UK Film Council shows UK box office at record high

The following is taken from the UK Film Council's web site:

New UK Film Council analysis shows indigenous British films hold strong in 2008 with a 20% increase in production spend, while foreign investment drops due to a number of exceptional factors. Market share for British films second highest in a decade at 31%.

The latest statistics from the UK Film Council paint a mixed picture for UK film in 2008. While UK box office receipts reached a record high, film production spend in the UK was down compared with the previous year.

Cinema-going continues to be one of the nation's favourite activities with box office takings for the UK and Republic of Ireland hitting £949.5 million, up 5% on 2007's £904 million, and the highest since records began in 1989.

British films also accounted for 31% of cinema takings, the second highest in a decade.

The top films of the year at the UK box office were all made with significant UK involvement. These included Mamma Mia! earning £69 million to become the most successful film in the UK ever and Quantum of Solace taking more than £50 million and achieving the highest opening weekend for any film in the UK with £15.4 million.

Film production spending in the UK: 2008 round-up and 2009 predictions

Film production statistics paint a more complex picture with spend totalling over £0.5 billion in 2008 – but still down 23% on 2007.

For films with production budgets of £500,000 and above in the calendar year 2008, production spending in the UK totalled £578.2 million with the UK involved in the making of 111 feature films (126 in 2007). Production spend in the UK for the year was 23% lower than 2007's total of £753 million.

The UK Film Council further breaks the data into three distinct types of production category:

Indigenous British - films made by a UK production company that are shot wholly or partly in the UK.
Inward investment films – big budget films that are financed from overseas but made in whole or part in the UK.
Co-production films - made both in the UK and abroad using UK crew, expertise and services.
Spend on indigenous British films was strong with a 21.5% increase compared to 2007. 66 UK indigenous feature films were produced in 2008 (68 in 2007) with the total UK spend reaching £192 million, 21% higher than 2007's £158 million. UK indigenous films included The Boat that Rocked, Green Zone, Dorian Gray, Me and Orson Welles and 1939.

However, the outlook for independent British films in 2009 is expected to be tough with the economic downturn starting to take effect. This impact had not materialised in 2008 as finance and credit deals are done well in advance of film production and release. The immediate prospects for these British independent films suggest it will become even harder for them to raise credit especially through bank loans.

Inward investment films decreased by 35% compared to 2007's £523 million with 25 films (30 in 2007), but still brought £338 million into the British economy. This drop was due to a number of exceptional factors including films being lost or postponed due to the US writers' strike, the exchange rate ($1.97-£1 in June 2008 compared to $1.53-£1 in November 2008), US productions being encouraged to spend closer to home because of US tax incentives, and the effects of the actors' dispute. Inward investment films included Prince of Persia: The Sands of Time, Quantum of Solace, The Wolfman, Nine and The Fantastic Mr Fox.

In 2009, the environment for inward investment looks much more favourable due largely to an upturn in the exchange rate which is further enhancing the UK's competitiveness and encouraging the US studios to bring more work to the UK.

The UK was involved in 20 co-productions, compared to 28 in 2007. The total UK spend of £48 million was a 34% decrease on 2007's figure of £72 million with 28 films. These included Solomon Kane, Cheri and Bright Star.

Co-production activity is not expected to rise in 2009 given that the tax break incentivises spend inside the UK and therefore not production outside the UK.

John Woodward, Chief Executive Officer of the UK Film Council commented: "It has undoubtedly been a tougher year for inward investment because of the exchange rate, the effects of the US writers' strike and actors' dispute plus increased fiscal incentives now offered in more than 30 US states. While these effects were felt the world over, the UK tax credit has remained absolutely vital in keeping us competitive and helping to bring more than £330 million in foreign investment into our economy.

"This year has got off to a great start for British films and talent at the awards ceremonies. The major Fox production Gulliver's Travels is due to start shooting in April, plus Harry Potter and the Deathly Hallows and Nottingham will also be filmed in the UK this year.

"But we will also begin to see the full effects of the economic situation take their toll on independent British movies. It's going to be even harder for these types of films to raise credit especially through bank loans. Therefore the Lottery funding that the UK Film Council provides will become even more important as will the tax credit and support from broadcasters such as Channel 4 and the BBC."

www.ukfilmcouncil.org.uk