Peter Sharkey - why a trip to the movies may be a sound investment
13:00 23 March 2012
I drove past on my last visit north and it’ s now a supermarket, but as a boy of eight or nine, the Abbey cinema, located in the Liverpool suburb of Wavertree, was the venue where the city flocked to watch a movie.
Not only did this magnificent structure embrace you from afar, insisting that your step quickened as you approached, but once inside you were in a magical place dominated by a gigantic curved screen. It was here that movies screened in ‘Cinerama’ came to life, prefaced by the slow majestic swish of enormous dark curtains and the deep bass sound of plucked cello strings.
I recall my parents taking my younger brother and me to see Where Eagles Dare at the Abbey in the late sixties and being captivated by the way in which the action filled the entire screen.
So real was it that the audience gasped audibly when one character (Clint Eastwood?) leapt from one ski lift to another. It’s a moment etched indelibly in my mind; I’m certain it accounts for my subsequent love not only of movies, but of actually attending the cinema.
Many readers will have enjoyed similar experiences while growing up and then, as cinema attendances fell dramatically, contended with down-at-heel fleapits which owners had little incentive to upgrade because television, particularly colour TV, provided a much cheaper form of mass entertainment.
The extent to which UK cinema-going declined was remarkable. Between 1946-1984, annual attendances fell from 1.6bn to 55m.
First introduced in Canada in 1957, the multiplex cinema arrived in Britain (in Milton Keynes, to be precise) in 1985. Within the space of five years, audience numbers had doubled. The wider choice of movies, free parking, a vast array of snacks on sale, clean toilets, ample leg-room (important when you’re over 6’2”) and a host of other ideas based upon the US-imported business model created an altogether more pleasant cinema experience.
Ironically, the spread of multiplexes resulted in the demise of cinemas such as the Abbey unable to compete with these new, out-of-town cash cows.
Today, the UK market is dominated by Vue, a slick, private equity-funded operation and Cineworld, which attracted more than 48m visitors last year, reported annual turnover of £348m and pre-tax profits of £33.4m.
From an investment perspective, Cineworld has a number of attractions which were enhanced last week when the company announced it would remove all credit card booking fees and introduce a 10pc discount for tickets bought online. It already enjoys a market share of 24.6pc and these moves should help improve that figure.