Business

More than just super powers

Palace is set to show opera

BY SHAMILLE SCOTT Business reporter

Sunday, August 19, 2012    

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OPERA-GOERS may be able to view concerts at movie theatres in Jamaica as early as next month.

“We have a contract with the Metropolitan Opera (Met) to show their next concern season,” said Douglas Graham, Palace Amusement's director.

The new season begins on September 24 with L’Elisir d'Amore (The Elixir of Love), an opera by the Italian composer Gaetano Donizetti, with Met titles in English, German and Spanish.

Palace, which operates the four major cinemas in Jamaica, has been seeking to diversify its operation outside its major business segments.

Alternative content, which includes pop and classical concerts, has been on the horizon for some time, but the company was not able to make it a reality last year.

Palace and SportsMax have been discussing showing islandwide screenings of live sports events, such as British Premier League games.

They launched an initiative, called “SportsMax Cine Zone” in February, with an invitationonly showing of Manchester United versus Chelsea in the English Premiere League.

Renting films to cinemas in the Cayman Islands has historically been the most profitable side of Palace's business. Last year, film rentals contributed 50 per cent of the company’s gross profit.

But its importance has been declining over the years. For instance, it represented 75 per cent of Palace’s gross profit in 2009.

Showing commercials during movie screening has also been a lucrative activity. That business segment brought in another 10 per cent of its gross profit in 2011.

Ticket sales still bring in the bulk of revenues.

For the year ended June 30, a box office receipt was $514 million, up from $432 million in 2011, according to the company's most recent financial statements.

Jamaican movie-goers seem to like superheroes.

The Avengers, the American superhero film produced by Marvel Studios, was said to be popular among customers.

Customers’ liking for treats like popcorn, hotdogs and sodas have also grown this year. Palace made $208 million from confectionary sales, $25 million more than the year before.

The Liguanea Cineplex has consistently been in the black and is the biggest contributor to profits of the four theatres.

Cineplex, like Odeon, has two screens. In 2008, it contributed gross profits of $10 million. Three years later, it contributed $20 million to Palace's earnings. For 2012, based on the trend, it is projected that it could contribute over $20 million.

Carib at Cross Roads and Multiplex in Montego Bay are also now profitable but had their difficulties in the past.

Mandeville, however, hasn't turned a profit yet.

Graham told the Jamaica Observer that there are no plans to close the cinema. Instead, the company aims to use promotional activities to take it out of the red.

Last year, the firm's statements revealed that it had installed some 3D screens in its theatres. Carib has four, the Montego Bay and Cineplex theatres have two each and Odeon has one.

During the last year, the firm said it showed a total of 29 3D pictures.

“It is becoming patently obvious that the industry is set to phase out and discontinue its analog distribution within two years. Locations without digitised screens, will, by then, have no option but to close,” the statements said.

The Group has three main divisions, showing films in its theatres and selling confectionary, renting them to third parties throughout the Caribbean, and screen advertising.

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