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Director Feng Xiaogang, actress Xu Fan and actor Zhang Guoli (left to right) wave to audience at the 7th Rome Film Festival on November 11, 2012. Feng's Back to 1942 has picked up two awards, including the A.I.C. Award for Best Cinematography, as well as the Golden Butterfly Award (IBTIMES.COM) |
Shares of Huayi Brothers Media Corporation, one of the largest private entertainment groups in China, dropped 6.6 percent on March 20, closing at 17.73 yuan ($2.86), two days after the company released its 2012 annual report and its first quarter of 2013 performance forecast on March 18.
Market analysis shows its net profit growth in 2012 was lower than expected. The report indicated that thanks to the good box office sales of Stephen Chow's fantasy comedy Odyssey, Huayi's estimated profits in the first quarter of 2013 could reach between 140 million yuan ($22.58 million) and 190 million yuan ($30.65 million), a rise of 390-420 percent compared with the same period of last year.
Data from the annual report shows that the company's income in 2012 was 1.386 billion yuan ($223.54 million), an increase of 55.36 percent. However, its net profits were only 244 million ($39.35 million), up 20.47 percent.
Huayi's 2012 growth was almost the lowest since it was listed in 2009. The main cause was the unexpectedly poor box office sales of the feature film Back to 1942 by famous director Feng Xiaogang.
Costing 210 million yuan ($33.6 million), the blockbuster depicts a tragic drought which claimed about three million lives in central China's Henan Province in 1942. Before its release, the estimated box office was 700-800 million yuan ($110-126 million). Unfortunately, the total box office was only 362 million yuan ($57 million).
Huayi debuted seven films in 2012 with the total revenues reaching 610 million yuan ($98.39), an increase of 198 percent compared with the previous year. Its box office sales on the Chinese mainland totalled 2.1 billion yuan ($339 million). However, its business costs in 2012 increased by 81.7 percent.
"The slow growth of net profits was mainly because it was influenced by the increase of production costs for a single film and of the inputs in movie theaters," said a GF Securities report.
It is expected that Huayi's total box office income will reach between 2.5 billion yuan ($403 million) and 3 billion yuan ($484 million) this year. In addition, Huayi Brothers' theater business is also expected to turn its losses into profits.
(Source: Beijing Morning Post) | 
