Disney Sees $200 Million Loss From ‘John Carter’ Picture
Stock Chart for Walt Disney Co/The (DIS)
Walt Disney Co. (DIS), the world’s largest entertainment company, said the box-office disappointment “John Carter” will post a loss of about $200 million, possibly the biggest ever for a single film.
The film division will report a fiscal second-quarter operating loss of $80 million to $120 million as result of the picture, Burbank, California-based Disney said yesterday in an e-mailed statement.
“I do think this is the largest loss on a single film that I have ever seen,” said Matthew Harrigan, an analyst with Wunderlich Securities in Denver who has followed the industry for 20 years. He has a hold rating on Disney stock.
“John Carter,” about a Civil War veteran transported to Mars, cost an estimated $250 million to produce, according to Box Office Mojo. The loss exceeded the estimate of Alan Gould, an analyst at Evercore Partners in New York. He said Disney is unlikely to commit such a sum again to an untested project.
“It’ll have to be an established franchise,” said Gould, who has an overweight or buy rating on the stock.
Disney fell 0.5 percent to $43.24 at the close in New York. The shares have advanced 15 percent this year.
The film, which opened March 9, has collected $184 million in worldwide ticket sales, according to the company. Studios split ticket revenue with theater operators.
“As we look forward to the second half of the year, we are excited about the upcoming releases of ‘The Avengers’ and ‘Brave,’ which we believe have tremendous potential to drive value for the studio and the rest of the company,” Disney said in its statement.
To boost profitability, the Disney studio has been making fewer movies and trying to focus on films with multipicture potential, such as Pixar’s animated features and the “Pirates of Caribbean” series. Rich Ross, who served as head of the company’s Disney Channel networks, took over the studio in October 2009.
“John Carter” is based on a 100-year-old series of novels by Tarzan creator Edgar Rice Burroughs. It marked the live- action debut for writer-director Andrew Stanton, who won Oscars for “Finding Nemo” and “Wall-E,” at Pixar.
Gould was expecting a $165 million loss for the movie and a break-even fiscal second quarter for the film unit.
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