Category Archives: Daily News Roundup

Daily Cinema Digest – Tuesday 21 October 2014

The Space Italy

Last week’s big news was the announcement that UK/European exhibitor Vue had acquired Italian cinema chain The Space. Having previously expanded into Germany and Poland, this was a vote of confidence in the troubled south European market – though The Space is the cinema leader in an otherwise fragmented market, plus Italy had unless most other European territories an excellent cinema year in 2014.

European exhibitor Vue Entertainment International said Thursday it has agreed to acquire The Space Entertainment, a cinema chain in Italy with 36 multiplex theaters with 362 screens.

The deal is Vue’s fourth acquisition in the past three years and is supported via a follow-on investment from the firm’s Canadian owners Omers Private Equity and AIMCo. Over the past three years, Vue has more than doubled the number of cinemas and screens under its ownership from 70 to 187 cinemas and from 678 to 1,727 screens.  LINK

Wanda Cinema

China (PRC) – Wanda has re-filed its IPO documents for a listing in Shenzen. So much for the conspiracy theories that the first failure was a face saving strategy to list in Hong Kong or abroad.

Wanda Cinema Line, China’s biggest theaters chain, has re-filed its application for an IPO.

Its earlier attempt to float on the Shenzhen stock market in July was denied by regulators who said that its documentation was insufficient.

The company plans to issue 60 million shares and raise RMB2 billion ($326 million) of fresh capital.  LINK

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Daily Cinema Digest – Friday 3 October 2014

RealD Founders Michael Lewis and Josh Greer

RealD founders Michael Lewis, left, and Josh Greer wear 3-D glasses inside their theater at their Beverly Hills headquarters. (Ken Hively / Los Angeles Times)

RealD shares debuted at USD $16 when the company first went public but are now languishing at less than ten dollars, so this unsolicited take-over bid should not come as a surprise.

RealD Inc. (RLD), the supplier of 3-D technology to cinemas, received a $12-a-share takeover bid from Starboard Value LP, the activist investor that’s pressing Yahoo! Inc. (YHOO) for changes. RealD shares soared.

Starboard holds a 9.9 percent stake in RealD, according to a regulatory filing yesterday. The offer represents a 29 percent premium over RealD’s $9.27 closing price yesterday in New York and values the company at about $600 million. The stock jumped 27 percent to $11.78 at the close in New York, the biggest one-day gain since the July 2010 IPO. LINK

ACGE Conference

Director Sylvain Guy Francois Macerola, Patrick Roy, president of Seville Pictures and Raffaele Papalia, president Cinemas Cine Entreprise

Canada (Quebeq) – French-speaking Canada has a new cinema association: l’Association pour le cinéma sur grand écran (ACGE).

Speakers from all areas of the film industry on the big screen on Wednesday announced the creation of the Association for movies on the big screen (ACGE), whose objective is to promote the cinematic experience.

As President, members ACGE elected unanimously Raffaele Papalia, president of Cinemas Cine Entreprise. The former president and CEO of SODEC François Macerola will act as a strategic advisor to the association.

According to Papalia, now is now conducive to union resources of members of the CGEA, “to analyze the challenges the film industry faces on the big screen.” The objectives of the new association will be to develop new approaches that will favor the revival of audiences, convey a positive and inclusive message to moviegoers and promote the cinema experience on the big screen. LINK

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Daily Cinema Digest – Wednesday 1 October 2014

Billy Elliot

Event cinema has a new hero and his name is Billy Elliot, having grossed more on the day it beamed than The Equalizer, the highest grossing film.

Universal’s live stream from London’s Victoria Palace Theatre last night [Sept 28] danced its way to an extraordinary $3.1m (£1.904m), setting a new record for Event Cinema releases.

Based on figures from Rentrak, in terms of theatre releases, Billy Elliot surpassed the previous best opening set by NT Live: War Horse at $2.5m (£1.6m). War Horse is also currently the highest grossing theatre release at $4.6m (£2.7m).  LINK

Good timing for Variety to cast a spotlight on event cinema, which accounts for almost a fifth of revenue of some art house screens and has saved many a rural cinemas.

Picturehouse director of distribution Marc Allenby says a like percentage of his company’s box office comes from such programming. “What’s remarkable,” he adds, “is that that 18% comes from such a small proportion of screenings.”

In Sweden, not only has the sector been a boon to rural cinemas, which struggle to book new film releases day-and-date with big cities, it also has enabled exhibs to take advantage of new revenue streams.

“A court decision said that when a cinema is screening opera or theater, it automatically becomes an opera house or theater, so legally, we can serve alcohol,” says Rickard Gramfors of Folkets Hus och Parker, which operates 170 cinemas in the nation.  LINK

Both of them will be attending the ECA event in London on 16 October – see our banner and side bar for details.

AMC premium seats

AMC is pushing ahead faster than planned with its re-seating plan of upgrading more of its cinemas to premium quality (and pricing). It will spend USD $39 million more than initially planned in the current year. Smart or desperate strategy? The answer is: ‘necessary’.

The approximately $39 million represents a nearly 20 percent increase from the estimated $200 million in planned net cash outlays in 2014. Actual total capital spending for 2014 will be approximately $265-$285 million, before expected landlord contributions of $35-$55 million.

The additional 2014 capital investment will primarily support the acceleration of recliner re-seat initiatives, additional MacGuffins bars and IMAX screens in AMC theatres. As of June 30, 2014, AMC had recliner re-seats in 44 locations with 505 screens, 74 MacGuffins and 148 IMAX screens, which makes AMC North America’s leading and largest IMAX distributor.

In December of 2013, AMC announced a $600 million, five-year recliner re-seat investment. During the second quarter of 2014, admissions revenues per screen increased by 33 percent and Adjusted EBITDA more than doubled at AMC’s 44 recliner re-seat locations.   LINK

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China Special Cinema Digest – Thursday 25 September 2014

Today we catch up Chinese cinema news from the last couple of weeks, which I was unable to report while travelling. As always, the Google translation is not perfect, but as we do not have a journalist on staff who can translate perfectly from Mandarin (yet!), it will have to do. We are also saving the biggest piece of cinema news to come out of China recently for a separate post.

Chen Xing technology laser

Our favourite Chinese (digital) cinema equipment manufacturer Chen Xing has issues a list of “Seven Rules for Cinema Brand Building” that heavily promotes its own technologies and solutions, while also providing an insight into the company’s thinking and strategy.

Don’t forget what we’ve written about them before: “China’s ‘Last Mile’ Plan for Digital Cinema: Ditch Western Technology.” This is as much true for smartphones and airplanes as it is for cinema equipment – China does not want to keep importing ‘Western’ technologies but build their own (then export it). Such competition and innovation should not be seen as a threat but a good thing.

The Seven Rules are: acoustical design, sound system, laser light source projection, TMS centralized management and control systems, cinema ticketing management system and service quality guarantee system.

Chen Xing talks about the alternatives it will offer up when it comes to laser (illuminated) projection, as well as immersive audio, where its Cinelab has developed 5.1, 15.1 and 17.1 audio which “get rid of the shackles of sources,” and offer “the perfect interpretation of the Dolby (ATMOS) panoramic sound studio truest sound.”

Chen Xing fires a shot across the bows of the other manufacturers by pointing out that while not being part of the original DCI elite, it is one of the largest server/media block deployers in the world today.

Digital Film for film and television industry has brought tremendous changes. Especially in distribution and exhibition side, digital cinema technology has maintained rapid growth in recent years. Of course, these are inseparable from the updated device technology. Regardless nowadays 3D, IMAX, 4K and other high-tech marketing, have become an end shadow vane hall, the market demand for high-tech also “hubbub straight on.” Christie, Barco, NEC, SONY have launched projectors with laser light source, which means Hollywood recommended type of light source laser source trend.

Among them, in the digital cinema systems, as film screenings server core products while always being SONY, GDC, Dolby, Doremi and other foreign manufacturers, “occupation”, but with the development of technology, more and more Chinese national brand manufacturers Chen Xing Technology began as “emerging” by the market influence is also rising. It is understood that the field of the world’s digital projectors DCI-compliant digital cinema server products, market share and influence were sorted by: GDC, Dolby, Doremi, Chen Xing AQ series.  LINK

Imax Tianjin

Imax screens only account for one per cent (1%) of the total Mainland screen count but an astonishing ten per cent (10%) of the box office, according to an interview with Imax’s director in China Yuan Hong. He also reiterates that China’s total box office will overtake the United States, some time between 2018 and 2020. “When will we surpass the United States? Five years ago we did not expect to ask this question, now it is just around the corner,” he observes.

Also at the box office, too, “as the movie, the theater itself is dependent on bringing new grossing film screenings, but also for the huge traffic.” Especially as the Lunar New Year stalls, summer gears up. “It also shows that, for shopping centre developers, the introduction of a cinema format still has a very good future.” At the box office, although high, it brings high turnover, but the scene, Yuan Hong also points out is “broke.” “For the cinema itself the profit margins are very limited, even if the movie is good, it is quicker to make money from popcorn, drinks, toys and other Transformers. ”  LINK

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Daily Cinema Digest – Wednesday 24 September 2014

Iosono lab

IOSONO – when 11.1 speakers just ain’t enough.

Barco is doubling down on its immersive audio efforts by hiring away IOSONO’s audio team and setting up what is now called Barco Audio Technologies [BAT?]. This could potentially mean moving away from a dependance on the Auro brand and Auro Technologies partnership, though the latter is quoted on how thrilled they too are about the new corporate sibling’s arrival.

With 500 screens committed or installed, Barco is now ready to take immersive sound to the next level. The digital cinema leader is adding the team of 3D audio expert IOSONO and its assets to the Barco family to further enhance and customize its object based immersive sound technology. In this way, it wants to help cinema exhibitors bring even more magic to the movie-going experience.  LINK

And since Barco does not have any film immediately lined up to follow “The Maze Runner” for its Escape triptych-screen it is venturing into event cinema, by announcing a concert film with Lady Gaga and Tony Bennett.

Barco will collaborate with Universal Music/Interscope Records and recording artists Tony Bennett and Lady Gaga to bring their performance at the Grand Palace in Brussels into Barco Escape theaters in early 2015.

The performance will be filmed today specifically for the Barco format, the day before Tony Bennett and Lady Gaga’s “Cheek to Cheek” album of jazz and popular standards is set to release worldwide.  LINK

Everstone

The interest in India’s multiplex business is heating up, with yet another private equity company talking to two multiplex veterans about setting up a new cinema venture called Cinemasia, that could be looking beyond just India.

Private equity fund Everstone Capital may team up with two individuals with experience in the entertainment industry to start a venture called Cinemasia, three people familiar with the development said. Everstone is in talks with Shravan Shroff, the former promoter and managing director of multiplex operator Fame India Ltd, and Pramod Arora, who recently quit PVR Ltd as group president, the people said on condition of anonymity.

And:

This would be Everstone’s maiden venture in the multiplex business, which has already attracted other private equity funds. Renuka Ramnath-promoted Multiples Alternate Asset Management Pvt Ltd and L Capital Asia, the third party private equity fund of LVMH Group, backed PVR Ltd to acquire Cinemax India Ltd in November 2012. Before selling off Fame, Shroff also raised capital from India Value Fund and Singapore’s sovereign wealth fund Temasek Holdings (Private) Ltd.  LINK

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Daily Cinema Digest – Friday 12 September 2014

As you may have noticed Patrick von Sychowski is in Amsterdam attending IBC which means you must suffer my attempt at putting together a Daily Cinema Digest.  Be sure to check out all of Patrick’s coverage of IBC after catching up on the day’s (or in this case, week’s) cinema news.

Big Cinemas

Hey, remember when North American exhibitors built way too many multiplexes during the 1980′s and 90′s over extending themselves to such a degree that during the early 2000′s the industry began to consolidate with cinema chains buying each other out or merging?  Well, it seems this is a trend that might be hard to avoid.  India has been going through a huge multiplex boom over the past decade and now it seems has entered the consolidation phase of the business cycle.  Rumors are afoot that Carnival Films is in negotiations to acquire the majority of Reliance MediaWorks theatre chain Big Cinemas.  This would be the third such merger or acquisition for India’s exhibition industry in as many months:

Inox Leisure, India’s second largest multiplex operator, acquired Delhi-based Satyam Cineplexes Ltd for nearly Rs.240 crore, paying Rs.182 crore in cash and taking over its debt in a deal that expanded Inox’s presence to 50 cities, with 91 multiplexes and 358 screens; and Housing Development and Infrastructure Ltd (HDIL) sold its multiplex business Broadway Cinemas to Carnival Cinemas for an undisclosed amount.

If the deal goes through Carnival would end up with 280 screens.  That really seems to be one of the main reasons for all the mergers and acquisitions; more screens a bigger market share of the box office and thus more leverage when negotiating with film producers and distributors over film rental.

According to the omnipresent anonymous source “familiar with the situation” Reliance isn’t looking to completely exit exhibition:

“The contour of the final transaction is yet to be arrived at, but Big Cinemas will not entirely exit the business. It will form a strategic alliance with an existing cinema exhibition chain that will run the daily operations and it will receive proportionate revenues from them as part of the partnership. Reliance MediaWorks will also invest in the venture as part of its growth strategy because it believes there is growth potential in this business.”

Don’t expect the consolidation of the Indian exhibition industry to slow down anytime soon.  Jehil Thakkar, head of the media and entertainment practice at KPMG, told LiveMint:

We certainly do see the cinema multiplex industry continuing to consolidate inorganically as the real growth opportunity lies there… Most of the big players are seeking inorganic growth options and scale is a very important part of this business.”

I just love that word “inorganic”.  Do you think since organic products usually cost more at stores that inorganic ones would cost less?  If so, maybe Carnival could get a discount on Big Cinemas since it would technically be considered “inorganic growth”.  LINK

Megabox

South Korea – The sale of exhibition circuits isn’t limited to India.  Over in South Korea an investment group is looking to cash out on their seven-year investment in Megabox.  Korea Multiplex Investment Corp.

Inside, though anonymous, sources have told various media outlets that backers Korea Multiplex Investment Corp., whose shareholders include the National Pension Service, Public Officials Benefit Association and Military Mutual Aid Association, are pushing for a sale of the company and have been reaching out to potential buyers.

Megabox is one of South Korea’s largest multiplex operators controlling 21% of the screens in the country as of last year. That figure is third to CJ CGV which operates 43% of screens and the film division of Lotte Shopping Company which controls 32%. Korea Multiplex, which owns 50% of Megabox (Jcontentree Corp. holds a 46% stake in the exhibitor), is hoping the circuit will sell for as much as 13 times its current earnings.

In 2013 Megabox netted KRW 25.6 billion (USD $24,745,216) on KRW 206.1 billion (USD $199,218,321) in revenue.  LINK

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Daily Cinema Digest – Tuesday 9 September 2014

AMC Wanda logo

‘AMC Is A Ticking Time Bomb’, Seeking Alpha’s article headline yells. Not quite as dire, but it does raise some pertinent questions about AMC’s long term financing. No mention of the summer slate of 2015 but just a penetrating look at the underlying profit, margin, borrowing, yield and re-financing numbers.

So why are investors willing to pay 22x Forward PE? Is the growth potential really that strong? Revenues has not indicated so. AMC’s profitability is not exactly very decent either – the company earned 2% net income margin for the H1 2014 compared to 3.8% a year ago. What about RGC? Same story.

A large portion of AMC’s earnings is actually paid to debt holders. AMC paid $57.6m in interest expenses compared to its net income of $26.9m during the first half of 2014.

And it is a hefty bill that shareholders have to foot.  LINK

Don’t forget though that AMC is 80% owned by Wanda, so whatever risks other shareholders are exposed to, Wanda carries four times that risk. So Wanda will not let AMC shares tank while it re-structures its planned IPO for Wanda’s Chinese cinema business, which may or may not take place in the US.

Get on Up

Universal has announced that it will henceforth support subtitling and audio description for all of its Hollywood releases in Germany.

Universal will provide cinemas in Germany with international films with subtitles and audio description in future. The first will be the James Brown biopic “Get On Up” on October 9. As stated in a press release co-authored with providers of the app Greta & Stark, this access will be provided for five new Universal releases, with subtitles and audio description in cinemas available in combination with this free smartphone app. In addition to “Get On Up”, these are the Stephen Hawking-biopic “The Theory of Everything”, “In The Labyrinth of Silence”, “Trash” and “Alles ist Liebe” (“All is Love”).  LINK

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Daily Cinema Digest – Monday 8 September 2014

Jerome Seydoux Pathe Paris

Paris is about to see the opening of a museum by the Jérôme Seydoux-Pathé Foundation, which will showcase the evolution of cinema through the Pathé film company’s history. The 2,200 square meter building itself looks hugely impressive (even if it makes people think of a ‘giant glass slug’), perhaps no surprise as it was designed by ‘starchitect’ Renzo Piano.

“Pathé was the first to make cinema into an international industry,” says cinema historian Anne Gourdet-Marès, who is in charge of the equipment section. “Pathé was a visionary, surrounding himself with engineers who could turn his ideas into equipment, like the Pathéscope or the Pathé Baby which dates from 1922. The initial studies for this camera were developed secretly with English engineers. ”

One of the draws of the Foundation, designed by the same architect who designed The Shard in London or the New York Times newspaper building, is its cosy 68-seater screening hall, equipped two 35mm projectors and a digital one – because of course the Foundation is involved in restoring and digitalising film.

A black piano at the foot of the screen is not just for show.  LINK

Cinema France

Reassuring then to know that cinema remains the favourite cultural activity of the French.

Over the past twelve months, the cinema topped the ranking with 72% against 42% for museums and 32% for concerts after LH2 study mareduc.com.

Cinemas attract 90% of 15-24 years, while 65 and older prefer the museum and exhibitions.

Next budget, the study says that more than six out of ten French, 65% spend less than 50 € monthly in cultural outings budget.  LINK

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Daily Cinema Digest – Friday 5 September 2014

Selfridge cinema

London’s luxury department store Selfridges (star of the ITV drama series about its eponymous American founder) will be one of the first stores in the world to have its own in-house cinema. We like the look of it so much that we even break our usual policy of only posting on photo per story to show you both the outside (above) and inside (below) – so no artwork for China BO.

Selfridges opens the world’s first department store cinema in its iconic Oxford Street store today, which will screen classic and contemporary films.

Selfridges has teamed up with the independent chain Everyman to install the 60-seat 3,500 sq ft experience, located on the store’s lower-ground floor.

The cinema, which will be at Selfridges until spring 2015, will initially screen films selected by designers from the store’s Masters campaign, which showcases the work of 12 influential designers such as Paul Smith, Marc Jacobs and Oscar de la Renta.  LINK

Selfridge cinema

China (PRC) – Chinese Mainland box office it set to pass USD $5 billion this year, according to THR.

China’s box office has just passed the key 20 billion yuan ($3.26 billion) threshold, a full three months faster than last year, and is already swiftly approaching last year’s $3.55 billion total.

With a raft of major Hollywood and domestic titles still to come this year in the world’s second-biggest film market, box office is on track for $5 billion in full-year 2014, according to M1905, which is the official website of the state broadcaster’s movie channel, CCTV6.

It took 246 days to break through the 20-billion-yuan marker, which is 96 days faster than last year.  LINK

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Daily Cinema Digest – Thursday 4 September

 

IBC

IBC is less than a week away and the IBC Big Screen Experience (free for all attendees!) will hear an urgent appeal for digital cinema manufacturers, exhibitors and others to resolve the vexing issue of software upgrades.

John Hurst, co-founder and CTO of CineCert, LLC internationally recognized developer of D-Cinema technology based in California, will be presenting at the Global D-Cinema Update Session at IBC a call to action to all digital cinema stakeholders to resolve delays in deployment of software upgrades on installed digital cinema systems globally.

During the session hosted by the European Digital Cinema Forum (EDCF), panelists will discuss the effect of out of date software on global cinema operations and the barriers to upgrade which keep many cinemas on legacy versions. John Hurst will explain the importance of upgrading software on legacy systems and will explore barriers to upgrades including the financial and operational issues that are preventing cinemas from deploying new versions.  LINK

Paragon Theatres

A fascinating look at one of the true pioneers in terms of VIP food cinemas. I had read that for a long time Disney held out against cinemas serving alcohol, but didn’t know that Paramount was the first studio to program films in cinemas that did.

In 1993 on Marco Island, restaurateur Nick Campo and his partners built a movie theater so different it would be 10 years before the National Association of Theatre Owners gave the theater, and its emulators, a category: first-run food theaters. Although food had been served at showings of old movies in retrofitted, abandoned theaters in college towns, Marco Movies was the first theater in the country that was purpose built specifically for serving quality food to audiences in posh auditoriums during showings of first-run films.

The concept proved so successful that Campo and his partners built the Beach Theater on Fort Myers Beach in 1999. But first, the partners had to overcome resistance from the studios. Campo said that at the time his Marco location opened, the contract that theater owners had to sign to obtain first-run movies from the studios stipulated no food or alcoholic beverages could be served. He said Paramount Pictures was the only studio that didn’t have the prohibitive clause, so he started by showing Paramount films.  LINK

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