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Murdoch Calls Fox's Results 'Pretty Horrible'

August 17, 2000|JAMES BATES | TIMES STAFF WRITER

Rupert Murdoch said his Fox film division had a "pretty horrible year" and that "it's just one of those things that we have to get right" in the wake of lower News Corp. financial results released Wednesday. Murdoch largely blamed the animated sci-fi bomb "Titan A.E." for the disappointing corporate performance.

"We expect better films, and more films and we expect profitable films," Murdoch said. "We're coming off a--there's no point in hiding it--a pretty horrible year," Murdoch said in a conference call with reporters.

Murdoch's disappointment in the losses for the $80-million-plus "Titan" was the final straw leading to the firing of film chief Bill Mechanic in June. Production veteran Tom Rothman and longtime international chief Jim Gianopulos have since been named co-chiefs of the studio.

But Murdoch said things are looking up in the wake of the successful release of "X-Men" and its half interest with DreamWorks SKG in "What Lies Beneath." He predicted that over the next two years the company will have "some pretty exciting filmmaking--and profitable." He also expressed confidence in the unit's new executives.

Separately, Murdoch said his treatments for low-grade prostate cancer--which he said involved 10 minutes of treatment daily for nine weeks--have ended and that his doctors are confident they were successful.

"It just convinced me of my own immortality," he joked, adding that the experience won't influence his plans to continue as head of News Corp.

Australia-based News Corp., controlled by Murdoch, reported an operating profit of $184 million, down 14% from $214 million a year earlier. The company said "Titan" offset improved profit in its TV and newspaper operations.

The company's New York-based Fox Entertainment Group, which News Corp. controls, posted a net loss of $11 million in the fiscal quarter that ended June 30. Higher earnings by Fox's TV stations and cable networks were more than offset by losses in the film division.

According to the company, the film division's pretax loss was $38 million. Fox Entertainment's revenues for the quarter rose 25% from a year earlier, to $2.5 billion. Results were a shade better than what analysts had expected.

Although the company declined to specify the exact size of the loss for "Titan," which some analysts have estimated to be as high as $120 million, the company did acknowledge that the red ink from "Titan" more than offset Fox's profit from the hit Martin Lawrence film "Big Momma's House" as well as profit generated by its film library during the quarter.

The company also said it had $12 million in charges related to the shuttering of its Fox Animation Studios in Phoenix, where "Titan" was made.

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