Lionsgate Studios Corp.LION

Lionsgate Studios Corp. Fair Value Disclosure

10-KFiled May 27, 20263 min read
Fair Value Measurements
Fair Value

Accounting guidance and standards about fair value define fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Fair Value Hierarchy

Fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The accounting guidance and standards establish three levels of inputs that may be used to measure fair value:

•Level 1 — Quoted prices in active markets for identical assets or liabilities.
•Level 2 — Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (fewer active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities.
•Level 3 — Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities.

Assets and liabilities required to be carried at fair value on a recurring basis as of March 31, 2026 and 2025 were as follows:
March 31, 2026March 31, 2025
Level 1Level 2TotalLevel 1Level 2Total
(Amounts in millions)
Assets:
Forward exchange contracts (see Note 19)— — $— — 1.8 $1.8 
Liabilities:
Forward exchange contracts (see Note 19)— 2.7 $2.7 — — $— 
Interest rate swaps (see Note 19)— 1.6 $1.6 — 3.1 $3.1 
The carrying values and fair values of the Company’s outstanding debt and film related obligations as of March 31, 2026 and 2025 were as follows:
 
March 31, 2026March 31, 2025
Carrying
Value
Fair Value(1)
Carrying
Value
Fair Value(1)
 (Level 2)(Level 2)
(Amounts in millions)
Term Loan A$— $— $313.4 $312.9 
Revolving Credit Facility— — — — 
Senior Notes383.1 359.6 381.6 360.9 
eOne IP Credit Facility366.7 371.3 317.6 323.0 
LG IP Credit Facility1,172.5 1,187.5 962.9 978.8 
3 Arts Credit Facility30.1 30.7 — — 
Production Loans1,280.5 1,283.9 1,393.9 1,395.4 
Production Tax Credit Facility364.8 368.0 276.2 280.0 
Backlog Facility and Other304.6 307.2 238.4 238.9 
Film Library Facility— — 74.4 75.9 
 ______________________
(1)The Company measures the fair value of its outstanding debt and interest rate swaps using discounted cash flow techniques that use observable market inputs, such as SOFR-based yield curves, swap rates, and credit ratings (Level 2 measurements).

The Company’s financial instruments also include cash and cash equivalents, accounts receivable, accounts payable, content related payables, other accrued liabilities and other liabilities. The carrying values of these financial instruments approximated their fair values as of March 31, 2026 and 2025.
Financial and nonfinancial assets and liabilities measured on a non-recurring basis that are adjusted to fair value when a significant event occurs include the Company’s goodwill, intangible assets, equity method investments and film and television costs.

Historical Timeline

Fiscal YearFiled
2026May 27, 2026Showing above
2025May 30, 2025

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

Income TaxesRevenuePP&EGoodwill & IntangiblesLeasesSegmentsDebtCommitmentsNew StandardsPay vs Performance