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'Ransom' Notes

In terms of cooking the books, studio accountants could give Emeril Lagasse a run for his bammed-up money. Here's how one film grossed $308.9 million worldwide, but still lost money.

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The 1996 thriller Ransom arrived with a high-power pedigree: star Mel Gibson, director Ron Howard, and producer Brian Grazer. But it was no match for Hollywood accounting. According to a final participation statement obtained by EW*, Disney claims to be more than $100 million in debt on a film that grossed $308.9 million worldwide. Heavy hitters like Gibson, Howard, and Grazer negotiated gross percentages of any money the studio took in from the opening weekend, but less powerful players only got net profits -- dispensed after the studio breaks even. A Disney accountant wrote to one Ransom net participant in June 1998, ''We are not projecting that you will be paid any profit participations for this picture.'' (A Disney spokeswoman says, ''The participants were accounted to exactly and appropriately according to the deal they negotiated.'') Here's who really got held for Ransom:

WALT DISNEY PICTURES PARTICIPATION STATEMENT PERIOD ENDED MARCH 31, 1998

Film Rental 1

Domestic Theatrical 1A $71,309,701 Foreign Theatrical 76,275,568 Free Television 1B 0 Pay Television 19,294,767 Home Video 24,255,190 Non-theatrical 2,115,767 Other Sources 26,574

-- -- -- -- -- -- -- -

Total Film Rental 193,277,567

Less Accounts Receivable 4,690,542

-- -- -- -- -- -- -- -

Total Gross Receipts 188,587,025

Less Distribution Fees 2 64,461,741

-- -- -- -- -- -- --

Net Receipt After Distribution Fees 124,125,284

Less Distribution Costs 3 Advertising and Publicity 3A 68,690,709 Prints 3B 13,005,277 Other itemized costs 14,061,392

-- -- -- -- -- -- --

Total Distribution Costs 3C 95,757,378

Net Receipts After Distribution Fees and Costs 4 28,367,906

Less: Negative Cost Direct Cost 5 75,439,225 Overhead @ 15-percent 5A 11,315,884 Interest 5B 19,863,536 Gross Participations 5C 24,910,342

-- -- -- -- -- -

Total Negative Cost 5D 131,528,987

Net Profits (Loss) 6 (103,161,081)

1 This is the amount Disney has collected from movie theaters, video sales, etc. worldwide. 1A The domestic theatrical figure is only a little more than half of the reported box office gross ($136.5 mil). The theater owners get the rest. 1B Okay, as of March 1998, Disney had not sold broadcast rights to the film, but the movie did air on Disney-owned ABC last February (and again on Oct. 7). What does that mean to the bottom line? A film like Ransom fetches about $3-7 million for several airings on a network.

2 This is studio accounting's catch-22: the automatic up-front fee a studio charges for releasing any movie in theaters and on video. (It doesn't include actual releasing costs or studio overhead, which are calculated later.) It adds up to a hefty 30 percent of the studio's take from theaters in the U.S. and Canada, 35 percent in the U.K., 40 percent in other countries.

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