Firm Takes a New Line in Making Movies

For a while there it looked as if New Line Cinema could do no wrong. There were the two back-to-back Jim Carrey blockbusters, “The Mask” and “Dumb and Dumber,” both relatively cheap considering that the star now commands $20 million a picture. Then there was the $100-million-grossing sleeper “Seven” and “Mortal Kombat.” The hits just seemed to keep on coming.

A two-year winning streak solidified the company’s standing as a darling of Hollywood and Wall Street alike. Ted Turner, who purchased the 29-year-old independent in 1994 in a stock swap valued at $550 million, looked like more of a genius than ever.

But, like all movie companies that are vulnerable to the vagaries of a volatile, low-margin business, New Line has hit a prolonged dry spell at the box office that’s lasted nearly a year. The company has not had a major hit since last fall’s sleeper thriller “Seven,” starring Brad Pitt.

Last year, New Line’s market share was competitive with some of the major studios at 6.6%, whereas currently it’s at 3.4%, behind Disney’s Miramax.

Even so, market share isn’t the full story. Most of New Line’s recent offerings have been inexpensive films, which limits the company’s losses.

Last weekend, New Line’s trademark maverick marketing came through when the company unexpectedly opened the universally panned sci-fi remake “The Island of Dr. Moreau,” starring Marlon Brando and Val Kilmer, in the No. 1 spot with $9.1 million.

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New Line executives were understandably nervous heading into the weekend, ducking critical barbs such as “Moreau needs a doctor” and “The Island of Dr. Moreau is not worth visiting.” Despite the strong opening, Hollywood executives expect a pretty steep drop-off in business.

That bit of positive news comes after a long drought not only at the box office but amid an uncharacteristic dip in New Line’s normally active production and release output.

New Line representatives have declined to be interviewed. But the slowdown may be tied to the uncertainty of the company’s future in the wake of the pending merger of Time Warner and Turner. In addition, the company strategy has changed. Instead of releasing a batch of low-budget films, it’s now feeding its production dollars to a batch of bigger-budget movies as it seeks to go head-to-head with the major studios.

All this comes at a critical time for New Line. The Time Warner acquisition could close in as little as two months.

After that, it’s widely expected that New Line would be spun off or sold to the highest bidder after the merger is final. Turner’s other movie company, Castle Rock Entertainment, has already been officially put on the block and has been in negotiations with both MCA/Universal Pictures and Sony. Selling New Line and Castle Rock would give Time Warner a way to cut its debt. And its Warner Bros. unit already has plenty of movies to handle.

“The Island of Dr. Moreau,” based on the H.G. Wells classic, ushers in a new era of bigger-budget--and riskier--movies for New Line. “Island” is one of New Line’s most expensive productions to date at what sources estimated to be in the high $40-million range, although some at the company contend the movie was only in the high 30s. The production was plagued with problems from the outset, which undoubtedly put the movie over its original budget.

Four days into production, the film’s director, Richard Stanley, was fired after New Line executives didn’t like what they saw in the daily takes. One of the actors, Rob Morrow, walked off, and production was halted until director John Frankenheimer was brought aboard to replace Stanley.

October will mark the debut of New Line’s most risky, expensive production ever, “The Long Kiss Goodnight,” directed by Renny Harlin and starring his actress-wife, Geena Davis, and Samuel Jackson. Sources said the film went well over its budget of more than $60 million.

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In 1994, New Line broke the record on what companies pay for screenplays written on speculation by doling out an astounding $4 million for the Shane Black action thriller. The story is about a housewife who emerges from amnesia to discover she was once an assassin for the government.

Given the huge sum New Line paid for the script and spent on the production, Hollywood will be closely watching the film, which opens Oct. 11.

Lavishing its efforts on big-budget films is a stark contrast to New Line’s history. The company built its name on niche marketing of lower-budget, genre movies and had great success with such movie series as “Nightmare on Elm Street” and “Teenage Mutant Ninja Turtles.”

With access to Ted Turner’s wallet, New Line decided it wanted to play in the big leagues. In 1994, New Line Chairman Robert Shaye told The Times: “It was the one piece of our product puzzle still missing. And it was what I wanted to do with my life. Ted was OK with that.”

Shaye and President Michael Lynne sent a clear message to the Hollywood community that the days of low-budget fare were over when they wrote the check for “Long Kiss.”

New Line also stunned industry insiders by agreeing to pay Jim Carrey $7 million for “Dumb and Dumber,” an enormous jump from the six-figure fees he had been getting even in light of his success in “The Mask” and “Ace Ventura.” The decision turned out brilliantly as “Dumb and Dumber” grossed more than $127 million domestically.

Hollywood skeptics wonder if the company can make and market event movies with the same success it had with more moderately budgeted fare. “They’re going to have a hard time following their own act,” said one executive familiar with New Line.

The company’s releases in the coming months could raise its market share considerably by year-end. In addition to “Long Kiss,” those releases are Walter Hill’s “Last Man Standing,” starring Bruce Willis (due out Sept. 20), Nora Ephron’s “Michael,” in which John Travolta stars as an earthbound angel (Dec. 25) and Richard Attenborough’s “In Love and War,” teaming Sandra Bullock and Chris O’Donnell.

Over the last year, New Line’s biggest box-office hit was “Thin Line Between Love and Hate,” starring Martin Lawrence, grossed $34.7 million. New Line expects to see a profit from the movie, but not as much as it would have if it owned the film outright. The company bought out a 50% interest in the film from financially ailing Savoy Pictures for $5 million.

New Line will make out far better on its Jackie Chan picture, “Rumble in the Bronx,” which it owns worldwide rights to. The movie has grossed $32.4 million.

“Thin Line” was one of four projects the company cherry-picked from ailing Savoy Pictures with mixed results. “Thin Line” will be profitable, but the company’s live-action “Pinocchio” did poorly, although it could turn a profit if videocassette sales are strong.

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Despite the slump, New Line is still well-loved on Wall Street.

“They’ve had such a long-term, consistent track record, this [downturn] is not a big deal,” said Jessica Reif, an analyst with Merrill Lynch.

“I don’t think there’s been extensive damage. . . . They have a lot of respect and are still a darling on Wall Street.”

Box-office figures were supplied by Exhibitor Relations Co.

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New Line Flat Line

After riding high with such hit films as “The Mask,” “Dumb and Dumber” and “Seven,” New Line Cinema’s business over the past year has slowed considerably. The company’s market share to date is just 3.4%. In 1995, its 6.6% market share was enough to make it competitive with some major Hollywood studios. New Line is hoping upcoming bigger-budget films such as “The Long Kiss Goodnight” and “Last Man Standing” will reverse the downturn.

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The Hits

Dumb and Dumber (1994)

The Mask (1994)

Seven (1995)

Mortal Kombat (1995)

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The Misses

Faithful (1996)

Lawnmower Man II (1996)

Heaven’s Prisoners (1996)

Adventures of Pinocchio (1996)