Anousha Sakoui Los Angeles
DREAMWORKS Animation, the studio that made the blockbuster Shrek movies, is struggling to get kids to show up for its pictures.
The independent filmmaker’s newest feature, Home, about a lovable purple alien, opens on Friday in the US, and some Wall Street analysts are expressing concern the Glendale, California- based company may have another money-losing picture with its only release this year.
That would be a setback for founder and chief executive Jeffrey Katzenberg, who has led the studio for two decades. DreamWorks Animation has released only two to three pictures a year, and four of the past six have lost money. In recent months, the chief executive has cut jobs, closed offices and trimmed his release schedule by dropping some projects – including the other film planned for this year.
“I remain concerned about the likelihood for disappointing results and a write-down,” said Eric Wold, an analyst at B Riley, who downgraded the stock to neutral from buy last week.
Wold predicts Home will produce $85 million (R1 billion) in ticket sales for its full run in US and Canadian theatres and $170 million outside the US, not enough to recoup the $135 million production cost after splitting revenue with theatres and paying the distributor, 21st Century Fox.
DreamWorks Animation officials declined to comment on whether the film would lose money.
Home also faced competition from other kids’ films, including two Walt Disney pictures: Cinderella and a new Avengers on May 1, according to Tony Wible, an analyst at Janney Montgomery Scott. He has a sell rating on DreamWorks Animation and has also suggested Home might lose money.
Sales forecast
Barton Crockett, an analyst at FBR, is more optimistic. He sees $140 million in domestic sales and as much as $297 million outside the US, enough to earn $9 million on Home.
DreamWorks Animation and Fox predicted a weekend opening in the mid-$30 million range in the US, according to a Fox spokesman. The film could also benefit from the extended Easter weekend in early April. BoxOffice.com forecasts $26 million for the opening weekend in the US. Home had already collected $20.1 million internationally, according to Fox.
In Home, pop star Rihanna provides the voice of Tip, an adventurous girl who forms a friendship with the alien Oh, played by Jim Parsons of The Big Bang Theory. Jennifer Lopez supplies the voice of a third character, Lucy. Tip is the first black lead character in a DreamWorks Animation film.
Both women sing in the film and have helped promote the picture. Rihanna posted pictures of herself to her 16 million Instagram followers, including one with a stuffed toy Oh. Lopez posted a shot to her almost 13 million fans, saying it “feels good to just be #Home”. She also appeared on American Idol last week to perform the song Feel the Light.
Fighting chance
“Search numbers suggest parents are taking notice and Twitter buzz around the top-level talent means Home is at least on people’s radars, which gives it a fighting chance at a solid box-office haul,” said Tobi Bauckhage, the chief executive of researcher Moviepilot.
Reviews for Home have been mostly negative, with just nine of 22 providing a thumbs-up at Rottentomatoes.com, a site that aggregates critics’ comments. Film fans have been more upbeat, with 92 percent of more than 18 500 fans at the site saying they want to see it.
Since DreamWorks Animation wowed audiences with the Shrek films, competition has increased. Last year’s top-grossing animated pictures included The Lego Movie from Warner Bros and Big Hero 6 from Disney, in addition to the company’s How to Train Your Dragon 2.
Home is the first release from DreamWorks Animation since the company announced in January a series of write-downs on past flops and future projects that have been shelved, including B.O.O.: Bureau of Otherworldly Operations, which was planned for this year. The studio eliminated 500 jobs and cut production to two pictures annually to focus on boosting quality and profitability.
Only two films since mid-2012 have not been written down, according to the company: How to Train Your Dragon 2 and The Croods from 2013. As a result, DreamWorks Animation announced in February a $263 million fourth-quarter loss. –
Bloomberg