Chapter 58 Business Reputation

The distributor, with relatively low investment and minimal risk, could still take away half of the film's profits. How could this not make people jealous?

Still, Ronan used quite a few tactics. None of the cast members were entitled to post-production profit shares; otherwise, Sahara Entertainment would have only been able to receive one-third of the North American profits at most.

When the profit shares came in, Sahara Entertainment's share was naturally deducted first.

Reserved taxes, a fifteen percent management fee, twenty percent profit sharing, and so on, were all reasonable and legal norms.

In total, "Human Purge" generated $45.2 million in revenue for Sahara Entertainment. Ronan, in his generosity, let Sahara Entertainment retain only $25.2 million of that, while the remaining $20 million was given back to their Arab friends, who were "like brothers".

That left them with a profit of $9 million.

In less than a year, with an investment of $11 million, they had earned a profit of $9 million. This was definitely a lucrative investment.

Like many Hollywood companies, Sahara Entertainment also announced the net profit of "Human Purge" as $9 million.

Net profit is a special term in Hollywood, representing completely different accounting rules because of the next financing plan. Ronan didn't manipulate it much this time, but in the future, there would be plenty of opportunities to make a big profit.

Many high-grossing films end up showing negative net profits on the film company's books. Those who share in the net profit often end up with nothing.

One of the most typical examples is this year's release of "Saving Private Ryan." It's a common financing project. According to the financial statements released by the film company, the net profit was negative, indicating a loss.

Director Spielberg made money, lead actor Tom Hanks made money, production company DreamWorks made money, distributor Paramount Pictures also made money...

Compared to these people, Ronan believed himself to be a righteous man, full of honor, justice, selflessness, integrity.

"Do we really have to share the profits with the Arabs?"

In the office, Robert expressed some reluctance. "We could easily calculate a negative net profit."

George furrowed his brow and said, "Can't we just return the investment?"

Mary, relatively conservative, reminded them, "The film's distribution is not something we handle ourselves. The distribution company has records. If the Arabs manage to convince the distribution company to audit, we'll be in trouble."

"Look further ahead," Ronan said slowly. "We're going to Abu Dhabi next to launch the second round of financing with the Arabs. This money is a guarantee to establish our business reputation because this time our financing won't be just $10 million."

He glanced at the three people in the office and continued, "We have two projects coming up next: James Huang's 'Death Comes', and an action film with an Arab protagonist, for which I've just completed the script. The combined budget for these two films is $30 million. I plan to raise between $30 million and $40 million in financing."

Upon hearing this, George and Robert became excited, eager to try.

Ronan added, "Also, we need to acquire a distribution company. How much do we need? At least $20 million. We need funds, and Abu Dhabi isn't short on funds."

George and Robert exchanged glances, not saying anything more. They knew that if they wanted to raise more money, there would definitely be some trade-offs.

"The usual rules," Ronan said softly. "If the financing is successful, everyone gets a one percent bonus."

"This time, I won't stay home. I'm going to Abu Dhabi," George said.

Ronan nodded. "Let's make a big splash in Abu Dhabi together."

Robert was confident. "We'll definitely succeed!"

Mary smiled but didn't say anything.

Ronan opened the drawer and took out six copies of the script, handing two to each person. "Here are the scripts and project proposals for 'Death Comes' and 'Ace Agent'. Take a look and familiarize yourselves with them as soon as possible."

The three flipped through the scripts briefly.

"In the plan, 'Death Comes' has a budget of $10 million, while 'Ace Agent' has a budget of $20 million. But in our actual operation, it's the opposite. We need more funds invested in James Huang's project, and 'Ace Agent' is mainly used to attract the Arabs," Ronan explained.

Robert, who had read the script for 'Ace Agent' first, closed it and said, "A bunch of Arabs as protagonists, apart from Arabs, not many people will like it. This film is probably going to flop."

"It doesn't matter," Ronan had already considered this. "The purpose of this film is to attract Arab investments. Everything else is secondary."

As long as they could attract investments, let it flop. After all, it was the investors' money they would lose.

George rubbed his wrinkled face and said, "If we change the protagonists to Americans or British, there's still some room for maneuvering."

Ronan smiled. "We have the copyrights. After using the Arabs, we can invest in another version with British protagonists."

Robert nodded. "Good idea."

The four ended the meeting. Shortly after Mary, George, and Robert left, James Huang came knocking.

"I've read the script and project proposal," Ronan said to James Huang. "Very good, even better than I expected."

James Huang pushed his glasses and asked, "When can we officially start preparing?"

Ronan didn't answer James Huang's question but instead asked, "James, with your script and the plan you've laid out, is $6 million enough for the investment?"

James Huang smiled and said, "I've made the plan based on the most ideal film result."

Having actually operated a film himself and gained some experience, combined with what he learned, Ronan said, "In my estimation, for this film to achieve outstanding results, we need at least $15 million."

James Huang didn't respond to Ronan's words but tentatively asked, "I heard 'Human Purge' made a lot of profit?"

Ronan shook his head. "That's the profit of the investors. Sahara Entertainment got very little."

James Huang scratched his head a bit and said, "I'll try to save..."

Ronan stopped him with a raised hand. "I'll take care of the funding issue." He paused intentionally before continuing, "I'll be attending the premiere of 'Human Purge' in Abu Dhabi next week, trying to raise funds from the Arabs. $15 million isn't a small amount; it'll probably take some time."

"I understand." James Huang was a bit excited to hear the $15 million figure. "I can wait."

Most directors never had the opportunity to direct such a large-scale film project.

Ronan said solemnly, "James, my company and I are all in on this project with you. If the film fails, I'll go bankrupt and become a pauper."

James Huang nodded solemnly. "I'll give it my all."

"Good!" Ronan reached out his hand. "James, I believe in you."

James Huang gave Ronan's hand a firm shake. "I'll repay your trust with success."

The success of "Human Purge" gave Ronan more confidence in James Huang. After discussing the project plan, Ronan continued, "Before I leave for Abu Dhabi next week, I'll set up a special account for 'Death Comes' and allocate $1 million for your initial preparations. You and Glenn Morgan should keep working."

"Don't worry," James Huang assured him. "We'll keep pushing forward with this project."

Ronan checked the time and continued, "If everything goes smoothly with the financing, when I come back from Abu Dhabi, I'll go to Germany. Probably after the New Year, 'Death Comes' can officially start pre-production."

Time passed quickly. Before heading to Abu Dhabi, Ronan had a series of affairs to attend to, such as reinvesting some of Sahara Entertainment's profits.