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Company Town | BOX-OFFICE ANALYSIS

'Lethal' Comes Out Shooting but Stars Will Drain Profit

July 14, 1998|RICHARD NATALE | SPECIAL TO THE TIMES

Warner Bros.' "Lethal Weapon 4" got off to a strong start, but even if it matches the domestic gross of sequels 2 and 3 (around $140 million) and soars overseas (more than $150 million), the film may only squeak into the profit zone.

The film cost between $120 million and $150 million and worldwide marketing and distribution add $50 million more. With profit participants like Mel Gibson and director Richard Donner draining at least 35% of every dollar returned to Warner, there is little upside for the studio.

Warner is essentially buying market share with this one and feeding its distribution system.

DreamWorks SKG's "Small Soldiers" debuted at $14 million against a reported $70-million cost. While this isn't promising, the film should make a modest return with strong video and merchandise sales. Universal should do well with "Small Soldiers" overseas.

Sony's "Madeline" will not be a major box-office performer, but at a cost of less than $20 million it will do well enough to set up solid home video sales.

"Armageddon's" second-week take was strong and suggests that the film will surpass "Deep Impact" as the top U.S. grosser of the summer.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Company Town Film Profit Report

The report is based on projections of total U.S. box-office gross from a consensus of industry sources and studio financial models. The U.S. returns (approximately 55% of gross) represent only 20% of a film's final revenue, which includes overseas theatrical, video and TV income. The industry marketing average of $30 million per film is factored into these profit equations, as is the relative strength of specific film genres in foreign markets. Results for the weekend of July 10-12:

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Box- Estimated office cost, in Movie title Studio rank millions $$ Mega-Moneymakers The Truman Show Paramount 10 $65 The X-Files 20th Century Fox 7 65 Mulan Buena Vista 5 100 Dr. Dolittle 20th Century Fox 4 68 $ Minor Moneymakers Hope Floats 20th Century Fox 12 $32 Armageddon Buena Vista 2 150 Madeline Sony 6 18 Small Soldiers DreamWorks SKG 3 70 ?Tossups A Perfect Murder Warner Bros. 11 $65 Six Days, Seven Nights Buena Vista 9 65 Out of Sight Universal 8 45 Lethal Weapon 4 Warner Bros. 1 135

Projected U.S. box-office receipts, Movie title in millions $$ Mega-Moneymakers The Truman Show $130 The X-Files 85 Mulan 120 Dr. Dolittle 125 $ Minor Moneymakers Hope Floats $58 Armageddon 165 Madeline 22 Small Soldiers 55 ?Tossups A Perfect Murder $70 Six Days, Seven Nights 70 Out of Sight 42 Lethal Weapon 4 120

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Notes: Cost estimates are for production only. Only half of box-office receipts come back to the studio.

Researched by RICHARD NATALE

If you have information or comments about the chart, call (213) 237-2001 or send e-mail to company.town@latimes.com. Send faxes to (213) 237-7837.

For weekly box-office listings, see Calendar section on Tuesdays.

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