuals represent amounts payable to various unions or “guilds” such as the Screen Actors Guild - American Federation of Television and Radio Artists, Directors Guild of America, and Writers Guild of America, based on the performance of the film or television program in certain ancillary markets or based on the individual’s (i.e., actor, director, writer) salary level in the television market.
Added
Distribution and marketing expenses primarily include the costs of theatrical prints and advertising (“P&A”) and premium video-on-demand ("Premium VOD") expense and of DVD/Blu-ray duplication and marketing. Theatrical P&A includes the costs of the theatrical prints delivered to theatrical exhibitors and the advertising and marketing cost associated with the theatrical release of the picture.
Added
Premium VOD expense represents the advertising and marketing cost associated with the Premium VOD release of the picture. DVD/Blu-ray duplication represents the cost of the DVD/Blu-ray product and the manufacturing costs associated with creating the physical products. DVD/Blu-ray marketing costs represent the cost of advertising the product at or near the time of its release or special promotional advertising.
Added
Marketing costs for Media Networks includes advertising, consumer marketing, distributor marketing support and other marketing costs. In addition, distribution and marketing costs includes our Media Networks segment operating costs for the direct-to-consumer service, transponder expenses and maintenance and repairs. General and administration expenses include salaries and other overhead.
Added
Corporate general and administrative expenses include certain corporate executive expense (such as salaries and wages for the office of the Chief Executive Officer, Chief Financial Officer, General Counsel and other corporate officers), investor relations costs, costs of maintaining corporate facilities, and other unallocated common administrative support functions, including corporate accounting, finance and financial reporting, internal and external audit and tax costs, corporate and other legal support functions, and certain information technology and human resources expense.
Added
CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our accounting policies are more fully described in Note 1 to our consolidated financial statements.
Added
As disclosed in Note 1 to our consolidated financial statements, the preparation of our financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.
Added
The application of the following accounting policies, which are important to our financial position and results of operations, requires significant judgments and estimates on the part of management. As described more fully below, these estimates bear the risk of change due to the inherent uncertainty of the estimate.
Added
In some cases, changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ materially from our estimates. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations will be affected.
Added
We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis.
Added
We believe that the following discussion addresses our most critical accounting policies, which are those that are most important to the portrayal of our financial condition and results of operations and require management's most difficult, subjective and complex judgments. 48 Table of Contents Accounting for Films and Television Programs and Licensed Program Rights Capitalized costs for films or television programs are amortized and tested for impairment based on whether the content is predominantly monetized individually or as a group.
Added
Film and Television Programs Monetized Individually. For films and television programs monetized individually, film cost amortization, participations and residuals expense are based on management's estimates.
Added
Costs of acquiring and producing films and television programs and of acquired libraries that are monetized individually are amortized and estimated liabilities for participations and residuals costs are accrued using the individual-film-forecast method, based on the ratio of the current period's revenues to management’s estimated remaining total gross revenues to be earned ("ultimate revenue").
Added
Management's judgment is required in estimating ultimate revenue and the costs to be incurred throughout the life of each film or television program.
Added
Management estimates ultimate revenues based on historical experience with similar titles or the title genre, the general public appeal of the cast, audience test results when available, actual performance (when available) at the box office or in markets currently being exploited, and other factors such as the quality and acceptance of motion pictures or programs that our competitors release into the marketplace at or near the same time, critical reviews, general economic conditions and other tangible and intangible factors, many of which we do not control and which may change.
Added
For motion pictures, ultimate revenue includes estimates over a period not to exceed ten years following the date of initial release of the motion picture.
Added
The most sensitive factor affecting our estimate of ultimate revenues for a film intended for theatrical release is the film's theatrical performance, as subsequent revenues from the licensing and sale in other markets have historically been highly correlated to its theatrical performance.
Added
After a film's release, our estimates of revenue from succeeding markets are revised based on historical relationships and an analysis of current market trends.
Added
For an episodic television series, the period over which ultimate revenues are estimated cannot exceed ten years following the date of delivery of the first episode, or, if still in production, five years from the date of delivery of the most recent episode, if later.
Added
The most sensitive factors affecting our estimate of ultimate revenues for a television series is whether the series will be ordered for a subsequent season and estimates of revenue in secondary markets other than the initial license fee, which may depend on a number of factors, including, among others, the ratings or viewership the program achieves on the customers' platforms.
Added
The initial estimate of ultimate revenue may include estimates of revenues outside of the initial license window (i.e., international, home entertainment and other distribution platforms) and are based on historical experience for similar programs (genre, duration, etc.) and the estimated number of seasons of the series.
Added
Ultimates of revenue beyond the initial license fee are generally higher for programs that have been or are expected to be ordered for multiple seasons.
Added
We regularly monitor the performance of each season, and evaluate whether impairment indicators are present (i.e., low ratings, cancellations or the season is not reordered), and based upon our review, we revise our estimates as needed and perform an impairment assessment if impairment indicators are present (see below).
Added
For titles included in acquired libraries, ultimate revenue includes estimates over a period not to exceed twenty years following the date of acquisition.
Added
Due to the inherent uncertainties involved in making such estimates of ultimate revenues and expenses, these estimates have differed in the past from actual results and are likely to differ to some extent in the future from actual results. In addition, in the normal course of our business, some films and titles are more successful or less successful than anticipated.
Added
Management regularly reviews and revises when necessary its ultimate revenue and cost estimates, which may result in a change in the rate of amortization of film costs and participations and residuals and/or a write-down of all or a portion of the unamortized costs of the film or television program to its estimated fair value (see below).
Added
An increase in the estimate of ultimate revenue will generally result in a lower amortization rate and, therefore, less film and television program amortization expense, while a decrease in the estimate of ultimate revenue will generally result in a higher amortization rate and, therefore, higher film and television program amortization expense, and also periodically results in an impairment requiring a write-down of the film cost to the title’s fair value.
Added
These write-downs are included in amortization expense within direct operating expenses in our consolidated statements of operations. See further discussion below under Impairment Assessment . Film and Television Programs Monetized as a Group. Licensed programming rights may include rights to more than one exploitation window under the Company's output and library agreements.
Added
For films with multiple windows, the license fee is allocated between the windows based upon the proportionate estimated fair value of each window which generally results in the majority of the cost allocated to the first window on newer releases. 49 Table of Contents While not significant through March 31, 2023, certain license agreements and productions may include additional ancillary rights in addition to the rights for exploitation on the Starz Platforms.
Added
A portion of the cost of these licenses and in some cases the cost of produced content, is allocated between the programming rights for exploitation on the Starz Platforms and investment in film and television programs for exploitation outside of the Starz Platforms in ancillary markets (e.g., home video, digital platforms, television, etc.) based on the relative fair value of those markets.
Added
The estimates of fair value for the allocation between windows of exploitation on the Starz Platform and ancillary markets is based on historical experience of the values of similar titles licensed in subsequent windows and estimates of future revenues in ancillary markets. Management believes these are reasonably reliable estimates of these values, however, these estimates involve uncertainty and management judgment.

… 306 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

10 edited+2 added−9 removed7 unchanged
Biggest changeThe table also presents the cash flows of the principal amounts of the financial instruments, or the cash flows associated with the notional amounts of interest rate derivative instruments, and related weighted-average interest rates by expected maturity or required principal payment dates and the fair value of the instrument as of March 31, 2022: 76 Table of Contents Year Ended March 31, Fair Value 2023 2024 2025 2026 2027 Thereafter Total March 31, 2022 (Amounts in millions) Variable Rates (1) : Revolving Credit Facility (2) $ — $ — $ — $ — $ — $ — $ — $ — Average Interest Rate — — — — — — Term Loan A (2)(3) 210.3 28.9 41.1 44.5 313.7 — 638.5 625.7 Average Interest Rate 2.20 % 2.20 % 2.20 % 2.20 % 2.20 % — Term Loan B (2) 12.5 12.5 819.2 — — — 844.2 828.3 Average Interest Rate 2.70 % 2.70 % 2.70 % — — — Production and related loans (4) 732.9 190.1 363.7 — — — 1,286.7 1,286.7 Average Interest Rate 3.16 % 2.53 % 1.28 % — — — IP Credit Facility (5) 27.1 25.4 26.3 26.3 18.4 — 123.5 123.5 Average Interest Rate 2.70 % 2.70 % 2.70 % 2.70 % 2.70 % — Fixed Rates: 5.500% Senior Notes — — — — — 1,000.0 1,000.0 962.5 Average Interest Rate — — — — — 5.50 % Interest Rate Swaps (6) Variable to fixed notional amount — — 300.0 — 500.0 900.0 1,700.0 (25.8) ____________________ (1) On April 1, 2022, the Company received $125.0 million under the IGR Facility, not reflected in the amounts above (see Note 8 and Note 21 to our consolidated financial statements for further information).
Biggest changeThe table also presents the cash flows of the principal amounts of the financial instruments, or the cash flows associated with the notional amounts of interest rate derivative instruments, and related weighted-average interest rates by expected maturity or required principal payment dates and the fair value of the instrument as of March 31, 2023: Year Ended March 31, Fair Value 2024 2025 2026 2027 2028 Thereafter Total March 31, 2023 (Amounts in millions) Variable Rates : Revolving Credit Facility (1) $ — $ — $ — $ — $ — $ — $ — $ — Average Interest Rate — — — — — — Term Loan A (1) 28.9 41.2 44.5 313.6 — — 428.2 415.4 Average Interest Rate 6.61 % 6.61 % 6.61 % 6.61 % — — Term Loan B (1) 12.5 819.2 — — — — 831.7 817.1 Average Interest Rate 7.11 % 7.11 % — — — — Film related obligations (2) 1,007.2 796.3 59.8 30.4 141.4 — 2,035.1 2,035.1 Average Interest Rate 6.90 % 6.58 % 7.05 % 7.46 % 6.28 % — Fixed Rates: 5.500% Senior Notes — — — — — 800.0 800.0 510.0 Average Interest Rate — — — — — 5.50 % Interest Rate Swaps (3) Variable to fixed notional amount — 1,700.0 — — — — 1,700.0 41.1 ____________________ (1) The effective interest rate in the table above is before the impact of interest rate swaps.
At March 31, 2022, we had interest rate swap agreements to fix the interest rate on $1.7 billion of variable rate LIBOR-based debt. See Note 18 to our consolidated financial statements for additional information.
At March 31, 2023, we had interest rate swap agreements to fix the interest rate on $1.7 billion of variable rate LIBOR-based debt. See Note 18 to our consolidated financial statements for additional information.
Assuming the revolving credit facility is drawn up to its maximum borrowing capacity of $1.25 billion, based on 75 Table of Contents the applicable LIBOR in effect as of March 31, 2022, each quarter point change in interest rates would result in a $2.6 million change in annual net interest expense on the revolving credit facility, Term Loan A, Term Loan B and interest rate swap agreements.
Assuming the revolving credit facility is drawn up to its maximum borrowing capacity of $1.25 billion, based on the applicable LIBOR in effect as of March 31, 2023, each quarter point change in interest rates would result in a $2.0 million change in annual net interest expense on the revolving credit facility, Term Loan A, Term Loan B and interest rate swap agreements.
The applicable margin with respect to loans under our Term Loan B is a percentage per annum equal to a LIBOR rate plus 2.25%.
The applicable margin with respect to loans under the revolving credit facility and Term Loan A is a percentage per annum equal to a LIBOR rate plus 1.75%. The applicable margin with respect to loans under our Term Loan B is a percentage per annum equal to a LIBOR rate plus 2.25%.
A 1% increase in the level of interest rates would decrease the fair value of the 5.500% Senior Notes by approximately $52.9 million, and a 1% decrease in the level of interest rates would increase the fair value of the 5.500% Senior Notes by approximately $49.5 million.
A 1% increase in the level of interest rates would decrease the fair value of the 5.500% Senior Notes by approximately $23.1 million, and a 1% decrease in the level of interest rates would increase the fair value of the 5.500% Senior Notes by approximately $24.0 million.
Certain of our borrowings, primarily borrowings under our Senior Credit Facilities, certain production and related loans, our Production Tax Credit Facility and our IP Credit Facility, are, and are expected to continue to be, at variable rates of interest and expose us to interest rate risk.
Certain of our borrowings, primarily borrowings under our Senior Credit Facilities, and our film related obligations are, and are expected to continue to be, at variable rates of interest and expose us to interest rate risk.
(6) Represents interest rate swap agreements on certain of our LIBOR-based floating-rate debt with fixed rates paid ranging from 1.840% to 2.915% with maturities beginning in March 2025 through March 2030. See Note 18 to our consolidated financial statements. 77 Table of Contents
(3) Represents interest rate swap agreements on certain of our LIBOR-based floating-rate debt with fixed rates paid ranging from 2.723% to 2.915% with maturities in March 2025. See Note 18 to our consolidated financial statements. 79 Table of Contents
At March 31, 2022, our 5.500% Senior Notes had an outstanding carrying value of $965.8 million, and an estimated fair value of $962.5 million.
At March 31, 2023, our 5.500% Senior Notes had an outstanding carrying value of $776.0 million, and an estimated fair value of $510.0 million.
A quarter point increase of the interest rates on the outstanding principal amount of our variable rate individual production and related loans would result in $3.1 million in additional costs capitalized to the respective film or television asset.
A quarter point increase of the interest rates on the variable interest film related obligations would result in $3.6 million in additional costs capitalized to the respective film or television asset for production loans and programming notes (based on the outstanding principal amount of such loans), and a $1.5 million change in annual net interest expense (based on the outstanding principal amount of such loans, and assuming the Production Tax Credit Facility and Backlog Facility are utilized up to their maximum capacity of $235.0 million and $175.0 million, respectively).
If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income would decrease. The applicable margin with respect to loans under the revolving credit facility and Term Loan A is a percentage per annum equal to a LIBOR rate plus 1.75%.
If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and 77 Table of Contents our net income would decrease.
Removed
The variable interest individual production and related loans incur primarily LIBOR and SOFR-based interest at a weighted average rate of approximately 3.00%, including applicable margins ranging from 1.75% over a LIBOR rate to 3.00% over a LIBOR rate, or 1.75% over a SOFR rate to 3.25% over a SOFR rate, each depending on the respective LIBOR or SOFR term.
Added
The variable interest film related obligations (which includes our production loans, programming notes, Production Tax Credit Facility, IP Credit Facility, Backlog Facility and other) incur primarily SOFR and LIBOR-based interest, with applicable margins ranging from 1.15% to 3.50% per annum.
Removed
The applicable margin with respect to advances under the Production Tax Credit Facility is a percentage per annum equal to SOFR plus 0.10% to 0.25% depending on the SOFR term (i.e., one, three or six months) plus 1.50% per annum.
Added
(2) Represents amounts outstanding under film related obligations (i.e., production loans, Production Tax Credit Facility, programming notes, Backlog Facility and other, and IP Credit Facility), actual amounts outstanding and the timing of 78 Table of Contents expected future repayments may vary in the future (see Note 8 to our consolidated financial statements for further information).
Removed
Assuming the Production Tax Credit Facility is utilized up to its maximum capacity of $235.0 million, based on the applicable SOFR in effect as of March 31, 2022, each quarter point change in interest rates would result in a $0.6 million change in annual net interest expense on the Production Tax Credit Facility.
Removed
The applicable margin with respect to advances under the IP Credit Facility is a percentage per annum equal to a LIBOR rate plus 2.25%.
Removed
Based on the applicable LIBOR in effect as of March 31, 2022, each quarter point change in interest rates on the outstanding amount under the IP Credit Facility would result in a $0.3 million change in annual net interest expense on the IP Credit Facility.
Removed
(2) The effective interest rate in the table above is before the impact of interest rate swaps. (3) In April 2022, the Company voluntarily prepaid the entire outstanding principal amount of the 2023 Term Loan A of $193.6 million, together with accrued and unpaid interest (see Note 21 to our consolidated financial statements for subsequent events).
Removed
(4) Production and related loans include individual loans for the production of film and television programs that the Company produces or licenses and the Company's Production Tax Credit Facility.
Removed
Production Tax Credit Facility amounts represent outstanding amounts under our Production Tax Credit Facility at March 31, 2022, and the repayment date represents the maturity date of the Production Tax Credit Facility (January 27, 2025), however net advances and payments under the Production Tax Credit Facility can fluctuate depending on the amount of collateral available.
Removed
(5) IP Credit Facility amounts represent outstanding amounts under our IP Credit Facility at March 31, 2022, and repayment dates are based on the projected future cash flows generated from the exploitation of the rights, subject to a minimum guaranteed payment amount, as applicable.

Other STRZ 10-K year-over-year comparisons