Home > Vulture News > Lionsgate CEO Blames ‘Killers’ For Tanking 1st Quarter Profits

Lionsgate CEO Blames ‘Killers’ For Tanking 1st Quarter Profits

This summer’s blockbuster movie season got off to a sluggish start with audiences staying away from the studio’s tent pole movies in droves. Even though it was far from the only disappointment at the box office, the Ashton Kutcher, Katherine Heigl rom-com, Killers, was the biggest fizzle of a group that included the likes of Prince of Persia, Marmaduke, Knight and Day and the bloated budget sequel, Sex and the City 2. When Lionsgate recently anounced it suffered a first quarter loss of $64.1 million, CEO Jon Feltheimer (pictured above) pointed blame on the failed blockbuster. He said:

Our first quarter was affected by marketing costs for our three wide releases, timing of television deliveries and the underperformance of our theatrical release Killers.

The movie was Lionsgate’s biggest budget movie ever and its worldwide gross was scarcely higher than the $75 million the studio poured into its production. It was supposed to strengthen the studio’s bottom line, but instead became a prime example of corporate mismanagement. The studio’s February release, Kick-Ass starring Christopher Mintz-Plasse (Superbad) was also met with audience indifference.

The announcement of the first quarter loss comes just as coporate raider/financeer Carl Icahn has threatened to sue the studio for not accepting his takeover bid. Icahn, Lionsgate’s biggest shareholder, launched a hostile takeover bid in March amidst frustrations over its stock performance.

The studio has managed to stave off a takeover, although that may change as its financial future becomes increasingly bleak. The back and forth infighting between the studio and Icahn, recently reached a head after the company announced a debt to equity swap that reduces Icahn’s share from 37.9% to 33.5%. Icahn released a statement decrying the transaction. He said:

We view this transaction as a prime example of scorched earth tactics executed with other people’s money – in this case, the money of Lions Gate shareholders – and they will be met with an equally forceful response.

The future of the studio will get sorted in the coming months and it will remain to be seen whether it can rebound with upcoming releases like Saw 3D.

[WENN, THR]

Categories: Vulture News