NEW YORK — Film Roman Inc., the animation house responsible for “The Simpsons” and “King of the Hill,” is looking for a strategic alliance to give it some distribution clout, Film Roman CEO Phil Roman said Monday.
Without a strategic alliance, the indie’s future is uncertain — reflected in a disastrous slide in the price of its stock since the company went public last October. After selling stock at $10 a share, Film Roman dropped to a low of $2.37 last Thursday although it rose 43¢ to $3.06.
Much of the stock decline has occurred in recent weeks as a result of the poor performance of two of its three new series, “C-Bear and Jamal” and “Bruno the Kid.” In early February, Fox Kids Network canceled C-Bear, but said Monday it would reinstate the show on Friday mornings, although no new episodes have yet been ordered. “Bruno,” developed by Bruce Willis, is in syndication, but has not been well received.
Film Roman provides animation services on Fox’s longrunning “The Simpsons” and newest hit “King of the Hill,” but only on a fee-for-service basis; it has no ownership rights in either series. And the outside production biz is clouded by the increasing amount of work being shifted to Canada, where tax incentives allow producers to charge 20% to 30% less, industry execs say.
Film Roman’s strategy now is to build a library of shows by retaining ownership of distribution and ancillary rights. Aside from C-Bear and Bruno, Film Roman has developed an animated version of The Blues Brothers, which UPN may pick up for primetime this fall. The company also co-produces with Fox “Bobby’s World” and is developing another series with that show’s creator, comedian Howie Mandel.
“We’re doing whatever we can to strengthen our position,” Roman said, including seeking alliances, international co-production deals and potentially, an outright sale, although the company is not being actively shopped and no active negotiations are under way, he said. But an ongoing “retrenching” of the company’s business is meant to protect against an intensely competitive environment for animators, given consolidation of producers with distribution outlets.
Margaret Loesch, president of Fox Kids Network, said Fox will air the 13 existing episodes of “C Bear,” an FCC-friendly show that represents Fox’s only minority-themed cartoon, after prodding from Film Roman and rapper Tone Loc, who is an exec producer and the voice of the lead character.
“It was so difficult on Saturday morning at 8 to establish a hit, we thought we could move it to Friday where we could protect and nurture it.” Loesch denied an analyst’s report suggesting that Fox might bid for Film Roman, saying that after a pending deal to merge with Saban Entertainment “we don’t need another studio.”
But for Film Roman, she said, “the biggest challenge is for them to try to create some of their own copyrights.”
Montgomery Securities, which underwrote Film Roman’s public offering, noted in a report earlier this month that Fox Children’s Network’s merger with Saban Entertainment prompted Fox to “primarily produce its shows inhouse.”
Montgomery analyst John Tinker said Film Roman was being hurt by “the recent tightening in broadcast television timeslots,” and it added that this increased the likelihood that the company would look for a strategic partner or find an outright buyer.
But an outright sale seems unlikely, industry execs say. With no library to speak of, Film Roman’s only asset is its animation workforce, one industry exec said, which can be hired out.
Tinker revised his prediction for Film Roman’s bottom line, forecasting a loss of $4.2 million compared with a profit of $2.1 million for 1997, both as a result of “C-Bear’s” cancellation and of “Bruno’s” difficulties in syndication.