Globally, the number of cinema screens has crossed 150,000. In the MENA region, the number of cinema screens is expected to jump 38.4% with 1,300 new cinema screens to be set up, mainly in Saudi Arabia, indicates global advisory firm PwC Middle East.
PWC’s another research shows that, in the MENA region, box office revenue exceeded $500 million (AED1.83 billion). This is about 1.25% of the global box office revenue of $39.92 billion recorded last year, up 3% from 2016. More than $3.54 billion investment in cinema screens across the Gulf is expected to boost the region’s cinema industry.
With cinemas opening up in the Kingdom of Saudi Arabia after three decades, the total cinema revenue in the Kingdom is expected to touch $1.5 billion (AED5.5 billion) in 2030, estimates PwC Middle East.
“By 2030, Saudi Arabia is expected to host 2,600 cinema screens that will entertain its growing population,” says Martin Berlin, Middle East partner and Global Deals Real Estate leader at PwC Middle East. “Based on global and regional benchmarks, we expect the KSA to accommodate between 300 and 370 cinema locations.”
Berlin’s estimation is based on a projected 2030 population of 39.5 million, and 6.6 screens per 100,000 people.
“Based on pricing of $11 – $14 for lower end formats, and $40 for luxury formats – Saudi Arabia could generate $950 million in box office revenues by 2030. As other revenue streams typically account for ~35% of overall revenues, this brings the total to $1.5 billion,” Berlin adds.
The Gulf region will see the development of more than 1,000 new cinema screens in the next three to five years, as developers and cinema operators announced massive investment plan at the first-ever MENA Cinema Forum.
The region has 1,300 cinema screens in operation. The announcement of 1,000 cinema screens will see more than 2,300 cinema screens in operations in the next five years, with the majority of the new screens to open in Saudi Arabia, which has opened the country for cinema theatres.
Majid Al Futtaim, which operates 355 VOX Cinemas screens, is investing AED2 billion in adding 600 cinema screens in Saudi Arabia.
“We will invest $100 million in a year to open 100 cinema screens – part of the AED2 billion plan to open 600 cinema screens in Saudi Arabia in the next three to five years,” shares Cameron Mitchell, CEO, Majid Al Futtaim Cinemas and Leisure & Entertainment. “Overall, we will operate around 1,200 cinema screens across the region in five years’ time – that’s how fast we are going to expand. With Saudi market opening, we see a lot of opportunities in the region’s cinema and entertainment industry.”
“We have opened our first cinema complex in Saudi Arabia in May this year, right after the government announced the opening of the cinema industry for public. We were closely working with the Saudi Arabian Government and as a result were the first operator to open the first cinema screen in the Kingdom,” he emphasises.
According to Mitchell, the company is hiring a large number of Saudi nationals to manage the growth in the Kingdom. “We are employing a large local talent pool to manage our entertainment assets in the Kingdom. We have achieved 98% Saudisation in our operations already.”
Further, Novo Cinemas, which operates 124 screens in 10 locations with 19,000 seats, will add more cinemas in the next few years.
“Although I do not have a budget in my mind, we will could potentially operate 1,000 cinema screens five years down the line, depending on how the market evolves,” states CEO Debbie Stanford-Kristiansen. “Saudi Arabia is obviously the market that will drive the growth and we are talking to our partners to open as many screens as the market demands.”