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Segment Information | 9 Months Ended
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Dec. 31, 2016
Segment Reporting [Abstract] |
Segment Information | Segment Information The Company’s reportable segments have been determined based on the distinct nature of their operations, the Company's internal management structure, and the financial information that is evaluated regularly by the Company's chief operating decision maker. Following the Starz Merger (see Note 2), the Company has added a new segment from the Starz business and realigned business operations within Lionsgate and Starz under three reporting segments and made some changes in what is included and excluded from segment profit. The Company previously had two reportable business segments, consisting of the Motion Pictures and Television Production segments. Beginning in the period ended December 31, 2016, the Company now manages and reports its operating results in three reportable business segments: (1) Motion Pictures, (2) Television Production and (3) Media Networks. As a result, the Company has presented prior period segment data in a manner that conforms to the current period presentation (see further discussion below). Motion Pictures consists of the development and production of feature films, acquisition of North American and worldwide distribution rights, North American theatrical, home entertainment and television distribution of feature films produced and acquired, and worldwide licensing of distribution rights to feature films produced and acquired. As a result of the Starz Merger (see Note 2), beginning December 8, 2016, the Motion Pictures segment includes Starz's third-party distribution business, which is substantially the same as the Motion Pictures existing business. Television Production consists of the development, production and worldwide distribution of television productions including television series, television movies and mini-series, and non-fiction programming. Media Networks (which was previously not a reportable segment) consists of the licensing of premium subscription video programming to U.S. multichannel video programming distributors ("MVPDs") including cable operators, satellite television providers, telecommunication companies, and online video providers, and the licensing of the Media Networks' original series programming to subscription video-on-demand (“SVOD”) services, international television networks, home entertainment and other ancillary markets. In connection with the Starz Merger, the Company moved its start-up direct to consumer streaming services on its SVOD platforms under the Media Networks segment. In the ordinary course of business, the Company's reportable segments enter into transactions with one another. The most common types of intersegment transactions include licensing motion pictures or television production produced or acquired programming reported from the Motion Pictures and Television Production segments to the Media Networks segment, and certain fees charged to the Media Networks segment by the Television Production segment for the distribution of Media Networks' original series programming in ancillary markets. While intersegment transactions are treated like third-party transactions to determine segment performance, the revenues (and corresponding expenses or assets recognized by the segment that is the counterparty to the transaction) are eliminated in consolidation and, therefore, do not affect consolidated results. Segment information by business unit is presented in the table below. The Media Networks segment reflects the Starz network business from the date of acquisition (December 8, 2016), and the Lionsgate direct to consumer streaming services on SVOD platforms for the historical periods presented.
| Three Months Ended |  | Nine Months Ended
| December 31, |  | December 31,
| 2016 |  | 2015 |  | 2016 |  | 2015
| (Amounts in millions)
Segment revenues |  |  |  |  |  |  |
Motion Pictures | $ | 440 |  |  | $ | 506 |  |  | $ | 1,266 |  |  | $ | 1,135 |
Television Production | 229 |  |  | 165 |  |  | 595 |  |  | 421 |
Media Networks | 85 |  |  | — |  |  | 86 |  |  | — |
Intersegment eliminations | (2 | ) |  | — |  |  | (2 | ) |  | — |
| $ | 752 |  |  | $ | 671 |  |  | $ | 1,945 |  |  | $ | 1,556 |
Gross contribution |  |  |  |  |  |  |
Motion Pictures | $ | 77 |  |  | $ | 51 |  |  | $ | 153 |  |  | $ | 157 |
Television Production | 33 |  |  | 17 |  |  | 70 |  |  | 49 |
Media Networks | 41 |  |  | (1 | ) |  | 29 |  |  | (1 | )
Intersegment eliminations | (1 | ) |  | — |  |  | (1 | ) |  | — |
| $ | 150 |  |  | $ | 67 |  |  | $ | 251 |  |  | $ | 205 |
Segment general and administration |  |  |  |  |  |  |
Motion Pictures | $ | 26 |  |  | $ | 18 |  |  | $ | 74 |  |  | $ | 60 |
Television Production | 7 |  |  | 5 |  |  | 23 |  |  | 15 |
Media Networks | 8 |  |  | 3 |  |  | 14 |  |  | 3 |
| $ | 41 |  |  | $ | 26 |  |  | $ | 111 |  |  | $ | 78 |
Segment profit (loss) |  |  |  |  |  |  |
Motion Pictures | $ | 51 |  |  | $ | 33 |  |  | $ | 79 |  |  | $ | 97 |
Television Production | 26 |  |  | 12 |  |  | 47 |  |  | 34 |
Media Networks | 33 |  |  | (4 | ) |  | 15 |  |  | (4 | )
Intersegment eliminations | (1 | ) |  | — |  |  | (1 | ) |  | — |
| $ | 109 |  |  | $ | 41 |  |  | $ | 140 |  |  | $ | 127 |
Following the Starz Merger, beginning in the quarter ended December 31, 2016, the Company has revised what it will include and exclude from segment profit (loss), the primary measure used by management to evaluate segment performance. Segment profit (loss) continues to be defined as gross contribution (segment revenues, less segment direct operating and distribution and marketing expense) less segment general and administration expenses. However, segment general and administrative expenses will include annual bonuses whether granted in stock or paid in cash, which were previously included in corporate general and administrative expenses and stock-based compensation, respectively. In addition, segment profit will no longer exclude start-up costs of direct to consumer streaming services on its SVOD platforms, non-cash imputed interest charge, and backstopped prints and advertising ("P&A") expense. Segment profit will continue to exclude purchase accounting and related adjustments. As a result of the changes to the segments and definition of segment profit, the Company has presented prior period segment data in a manner that conforms to the current period presentation. The reconciliation of total segment profit to the Company’s loss before income taxes is as follows:
| Three Months Ended |  | Nine Months Ended
| December 31, |  | December 31,
| 2016 |  | 2015 |  | 2016 |  | 2015
| (Amounts in millions)
Company’s total segment profit | $ | 109 |  |  | $ | 41 |  |  | $ | 140 |  |  | $ | 127 |
Corporate general and administrative expenses | (25 | ) |  | (17 | ) |  | (68 | ) |  | (54 | )
Adjusted depreciation and amortization(1) | (4 | ) |  | (3 | ) |  | (13 | ) |  | (7 | )
Restructuring and other(2) | (52 | ) |  | (13 | ) |  | (70 | ) |  | (18 | )
Adjusted share-based compensation expense(3) | (22 | ) |  | (13 | ) |  | (52 | ) |  | (48 | )
Purchase accounting and related adjustments(4) | (13 | ) |  | (4 | ) |  | (25 | ) |  | (4 | )
Operating loss | (7 | ) |  | (9 | ) |  | (88 | ) |  | (4 | )
Interest expense | (27 | ) |  | (14 | ) |  | (58 | ) |  | (40 | )
Interest and other income | 1 |  |  | — |  |  | 4 |  |  | 2 |
Gain on Starz investment | 20 |  |  | — |  |  | 20 |  |  | — |
Loss on extinguishment of debt | (28 | ) |  | — |  |  | (28 | ) |  | — |
Equity interests income | (2 | ) |  | 11 |  |  | 11 |  |  | 29 |
Loss before income taxes | $ | (43 | ) |  | $ | (12 | ) |  | $ | (139 | ) |  | $ | (13 | )
___________________
(1) | Adjusted depreciation and amortization represents depreciation and amortization as presented on our unaudited condensed consolidated statements of operations less the depreciation and amortization related to the non-cash fair value adjustments to property and equipment and intangible assets acquired in the acquisition of Starz and Pilgrim Media Group which are included in the purchase accounting and related adjustments line item above.
(2) | Restructuring and other includes restructuring and severance costs, certain transaction related costs, and certain unusual items, when applicable (see Note 14).
(3) | Adjusted share-based compensation expense represents share-based compensation excluding (i) immediately vested stock awards granted as part of our annual bonus program issued in lieu of cash bonuses, which are included in segment and corporate general and administrative expenses, and (ii) the impact of the acceleration of certain vesting schedules for equity awards pursuant to certain severance arrangements, when included in restructuring and other expenses (see Note 12 and Note 14).
(4) | Purchase accounting and related adjustments represent the amortization of non-cash fair value adjustments to the assets and liabilities acquired in the acquisition of Starz and Pilgrim Media Group. The following sets forth the amounts included in each line item in the financial statements:
| Three Months Ended |  | Nine Months Ended
| December 31, |  | December 31,
| 2016 |  | 2015 |  | 2016 |  | 2015
| (Amounts in millions)
Purchase accounting and related adjustments: |  |  |  |  |  |  |
Direct operating | $ | 3 |  |  | $ | 3 |  |  | $ | 11 |  |  | $ | 3 |
General and administrative expense | 1 |  |  | 1 |  |  | 4 |  |  | 1 |
Depreciation and amortization | 9 |  |  | — |  |  | 10 |  |  | — |
| $ | 13 |  |  | $ | 4 |  |  | $ | 25 |  |  | $ | 4 |
The following table sets forth revenues by media or product line as broken down by segment for the three and nine months ended December 31, 2016 and 2015:
| Three Months Ended |  | Nine Months Ended
| December 31, |  | December 31,
| 2016 |  | 2015 |  | 2016 |  | 2015
| (Amounts in millions)
Segment revenues: |  |  |  |  |  |  |
Motion Pictures |  |  |  |  |  |  |
Theatrical | $ | 87 |  |  | $ | 183 |  |  | $ | 197 |  |  | $ | 232 |
Home Entertainment | 167 |  |  | 126 |  |  | 467 |  |  | 389 |
Television | 91 |  |  | 49 |  |  | 214 |  |  | 157 |
International | 90 |  |  | 140 |  |  | 372 |  |  | 333 |
Other | 5 |  |  | 8 |  |  | 16 |  |  | 24 |
Total Motion Pictures revenues | $ | 440 |  |  | $ | 506 |  |  | $ | 1,266 |  |  | $ | 1,135 |
Television Production |  |  |  |  |  |  |
Domestic Television | $ | 174 |  |  | $ | 121 |  |  | $ | 481 |  |  | $ | 268 |
International | 31 |  |  | 26 |  |  | 75 |  |  | 112 |
Home Entertainment | 23 |  |  | 16 |  |  | 33 |  |  | 36 |
Other | 1 |  |  | 2 |  |  | 6 |  |  | 5 |
Total Television Production revenues | $ | 229 |  |  | $ | 165 |  |  | $ | 595 |  |  | $ | 421 |
Media Networks |  |  |  |  |  |  |
Starz Networks | $ | 83 |  |  | $ | — |  |  | $ | 83 |  |  | $ | — |
Content and Other | 1 |  |  | — |  |  | 1 |  |  | — |
Streaming Services | 1 |  |  | — |  |  | 2 |  |  | — |
Total Media Networks revenues | $ | 85 |  |  | $ | — |  |  | $ | 86 |  |  | $ | — |
Intersegment eliminations | (2 | ) |  | — |  |  | (2 | ) |  | — |
Total revenues | $ | 752 |  |  | $ | 671 |  |  | $ | 1,945 |  |  | $ | 1,556 |
The reconciliation of total segment assets to the Company’s total consolidated assets is as follows:
| December 31, 2016 |  | March 31, 2016
| (Amounts in millions)
Assets |  |  |
Motion Pictures | $ | 1,813 |  |  | $ | 1,924 |
Television Production | 1,158 |  |  | 1,130 |
Media Networks | 5,359 |  |  | — |
Other unallocated assets(1) | 1,050 |  |  | 780 |
| $ | 9,380 |  |  | $ | 3,834 |
_____________________
(1) | Other unallocated assets primarily consist of cash, other assets and investments.
The following table sets forth acquisition of investment in films and television programs and program rights, as broken down by segment for the three and nine months ended December 31, 2016 and 2015:
| Three Months Ended |  | Nine Months Ended
| December 31, |  | December 31,
| 2016 |  | 2015 |  | 2016 |  | 2015
| (Amounts in millions)
Acquisition of investment in films and television programs and program rights |  |  |  |  |  |  |
Motion Pictures | $ | 76 |  |  | $ | 140 |  |  | $ | 267 |  |  | $ | 504 |
Television Production | 106 |  |  | 96 |  |  | 345 |  |  | 267 |
Media Networks | 31 |  |  | — |  |  | 48 |  |  | — |
| $ | 213 |  |  | $ | 236 |  |  | $ | 660 |  |  | $ | 771 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8981-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9038-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8971-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8595-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8984-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9031-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8538-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8864-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8924-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8906-108599 + Details
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