Film blow

Cinemas shut amid cost crisis and stayaway film fans

Richard E Grant
Actor Richard E Grant outside the Filmhouse in 2017 (pic: Terry Murden)

Soaring costs and declining audiences have forced the closure of the Edinburgh Filmhouse Cinema and Café Bar, Edinburgh International Film Festival and Belmont Filmhouse in Aberdeen.

Parent charity the Centre for the Moving Image has called in administrators and all three operations have ceased trading immediately with 102 staff made redundant.

CMI said payroll commitments and a decline in public funding had created a “perfect storm” which means it is “unsustainable to continue”.

It added: “The combination and scale of these challenges is unprecedented and means that there was no option but to take immediate action.”

The the Filmhouse on Lothian Road, Edinburgh marked its 40th anniversary in 2018 while the collapse of the charity raises big questions about the future of the Edinburgh International Film Festival which began in 1947 and has attracted a long list of A-list celebrities such as Gene Kelly, Clint Eastwood and Jennifer Lawrence.

Tom MacLennan and Chad Griffin of FRP Advisory are working with Creative Scotland and the local authorities on possible next steps and the impact on staff.

Actress Kelly Macdonald at the Film Festival (pic: Terry Murden)

In a statement CMI said: “Unfortunately, the combination of sharply increasing energy and other costs, together with both the lasting impacts of the pandemic and the rapidly emerging cost of living crisis affecting cinema attendances, means that we have had no other option but to appoint administrators at this time.”

Cinema audiences have plummeted by half since before the pandemic as customers preferred to stay at home and watch streaming services, it said. Surveys show that only 57% of cinema audiences have come back to the cinema since the pandemic, with older audiences less likely to have returned.

“More generally the global cinema exhibition sector continues to struggle post pandemic, with Cineworld being the most high profile example of the challenges the sector is facing.”

CMI said public funding has been standstill or reducing for more than eight years and had been reducing in real terms value throughout that period.

Recent steep inflationary costs reduce the real terms value even further. Additionally CMI said its funders and the Scottish Government “have indicated that the outlook beyond March 2023 for public funding is highly uncertain, given the other pressures that they have, making planning and beyond that point almost impossible.”

The charity said that even with the recently announced energy price cap for businesses, its energy costs are rising by approximately £200,000 over the next 12 months. The price cap is also only in place for six months and so planning beyond March 2023 is highly uncertain.

As an accredited Real Living Wage employer CMI is facing an increase of 10.1% in payroll costs over the next 12 months.

It also expects further spikes and waves of Covid and seasonal flu in the coming months which will affect admissions and booking patterns. Meanwhile some audiences are still uncertain or resistant about coming into indoor public spaces.

Danny Boyle
Director Danny Boyle at the 2019 Film Festival (pic: Terry Murden)

The breakdown of staff redundancies is: The CMI – 58; Filmhouse Trading – 22; Belmont Filmhouse – 20 and EIFF – 2. 

A total of 107 staff were employed across all four businesses.  The balance of 5 staff will be retained to assist with the administration process.

In March 2020, just as the pandemic struck, the CMI announced an ambitious £50 million plan to build a landmark new home for Edinburgh Filmhouse in Festival Square between the Sheraton Hotel and Usher Hall.

Designed by Edinburgh-based Richard Murphy Architects, it would have six screens – twice the current number – and a rooftop restaurant and events space in an oculus or eye-shaped building twice the height of its neighbours. The design was later modified and the height reduced, though the cost rose to £60m. However, it is now unlikely be built.

Filmhouse
Ambitious plans for a new Filmhouse were unveiled in 2020

Mr MacLennan of FRP said: “Centre for the Moving Image was central to the development and promotion of Scotland’s thriving film industry and the catalyst behind many learning, cultural and development initiatives that widened the enjoyment and reach of film across Scotland. 

“Unfortunately, CMI and its three subsidiary businesses have been severely affected by a wide range of factors that have rendered all businesses unsustainable and administration was the only option. 

“We are hopeful that businesses already operating in the film industry or entrepreneurs looking to enter the film industry will be encouraged to register their interest in the assets.”



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