MADRID — When Filmax chairman Julio Fernandez announced an English-lingo scarefare label in 2000 other Spanish producers thought he was either overly ambitious or mad.

Five years later, Filmax can point to multiple achievements with Fantastic Factory. It’s sold 15 titles to the U.S., eight to Lions Gate. It produced Brad Anderson’s “The Machinist,” and Jaume Balaguero’s femme teen screamfest “Darkness,” which Miramax opened to $22.2 million Stateside.

Balaguero’s next, “Fragile,” with Calista Flockhart, is still available in the U.S.

While Fantastic Factory’s first films, featuring sea monsters and alien spiders, sold well on DVD worldwide, times have now changed:

  • The bottom is falling out of the straight-to-DVD market. A DVD genre pic used to command $300,000-$500,000 for Japan — it’s now down to $50,000-$100,000. TV sales potential determines buyers’ choices. And ever more picky webs want theatrical titles.

  • There’s far more competition out there. In 2000, Filmax was a scarefare pioneer. Now there’s a legion of horror specialists: Rogue, Ghost House, Lions Gate, Taka Ichise’s Entertainment Farm, and more. So audiences want genre with a fresh twist; which is not necessarily a surprise finale.

Filmax’s 2005-06 slate aims to deliver, and plays off its brand. “The strategy has to be to make increasingly substantial, important titles with clear theatrical credentials,” says Fernandez.

Set at a Barcelona convent school, Cannes market screener “The Nun,” which has sold worldwide save Japan and France, features a back-from-the-grave sister of mercy. Spanish-lingo “The Just,” from first-timer Manuel Carvallo, also waves the country’s flag, being an apocalyptic chiller set in Spain’s Galician north.

Filmax’s production know-how and sales arm is luring other producers. Mexican Rigoberto Castaneda’s twins’ telepathy chiller “KM31,” another sales entry, was brought to Filmax by Televisa’s Videocine and indie prodco Lemon Films. “The End of the Summer” is about telepathic children; Filmax VP Antonia Nava describes Nacho Cerda’s “Bloodline,” about a woman who discovers her own ghost, as a “horror circus,” exhibiting various scarefare sub-genres.

But “audiences are going back to something more traditional, a Hitchcock mix of terror and suspense which attracts female spectators,” she adds.

Daniel Monzon’s Timothy Hutton starrer “The Kovak Box” certainly paints a Hitchcockian world: A bestselling author, attending a conference in Mallorca, suddenly has people around him dying (in this case, committing suicide) for no apparent reason. Or so he thinks.