Motion Picture Herald (Jul-Sep 1933)

July 2 9, 19 3 3 MOTION PICTURE HERALD 13 CROSSES IN JULY AHEAD OF 1932; DOLLAR DECLINE ADDS $12,000,000 A Steady Improvement Since Spring Noted by Wall Street Journal; Also 40 Per Cent Increase to Foreign Income So far in July, for the first time in several years, weekly gross income of theatres in the United States has been running AHEAD OF THE CORRESPONDING WEEK IN THE PRECEDING YEAR. — IV all Street Journal Wall Street last week noted official recognition of the fact that the trend in motion picture business is upward, submitting documentary evidence to prove it. Financial editors and analysts the country over, pointing out ever increasing signs of the forward swing, with charts of cotton and steel, car-loadings and so on, now have turned to the surest sign to the buyers and sellers of motion picture entertainment: better box-office grosses. Then the Wall Street Journal, reflecting reports which had reached the canyons of the nation's financial center, came forth with a pagewide heading which read : "Movie Business Turns Upward." Not only did the conservative Dow, Jones Wall Street publishing authorities reveal an increase in grosses in July, for the first time in several years, but they also recorded a steady improvement since last spring, when theatre receipts were running 30 per cent behind 1932. 40 Per Cent More Foreign Income The decline of the dollar abroad already has added 40 per cent to the foreign income of American distributors, with cash benefits estimated by Wall Street Journal at $12,000,000. "Income of American moving picture companies so far this year has been materially increased by the decline in the dollar and the advance in foreign securities, particularly sterling and South American exchanges," said Wall Street Journal. "Foreign business has always formed an important part of the revenues of film companies and profits have held up well from this source while domestic business has been unprofitable. "With the pound around $4.75, against $3.50 last year, there is a difference of nearly 40% in dollar income brought from abroad. Many of the important film companies are making sure of these profits by selling foreign exchange futures. Leaders in the industry estimate that the exchange situation may make a difference in favor of the American film companies of $12,000,000 to $15,000,000 this year, or from $2,000,000 to $4,000,000 a company, according to volume of foreign sales. Foreign revenues are now running nearly 10 per cent ahead of last year. "About 50% of the foreign income of American producers comes from the British Empire and a large part of the remainder from South America, where the improve General improvement of theatre business in the four-week period from June 17 to July 8 is shown in a comparison with the previous four weeks, May 20 to June 10, from Motion Picture Herald's weekly compilation of box office grosses. Nine of the twelve cities showed gains. The solid black column represents the more recent period, the shaded column the previous four weeks. The 100 per cent line in each case represents the average for the earlier period. ment has been even greater," said the Dow, Jones Journal. "The industry is looking forward to a material improvement in income in the next few months in line with the increased public buying power. "It is, of course, too early to predict earnings per share on the amusement stocks. However, there are indications that the downward trend in income has been halted and that with expenses heavily cut, and leases and mortgage interest rates reduced, the important companies may be in the black in the final quarter. "Improvement in income would facilitate the reorganization plans for Radio-KeithOrpheum and Paramount-Publix Corp., now in receivership. Recapitalization plans for Fox have been . . . acted on by stockholders. . . . No other reorganizations in the industry now seem likely." Further reflections of the sentiment prevailing throughout the nation against any proposed increase in admission scales at this time as set forth in last week's issue of Motion Picture Herald, are seen in additional reports : The most important development in the field in the past week was the action of Governor White, of Ohio, who refused to affix his signature to the state senate's sales tax program, thus allowing it to become a law without signing. The tax includes, among other things, a 10 per cent impost on admissions of 40 cents and over, and went into effect immediately. Suburban and neighborhood exhibitors throughout Ohio look upon this as a serious move, reasoning that first-run houses now charging more than 40 cents will reduce prices, thereby increasing competition. While Ohio theatre owners were said to be considering admission raises, it is expected no action will be taken before September 1. A highlight of the 34-point code adopted in Iowa last week by the Allied Theatre Owners of Iowa, as well as unaffiliated exhibitors in that territory, is a clause for a minimum admission scale of IS cents. The code provides that distributors shall refuse to enter contracts licensing the exhibition of their film by exhibitors who "refuse to maintain the minimum price provided for in the contract." Alabama Grosses Improve Throughout the south there is little or no talk of increasing admission scales. Exhibitors in Alabama are not contemplating any such action, although they agree that a slight increase would benefit. Grosses in this sector are slightly in advance of the same period last year. In New Orleans prices are still going down, with giveaways, free beer, double features and bathing beauty revues as "extra added attractions." There has been no advance in the admission scale in the Tampa (Fla.) theatres this year, and what few changes have been made in the prices since the beginning of the summer have been toward a lower scale. Exhibitors there say they have no intention of advancing prices before fall, and then the tilt probably will be no greater than the scale in vogue during the past winter. While there is some talk in the Baltimore section about increasing admission prices, nothhas been done. No raise in . theatre prices is contemplated in San Antonio, at least not before the fall. Exhibitors there feel that any price raise would be suicidal. The same is true in the Seattle territory and in San Francisco. Exhibitors in Chicago are looking forward to increased admission prices in the future, but not now. The only move in that direction is discussion of starting evening price scales at 5 o'clock instead of 6:30, which would amount to an increase, as many theatres are getting the bulk of their evening's business at the matinee price just before the evening scale goes into effect. From the government at Washington came word that admission taxes for the fiscal year ending June 30, 1933, totaled $15,520,512, a gain of $13,661,906 over the previous year, because of the emergency taxes.