With expenses for its new horror channel, FEARNet, higher than budgeted for, Lionsgate Entertainment Corp. (LGF) reported higher quarterly loss than expected. The result was a 3.76 percent drop in its share price, or 40 cents.
Lionsgate Chief Executive Jon Feltheimer told analysts: "If not for FEARNet and some stock option expenses ... we would likely be raising our guidance for all of our metrics at this time."
This was just a day after investors optimism drove the price to a new 18-month high, based upon Lionsgate's strength in "film franchises, fast expansion of its TV production business and strength of its film 
library."
For their second quarter of this fiscal year, they incurred a net loss of $14.4 million, or 14 cents a share. Last year they had a loss of $14.1 million or 14 cents a share during the same quarter.
The company said that earnings were lower than expected because the release date of "Employee of the Month", was changed from October to September. The result was that $17 million in costs weren't recovered from the release of the film.
The sales for their home video division were down by 4 percent to $115.1 million because they didn't release as many movies on DVD this quarter. They also had less money come in from licensing and international sales.
They should have a strong finish to the fiscal year though as it releases "Crank," "Employee of the Month," "Saw III," and "Descent" on DVD. Another just about for sure thing will be the release of the popular Tyler Perry's upcoming movie, "Tyler Perry's Daddy's Little Girls" on Feb. 14.
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