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An opening weekend does not make/break a movie, but it does indicate a trend.  With a stated production cost of $40m for Escape, and an opening weekend of $20m does not look to good.  As a point of reference, DWA had a production cost of $150m for Guardians with an opening weekend of $70m.  Analyst are now predicting a necessary write-off by DWA of between $50-$100m.

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I think the specifics of Escape need to be considered.  Specifically, they have the highest rev per showing of all current pictures since it opened and it is the only animated alternative for the families that want to go theatre for the kids on Winter break.  We will see how this plays out over the next few weeks.

 

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An opening weekend does not make/break a movie, but it does indicate a trend.  With a stated production cost of $40m for Escape, and an opening weekend of $20m does not look to good.  As a point of reference, DWA had a production cost of $150m for Guardians with an opening weekend of $70m.  Analyst are now predicting a necessary write-off by DWA of between $50-$100m.

 

That's because Guardian spent another $50-70M on marketing and promotion.  Escape has spent hardly a cent on marketing relative to other films.  Here's a good article on how surprising the results actually were for Escape considering the circumstances around the production, promotion and distribution.  Cheers!

 

http://news.moviefone.com/2013/02/15/box-office-escape-from-planet-earth_n_2707419.html

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True about the $50-70M on marketing and promotion for DWA's Guardian, plus an unknown amount for distribution.  No disrespect for RNK as they have had a rough ride and happy to see good people doing good after the ride - similar to the FFH ride, kinda.

 

As I understand it, mostly thru DWA, is that the producer ends paying the distributor nearly all the box office gross and they make it up on the backend with digital, DVD, and TV.  An assumption on my part is RNK will only pay the distributor 10-12% for the backend distribution.  With that, one could probably make an educated guess as to possible revenue next couple of years.

 

Cheers

JEast

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True about the $50-70M on marketing and promotion for DWA's Guardian, plus an unknown amount for distribution.  No disrespect for RNK as they have had a rough ride and happy to see good people doing good after the ride - similar to the FFH ride, kinda.

 

As I understand it, mostly thru DWA, is that the producer ends paying the distributor nearly all the box office gross and they make it up on the backend with digital, DVD, and TV.  An assumption on my part is RNK will only pay the distributor 10-12% for the backend distribution.  With that, one could probably make an educated guess as to possible revenue next couple of years.

 

Cheers

JEast

 

I believe you are correct on the larger studios.  Don't know exactly what the breakdown is at RNK, but I'm sure we'll start to get some clarity as the year progresses and they report on the film.  Cheers!

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Here's a good article on how surprising the results actually were for Escape considering the circumstances around the production, promotion and distribution.  Cheers!

 

http://news.moviefone.com/2013/02/15/box-office-escape-from-planet-earth_n_2707419.html

 

It's nice to see Escape getting some media coverage as a success story.  Here is an interview with Weinstein Executive Producer, Marvin Peart.

http://video.foxbusiness.com/v/2174250680001/

 

Peart states that the film will have brought in slightly under $22 million over the 4-day holiday showings (I believe it is accurate to say these numbers only include the domestic box office).  Hopefully, the positive press coverage that is starting to come in extends the run.  This and the the nature of the film will hopefully provide some appeal to foreign markets.  If you look through films of the past that are considered a success domestically:

- a good result: would seem to be similar revenues in the foreign box office. 

- an outstanding result: would seem to be a doubling (or more) of foreign box office revenue vs domestic. 

 

Hopefully, they can shoot for the later -- as mentioned before I have a hunch that RNK's incentive could be weighted toward the foreign success of the film.

 

True about the $50-70M on marketing and promotion for DWA's Guardian, plus an unknown amount for distribution.  No disrespect for RNK as they have had a rough ride and happy to see good people doing good after the ride - similar to the FFH ride, kinda.

 

As I understand it, mostly thru DWA, is that the producer ends paying the distributor nearly all the box office gross and they make it up on the backend with digital, DVD, and TV.  An assumption on my part is RNK will only pay the distributor 10-12% for the backend distribution.  With that, one could probably make an educated guess as to possible revenue next couple of years.

 

Cheers

JEast

 

RNK does not own this film -- Weinstein does, but may have given up some of that ownership when the story had to be re-written and at the same time they were running into financial difficulties (during the worst of the financial crisis).  It was during this time that RNK worked out a participation in potential profits for the film.  But again - they don't have ownership in it -- so they are not paying anyone to distribute it.  The distribution costs of the film are definitely taken into account in determining the profit for the film -- RNK shares in this potential profit pool by an undisclosed formula. You are right that the most lucrative money is often merchandise sales (DVD's, games, toys, etc) -- but it is not clear whether RNK's participation extends to this.

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Another week or so as the only children's movie, and the international push should start soon.  With DVD sales, etc, may creep to the $90-100M mark over time.  Cheers!

 

At this point, I think $50 million+ in domestic box office is very achievable.  If they can come any where close in matching this at the foreign box office -- I think this range is very achievable at the total box office alone (ie. $90-100 mil - before DVD's, etc).  I think this film will appeal to the international market and could possibly surprise in that regard also -- perhaps pushing total box office well over $100 million.... but we will have to see. 

 

It is interesting that you bring up DVD sales (etc) Sanj.  Do you interpret RNK's back end box office share might actually extend to merchandise?  Would be wonderful if it does -- merchandise could do very well this Xmas.

 

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Another week or so as the only children's movie, and the international push should start soon.  With DVD sales, etc, may creep to the $90-100M mark over time.  Cheers!

 

At this point, I think $50 million+ in domestic box office is very achievable.  If they can come any where close in matching this at the foreign box office -- I think this range is very achievable at the total box office alone (ie. $90-100 mil - before DVD's, etc).  I think this film will appeal to the international market and could possibly surprise in that regard also -- perhaps pushing total box office well over $100 million.... but we will have to see. 

 

It is interesting that you bring up DVD sales (etc) Sanj.  Do you interpret RNK's back end box office share might actually extend to merchandise?  Would be wonderful if it does -- merchandise could do very well this Xmas.

 

Don't know, as we don't have full idea of what the contracts provide.  Hopefully starting in the 2nd quarter, they can provide shareholders with more information and disclosure on contracts, revenue sharing, merchandising, etc.  Also interested to know exactly what this Blockade deal entails, as Blockade Entertainment is known for their video game productions...are they moving into movies?  We should continue to see interesting things happen.  Cheers!

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  • 3 weeks later...

Escape has shown some renewed life over the last couple days.  Both Monday and Tuesday box office revenue was the 2nd highest achieved for these days of the week (beating out the previous 2 weeks numbers fairly impressively).

http://boxofficemojo.com/movies/?page=daily&id=escapefromplanetearth.htm

 

Not sure of the reason for this renewed interest.  Perhaps the extra traffic related to the successful Oz feature is bringing some attention to the Escape posters, trailers (etc)?  Domestic box office revenue should hit $50 million+/- by Thursday night .... with the coming weekend over and above.  Hopefully, the renewed interest continues for a while.  Not much showing up yet on the international reported box office figures, hopefully the existing numbers and theater openings are lagging.

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I'm not sure when/if it will be released to large population foreign countries. So far I see only release dates for a few countries (Russia, Iceland, Australia, New Zealand, Argentina and Taiwan - see http://www.imdb.com/title/tt0765446/releaseinfo?ref_=tt_dt_dt). But nothing for the countries that I suspect could move the needle (UK, Germany, France, Japan, etc)...

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  • 2 weeks later...

looks like the run is almost over for the movie.  When is the 2nd quarter report Parsad? Can't find the date. :(

 

 

Don't know.  1st Q report has not come out yet.  Cheers!

 

Thanks

seems the run is over. Hopefully Australia can do 1 to 2 million.

 

Still making small amounts...I think it may creep to $65-70M in total...$56.3M so far worldwide.

 

http://www.boxofficemojo.com/movies/?id=escapefromplanetearth.htm 

 

You then have DVD sales as well which will come.  Cheers!

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looks like the run is almost over for the movie.  When is the 2nd quarter report Parsad? Can't find the date. :(

 

 

Don't know.  1st Q report has not come out yet.  Cheers!

 

Thanks

seems the run is over. Hopefully Australia can do 1 to 2 million.

 

Still making small amounts...I think it may creep to $65-70M in total...$56.3M so far worldwide.

 

http://www.boxofficemojo.com/movies/?id=escapefromplanetearth.htm 

 

You then have DVD sales as well which will come.  Cheers!

 

I don't recall reading that back end included DVDs. were did you see that ?

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looks like the run is almost over for the movie.  When is the 2nd quarter report Parsad? Can't find the date. :(

 

 

Don't know.  1st Q report has not come out yet.  Cheers!

 

Thanks

seems the run is over. Hopefully Australia can do 1 to 2 million.

 

Still making small amounts...I think it may creep to $65-70M in total...$56.3M so far worldwide.

 

http://www.boxofficemojo.com/movies/?id=escapefromplanetearth.htm 

 

You then have DVD sales as well which will come.  Cheers!

 

I don't recall reading that back end included DVDs. were did you see that ?

 

I don't know if it does or doesn't.  But even if it doesn't, but sells pretty well in DVD's, then that hopefully means more business and notoriety for Rainmaker...even if they don't receive any direct compensation.  Cheers!

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well they are out on sedar

 

http://www.sedar.com/DisplayCompanyDocuments.do?lang=EN&issuerNo=00027273

 

Nothing new though

 

Appears to have shrunk quite significantly since last year.

Assets, liabilities, equity down significantly. This should be reversed with results of Escape in this  quarter.

 

Certainly cheap. About 40 cents of net assets, mostly cash like assets selling for 16 cents.

 

Risky, with decent chance of RNK being a value trap or mistake unless they can turn profits from projects they have committed to.

 

Is this a good business? I want to say no. High risk high reward is my impression. Then why are the major shareholders willing to put more money in and commit themselves to several new movie projects. I am thinking that it is to use up tax credits.

 

Disclosure: I have a very small amount purchased at 20 cents.

 

Investment thesis has changed since I bought ie purchase fell thru. I bought initially with the thought that there great people, decent investors taking over, selling at a significant  discount. Actually a graham net net. Crappy business that has lost a lot money but that perhaps mckelvin, Chou, etc would get into other more profitable ventures. Feels like my experience at sears with lambert trying to turn around crappy retailer.

 

Looks like a 2 legged stool, and I am afraid I am going to fall off.

There is still value there but more risk.

 

Very illiquid and unless you buy the debenture you will be diluted significantly.

 

What do you do?

 

What are others thinking?

 

What do you do when your original investment thesis changes. Are you not suppose to sell?

 

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