With many companies reporting big drops in profits during this earnings season, it's nice to see movie and television producer Lions Gate Entertainment (NYSE: LGF) weigh in with strong results. Maybe there's something to be said for the idea that entertainment is recession-proof after all.

The folks who are paid to know everything about this company predicted that it would post a $0.05-per-share loss on revenues of just over $330 million. In reality, though, Lions Gate came through with a profit of $0.30 per diluted share on $387.7 million in sales during its first quarter, which ended June 30.

Action!
Lions Gate is moving quickly with plans on a number of fronts. Along with Paramount, it agreed to allow DivX (Nasdaq: DIVX) to showcase several of its titles online. Lions Gate will distribute its DVDs through Coinstar 's (Nasdaq: CSTR) Redbox.

There's also the ongoing squabble with Carl Icahn over his lack of representation on the company's board of directors. The activist shareholder has been lobbying the company for multiple seats on its 12-member board for quite some time, but to no avail. Right now, the mogul owns about 17% of the company, having bought more shares recently in a possible attempt to pressure management into making concessions.

The big growth drivers for the quarter were film revenue -- especially from Mandate Pictures, which it acquired in 2007 -- and its TV production business.

Entertainment value
Sales attributable to the Mandate Pictures subsidiary jumped sixfold, because of contributions from hits like Sam Raimi's Drag Me to Hell. With its subsidiaries, Lions Gate has established itself as a leader in independent film production, and from Rambo to Hostel to Bratz, its works have always covered a wide array of movie genres.

Television revenue more than doubled on series licensing from its Lionsgate Television subsidiary, which produces shows like Mad Men, Weeds, and Nurse Jackie. Its acquisition of TV Guide earlier this year, as well as its joint venture with ISH Entertainment, also helped. Additionally, in conjunction with Liberty Media (Nasdaq: LCAPA), Lions Gate is co-producing the second season of the popular television series Crash, which will air this fall on Starz.

Decision time
What sets Lions Gate apart from companies like DreamWorks (Nasdaq: DWA), Time Warner (NYSE: TWX), and Walt Disney (NYSE: DIS) is the fact that it's a publicly traded, pure-play movie and television media company. It hasn't matured and gone the way of near-conglomerate Time Warner, and it's not entrenched in kiddie entertainment like DreamWorks and Disney. But unlike privately held Paramount, you can buy shares of Lions Gate.

If Lions Gate continues on this path, it could be one of the better investment turnaround stories of this year. By the time Rambo V comes out in 2011, I expect Lions Gate's shares will be much less affordable.

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