THE permanent closure of Palace Amusement Company’s Multiplex cinema in Montego Bay has prompted the company to accelerate plans to expand its film distribution network as it seeks to offset revenue losses and adapt to a rapidly changing entertainment landscape.

As the cinema operator continues to reel from one setback after the other, director and Marketing Manager Melanie Graham told the
Jamaica Observer that Palace is now looking to strengthen its role as a film distributor as it also works to forge new partnerships with independent cinema operators.

“We’ve gotten inquiries over the years, but nothing has come to fruition. In light of what has happened to our Mobay cinema, we are open to working with business interests in western Jamaica who may be willing to invest in rebuilding a cinema presence. We will be happy to supply them with content and to provide the guidance needed to get another or even multiple operations up and running,” Graham said.

While Palace now engages in similar arrangements, but on a limited scale, the director indicated that expanding this approach could become increasingly important for the business going forward.

“We currently supply films to the Cove Cinema in Ocho Rios, which is independently owned, and we’ve been doing that for some time. In the past we also had similar arrangements when cinemas existed in almost every town. Outside of Jamaica, we also supply films to some companies in Cayman,” Graham further said to the BusinessWeek.

She said that deepening this line of business would allow Palace to not only distribute films, but also provide technical support and equipment servicing to independent operators.

Palace’s renewed focus and push into film distribution comes at a time when the company continues to grapple with fallout from the recent closure of its Montego Bay location, which Graham described as both a significant loss and a potential turning point.

Opened in 2001, Palace Multiplex cinema was a major contributor to Palace’s earnings, generating a sizebale portion of ticket and concession sales behind Carib 5 in the Corporate Area and Sunshine Palace in Portmore, St Catherine. Its closure removes a key revenue stream at a time when the company is already navigating multiple industry challenges, including the lingering effects of the COVID-19 pandemic, disruptions from the 2023 Hollywood labour strikes, and growing competition from streaming platforms.

The decision to shutter the western Jamaica facility followed extensive damage caused by Hurricane Melissa last October, which left the building beyond repair.

The damage, which stemmed from water intrusion through the roof, saw much of the building’s internal structures becoming saturated, causing layered drywall and specialised insulation used for sound-proofing to be badly impacted. The situation was worsened by the building remaining sealed for an extended period without ventilation, allowing mould to spread rapidly throughout the complex.

“Of the four theatres at the facility, only one escaped significant impact,” Graham said.

The damage extended across the cinema, with screens, projection equipment, carpets, curtains and seating all rendered unusable.

Although the property was insured, Graham said that payouts, which she did not disclose, were not sufficient to cover the full cost of reconstruction, particularly given sharp increases in the price of imported equipment.

Depressed about having to sever ties with staff and losing millions in investment for the lost business which it operated on leased property, she however said the company, which continues to struggle financially, remains focused on recovery and diversification.

Among the strategies being explored is an expansion of alternative content offerings such as live sports screenings and special events, as well as initiatives aimed at increasing per-patron spend.

“As we approach the summer period we are also cautiously optimistic about increasing our attendance numbers at the remaining cinemas, based on a promising slate of upcoming films we have lined up,” Graham said.

Palace’s latest financials highlighting its struggles saw the company up to the six-month period ended December 31, 2025 posting a wider net loss of $115 million as the effects of hurricane-related disruptions on operations and sharp declines in cinema attendance weighed on the business.

“We need to and have to come out of this situation, and we’re busy looking at all the ways we can do things differently and so we continue to explore new ways to induce growth and cushion the fallout,” Graham stated.

GRAHAM…we’ve gotten inquiries over the years but nothing has come to fruition. In light of what has happened to our Mobay cinema, we are open to working with business interests in western Jamaica who may be willing to invest in rebuilding a cinema presence. We will be happy to supply them with content and to provide the guidance needed to get another or even multiple operations up and running