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Warner Bros Claims "Harry Potter 5" Lost Money to Avoid Sharing Profits

Posted: July 7th, 2010 by WorstPreviews.com Staff
Warner Bros Claims "Harry Potter 5" Lost Money to Avoid Sharing ProfitsSubmit Comment
Actors, writers, directors and producers usually get a cut of the profits in addition to their salaries. But if you doing business with a major studio, don't expect to see a penny, cause no movie can ever make money.

Deadline got its hands on profit statement for "Harry Potter and the Order of the Phoenix," the 2007 Warner Bros movie which grossed $938 million in worldwide ticket sales on a $150 million budget. But if you take a look at the statement below, the studio claims that the film actually lost $167 million.

A common practice is to take a very successful film and transition some of the profits to cover loses of other films that turned out to be flops, then turn around and tell everyone that the successful film didn't make any money. This way, there is no need to split the profits among other parties.

In the statement you can see that there is $57 million in interest charges, but Warner Bros used its own money for the film. So who is it paying interest to? It's definitely not to the cast and crew.

Statement: (click to enlarge)


Source: Deadline


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Displaying 22 comment(s) Profanity: Turn On
VDODSON writes:
on July 7th, 2010 at 5:16:35 AM

I need to hire their accountant to do my taxes ASAP. Did you see that f*cking report!! Those guys are good! According to this guy, Avatar only made the company about eighteen bucks!
Kid_A writes:
on July 7th, 2010 at 5:42:06 AM

Yeah, and James Cameron claims Avatar couldn't make enough money so he considers re-releasing it. Don't understand why producers insist on earning "more", while they already earn "more".
encoreyourface writes:
on July 7th, 2010 at 6:16:24 AM

so they lost money to avoid losing money?
johnny_boy writes:
on July 7th, 2010 at 6:54:03 AM

Good. Part 5 sucked. Wish some of that money couldve been to pay me back for that sucky film
Peter Parker writes:
on July 7th, 2010 at 7:26:38 AM

Everyone in Hollywood knows that the real artists are the accountants.

I have had in my hands other profit & loss statements, balance sheets, cash flow statements and other types of financial doc*ments indicating activities that could put many people in jail on several accounts of financial fraud.

Nevertheless, everybody is aware of the fact that this type of financial juggling is common practice in Hollywood and nobody seems to be interested in coming down on these people.

This article isn't really news, per se. It's more like a reminder of the sh*t that goes on in Hollywood.

Considering this, isn't it ironic when studios complain about losing money due to file sharing, claiming people didn't pay for their product?

Also ironic, it's a profit statement for a Harry Potter movie, and the numbers magically disappeared.
Fair enough, I guess.
Freudian_Nightmare writes:
on July 7th, 2010 at 9:34:18 AM

Wow, I can't believe they get through with this. I mean, everyone knows that Harry Potter didn't loose money and still they pull this off. I'm not saying that I care for the actors and etc but, as Peter said, it's quite ironic how they bitch about downloading.

f*cking c*nts.
trailertrash writes:
on July 7th, 2010 at 9:50:22 AM

That's big business for you.

I bet Nicolas Cage wished he had used these guys !!
Johnny Neat writes:
on July 7th, 2010 at 9:56:37 AM

Shady ass sh*t. They need to be sued and fast. This is like New Line's scam.
Dre-EL writes:
on July 7th, 2010 at 10:45:04 AM

Negative cost and Advances need to be more clearly defined, a note should have been attached to the financial stmt.

They could have taken loans to help finance, studios never really use their own money to do anything.

Revenue from video cassettes? maybe its old print and they really mean DVD/BR.
Max Rockatansky Junior writes:
on July 7th, 2010 at 12:50:14 PM

That's just some plain ol' bullsh*t.

If that was the case, then when The Dark Knight came out, Warners would have been belly up, like buying a new car and being automatically in debt.

The Dark Knight made 1/3, ONE THIRD of the budget of Warner Bros.

While it's true they have to make at least 100 million these days (maybe even 200 million) to cover the costs of having to make big budget movies (production costs, salaries, star's payments, etc.), they still make up the difference on the backend : DVD, Blu-Ray and PayPerView sales.

Don't tell me they don't make money on this.

And endorsements (re : Children-related movies with fast-food meal tie-ins)
Max Rockatansky Junior writes:
on July 7th, 2010 at 12:53:18 PM

A common practice is to take a very successful film and transition some of the profits to cover loses of other films that turned out to be flops, then turn around and tell everyone that the successful film didn't make any money. This way, there is no need to split the profits among other parties.


Solution : Quit putting out movies for the sake of putting them out. Take some time to see if the development is solid. The script. The star power. etc ...

When you put sh*t out just for the sake of its availability to be put out (ex : TWATLIGHT), based on negotiating rights upon publication or pop culture, then you're bound to have a pile of sh*t that lines the walls of Blockbuster.
Ranger writes:
on July 7th, 2010 at 12:59:56 PM

Keep this sh*t up studios.

Keep thinking short-term profits.

You'll get a reputation of which you may (or may not) know the deals no longer coming across your desks. I've done business with these short-term sh*ts myself. I've done it once, and won't deal with them again.

A movie makes almost half a billion $'s on a $150mil. budget LOST money?!

f*ck off Warner Bros!!!
Ranger writes:
on July 7th, 2010 at 1:09:59 PM

'I've done business with these short-term sh*ts myself.'

For clarity - I didn't mean I've done business with Warner Bros... but I have with their type of thinking.
Man in Black writes:
on July 7th, 2010 at 2:30:52 PM

and are we supposed to feel sorry for you WB ? you looking for a bailout / handout cause you made a bunch of sh*tty movies and your goose that lays the golden eggs did pull your ass out of the fire ... stop making sh*t movies stop over paying adults to play makebelive and if your gonna cook the books get your selfs some super jews or a few asians they're good with numbers .... damn it do i have to think of everything ... and can some one speed up inception to the theater ?
Ranger writes:
on July 7th, 2010 at 3:44:09 PM

lol...
vaodsi writes:
on July 7th, 2010 at 4:59:50 PM

wow...
Blu22 writes:
on July 7th, 2010 at 10:22:42 PM

That movie was the worsst one anyways....I'm happy they lost money!....Hiring a sh*tty director and all!....
Eben1277 writes:
on July 7th, 2010 at 11:44:46 PM

That's probably why they had so much difficulty securing the main cast for the last of the films
Ranger writes:
on July 7th, 2010 at 11:50:57 PM

@Eben - as there is usually such a delay in these back payments... I'll bet the studio kept saying: 'the money is coming, the money is coming!' until they got the cast to film the last movie.

I hope Warner Bros. goes to hell for this.

@Blu - you know they didn't lose money right... and that the studio is lying... right?
mustardayonnaise writes:
on July 8th, 2010 at 4:51:32 AM

i love how shocked all you morons are. and to single out one movie studio, as if they're the only company in the world that does this type of creative account, is insane. this is standard procedure; they are a company beholden to their parent company, who is beholden to shareholders. they need to make money. the movie biz is high-risk/high-reward; and media companies get egg on their faces all the time. i'm not saying it's right, i'm just saying it's commonplace.

and by the way- you think companies like wells fargo, or IBM, or Exxon/Mobil don't also pull some sort of similar type of bullsh*t to cover their asses? the difference between a lehman brothers and a goldman sachs is likely very subtle, they both pulled all sorts of shady crap, the only difference lehman just went a bit too far and got caught.

grow up and get real, people.
NunYoBusiness writes:
on July 8th, 2010 at 9:44:51 AM

This is just the truest form of corporate welfare there is. Movie companies have been doing this for decades, hell probably since Edison's first one. They claim all these movies lost money rip off the little guy who thought he might make some money in Hollyweird and then get back millions from the government so they can keep doing it over and over. MGM should of hired WB's accountants that way the Hobbit films could have been started already.
Ranger writes:
on July 8th, 2010 at 11:37:46 AM

@mustardayonnaise - look you moronic c*nt. We all don't think this is the ONLY studio doing this to people. But it's THIS studio the article is about... so we have chosen to stick to the topic (studio) at hand.

Thx. for the life lesson. Any more your mom taught you today whilst breast-feeding and home schooling you because you can't go public because of your associating inabilities with others, you single-minded, box-thinking f*ck?

Grow up and get real... take a look in the mirror f*cky.

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