Vancouver-based Lions Gate Entertainment recorded a third quarter loss of $3.1m for 2001-2002 as increasing distribution and marketing costs ate into revenue. It was the second consecutive losing quarter. Although gross profits were up 59% from the same period a year ago, distribution and marketing costs more than tripled.

Motion picture revenues increased 12.5% to $29.3m, one of the best single quarters ever, up from $26.1m in last year's third quarter. The company pointed to improving business in theatrical distribution, home video, video sell-through revenues and library sales, particularly the French-language pictures it distributed in Quebec, including Les Boys III, the highest-grossing Canadian film of 2001.

The company said it hopes to benefit from the Academy Award nominations of Halle Berry as Best Actress and Will Rokos and Milo Addica for Best Original Screenplay for Monster's Ball, which Lions Gate is distributing in North America.