Misdirected Venture? : Despite 2 Oscars, Camera Platforms International Has Never Been in the Profit Picture

After a decade of big losses, studio equipment maker Camera Platforms International has announced it needs a buyer or merger partner.

The company, started by “Smokey and the Bandit” director Hal Needham, managed to stagger through losses in recent years thanks largely to the financial support of UST Inc., a highly profitable tobacco company (“Skoal”) based in Greenwich, Conn. Years ago, Needham struck a friendship with former UST Chairman Louis Bantle through their mutual interest in stock car racing, and Needham got UST to bankroll his idea for a high-tech film equipment company to the tune of $10 million. UST now owns 76% of Camera Platforms stock.

Although Camera Platforms collected two Oscars for its innovative movie equipment, and its lighting ballast systems have become standard filmmaking hardware, the company never had a profitable year. Needham used to joke that he didn’t know much about running a public company, and Camera Platforms’ track record seems to have proven him right.

Last year, the company lost $1.9 million on only $3.5 million in revenue, and for the first nine months this year, it lost another $1 million on revenue of $3.1 million. Increased competition and the passing of action TV shows like “Knight Rider” and “Hill Street Blues” in favor of sitcoms may have been one factor in Camera Platform’s problems.

But some say that Needham--whose folksy style extended to writing shareholders letters beginning “Dear Mom” and ending “Love, Hal”--simply misjudged what kind of costly equipment the movie-making industry would support.

Camera Platforms chiefly rents two types of filmmaking equipment. One is a lighting ballast, a device that electrically controls light intensity to match camera speed, making it easier to film night scenes. Camera Platforms’ other main business is camera cars--essentially pickup trucks that carry cameras and lighting equipment. Camera cars tow or follow vehicles being filmed to shoot scenes in motion. Their use dates back to the earliest days of movie-making when they were used for stagecoach scenes in old Westerns. Recent films using Camera Platforms’ cars include “Dances with Wolves,” “Jurassic Park” and “Driving Miss Daisy.”

But competition for both types of equipment has increased and the market is thought to be getting saturated.

Camera Platforms seemed to get off to a fast start in the camera car business. With UST’s financial backing, and the help of a race car designer, and Camera Platforms’ former chief engineer William Fredrick, it produced a complex camera car, known as the Shotmaker ‘Elite.’ The Elite has a 23-foot-high crane, six wheels, side platforms and a silent, electric motor, which has made it possible to film car chases from multiple angles.

*

The company became by far the biggest player in the camera car business, an industry formerly dominated by small, independent operators. “They had a big name . . . and they undercut prices,” said Lee Nashold, owner of Camera Cars Unlimited, an Agoura Hills competitor. Camera Cars Unlimited saw its revenues decline by 60% in the late 1980s after Camera Platforms emerged on the scene, Nashold said.

But a shift in TV programming soon reduced demand for camera cars. Police shows with car chases began to be replaced with 30-minute shows shot indoors. Nowadays, “sitcoms (filmed) on stages--that’s pretty much all we have,” said Ron Woodward, who helps producers obtain equipment at CBS Studios in Studio City.

Computer-generated special effects in films may also have sapped demand for camera cars, said Mike Ruffing, commercial marketing manager for Hollywood Rental Co. Inc. in Sun Valley, a studio-equipment rental company that rents some of Camera Platforms’ lighting ballasts. “It’s tougher and tougher. Budgets are shrinking all the time with movies,” he said.

Part of Camera Platforms’ problem was its large overhead, which included the cost of its 24,500-square-foot plant in Valencia, its 39 employees and maintenance of its complex equipment. “You look inside the cab in one of their camera cars, and it looks like the cockpit of an airplane,” said Ken Day, owner of a small firm called Hollywood Camera Cars in Sylmar. “They have all these fancy things--hydraulic lines, all these gadgets . . . stuff you don’t need.”

Camera Platforms also faced competition from a host of small operators who flooded the business with camera cars rigged up at low cost. “In this business, a lot (depends on) what people are willing to pay for a shot,” acknowledged Camera Platforms chief financial officer Phil Panzera. “Will they pay $550 (a day) for an Elite, or just get a guy with a pickup truck for $250?”

The result for Camera Platforms was a barrage of bad news. Because of its sagging finances, the company’s stock was delisted from NASDAQ last year. UST continued to pour money into the company. UST’s initial investment, later converted to stock ownership, was followed by a $3-million line of credit in 1991, and the extension of another $2.3-million line of credit last year to help Camera Platforms acquire another camera equipment company that makes camera dollies.

UST has since forgiven $1 million in interest payments owed by Camera Platforms, and now says it will forgive the company’s remaining debt of $5.3 million to help make it more attractive to potential buyers. A UST spokesman declined further comment on Camera Platforms.

But the root of the company’s problems were administrative and legal costs of running a large, public company, Panzera said. “All three of our operating units are cash-positive generally. But you add corporate overhead and the entire entity has a loss,” he said.

Needham, the company’s chairman and CEO, could not be reached for comment. However, he has not been involved in day-to-day operations of Camera Platforms since 1988, said Panzera. But his unconventional style left its mark on the company.

The problems for Needham’s company are in contrast to his own success in the entertainment business. Born to a family of sharecroppers in Tennessee, Needham had only an eighth-grade education, yet he managed to become a leading stuntman, and eventually directed films. Reputed to be quick, charismatic and bluntly honest, he forged a friendship with Burt Reynolds, eventually directing a handful of successful Reynolds films, including “The Cannonball Run.”

Of late, Needham has returned to the trade he knows best. He recently produced a series of specials based on “Smokey and the Bandit” for television, Panzera said.

As for Camera Platforms, Panzera said he’s confident that the camera car, lighting and dolly divisions will stay in business, once they are freed of the burdensome corporate structure. “People will say ‘I can run them without that overhead.’ And they’re right,” he said.