Category Archives: Analysis

China Cinema Future – Barrage 2: Return of the Tucao

Cinema barrage

We were quite overwhelmed by the response to last week’s article about how China is inventing the future of cinema with the concept of ‘barrage’. (Thank you for all the tweets, Facebook posts, emails, LinkedIn mentions and other shares.) So we have decided to do what Hollywood always does when it has an unexpected hit on its hands, which is to quickly rush out a sequel.

The cinema barrage concept also stirred a lot of interest in China (we’ve found no less than 353 articles). In the last piece we focused on the trial involving The Legend of Qin (a.k.a. Qin’s Moon). This time we look at the other film to have tried this concept in a slightly different format at the same time, Generation 90 blockbuster Tiny Times 3.0.

Putting it all on the screen

Unlike the Legend of Qin special ‘barrage’ screening you can see from the picture above that for Tiny Times 3.0 the barrage was overlaid on the main screen showing the films, rather than projected onto the walls on either side of the screen. This makes the tucaos harder to ignore, so it is obviously only something for those cinema goers who seek out this activity, rather than casual cinema goers.

Call it striking up a conversation with the auditorium or turning the cinema screen into a graffiti wall for people to sign temporary messages.

JRJ.com interviews Wang Jun, who was responsible for the Tiny Times 3.0 barrage trial.

Mr Wang was keen to point out that this was an early experiment and is not something that should be expected to be rolled out to every screen any time soon. But the first question was about the equipment and cost.

Wang says that “the barrage is not complicated. There are numerous equipment package available now that add up to about 100,000 yuan [USD $16,240].” He then goes on to elaborate:

First, the film technology currently requires a digital movie player is a secret key [KDM?]. Simultaneous subtitles during playback and video cannot be implemented under the current terms from the policy. This broadcast mainly relies on our software. Only a screening device hardware is not speculation that the two were a movie projector screen with a barrage content superimposed on each other.

The current software was designed for 200 simultaneous participants, which Wang admits is a problem when you have sold 250 tickets. Questioned about whether the wifi network can handle that many simultaneous streams, Wang points out that because these are only short messages there is actually relatively little data being handled.

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Quarterly Results: RealD (Good) and NCM (Not)

RealD logo

We are coming to the end of the current season of quarterly financial results, with RealD and National CineMedia, Inc announcing their respective Q1 2015 and Q2 2014 results. One is good and the other one not so good.

Starting with 3D technology licensing company RealD, the figures should please investors, with a 43% EBITDA year-on-year growth and net income of over USD 5 million. The press release gives the details:

Total revenue was $55.4 million, comprised of license revenue of $36.0 million and product and other revenue of $19.4 million. For the first quarter of fiscal 2014, total revenue was $59.2 million, comprised of license revenue of $37.3 million and product and other revenue of $21.9 million.

China license revenue represented 14% of total worldwide license revenue, up from 8% in the first fiscal quarter of 2014.

GAAP net income attributable to common stockholders was $5.5 million, or $0.10 per share, compared to GAAP net loss attributable to common stockholders of $1.5 million, or $0.03 per diluted share, for the first quarter of fiscal 2014.

The key metrics are interesting in terms of showing RealD weathering a slowdown in North America, both in terms of deployment and box office, with growth in emerging markets more than compensating and in some cases overtaking US/Canada numbers.

  • Estimated box office generated on RealD-enabled screens(1) for the first quarter of fiscal 2015 was $787 million ($387 million domestic, $400 million international). In the first quarter of fiscal 2014, estimated box office generated on RealD-enabled screens was $838 million ($431 million domestic, $407 million international).
  • Ten 3D films were released in the first quarter of fiscal 2015, compared to eight 3D films in the first quarter of fiscal 2014. These figures reflect the number of 3D films released domestically during the periods.
  • International markets generated 63% of license revenue and 34% of product and other revenue in the first quarter of fiscal 2015.
  • As of June 30, 2014, RealD had deployed approximately 25,600 RealD-enabled screens, an increase of 9% from approximately 23,500 screens as of June 30, 2013, and an increase of 400 screens (50 domestic, 350 international), or 2%, from approximately 25,200 screens as of March 31, 2014.
  • As of June 30, 2014, RealD had approximately 13,450 domestic screens at approximately 3,000 domestic theater locations and approximately 12,150 international screens at approximately 3,000 international theater locations.

In the earnings call (transcript by Seeking Alpha, as always) CEO Michael V. Lewis pointed to a 20% cost reduction and significant growth in China, Russia and Latin America as keys to the company’s success in this quarter.

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China Just Invented the Future of Cinema Watching (But Everyone Older Than 30 Will Hate It)

The Legend of Qin - Qin's Moon

This week saw a cinema screening in China that may prove a watershed moment for how films are watched on the big screen. But chances are that unless you are a Millennial, particularly in Asia, you are not going to want to embrace it.

I’ve seen things…

Covering mainland China as a non-Mandarin speaker based in Singapore for me is a bit like watching an outdoor screening of Bladerunner from a neighbouring roof through a pair of binoculars; I can make out most of what is happening, pick up a lot of what is said, though I cannot pretend to understand everything that is going on. But to quote from the films memorable final monologue, “I’ve seen things you people wouldn’t believe.”

Because my perspective, disadvantaged though it may be, provides some fascinating insights into things happening in the Chinese exhibition industry, whether it is bizarre hammer attacks, concession food hygiene scares, Wanda IPO shenanigans or inherent structural market weaknesses - and that’s just in the last two weeks! And like Bladerunner this perspective offers a very real glimpse into the future – of cinema.

Because it is important to remember that the future of cinema does not lie in the west, which only offers stasis or a gentle decline of shrinking older audiences into wider, more comfortable and expensive seats, watching Avengers VII or a Met Opera. That is how THE END of cinema going as we know it plays out in cinema auditoriums everywhere from multiplexes in Manchester to art-houses in Atlanta, observed with gourmet popcorn and a glass of wine in our hand.

Whereas in China and Asia, cinema continue to grow and evolve as a social experience in the non-flickering digital projection light off the Imax/CFG screen. That is where we have to look to understand the future, particularly if we want to remain part of it.

China and Asia – the Cinema Innovators

We don’t need to rehash the already well-established importance of China to the global film and cinema business, whether it’s the gargantuan box office earning of Transformers 4 or the fact that it is the single most important growth market for Imax. What is important is not that China is now the second biggest cinema market in the world – though on uncertain foundations, as we’ve discussed many times before – but that it is a market that is continuing to expand.

This is equally true for the rest of the Far East and Southeast Asia, with the exception of Japan. The cinema business in South Asia is also growing, but with more restrictions, particularly in India where it is hampered by red tape and costly malls. (India also has a different and more traditionalist – not to say conservative – cinema going culture, that is in many way closer to that in the west than in China.)

So when we talk about China, it is often also a shorthand for talking about cinema developments in an arc across Asia that stretches from Seoul/Beijing/Tokyo, down through Singapore/Jakarta/Kuala Lumpur through to Chennai/Islamabad/Dubai.

It is in these markets that we are seeing the greatest innovations when it comes to cinemas. This comes from most of them being under-screened and unencumbered by legacy cinemas and multiplexes with their analogue heritage, as well as having a young population. It is easier to embrace the future if you can build it from scratch than if you have to retrofit it, particularly for audiences that don’t have a fixed concept of what ‘cinema’ should be. Asia is the only continent where the majority of cinemas that have never seen a 35mm print will soon outnumber those that at least once had a film projector. Asia *is* digital cinema.

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Can Filmmakers Really Help Kodak Craft A New Image?

Tired of Hearing Film Is Dead

The long standing uncertainty over the future of 35mm motion picture film was finally laid to rest this past week by the Eastman Kodak Co. causing the industry to heave a huge sigh of relief. That’s one way to look at the company’s announcement of an agreement with what the Wall Street Journal referred to as a “coalition of studios” for the guaranteed purchase of set quantities of film stock over the next several years. Another way to see the news is as a temporary stay of execution for the medium.

Whether the stay will turn into a permanent reprieve for film depends on many factors not the least of which are the length of the deal, the amount of film stock being manufactured and the continued creative preference of filmmakers. More importantly, it hinges on whether Kodak changes the strategy and approach of its historic motion picture business. If recent maneuvers are any indication, there may be some hope, however slim. Let me explain.

Mandatory Prerequisite Background
No story about the current state of the Eastman Kodak Co. or its future potential would be complete without reviewing the company’s last several years, specifically the time period leading up to and after January 19, 2012. That was the date the 124-year-old company filed for Chapter 11 bankruptcy protection. The adoption of digital imaging and photography both in the consumer and commercial markets devastated Kodak which wasn’t able to modify its business and product lines fast enough. The recent announcement about motion picture film stock finally gives us a little glimpse into the financial damage the company suffered during the transition to digital cinema.

According to Jeff Clarke, who took over as the CEO of Kodak this past March, the sale of motion picture film declined from 12.4 billion linear feet in 2006 to 449 million feet last year. You don’t need a degree from a fancy business school to know that a 96% decrease in revenue is a bad thing. The sale of film stock, once a profitable cash cow for the company, now accounts for under 10% of Kodak’s USD $2.2 billion annual revenue.

Since 2003 Kodak laid off 47,000 employees (and stand at around 8,500), closed 13 manufacturing plants along with 130 processing labs. The industry as a whole went from 260 motion picture laboratories capable of handling film in 2011 to 111 last year. As certain studios ceased the distribution of their releases on 35mm even giants such as Deluxe shuttered their film operations in the United Kingdom and United States, auctioning off their analog lab equipment.

This year Clarke reports Kodak will likely lose money manufacturing motion picture film and hopes to break even in 2015.

Examining The Past To Predict The Future
Much has been written over the past few years about how Kodak wound up in such dire straits despite having survived more than a century as one of the most widely recognized and dominant brands in the world. Most news stories focused on the company’s slow response to the transition toward digital photography. Though this may be true, Kodak may have avoided its financial difficulties if it had spent more time studying not only its own past, but also that of photographic technology which has never remained static for long.

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Cinema Audiences Getting Older, German Study Finds

FFA logo

The German Federal Film Board (FFA - Filmförderungsanstalt) has published its annual reports on cinema attendance and Top 75 films for Germany in 2013.

Noting successes for German titles last year, the two reports also record a significant decline in cinema attendance by young people but also a marked increase by older patrons. The findings are in line and emphasise trends in other developed markets, highlighting the needs to promote youth cinema attendance, while at the same time anchoring older audiences.

Demonstrating the customary German thoroughness and attention to detail, the reports were produced on the basis of the Media*Scope project from the Gesellschaft für Konsumforschung (GfK), whose film-related data FFA has exclusive use of, with the panel including no less than 25,000 participants and representatives of the German population over the age of 10.

The first report ‘Auswertung der Top 75-Filmtitel des Jahres 2013 nach soziodemografischen sowie kino- u. filmspezifischen Informationen’ (Evaluation of the Top 75 Movie Titles of 2013 by socio-demographic and cinema-and film-specific information)(PDF link) looks at the box office performance of German cinemas of the past year. While German box office as a whole declined from euro 1,033 million to euro 1,023 million (down one per cent) and attendance fell by 4% from 135.1 million to 129.7 million, as highlighted in the European Audiovisual Observatory 2013 annual report’s findings, the FFA report accentuates the positive by focusing on the success of German films.

Germany Top 75 Cinema attendance

Of the 75 most popular film of 2013 no less than 22 were German productions, which achieved an attendance record of 25.2 million tickets sold. This is more than twice as much as the 13 German productions that broke into the Top 75 in 2012 and only achieved attendance figures of 11.3 million ticket buyers. Local production “Fack Ju Göthe” is also the first German film since 2008′s “Keinohrhasen” to be the most successful film of the year, whether German or Hollywood. However, total attendance for both the Top 75 and all film were down on 2012. Even if they were up on the prior two years, the recent high-water mark is still 2009 (Avatar).

Germany cinema attendance age group

The report does an excellent job of breaking down cinema attendance for each Top 75 film by age (above), gender, income group, employment status, educational level, household size, day-of-the-week attendance, awareness of film’s genre and enough other categories to make even Nate Silver cry uncle!

It is the second report, however, that makes for more troubling reading: ‘Kinobesucher 2013 – Strukturen und Entwicklungen’ (‘Moviegoers 2013 – structures and trends’) (PDF link).

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Premium VoD Just Killed the Cinema Release Window

100,000 viewings DSK movie

One single tweet was the final nail in the coffin of the cinema exclusivity window, given added poignancy by being in French; “100 000 locations en une semaine, rien ne sera plus comme avant” (’100,000 viewings in a week, nothing will be as it was’).  This was the message from Vincent Maraval, Co-Founder of Wild Bunch, the French production and distribution outfit behind the controversial “Welcome to New York”, which was released on video-on-demand without first screening in French cinemas.

In a country (France) that counts cinema admissions rather than box office takings for a film (something that sets most of Continental Europe apart from Anglo-Saxon markets like the United States and United Kingdom), this tweet added insult to injury for what was truly a milestone for the industry in slaughtering its last sacred cow.

The day-and-date release of films in cinemas and on-line is nothing new, but we have now reached a point where the sacrosanctity of the exclusive theatrical window is well and truly dead for the vast majority of films. The recent Cannes Film Festival and the release of the report “Circulation of European Films in the Digital Era” (funded by the European Parliament and European Commission) has thrown this into sharp focus, yet there are many other factors to consider.

Fighting Day-and-Date for Years

“It’s the biggest threat to the viability of the cinema industry today,” is how John Fithian, president of the National Association of Theatre Owners (NATO), put it in 2006 in response to the day-and-date release of the Steven Soderbergh directed “Bubble”, which was released simultaneously on DVD, pay-per-view and in cinemas. Or rather, in a handful of cinemas. In Landmark Theatres alone, to be precise, the sister company of Magnolia Pictures, which produced and distributed the film, both owned by Mark Cuban.

Commenting on the experiment six years later, Steven Soderbergh opined:

On “Bubble” and “The Girlfriend Experience”, we really weren’t able to find out if the experiment worked because frankly, we were blackballed by all the chains. We couldn’t get any screens outside of Landmark, even though we offered to cut them in on some of the VOD and video revenue. They just blackballed us. Part of the point of going day-and-date is that somebody who lives in a place where that kind of movie wouldn’t typically open could watch it through VOD because they’ve read about it, because this whole thing of having to sell a movie multiple times is really f–king boring. We never got to find out if that worked or not because what does Landmark have, 75 screens or something? The movie was not allowed to be shown outside that group of theaters so I don’t know how day-and-date works.

Fithian was skilled in rallying his members to boycott the film, even though he knew that releasing a small independent film with no stars on DVD the same day as it plays in a few art-house screens was not the same existential threat as, say, releasing “Oceans 12″ (also directed by Soderbergh) on all platforms on the same day. But what it did represent was the thin end of the wedge, which is why Fithian was willing to risk coming up with a Jack Valenti-VCR-Boston-Strangler-type of quote.

Soderbergh Bubble

Bubble: “the biggest threat to the viability of the cinema industry today”

The key word in the Fithian quote is ‘today’ and where his greatest success lies was in killing off the discussion and experimentation for another half decade. Fithian is neither a technophobe nor is NATO blind to the direction in which the industry is heading. In response to Soderbergh’s interview, Fithian wrote, “Over the past two years NATO and our members have stated publicly that distributors should sit down privately with their exhibitor partners and their creative partners in dialogue about how the industry moves forward together.” But everything changed in early 2014.

The most serious threat wasn’t “Bubble” in 2006 but the MPAA-FCC exchange in 2009, known by the exhibitor-baiting headline, “MPAA Seeks FCC Okay For Transmission of First Run Movies Directly To Consumers”. While seemingly about day-and-date, we wrote at the time that “the MPAA may simply be hiding behind the concept of protecting content during shortened release windows as camouflage for their true motive; securing high definition digital content as it is distributed into the electronic ether of the home by controlling which devices can playback and display the content.”

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Is It Time To Go Short on AMC’s Shares?

AMC logo

It has been close to six months since the initial public offering (IPO) of AMC Entertainment, meaning that senior management will soon be allowed to start selling shares that they hold in the company. Seeking Alpha therefor asks if the time is right to go short on AMC.

The question of whether AMC managers and officers will start selling shares from 15th of June onwards is an interesting one, because it partly points towards the belief in the company and its future value by those closes to it that know it best, as well as to a larger extent about the prospects for the industry as a whole.

The article ‘AMC: June 15th Lockup Expiration From IPO Could Be A Preview To A Larger Short Play In December‘ summarizes the situation as follows:

  • AMC’s 180-day lockup period will come to an end on June 15th, freeing up 361,348 shares, held by the firm’s directors and officers.
  • An additional 77.8 million shares of AMC stock held by Wanda America will remain bound by lockup agreements until December 17, 2014.
  • While the larger short opportunity for AMC could be in December, the impending June lockup expiration could provide a small window for a short play as well.

While the article says that AMC shares have experienced ‘Unsteady Gains After Disappointing IPO’, the facts are that the shares were priced at USD $18 for the IPO on 17 December 2013. This many have been on the low end of expectations, but the shares have climbed to USD $23 in less than six months, peaking at $25.47 on 7 March.

While this may not be outperforming meteoric shares like Tesla, it is in line with the solid growth of the stock market as a whole this year.

More importantly, it should be remembered that the exhibition sector’s stock market performance was significantly better than the box office itself, as we noted in our February article ‘2013 – Bad Year for Film; Great Year for Exhibitor Share Price.’

Last year was also the first year that cinemas could not count on 3D films’ ticket price hike to boost admissions takings, but had to rely more on advertising, concessions, premium large format (notably Imax) and luxury dining and seating to improve the bottom line.

Seeking Alpha acknowledges that AMC has done a particularly good job of extracting more spending from cinema goers.

Solid First Quarter Results

AMC’s report for the quarter ended March 31 indicated a number of hopeful metrics for the venerable firm. Total revenues grew 7.8% on a year-over-year basis, and admissions revenues-considered amongst the most important metrics for movie theater chains-were up 6.8%. Food and beverage revenues also grew and impressive 8.2%.

AMC also benefits from the significant degree of consolidation in the US exhibition market that has seen the share of box office revenue taken by the four largest exhibitors increase from 35% in 2000 to 62% in 2012. This consolidation process is still underway and we are likely to see the Big Four cinema chains collect two out of every three dollars spent at the box office within the next two years.

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Opera Screenings Do Not Drive Actual Opera Attendance, Study Finds

Sicilian Vespers ROH

A UK study just released has found that screening opera in cinemas is not boosting the interest to attend performances in actual opera venues. The research would seem to provide ammunition to those who claim that event cinema screenings of Met and Royal Opera House productions is cannibalizing audiences from regional opera productions and is not increasing interest in the art form as a whole. However, a careful reading of the findings and underlying numbers provides a more complex picture.

The study called “English Touring Opera – ‘Opera in Cinemas’ Report” (Dropbox .DOCX link) is a research project undertaken by English Touring Opera and the Guildhall School of Music & Drama, in partnership with the Barbican Cinema, and funded by CreativeWorks London. While the report does not make it explicit, the English Touring Opera has a particular interest in this issue. In the pre-digital age, people who did not live or or could travel to London or one of the few other major UK cities with its own opera house, had to make do with local amateur productions or the touring opera.

The research was conducted through both questionnaires and focus group discussions. There is much data and analysis from the former, while the latter provides insights into participants views and opinions, with plenty of direct quotes to back up specific findings. At 23 pages it is worth reading in full and even to go through all the statistics. We won’t try to summarize everything, but to highlight some of the interesting findings.

Finding: Opera in Cinema is not a ‘Gateway’ to Opera in Person

The study took a focused view in terms of audiences, productions and locations.

Participants came from 13 different cinemas (4 outside London), with the majority (46%) drawn from the Barbican as partner (see Fig. 2). Participants from outside London only numbered 13 (5.5%). Most (160; 68.4%) were subscribers or part of a loyalty scheme at the venue, and 79.1% were repeat attenders to the venue for opera screenings. In addition, 64.5% reported having attended a live opera relay elsewhere.

There were five opera screenings that were included, the response rates for which can be seen in the graph below.

Cinema Opera survey response rates

Those polled were turned out to be mostly frequent attendees of opera screenings, with a significant majority having attended 10 or more screenings in the last couple of years.

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What Wanda’s IPO Prospectus Tell Us About China’s Cinema Market

Wanda Cinemas

No less than 30 Chinese companies are looking to list on US stock exchanges this year, led by Internet giants such as JD.com and Alibaba. The reason for choosing the likes of Nasdaq is because unlike their Chinese counterparts they don’t require three years of profitability as well as US regulations that allow for different classes of voting stock. In total some USD $36.6 billion has been raised by 140 Chinese companies through U.S.-based initial public offerings (IPOs) since 2000. But one Chinese company that isn’t going down this route is Wanda Cinemas.

As we have already reported, Wanda is planning a two billion yuan (USD $321 million) IPO ahead of a listing on the Shenzhen Stock Exchange. This is likely to make it China’s biggest domestic IPO in 2014, even if it is overshadowed internationally by Alibaba’s U.S. listing. The smaller film distributor and exhibitor Shanghai Film Co. has also announced plans for a 969 million yuan (USD $145 million) IPO. But it is Wanda that we will focus on as it is more of a bellwether on the state of the Chinese exhibition industry.

It is important to remember that one of the reasons Wanda is not seeking a U.S.-based IPO is because it has already listed AMC Entertainment Holdings, which controls the second largest North American cinema chain. This listing raised USD $314 million, i.e. almost as much as the Wanda’s China IPO aims for. The stock done very well since being listed, with shares rising from USD $18.81 to $22.39, after reaching a high of $26.68 in the brief six-month time span in which it has been trading.

Wanda Cinema’s IPO: the Basics

By way of quick recap, WSJ tells us that:

Wanda Cinema Line is controlled by commercial-property conglomerate Dalian Wanda Group, which always installs cinemas in the shopping complexes it develops. With that support, Wanda Cinema has expanded into smaller Chinese cities. Dalian Wanda is controlled by its chairman, tycoon Wang Jianlin, who is the country’s richest man. Wanda Cinema Line owned 142 cinemas in 73 cities with 1,247 screens at the end of 2013, its preliminary prospectus said. Its net profit in 2013 rose 55% to 603 million yuan from 388 million yuan in 2012, while revenue rose to 4.02 billion yuan, up 33% from 3.03 billion yuan.

It is worth flagging again the concerns raised in the risk factors section of the prospectus, as highlighted by the WSJ:

China’s largest cinema chain takes a dim view of the domestic movie industry. In the risk factors section, the prospectus notes that “While Chinese films have achieved a certain volume, there are relatively few films of commercial value” and regulations limit foreign film imports. Therefore, Wanda faces risks resulting from the “lack of quality films in China that can really win good praise and reviews and completely satisfy market needs and the cultural demands of viewers.”

So while everyone is celebrating the success of “X-Men: Days of future Past” and “The Monkey King” in the first half of this year, local action epic “The Iceman 3D” underperformed and had to be split into two releases in order to get a decent return on its runaway budget.  Meanwhile, even Hollywood flops like “Transcendence” didn’t perform much better in China. We have also previously flagged up on this site the very real risk of a crash that the Chinese cinema business faces. Read More »

The Real Reason That Carmike Bought Digiplex

Bud Mayo opportunist

Is A. Dale (“Bud”) Mayo the savviest man in US exhibition? One thing is for sure, after Carmike’s acquisition of Digiplex he is one of the country’s richest cinema entrepreneurs, with a hat-trick of deals in the last 15 years. So what lies behind this merger and what were the true reasons for it?

The deal itself is relatively straightforward: Carmike Cinemas is acquiring Digital Cinema Destinations Corp. (“Digiplex”) in an all-shares deal that will see each of Digiplex’s 7.93 million shares exchanged for 0.1775 shares of Carmike common stock. The deal is valued at around USD $64 million, of which USD $45 million is in stock and USD $19 million in assumed debt and obligations. Mayo has thrown his 39.5% voting stock behind the deal and the FCC and other regulatory bodies are unlikely to raise any objections or even require any screen sell-off.

Digiplex currently operates 206 screens across 21 locations and is in the process of acquiring another 5 theatres with 53 screens, for a total of 26 cinemas with 259 screens. Once the deal goes through Carmike will have grown to 280 cinemas with 2,936 screens across 41 US states. Significantly Digiplex brings four new states to the Carmike fold where previously it had no presence: Arizona, Connecticut, Maryland and New Hampshire.

What’s In It For Carmike

There is a two-fold reason for Carmike to do this deal. Inorganic growth (i.e. mergers and acquisitions) was the only way that Carmike could achieve the goal announced by its head last year.

Carmike Cinemas President and Chief Executive Officer David Passman stated, ”Carmike continues actively expanding our growing circuit, on our way to 300 theatres and 3,000 screens through selective acquisitions and the addition of multiple new-build theatres in promising locations like Decatur, across `Hometown America.`

Carmike has already acquired Muvico Entertainment with its nine cinemas with 147 screens in Florida, California and Illinois  for around USD $31.8 million late last year. Prior to this it purchased 16 multiplexes from Rave Review Cinemas (including seven IMAX screens) and three multiplexes from Cinemark (one Imax theater) for a total of eight Imax screens. There was also two theaters with a total of 16 screens in Kentucky and Tennessee bought from Phoenix Big Cinemas in 2012.

Carmike Cinema logo

So the deal to buy Digiplex is only the latest but largest in a series of acquisitions that total 30 multiplexes even prior to Digiplex in the last couple of years. While there is consolidation in the cinema industry both in the US and beyond, there is thus a clear roadmap that Carmike is following.

But these numbers, either multiplexes, screens, dollars or shares don’t tell the full story for Carmike – whereas a single digit does: 4.

The Lonely #4

Carmike likes to describe itself as “one of the nation’s largest motion picture exhibitors” and as “America’s Hometown Theatre Chain” but no matter which way you look at it, the chain is only the fourth largest circuit and a lonely fourth at that.

Why ‘lonely’? Consider who the top three circuits are, as well as who is fifth.

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