Cinecittà Studios Chief Nicola Maccanico on Turning a Profit and Bringing Back Hollywood Productions (EXCLUSIVE)
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Rome’s Cinecittà Studios are generating a profit for the first time in years amid a radical upgrade, overhaul, and expansion of the filming facilities where Hollywood productions are now flocking on a scale comparable with its glory days.
Roland Emmerich last month started shooting his gladiator series “Those About to Die” starring Anthony Hopkins as Emperor Vespasian; Joe Wright is in the midst of production on TV series “M,” about Benito Mussolini’s rise to power. And in January cameras started rolling in the “City of Cinema” on Netflix’s period soap “The Decameron.” These are among the biggest international productions lured by the storied studios in recent years, also thanks to Italy’s 40% cash back tax rebate.
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The Cinecittà revamp is being devised by CEO Nicola Maccanico who since 2021 has been implementing a plan fueled by a €300 million ($327,000 million) loan provided by the European Union’s post-pandemic recovery fund and driven by Italy’s ambitions for Cinecittà to go back to being a top European production hub.
Two years later, the studios are boasting one of Europe’s largest LED walls (pictured) as revenues soar and a small but significant profit is being made. And they are now operating at full capacity and getting ready to build new soundstages and expanding into a larger backlot. Variety spoke to Maccanico about his plan going forward.
You’ve just announced a €1.8 million profit for fiscal 2022 which in itself doesn’t seem such a big deal. Is it?
Since Cinecittà went public in 2017 it’s had average revenues of around €14 million ($15 million). This [fiscal] year we have €39 million ($42.5 million) in revenues, which reps a 170% growth. That gives a picture of how the new Cinecittà operating at full capacity is generating exponential growth. So, yes, the real news isn’t the €1.8 million ($1.9 million) profit, but that we are back in the black. Today Cinecittà is working at full capacity, it’s attracting world-class productions and it’s turning a profit.
Cinecittà is also back in the black sooner than envisioned by your business plan
Yes. The business plan envisioned a €300,000 ($327,000) loss this year and profitability next year.
What are your next steps?
We’ve increased revenues and operating profit with the full knowledge that profit margins in this business have to be managed very carefully. We will work on being more cost-efficient and on consolidating our occupancy level that in 2022 was 80%. Then there is our development plan. The main point is that we are developing and building new soundstages. The results that we’ve accomplished so far were obtained with Cinecittà in its existing incarnation. But with more soundstages it’s clear that we can raise revenues.
But there is an important point I want to make. Our current revenues aren’t just due to the fact that are soundstages are full. We made almost €19 million ($20.5 million) in revenues from our art and set design departments. This stands as testament to the quality of the productions that are coming to Cinecittà. The top level of the craftsmen and artisans at Cinecittà is a major asset.
Where do things stand in terms of new soundstages?
We are on track with our plan set out by the Pnrr [European Union’s post-pandemic recovery fund]. By June we will assign contracts to build nine soundstages. We are restructuring four facilities and building five new ones, increasing total stage space from 18,000 square meters to 30,000 square meters, (322,000 square feet) a 60% increase.
How are negotiations going with state bank Cassa Depositi e Prestiti to acquire the new plot of land adjacent to Cinecittà to expand the backlot?
We’ve closed the deal and formally set the value of the land at €17.8 million ($19 million) for ownership transfer of the 31 hectares (76 acres). We are waiting for final approval from Cinecittà’s shareholders – which are the ministries of economy and of culture – and from the bank’s board. We expect to definitively seal the deal by June.
It seems to me that one key change is that Cinecittà is attracting big Hollywood productions that, just like in its glory days, are doing the bulk of their shoots in the studios.
Certainly a large portion of the big Hollywood productions that we are attracting are coming to do a substantial part of their shoots within the studios. They are staying much longer that before. Having Cinecittà back at top level efficiency with cutting-edge services means we can attract a much steadier level of productions. What makes us proud is that in the past two years we’ve attracted very high-level productions, both films and TV series. That’s Cinecittà’s DNA. In the past Cinecittà had its glory days thanks to the huge relevance of the productions it hosted. It wasn’t just a matter of filling up the soundstages and providing jobs. That’s what we are building back.
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