Chinese Entertainment: Starting from 1996

Chapter 512 Overseas Theaters
Zou Chongyan is considered an old employee of Jiahe Group. She is also the only senior executive in the group who stayed after Liu Zhou acquired Jiahe.

Of course, her other identity is more well-known, that is, she is the daughter of Zou Wenhuai, the founder of Golden Harvest and Hong Kong film tycoon.

Zou Wenhuai was in charge of Golden Harvest for nearly thirty years, but as he grew old, none of his juniors were willing to take over Golden Harvest. Only his daughter Zou Chongyan was willing to take over.

But when Zou Chongyan took over Golden Harvest, the Hong Kong film industry was already half-dead, and the Golden Harvest Group had been on a downward trend for various reasons.

Zou Chongyan is quite capable, and Jiahe is the life's work of his father, so he has been trying his best to bring Jiahe out of the trough.

But the general trend was irreversible. The overall environment of the Hong Kong film industry had entered its darkest hour. No matter what she did, she could not stop Golden Harvest from continuing to decline. All she could do was to try her best to maintain it.

After two or three years, just when she was about to collapse, Liu Zhou acquired Jiahe.

Seeing that his father was happy to let Liu Zhou acquire Jiahe, Zou Chongyan also wanted to retire.

However, he did not expect that Liu Zhou would retain him, and his father also hoped that he could continue to stay in Jiahe as a symbol of the Zou family.

To be honest, Zou Chongyan was not very interested in the film industry. He couldn't bear to see his father in his seventies or eighties working hard for the company, so he agreed to take over.

But having stayed in Jiahe for nearly ten years, she inevitably still had some feelings for the company, so in response to the dual requests from Liu Zhou and her father, she agreed to stay.

In her opinion, she would not be able to stay in Jiahe for long. After the company was acquired, the old management would definitely be purged. The reason why she stayed was just to stabilize the morale of the troops.

Once Jiahe is completely under control, I will also be kicked out.

So she was quite Buddhist at the beginning, and she was willing to cooperate with Liu Zhou's work for the people her father liked.

She actively cooperated in bringing Golden Harvest to Beijing, stabilizing people's hearts, and replacing some of the management, and had no complaints even if she was assigned to the Hong Kong branch.

However, what she didn't expect was that after being handed over to Liu Zhou, Jiahe Group actually underwent gratifying changes in a short period of time.

Placing himself in the Hong Kong branch is not to marginalize himself. Liu Zhou also attaches great importance to the Hong Kong branch.

As Jiahe Group developed better and better, Zou Chongyan's mentality also changed quietly, and he regained his enthusiasm for work.

After all, in a lifeless company, no matter how passionate you are, it will slowly fade away, but in a thriving company, even if you are very indifferent, you will be infected.

And seeing that Liu Zhou had no intention of kicking him out, Zou Chongyan also began to work seriously and managed the Hong Kong branch in order.

Although Golden Harvest moved its registered address to Beijing and placed its focus on the mainland, Hong Kong is after all the place where Golden Harvest was founded, and many of its resources and foundations are located in Hong Kong.

Zou Chongyan also actively cooperated with the reintegration of Golden Harvest Group's resources, especially overseas cinemas and distribution channels. It was also thanks to her help that Golden Harvest International was able to get up and running so quickly.

She is still somewhat thankful that she did not leave at that time but actively integrated into the new Golden Harvest Group.

Zou Chongyan never imagined that in just four years, Jiahe would regain its glory and return to its peak under Liu Zhou's leadership, and was valued at 10 billion yuan before it even went public.

This was the case even when Golden Harvest had its highest market value after the company went public in the early 1990s.

The most important thing is that she was also allocated original shares, and after Golden Harvest went public, she immediately became a billionaire.

By now, the market value of Jiahe has reached nearly 100 billion yuan, and the few points of shares she holds are worth more than 2 billion yuan.

This is wealth she earned herself, not inherited from her father. Although she relied on the platform provided by her father, it still makes her feel very fulfilled.

After all, she has always been known as "Zou Wenhuai's daughter" and has always been under her father's protection.

In addition to wealth, Zou Chongyan also gained status.

Especially after Golden Harvest Group went public, Zou Chongyan took charge of the core department, Golden Harvest International, and became an influential figure in the entire Chinese-language film industry.

With money, status and a sense of accomplishment, Zou Chongyan felt for the first time that he had found his own value.

Although Jiahe Group is no longer her own, she now has a stronger sense of belonging and is more motivated to work.

So she has devoted herself to Golden Harvest International in the past two years, not only completely improving its distribution capabilities in Asia, but also starting to expand into Europe.

Zou Chongyan was well prepared and confident for this first general meeting of senior management of Jiahe Group since its listing.

Facing Liu Zhou's gaze, Zou Chongyan said slowly:
“Mr. Liu, last year, Golden Harvest International released a total of 45 Chinese-language films and 7 South Korean films, including our own films from Golden Harvest Group.

Excluding Interstellar, the total profit was 4.5 million, but after deducting the company's investment, it still lost more than million."

So far, Golden Harvest International may be the first subsidiary to incur losses.

However, seeing Zou Chongyan's calm expression, everyone knew that she must be confident.

Liu Zhou was not surprised by this. When calculating the profits of "Interstellar", he had already included the distribution costs of Golden Harvest International at the expense of Golden Harvest Films.

Golden Harvest International is currently expanding and requires a lot of investment, so losses are normal.

Moreover, for overseas distribution companies, not only does expansion require huge amounts of money, but even maintaining the company's operations is also costly.

This is also one of the reasons why only large companies can afford distribution channels, as the capital investment is not something that ordinary companies can afford.

Maintaining and expanding the overseas distribution network requires even more funds. Just setting up a base in Europe will already cause Golden Harvest International to incur losses. You should know that Golden Harvest International made a profit of two or three hundred million yuan the year before last.

A loss of just over 20 million is just a small amount of money for Golden Harvest Group, and if the distribution fee of "Interstellar" is added, there will still be considerable profit.

This shows that Golden Harvest International can be self-sufficient and can complete expansion on its own.

What really surprised Liu Zhou was that Golden Harvest International was able to get the overseas distribution of South Korean films.

Due to the ban, South Korean artists, TV dramas and movies are not allowed to enter the mainland, so the South Korean films released by Golden Harvest International are distributed to Asian regions outside of South Korea and China.

This can be considered a major step forward for Golden Harvest International. It would be great if they could crack open a new market, but this is rather difficult as the overseas distribution of a movie is almost monopolized by Sony.

"What's the situation in Europe?" Liu Zhou asked.

"We have established offices in the UK, France and Italy, and are currently negotiating with distribution companies in Europe to establish cooperation. For the first film, I plan to cooperate with distribution companies in Europe and let them distribute our films, and then slowly establish my own distribution channels."

The above three countries plus Germany are the four largest film markets in Europe. Although Europe is closely linked by the European Union, distribution companies are still a loose group.

So far, there is no company with a pan-European distribution network; only Hollywood companies have this capability.

If we establish cooperation with distribution companies in these four countries, we will have captured most of the European market.

"Very good. You don't need to rush your expansion into Europe. Do you need support from headquarters?"

"Not yet, but things are okay in the UK and Italy, but it's a little harder to open up the situation in France."

The UK and North America are almost the same, and Golden Harvest International can use the films of Summit Entertainment to open up the market, while Italy is a place where Golden Harvest has had more contact before.

Liu Zhou's first prestigious overseas award was the Golden Lion Award in Venice, Italy. When he was selling the copyright at that time, he established some connections with the distribution company in Italy.

But I didn't think about long-term cooperation at that time. Now I want long-term cooperation, and it would be a little easier to pick it up again if I have such a close relationship.

Moreover, the Italian film industry has the most exchanges with the mainland film industry. Among the three major European film festivals, Chinese-language films have also won the most awards in Venice.

As for France, Golden Harvest really has nothing to do with it.

"Do you have any idea?"

Zou Chongyan pondered for a while and said:
“In fact, the quickest way for Golden Harvest International to expand into Europe is to acquire a multinational cinema chain, but this would cost a lot of money.

Moreover, the cinema companies in Europe are now similar to those in North America. They are already sunset industries, and it may be difficult to make a profit by then.”

Liu Zhou shook his head and said:
“Forget about acquiring European multinational cinema chains. Golden Harvest Cinemas will only operate in China and Asia. I am also planning to gradually close down cinema chains in Asia outside of China.

There is no need to rush the European distribution channels, we can take our time.”

Just as Zou Chongyan said just now, cinema chains are already a sunset industry in North America and Europe, and the operating costs are getting higher and higher, especially if overseas companies operate them, the costs are even higher.

Liu Zhou must be out of his mind to go to North America or Europe to acquire cinema chains.

Golden Harvest is not like Wanda. Their main business is real estate, so they have a special liking for cinemas. For this purpose, they have even developed a global cinema chain and spent billions of dollars to acquire cinema companies in North America, Europe and Australia.

Wanda was at its peak at the time and dared to do this. Although Golden Harvest could afford it, it was completely unnecessary as it would greatly hinder the development of other sectors of the group.

Billions of dollars in funds are also a huge amount for Golden Harvest, and Golden Harvest does not dare to operate like Wanda with a debt ratio of more than 60 to 70 percent.

Not to mention European cinemas, Liu Zhou is also preparing to slowly withdraw from his own cinema chains in Asia.

During the nearly three decades that Zou Wenhuai was in charge of the Golden Harvest Group, the company not only built cinemas in Hong Kong and Taiwan, but also built many cinemas in Southeast Asia.

There are relatively few cinemas built in regions such as Indonesia and South Vietnam, and they are affiliated with local cinema chains. Then Golden Harvest's overseas distribution company directly cooperates with local cinema chains.

In regions like Singapore, Malaysia and Thailand, Golden Harvest has built relatively more cinemas and established its own cinema chains.

However, with changes in some national policies, the operating costs of these cinemas and theater chains are increasing, and the profits are decreasing. In two years, they may even be in the red.

Therefore, Liu Zhou is also preparing to gradually withdraw from the overseas cinema and theater chain markets, retaining only cinemas and theater chains in Hong Kong, Taiwan and the Mainland.

Liu Zhou is ready to sell all cinemas that have joined local cinema chains, whether they are rented properties or owned properties.

There is absolutely no need to own a few cinemas sporadically. The reason why Jiahe International can cooperate with local theater chains is not because of those few cinemas, but because Golden Harvest can provide enough film sources.

As for the cinema companies in Singapore, Malaysia and Thailand, Liu Zhou is not planning to sell them. Golden Harvest has deep roots and a greater influence in these three regions, and the policies in these regions are also more relaxed.

But Liu Zhou was still unwilling to let Golden Harvest Cinemas directly operate the business.

He plans to merge the cinema companies in Singapore, Malaysia and Thailand with the local cinema companies, and then hand over the management to the other party. Golden Harvest Group will just be a shareholder and only receive dividends.

Doing so can save a lot of trouble and operating costs, and will not affect the issuance of Golden Harvest International.

The cinema chains in Hong Kong and Taiwan are already very mature and do not need any changes. From now on, Golden Harvest Cinemas only needs to expand and operate seriously in the mainland.

Zou Chongyan had expected Liu Zhou's refusal. The cost of acquiring a European multinational cinema chain was too huge, and Golden Harvest Group's expenditure was already very high.

The Jiahe Film and Television Industrial Park requires 600 to 700 million yuan, and the Jiahe Cinema Line is also a big money-maker.

She also mentioned it in passing that if Liu Zhou agreed, her job would be much easier.

"Mr. Liu, can we at Golden Harvest cooperate with a French film company to make a co-production?"

"Are you trying to open up the situation with this?"

"Yes."

"That should be no problem. The Film Bureau is more supportive of co-productions now."

"The most powerful film company in France is Europa Films, owned by the great director Luc Besson. It is not only the largest production company in France, but also the largest distribution company there. If we want to cooperate, I think we can look for Europa Films."

"Okay, you can contact them when the time comes, and then ask Mr. Chen from Golden Harvest Films to cooperate with you."

Luc Besson's name is well-known to everyone. He is a French director, but he is not literary at all. Instead, he is more like a Hollywood director.

So he is also the most successful French director in Hollywood. One movie like "Léon: The Professional" can make him live a comfortable life.

At the same time, Luc Besson, like Spielberg, is not only a great director, but also a businessman. The Europa Films he founded is not only the largest film company in France but also in the whole of Europe.

If we can establish cooperation with Europa Films, it will not only help the distribution in France, but also provide a significant boost to the distribution in Western Europe as a whole.

(End of this chapter)