Creating a new Republic.

Creating a new Republic

In the colorized 1949 Republic Pictures Corp. movie "Sands of Iwo Jima," aired Oct. 12 on KTTV-Channel 11, John Wayne played "Striker," tough platoon leader struggling to keep his young troops alive in the South Pacific. KTTV rented the movie from Republic, giving to the film company about 12.5 minutes of ad time, worth about $25,000.

In one bit of classic celluloid, Wayne is charged with holding his Marines in position, despite Japanese tricks to lure them into the open.

Wayne's leathernecks hear pleas for help from the dark, just in front of their line. "There's a Marine out there," cries one soldier, ready to climb out of cover to aid the mysterious voices.

Wayne orders the soldier to stay put - under threat of death from Wayne's own cocked rifle.

The brave doughboy hesitates, and at last backs into his foxhole.

The camera then focuses on Wayne's face. It becomes beaded with sweat, his eyes the definition of haplessness. Privately, Striker is bowed by life, circumstance, and man's inhumanity to man.

It is a classic scene, one in a library of 1,117 films now owned by Russell Goldsmith, chairman and chief executive of a financially renewed Republic Pictures Corp. - who is a man certainly not bowed by life and circumstance.

Indeed, the young Goldsmith - Harvard law grad and son of Bram Goldsmith, the prominent Beverly Hills banker - appears poised to add another string of successful years onto a life that could be described as a 39-year-long winning streak.

"Things look very positive in the short-term and the long-run for us at Republic," says Goldsmith, flashing a set of near-perfect pearly whites. "There is emerging a global standard for entertainment, and that standard is American entertainment. The Japanese may make Sonys and Korean make the VCRs, but nobody would buy a Korean VCR that could only play Korean programs. They all want American programs."

That world market puts Los Angeles-based Republic on high ground, as Goldsmith sees it. In addition to the film library, which includes such greats as "The Quiet Man" and "The Red Pony," Republic owns 1,800 television serial episodes, including 430 installments from the long-running "Bonanza" TV series, and the complete stock of "Car 54, Where Are You?" and "Get Smart" television series.

Goldsmith says his film library is ammo that packs bigger bangs with each passing year, given that the number of venues for programming and world demand will only increase. "With what other asset or product does the value go up every four to five years?" asks Goldsmith, defining the typical syndication period. "We will get more in five years for syndicating high-quality entertainment such as `Bonanza,' which is the greatest western television series ever made and that probably will ever be made, than we get now."

The "Bonanza" series turned out to be appropriately named for Republic; upon buying control of the company, Goldsmith "discovered" that 170 of the series' 430 episodes had never been syndicated - "syndicated" being show biz slang for renting programs to television stations, cable operators and satellite systems for broadcast.

The unsyndicated shows hadn't been seen by the public in more than 25 years - longer than a generation. Westerns being a timeless genre, the shows might as well have been freshly minted.

More than 120 of the westerns, named "Bonanza - The Lost Episodes" were syndicated to the Christian Broadcasting Network Family Channel Cable Network last year in a multi-million dollar deal, an example of the more aggressive use of assets that many analysts say Goldsmith has brought to Republic since taking control of the company in August of 1986.

Says Joel Reader, entertainment industry investment banker with Oppenheimer & Co. in Los Angeles: "Republic is a company with fine assets, and Goldsmith knows how to manage those assets for maximum profit."

Goldsmith formed The Paragon Group, a limited partnership made up of himself, his father Bram, and other unidentified investors, to buy 34 percent of the company's voting stock at $14 a share in 1986. He then became chairman and chief executive.

Before assuming command of the troops at Republic, Goldsmith worked as chief operating officer at Lorimar-Telepictures Corp., and before that he was nameplate partner in the entertainment law firm of Sanders, Barnet, Goldsmith & Jacobson.

Goldsmith got his break in Hollywood by joining local law giant Irell & Manella, fresh out of Harvard Law in 1978 and apprenticing in entertainment law.

Since taking control of Republic in 1986, Goldsmith has also cautiously moved the 74-year-old studio back into production - after a 30-year hiatus - most notably with the series "Beauty and The Beast," shown weekly on the CBS network.

The series, just renewed for a third season, is a glowing example of Goldsmith's statement that American entertainment is the world standard: Republic has licensed distribution of the show in more than 100 countries, a veritable United Nations.

The studio has also produced several made-for-television movies, including "Liberace," a tale of the life and times of the colorful piano-man, and "Indiscreet," a drama starring Robert Wagner and Lesley-Anne Down.

Goldsmith's efforts have affected Republic's revenues, if not so much the bottom line. The studio reported a net of $285,000 on revenues of $51.98 million in 1988, compared with a net of $550,000 on revenues of $18.95 million in 1986.

However, in the first six months of 1989, Republic is looking better on the profit picture, earning $639,000 on revenues of $26.62 million.

Wall Street appreciated Goldsmith's opening acts at Republic but has been cool lately. The stock, which retreated to below $4 after the stock market crash in October 1987, rose into the lower double digits by March of this year - but it has pretty much stayed there, trading late last week for just over $10 a share.

Some say Republic is an asset play, due to the library. "It is worth $20 to $22 a share," says Raymond Katz, analyst with Mabon, Nugent & Co., a New York-based investment house. "We expect investors to become increasingly aware of the company's value."

Some investors don't like film companies due to a seemingly irresistible temptation on the part of Hollywood execs to think, and then spend, big.

Many other Hollywood studios have started out on practical, moderate-budget productions - as Republic is now - only to succumb to the Tinseltown lure to produce a star-studded, expensive blockbuster. When the blockbuster never comes, expenses spell defeat, as surely the mysterious voices that beckoned Wayne's troops on Iwo Jima.

Goldsmith swears he has the discipline to avoid the lure. "I am not about to bet the company on a feature film," he says. "We may do television movies, perhaps remakes of some of the films already in our library. But we will only do shows that have economic rewards that justify the risks."

Goldsmith's declarations of frugality can be taken seriously, if the Republic's somewhat Spartan headquarters building is any example. It sits in a nondescript office park zone near the old Hughes Airport, and leases for a mere $120,000 a year - less than some houses in Goldsmith's native Beverly Hills.

"We try to keep overhead low," says Goldsmith. "You don't want to get in an exposed position."

Just what Wayne's "Striker" would say.