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Jon Feltheimer, CEO of the first media company to report quarterly earnings since SAG-AFTRA struck a deal with studios, said he’s so pleased that “we can now all get back to making great content for a global audience.”
Speaking to Wall Streeter at the top of a call after the company’s second-quarter numbers, CFO Jimmy Barge put the impact of the strike on fiscal 2024 at about $30 million total — less than originally forecast, almost all at the television group and mostly in the September quarter. There could be a lingering $15-$20 million hit going forward around episodic delivery and increased costs for productions that had to shutter during the work stoppage.
Execs weighed in on how the company is situated as production restarts everywhere all at once, and the impact on costs longer term.
TV chief Kevin Beggs said things will move fast. “We have two network comedies [Extended Family, Ghosts] that are back in production Monday. We are sprinting to get Power Book IV back into production [and] trying to mitigate the costs when we can. There are some costs associated with series delays and are definitely a couple of series casualties due to the strike…but we actually mitigated those pretty well.”
Lionsgate will do its best to manage “enhanced costs both on the writing and performing side [and] to pass along the cost to the buyers. Everyone is in the same boat, so everyone knows the cost is coming.”
Motion picture chair Joe Drake said the studio “was able to secure a number of waivers and really lined our productions up so that as soon as we came out of the strike we could be running.” The Antione Fuqua-directed Michael Jackson biopic starts in January. Now You See Me 3 and a Highlander reboot with Henry Cavill are also up next year. “We got ahead of it really nicely.”
Of the new set of overall costs related to enhanced contracts that writers and actors fought for, Feltheimer said, “There is no question about it, there’s going to be some cost attached to this. But that is okay. Maybe we have to work a little harder to take some of the costs out of the business, things that we can actually manage.”
Beggs and Starz CEO Jeff Hirsch, for instance, “are really working to really be smart about the slate for Starz that they are putting together. We’ve just got to continue to be really thoughtful about the business… about how we pay for things. And again, I think that they’ve come up with something that’s really equitable for all the participants. And so we’ve all just got to figure out a smart way to pay for it.”
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