At Carmike Cinemas, the show must go on. The movie exhibitor owns, operates, or has stakes in about 240 theaters with more than 2,200 screens in 35 states across the US. The company's theaters are located mostly in small to midsized communities where the chain hosts the only theater in town. Its largest markets are located in Georgia, North Carolina, and Tennessee. Revenues come from the sale of admission tickets and concessions. Carmike Cinemas also owns two Hollywood Connection family entertainment centers (one in Georgia and one in Utah), which feature multiplex theaters along with skating rinks, miniature golf, and arcades.
The company's revenues decreased in 2011 by about 1% due to a decrease in total movie attendance, as well as Carmike partaking in increased discounts and promotional activities in order to lure more movie-goers into its theaters during a weak economy. However, the cinema chain cut its loss to $7.7 million, down from a loss $12.6 million in 2010, mostly due to an income tax benefit it received in 2011.
Carmike targets smaller, non-urban markets because of their lower operating costs and their lack of a variety of alternative forms of entertainment. Because the company focuses on smaller markets, it held back on developing the costly new multiplex theatres (12 screens or more) that are the focus of its larger rivals (Regal Entertainment Group and AMC Entertainment). Carmike also operates 18 theatres with 130 screens as discount theatres.
In lieu of building multiplex theaters, Carmike has instead opted to invest in technological upgrades. It was the first major movie theatre company to commit to converting virtually all of its theatres to digital projection systems. The project, which began at the end of 2005, cost about $300 million through a licensing deal with Christie Digital Systems. At the close of 2011 nearly 95% of the company's theaters and screens had gone digital. Carmike is also boosting its capacity for 3-D technology. By the end of 2011 nearly 90% of Carmike's theaters were equipped for the third dimension.
While its properties may contain less theaters per location than its rivals, the company doesn't necessarily eschew the idea that bigger is better. In 2010 it launched its Big D theater concept, with auditoriums that include wall-to-wall screens and the latest in surround sound and digital projection for both 2-D and 3-D features. In 2011 Carmike added seven Big D theaters to its portfolio. Going forward, it plans to include a Big D auditorium in all new theatres.
The company moved into the advertising realm in 2010 when it purchased a 20% stake in advertising network operator Screenvision. The theater chain had been an exhibitor partner of Screenvision; as part of the deal, Screenvision continues to support its Carmike with cinema advertising solutions.
Mergers and Acquisitions
Carmike Cinemas in 2012 acquired 16 entertainment complexes totaling about 250 screens in seven states from Rave Review Cinemas, a key step in its path toward expanding to 300 entertainment complexes and 3,000 screens.
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