With 'Beauty' poised for $1 billion, Disney readies more remakes

WALT Disney Co.'s live-action studio is on a lucrative nostalgia trip.

Disney's latest re-imagining, "Beauty and the Beast," marks a big test of the company's strategy of using live actors to make beloved animated tales more relevant to new generations. Disney has a dozen more possible remakes in the pipeline that it hopes will build on the success of recent films like "Cinderella," "The Jungle Book" and "Maleficent."

Despite a couple misses, the strategy has proven a better bet for the live-action studio than trying to create new legends. Disney has generated almost $2 billion in net profit from six remakes since 2010, according to S&P Global Inc.'s Kagan research unit. That success, coupled with strong showings by other Disney film divisions, including Marvel and Lucasfilm, have made the company the box-office leader.

They're properties that "everybody knows," said Doug Creutz, an analyst at Cowen & Co. "It's probably a safer strategy than taking all that money and trying to create new intellectual property."

The recent backlash over a gay character in "Beauty and the Beast" isn't expected to hurt the film's potential, with online ticket seller Fandango saying the movie is generating the fastest advance sales of any family feature. The picture, which debuts in more than 4,000 domestic locations on Friday, is forecast to bring in $144 million in ticket sales this weekend and may generate $420 million during its U.S. run, BoxOfficePro.com estimates. Some analysts expect it could double that overseas.

Disney, which said the film is opening in most of the world on the same day, predicts $120 million in ticket sales from the U.S. and Canada through Sunday.

The latest reincarnation of the French fairy tale stars Emma Watson as Belle, a bookworm stuck in a French village who yearns for a bigger life until a misadventure leads her to a reclusive beast.

"Beauty and the Beast" is getting positive reviews, with 68 percent positive at aggregator Rottentomatoes.com. The film cost about $160 million to make, according to the studio. With marketing costs, the total climbs to around $300 million, according to a person with knowledge of the matter who asked not to be identified discussing private information. Disney struck gold with the 1991 animated feature -- it became the first-ever cartoon to be nominated for a best-picture Oscar.

Disney's live-action strategy isn't without risks. When the company strayed from revisiting its classics, disaster sometimes ensued. "The Lone Ranger," "Tomorrowland" and "Million Dollar Arm" all failed to recover their costs at the box office, as did the Disney-backed live-action adaptation of the Roald Dahl book "The BFG" from Steven Spielberg. Two stories that came right from Disney's playbook, the sequel "Alice Through the Looking Glass" and "Pete's Dragon" were also duds.

The Burbank, California-based studio's current run of successful remakes began with "Alice in Wonderland" in 2010. Directed by Tim Burton, the film generated more than $1 billion in ticket sales. The success of that film, along with Universal Pictures' 2012 release "Snow White and the Huntsman," led Studio Chairman Alan Horn to wonder ,"Why aren't we doing that?"

Disney's live-action unit, led by Sean Bailey, built on the success in 2014 with "Maleficent," a darker take on "Sleeping Beauty," featuring Angelina Jolie. The $180 million production budget yielded $759 million in global sales. "Cinderella," in 2015, went on to score critical and commercial success, and "The Jungle Book" won an Oscar in February for visual effects. A sequel is planned.

To Barton Crockett, an analyst at FBR Capital Markets & Co., these films are a necessary new hybrid for a younger generation that's grown accustomed to cutting-edge special effects.

"It is very hard for them to watch some of the older movies because the movie-making technology was so different than it is today," Crockett said. "You don't get the same reaction."

While Disney is still making original live-action films, like the Ava DuVernay-directed "A Wrinkle in Time" due for release in 2018, it's largely focused on remaking classics.

A live-action "Mulan" film is due out in November 2018. "Mary Poppins Returns," with Emily Blunt, Meryl Streep and Lin-Manuel Miranda, is set for release the following month. Revivals of "Dumbo," "The Lion King," "Cruella" and "Aladdin" are being developed, and the company may also have in the works "The Little Mermaid," a "Maleficent" sequel, another "Peter Pan" story and a fresh "Pinocchio."

"I don't think they're anywhere close to trailing off soon," said Jeff Bock, senior box office analyst at Exhibitor Relations Co. "They'll run out of their best animated films maybe in a decade. That is not to say they don't continue the adventures in sequels."

Those films will also help Disney battle superhero fatigue in its Marvel division, which "everyone's expecting," said Michael Nathanson, an analyst at MoffettNathanson LLC.

Horn, Disney's studio head, said at the "Beauty and the Beast" premiere that the company remains committed to mining Disney's best characters.

Remakes of classics "are quintessential Walt Disney company properties and we believe to our toes that we are the company that should bring these stories to the screen in live action," Horn said. "We want to do so with an underscored emphasis on quality -- they have to be good."