LIONS GATE ENTERTAINMENT CORP. (Exact Name of Registrant As Specified in Its Charter)
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Dear Shareholders: Lionsgate achieved record revenues in fiscal 2009 and continued its growth as a strong and diversified Company with leadership positions in its core businesses and emerging markets. We achieved our best quarterly theatrical box office performance in the January to March 2009 quarter, and our upcoming motion picture slate highlights the breadth of our talent relationships, the distinctiveness of our content and the strength of our disciplined financial model. The iconic Mad Men, Weeds and Tyler Perry brands continued to lead the way for a critically acclaimed and commercially potent television business that now encompasses more than 20 shows on ten different networks. We have built our television operations into an industry leader with a portfolio of assets, unique content creation capabilities and full pipelines of product that should continue to translate into value for our shareholders in the years to come. Our home entertainment business generated major studio level market share and the best box office-to-DVD revenue conversion rate in the industry last year, and we are well positioned for growth in the digital markets of the future. We continued to create new distribution platforms to complement our content leadership and marketing skills, as we acquired TV Guide Network and TV Guide.com with JPMorgan's One Equity Partners, launched the KIX and Thrill branded action and horror channels in Asia, and prepared to launch our Epix multiplatform channel with partners Viacom and MGM. During fiscal 2009, we saw the numerous entrepreneurial businesses that comprise the Lionsgate family, including Debmar-Mercury, Mandate Pictures, Lionsgate UK, the FEARnet branded horror channel, ISH Entertainment, Maple Pictures and Break Media, deliver returns on our investment as they begin to realize their tremendous potential. Along with this significant growth, we are pleased to report that we were also able to reduce our costs across our businesses, reflecting our dual focus on cost management and revenue enhancement. We are always looking for ways to become even more efficient in all of our operations, and we will continue our rigorous focus on the cost side of our business. We enter fiscal 2010 positioned to achieve strong financial results and to continue growing our diversified portfolio of assets. We will continue to cultivate our distinctive franchises in all media, build upon our leadership in businesses that play to our unique strengths, and identify new and emerging markets that we believe will become part of the Lionsgate growth story in the years to come. The Lionsgate brand has never been stronger. Attached to this letter is our Form 10-K for fiscal 2009. Sincerely, Jon Feltheimer Co-Chairman and Chief Executive Officer UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ______________________________ Form 10-K (Mark One) 5 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended March 31, 2009 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File No. 1-14880 LIONS GATE ENTERTAINMENT CORP. (Exact Name of Registrant as Specified in Its Charter) British Columbia, Canada N/A (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) ____________________________ 1055 West Hastings Street, Suite 2200 2700 Colorado Avenue, Suite 200 Vancouver, British Columbia V6E 2E9 Santa Monica, California 90404 (877) 848-3866 (310) 449-9200 (Address of Principal Executive Offices, Zip Code) Registrant’s telephone number, including area code: (877) 848-3866 Securities registered pursuant to Section 12(b) of the Act: Title of Each Class Name of Each Exchange on Which Registered Common Shares, without par value New York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None ____________________________ Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No 5 Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Securities Exchange Act. Yes No 5 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or Section 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes 5 No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer 5 Accelerated filer Non accelerated filer Smaller reporting company (Do not check if a smaller reporting company) Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No 5 The aggregate market value of the voting stock held by non-affiliates of the registrant as of September 30, 2008 (the last business day of the registrant’s most recently completed second fiscal quarter) was approximately $1,014,150,710, based on the closing sale price as reported on the New York Stock Exchange. As of May 22, 2009, 117,032,091 shares of the registrant’s no par value common shares were outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s definitive proxy statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A and relating to the registrant’s 2009 annual meeting of shareholders are incorporated by reference into Part III. Page PART I Item 1. Business................................................................................................................................................... 3 Item 1A. Risk Factors.......................................................................................................................................... 20 Item 1B. Unresolved Staff Comments................................................................................................................. 33 Item 2. Properties................................................................................................................................................. 33 Item 3. Legal Proceedings ................................................................................................................................... 34 Item 4. Submission of Matters to a Vote of Security Holders ............................................................................. 34 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities................................................................................................................................................ 34 Item 6. Selected Consolidated Financial Data ..................................................................................................... 38 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations .................. 40 Item 7A. Quantitative and Qualitative Disclosures About Market Risk.............................................................. 67 Item 8. Financial Statements and Supplementary Data ....................................................................................... 68 Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure.................. 68 Item 9A. Controls and Procedures....................................................................................................................... 68 Item 9B. Other Information ................................................................................................................................. 71 PART III Item 10. Directors, Executive Officers and Corporate Governance .................................................................... 71 Item 11. Executive Compensation....................................................................................................................... 71 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters............................................................................................................................................................... 72 Item 13. Certain Relationships and Related Transactions, and Director Independence ...................................... 72 Item 14. Principal Accounting Fees and Services ..............................................................................................