Harry Potter and the Order of the Phoenix is still deeply in the red despite being the ninth-highest grossing film of all time, according to industry blog
A hint of the true extent of Hollywood’s current financial travails has emerged after it was claimed that a film which racked up almost $1bn at the worldwide box office in 2007 still lost money for the studio that made it.
The industry blog Deadline yesterday published a leaked net profit statement for the blockbuster film Harry Potter and the Order of the Phoenix, which stands at number nine in the all-time global box office chart, with a gross profit of $938.2m (£619m). If genuine, the statement suggests that Warner Bros is still yet to recoup $167m (£110m) of the film’s total budget.
The report suggests that Hollywood may be in a far more precarious position than previously thought – it is already well known that studios are struggling to find funding in the wake of the credit crunch and interest payments on loans and other calculations are not normally factored into a film’s official production budget. Order of the Phoenix is listed with costs of just $150m on the Box Office Mojo website.
The statement unearthed by Deadline suggests that Warner Bros incurred interest payments of $57m (£38m) on loans it took out to pay for the film to be made, more than a third of the official production budget. The extra costs may be due to distribution fees and adverts.
It also casts into doubt the efficacy of stars making deals that give them a share of net profits on top of their wages. On the evidence of Order of the Phoenix, few films can be delivering particularly large sums to those who sign up to such contracts.