Consolidating Financial Information — Convertible Senior Subordinated Notes

The April 2013 1.25% Notes by their terms, are fully and unconditionally guaranteed by the Company. LGEI, the issuer of the April 2013 1.25% Notes that are guaranteed by the Company, is 100% owned by the parent company guarantor, Lions Gate Entertainment Corp.

The following tables present condensed consolidating financial information as of March 31, 2017 and March 31, 2016, and for the years ended March 31, 2017, 2016 and 2015 for (1) the Company, on a stand-alone basis, (2) LGEI, on a stand-alone basis, (3) the non-guarantor subsidiaries of the Company (including the subsidiaries of LGEI), on a combined basis (collectively, the “Non-guarantor Subsidiaries”) and (4) the Company, on a consolidated basis.



	As of
	March 31, 2017
	Lions Gate Entertainment Corp.		Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries		Consolidating Adjustments			Lions Gate Consolidated
	(Amounts in millions)
BALANCE SHEET
Assets
Cash and cash equivalents	$	15.1	$	160.6		$	146.2	$	—		$	321.9
Restricted cash	—		2.8			—		—			2.8
Accounts receivable, net	0.6		1.7			905.8		—			908.1
Program rights	—		—			261.7		—			261.7
Other current assets	—		21.0			179.7		(4.8		)	195.9
Total current assets	15.7		186.1			1,493.4		(4.8		)	1,690.4
Investment in films and television programs and program rights, net	—		6.5			1,723.0		—			1,729.5
Property and equipment, net	—		36.3			129.2		—			165.5
Investments	40.1		18.0			313.4		—			371.5
Intangible assets	—		—			2,046.7		—			2,046.7
Goodwill	10.2		—			2,690.3		—			2,700.5
Other assets	—		17.1			455.7		—			472.8
Deferred tax assets	20.0		290.8			—		(290.8		)	20.0
Subsidiary investments and advances	5,451.0		1,413.3			5,738.7		(12,603.0		)	—
	$	5,537.0	$	1,968.1		$	14,590.4	$	(12,898.6	)	$	9,196.9
Liabilities and Shareholders' Equity (Deficiency)
Accounts payable and accrued liabilities	24.1		75.3			473.6		—			573.0
Participations and residuals	—		3.5			511.4		—			514.9
Film obligations and production loans	—		—			367.2		—			367.2
Debt - short term portion	70.0		—			7.9		—			77.9
Deferred revenue	—		2.4			154.5		—			156.9
Total current liabilities	94.1		81.2			1,514.6		—			1,689.9
Debt	2,928.6		53.7			64.7		—			3,047.0
Participations and residuals	—		—			359.7		—			359.7
Film obligations and production loans	—		—			116.0		—			116.0
Other liabilities	—		—			50.3		—			50.3
Dissenting shareholders liability	—		—			812.9		—			812.9
Deferred revenue	—		—			72.7		—			72.7
Deferred tax liabilities	—		—			731.0		(290.8		)	440.2
Intercompany payable	—		2,314.6			4,643.7		(6,958.3		)	—
Redeemable noncontrolling interest	—		—			93.8		—			93.8
Total shareholders' equity (deficiency)	2,514.3		(481.4		)	6,131.0		(5,649.5		)	2,514.4
	$	5,537.0	$	1,968.1		$	14,590.4	$	(12,898.6	)	$	9,196.9



	Year Ended
	March 31, 2017
	Lions Gate Entertainment Corp.			Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries			Consolidating Adjustments			Lions Gate Consolidated
				(Amounts in millions)
STATEMENT OF OPERATIONS
Revenues	$	—		$	17.0		$	3,184.5		$	—		$	3,201.5
EXPENSES:
Direct operating	—			1.7			1,902.1			—			1,903.8
Distribution and marketing	—			1.7			805.1			—			806.8
General and administration	1.1			129.0			226.6			(1.3		)	355.4
Depreciation and amortization	—			11.0			52.1			—			63.1
Restructuring and other	4.0			71.7			13.0			—			88.7
Total expenses	5.1			215.1			2,998.9			(1.3		)	3,217.8
OPERATING INCOME (LOSS)	(5.1		)	(198.1		)	185.6			1.3			(16.3		)
Other expenses (income):
Interest expense	84.1			225.8			263.1			(457.8		)	115.2
Interest and other income	(278.8		)	—			(184.8		)	457.2			(6.4		)
Gain on Starz investment	(20.4		)	—			—			—			(20.4		)
Loss on extinguishment of debt	34.1			3.2			3.1			—			40.4
Total other expenses (income)	(181.0		)	229.0			81.4			(0.6		)	128.8
INCOME (LOSS) BEFORE EQUITY INTERESTS AND INCOME TAXES	175.9			(427.1		)	104.2			1.9			(145.1		)
Equity interests income (loss)	(171.3		)	112.7			18.1			51.2			10.7
INCOME (LOSS) BEFORE INCOME TAXES	4.6			(314.4		)	122.3			53.1			(134.4		)
Income tax provision (benefit)	(10.2		)	(140.8		)	47.7			(45.6		)	(148.9		)
NET INCOME (LOSS)	14.8			(173.6		)	74.6			98.7			14.5
Less: Net loss attributable to noncontrolling interest	—			—			—			0.3			0.3
Net income (loss) attributable to Lions Gate Entertainment Corp. shareholders	$	14.8		$	(173.6	)	$	74.6		$	99.0		$	14.8



	Year Ended
	March 31, 2017
	Lions Gate Entertainment Corp.			Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries			Consolidating Adjustments			Lions Gate Consolidated
STATEMENT OF COMPREHENSIVE INCOME (LOSS)				(Amounts in millions)
NET INCOME (LOSS)	$	14.8		$	(173.6	)	$	74.6		$	98.7		$	14.5
Foreign currency translation adjustments, net of tax	(3.0		)	(14.0		)	(11.3		)	20.2			(8.1		)
Net unrealized gain on available-for-sale securities, net of tax	56.4			—			56.4			(56.4		)	56.4
Reclassification adjustment for gain on available-for-sale securities realized in net income	(17.8		)	—			(17.8		)	17.8			(17.8		)
Net unrealized loss on foreign exchange contracts, net of tax	(3.5		)	—			(3.5		)	3.5			(3.5		)
COMPREHENSIVE INCOME (LOSS)	46.9			(187.6		)	98.4			83.8			41.5
Less: Comprehensive loss attributable to noncontrolling interest	—			—			—			0.3			0.3
Comprehensive income (loss) attributable to Lions Gate Entertainment Corp. shareholders	$	46.9		$	(187.6	)	$	98.4		$	84.1		$	41.8



	Year Ended
	March 31, 2017
	Lions Gate Entertainment Corp.			Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries			Consolidating Adjustments		Lions Gate Consolidated
	(Amounts in millions)
STATEMENT OF CASH FLOWS
NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	(2,121.9	)	$	145.2		$	2,535.3		$	—	$	558.6
INVESTING ACTIVITIES:
Investment in equity method investees	—			(4.2		)	(16.4		)	—		(20.6		)
Distributions from equity method investees	—			0.4			2.7			—		3.1
Purchase of Starz, net of cash acquired of $73.5	—			—			(1,102.6		)	—		(1,102.6		)
Capital expenditures	—			(8.9		)	(16.3		)	—		(25.2		)
NET CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES	—			(12.7		)	(1,132.6		)	—		(1,145.3		)
FINANCING ACTIVITIES:
Debt - borrowings	4,002.8			—			—			—		4,002.8
Debt - repayments	(1,824.1		)	—			(942.8		)	—		(2,766.9		)
Production loans - borrowings	—			—			296.0			—		296.0
Production loans - repayments	—			—			(632.6		)	—		(632.6		)
Dividends paid	(26.8		)	—			—			—		(26.8		)
Distributions to noncontrolling interest	—			—			(6.9		)	—		(6.9		)
Exercise of stock options	25.4			—			—			—		25.4
Tax withholding required on equity awards	(40.9		)	—			—			—		(40.9		)
NET CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES	2,136.4			—			(1,286.3		)	—		850.1
NET CHANGE IN CASH AND CASH EQUIVALENTS	14.5			132.5			116.4			—		263.4
FOREIGN EXCHANGE EFFECTS ON CASH	—			—			0.8			—		0.8
CASH AND CASH EQUIVALENTS — BEGINNING OF PERIOD	0.6			28.1			29.0			—		57.7
CASH AND CASH EQUIVALENTS — END OF PERIOD	$	15.1		$	160.6		$	146.2		$	—	$	321.9



	As of
	March 31, 2016
	Lions Gate Entertainment Corp.		Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries		Consolidating Adjustments			Lions Gate Consolidated
	(Amounts in millions)
BALANCE SHEET
Assets
Cash and cash equivalents	$	0.6	$	28.1		$	29.0	$	—		$	57.7
Restricted cash	—		2.9			—		—			2.9
Accounts receivable, net	0.7		1.6			567.8		—			570.1
Other current assets	0.3		17.9			218.7		—			236.9
Total current assets	1.6		50.5			815.5		—			867.6
Investment in films and television programs, net	—		6.4			1,451.2		—			1,457.6
Property and equipment, net	—		36.2			7.2		—			43.4
Investments	40.1		15.3			408.9		—			464.3
Intangible assets	—		—			11.4		—			11.4
Goodwill	10.2		—			524.6		—			534.8
Other assets	—		24.2			301.9		(5.4		)	320.7
Deferred tax assets	1.5		121.7			11.2		—			134.4
Subsidiary investments and advances	1,584.2		1,518.3			3,095.0		(6,197.5		)	—
	$	1,637.6	$	1,772.6		$	6,626.9	$	(6,202.9	)	$	3,834.2
Liabilities and Shareholders' Equity (Deficiency)
Accounts payable and accrued liabilities	22.1		89.9			242.9		—			354.9
Participations and residuals	—		2.6			434.7		—			437.3
Film obligations and production loans	—		—			663.2		—			663.2
Debt - short term portion	—		40.1			—		—			40.1
Deferred revenue	—		—			246.4		—			246.4
Total current liabilities	22.1		132.6			1,587.2		—			1,741.9
Debt	765.2		59.9			—		—			825.1
Participations and residuals	—		1.0			169.1		—			170.1
Film obligations and production loans	—		—			51.8		—			51.8
Other liabilities	—		—			22.7		—			22.7
Deferred revenue	—		4.8			77.0		—			81.8
Intercompany payable	—		1,906.9			2,415.8		(4,322.7		)	—
Redeemable noncontrolling interest	—		—			90.5		—			90.5
Total shareholders' equity (deficiency)	850.3		(332.6		)	2,212.8		(1,880.2		)	850.3
	$	1,637.6	$	1,772.6		$	6,626.9	$	(6,202.9	)	$	3,834.2



	Year Ended
	March 31, 2016
	Lions Gate Entertainment Corp.			Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries			Consolidating Adjustments			Lions Gate Consolidated
	(Amounts in millions)
STATEMENT OF OPERATIONS
Revenues	$	—		$	23.7		$	2,324.2		$	(0.5	)	$	2,347.4
EXPENSES:
Direct operating	—			0.5			1,414.8			—			1,415.3
Distribution and marketing	—			6.5			655.3			—			661.8
General and administration	3.4			153.1			107.4			(1.5		)	262.4
Depreciation and amortization	—			9.3			3.8			—			13.1
Restructuring and other	3.1			6.0			10.7			—			19.8
Total expenses	6.5			175.4			2,192.0			(1.5		)	2,372.4
OPERATING INCOME (LOSS)	(6.5		)	(151.7		)	132.2			1.0			(25.0		)
Other expenses (income):
Interest expense	38.6			220.6			176.0			(380.3		)	54.9
Interest and other income	(209.4		)	(0.2		)	(172.1		)	379.8			(1.9		)
Total other expenses (income)	(170.8		)	220.4			3.9			(0.5		)	53.0
INCOME (LOSS) BEFORE EQUITY INTERESTS AND INCOME TAXES	164.3			(372.1		)	128.3			1.5			(78.0		)
Equity interests income (loss)	(113.2		)	182.7			46.7			(72.0		)	44.2
INCOME (LOSS) BEFORE INCOME TAXES	51.1			(189.4		)	175.0			(70.5		)	(33.8		)
Income tax provision (benefit)	0.9			(76.3		)	65.5			(66.6		)	(76.5		)
NET INCOME (LOSS)	50.2			(113.1		)	109.5			(3.9		)	42.7
Less: Net loss attributable to noncontrolling interest	—			—			—			7.5			7.5
Net income (loss) attributable to Lions Gate Entertainment Corp. shareholders	$	50.2		$	(113.1	)	$	109.5		$	3.6		$	50.2



	Year Ended
	March 31, 2016
	Lions Gate Entertainment Corp.			Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries			Consolidating Adjustments			Lions Gate Consolidated
STATEMENT OF COMPREHENSIVE INCOME (LOSS)	(Amounts in millions)
NET INCOME (LOSS)	$	50.2		$	(113.1	)	$	109.5		$	(3.9	)	$	42.7
Foreign currency translation adjustments, net of tax	(3.1		)	(4.3		)	(6.5		)	10.8			(3.1		)
Net unrealized loss on available-for-sale securities, net of tax	(37.6		)	—			(37.6		)	37.6			(37.6		)
Net unrealized gain on foreign exchange contracts, net of tax	(0.2		)	—			(0.2		)	0.2			(0.2		)
COMPREHENSIVE INCOME (LOSS)	$	9.3		$	(117.4	)	$	65.2		$	44.7		$	1.8
Less: Comprehensive loss attributable to noncontrolling interest	—			—			—			7.5			7.5
Comprehensive income (loss) attributable to Lions Gate Entertainment Corp. shareholders	$	9.3		$	(117.4	)	$	65.2		$	52.2		$	9.3



	Year Ended
	March 31, 2016
	Lions Gate Entertainment Corp.			Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries			Consolidating Adjustments		Lions Gate Consolidated
	(Amounts in millions)
STATEMENT OF CASH FLOWS
NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	(49.1	)	$	7.7		$	22.4		$	—	$	(19.0	)
INVESTING ACTIVITIES:
Investment in equity method investees and other investments	—			(8.6		)	(8.2		)	—		(16.8		)
Purchase of Pilgrim Media Group, net of cash acquired of $15.8	—			—			(126.9		)	—		(126.9		)
Capital expenditures	—			(18.3		)	(0.1		)	—		(18.4		)
NET CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES	—			(26.9		)	(135.2		)	—		(162.1		)
FINANCING ACTIVITIES:
Debt - borrowings	629.5			—			—			—		629.5
Debt - repayments	(444.5		)	—			—			—		(444.5		)
Production loans - borrowings	—			—			572.6			—		572.6
Production loans - repayments	—			—			(483.1		)	—		(483.1		)
Repurchase of common shares	(73.2		)	—			—			—		(73.2		)
Dividends paid	(47.5		)	—			—			—		(47.5		)
Exercise of stock options	6.1			—			—			—		6.1
Tax withholding required on equity awards	(24.2		)	—			—			—		(24.2		)
NET CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES	46.2			—			89.5			—		135.7
NET CHANGE IN CASH AND CASH EQUIVALENTS	(2.9		)	(19.2		)	(23.3		)	—		(45.4		)
FOREIGN EXCHANGE EFFECTS ON CASH	—			—			0.4			—		0.4
CASH AND CASH EQUIVALENTS — BEGINNING OF PERIOD	3.5			47.3			51.9			—		102.7
CASH AND CASH EQUIVALENTS — END OF PERIOD	$	0.6		$	28.1		$	29.0		$	—	$	57.7



	Year Ended
	March 31, 2015
	Lions Gate Entertainment Corp.			Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries			Consolidating Adjustments			Lions Gate Consolidated
	(Amounts in millions)
STATEMENT OF OPERATIONS
Revenues	$	—		$	29.6		$	2,370.7		$	(0.7	)	$	2,399.6
EXPENSES:
Direct operating	—			6.9			1,308.9			—			1,315.8
Distribution and marketing	—			1.2			590.3			—			591.5
General and administration	9.5			153.9			89.9			(0.5		)	252.8
Depreciation and amortization	—			4.1			2.5			—			6.6
Restructuring and other	1.8			6.0			2.9			—			10.7
Total expenses	11.3			172.1			1,994.5			(0.5		)	2,177.4
OPERATING INCOME (LOSS)	(11.3		)	(142.5		)	376.2			(0.2		)	222.2
Other expenses (income):
Interest expense	33.8			188.8			134.1			(304.2		)	52.5
Interest and other income	(172.5		)	(2.9		)	(131.2		)	303.7			(2.9		)
Loss on extinguishment of debt	6.7			5.0			—			—			11.7
Total other expenses (income)	(132.0		)	190.9			2.9			(0.5		)	61.3
INCOME (LOSS) BEFORE EQUITY INTERESTS AND INCOME TAXES	120.7			(333.4		)	373.3			0.3			160.9
Equity interests income (loss)	59.3			403.0			53.0			(462.8		)	52.5
INCOME (LOSS) BEFORE INCOME TAXES	180.0			69.6			426.3			(462.5		)	213.4
Income tax provision (benefit)	(1.8		)	10.3			63.4			(40.3		)	31.6
NET INCOME (LOSS)	181.8			59.3			362.9			(422.2		)	181.8
Less: Net loss attributable to noncontrolling interest	—			—			—			—			—
Net income (loss) attributable to Lions Gate Entertainment Corp. shareholders	$	181.8		$	59.3		$	362.9		$	(422.2	)	$	181.8



	Year Ended
	March 31, 2015
	Lions Gate Entertainment Corp.			Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries			Consolidating Adjustments			Lions Gate Consolidated
STATEMENT OF COMPREHENSIVE INCOME (LOSS)	(Amounts in millions)
NET INCOME (LOSS)	$	181.8		$	59.3		$	362.9		$	(422.2	)	$	181.8
Foreign currency translation adjustments, net of tax	(0.9		)	(3.5		)	(1.9		)	(0.1		)	(6.4		)
Net unrealized loss on available-for-sale securities, net of tax	—			—			2.7			—			2.7
Net unrealized gain on foreign exchange contracts, net of tax	—			—			2.8			—			2.8
COMPREHENSIVE INCOME (LOSS)	$	180.9		$	55.8		$	366.5		$	(422.3	)	$	180.9
Less: Comprehensive loss attributable to noncontrolling interest	—			—			—			—			—
Comprehensive income (loss) attributable to Lions Gate Entertainment Corp. shareholders	$	180.9		$	55.8		$	366.5		$	(422.3	)	$	180.9



	Year Ended
	March 31, 2015
	Lions Gate Entertainment Corp.			Lions Gate Entertainment Inc.			Non-guarantor Subsidiaries			Consolidating Adjustments		Lions Gate Consolidated
	(Amounts in millions)
STATEMENT OF CASH FLOWS
NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	171.2		$	62.9		$	(137.6	)	$	—	$	96.5
INVESTING ACTIVITIES:
Proceeds from the sale of equity method investees	—			—			14.5			—		14.5
Investment in equity method investees and other investments	(27.9		)	(6.7		)	(18.1		)	—		(52.7		)
Capital expenditures	—			(14.9		)	(2.1		)	—		(17.0		)
NET CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES	(27.9		)	(21.6		)	(5.7		)	—		(55.2		)
FINANCING ACTIVITIES:
Debt - borrowings	1,149.2			—			—			—		1,149.2
Debt - repayments	(1,105.6		)	—			—			—		(1,105.6		)
Production loans - borrowings	—			—			631.7			—		631.7
Production loans - repayments	—			—			(449.6		)	—		(449.6		)
Repurchase of common shares	(144.8		)	—			—			—		(144.8		)
Dividends paid	(33.4		)	—			—			—		(33.4		)
Exercise of stock options	6.8			—			—			—		6.8
Tax withholding required on equity awards	(20.1		)	—			—			—		(20.1		)
NET CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES	(147.9		)	—			182.1			—		34.2
NET CHANGE IN CASH AND CASH EQUIVALENTS	(4.6		)	41.3			38.8			—		75.5
FOREIGN EXCHANGE EFFECTS ON CASH	—			—			1.5			—		1.5
CASH AND CASH EQUIVALENTS — BEGINNING OF PERIOD	8.1			6.0			11.6			—		25.7
CASH AND CASH EQUIVALENTS — END OF PERIOD	$	3.5		$	47.3		$	51.9		$	—	$	102.7