Mall operator Majid Al Futtaim has revealed that it expects revenue from its Vox cinema chain to return to pre-pandemic levels next year driven by an increase in sales of its top-tier tickets.
Vox is the largest cinema operator in the Middle East with over 600 screens in eight countries. The UAE is home to more of them than anywhere else and in 2022 Vox had a 59 percent market share in the country.
Vox runs some of the Middle East’s most lavish cinemas and was the first operator in the region to introduce laser projection to its super-sized IMAX screens. It now has its own Vox MAX big screen format and holds the exclusive Middle East rights to 4DX cinemas which feature moving seats, smoke, wind and water effects.
In April it lifted the curtain on its new top-tier ticket offering at its Mall of the Emirates multiplex. Called Theatre, it offers cinemagoers a gourmet meal served during the movie at plush leather seats which were designed bespoke for Vox. They are wider than ones in most first class airline cabins and feature retractable tables with soft lighting. No stone has been left unturned as the seats are heated, almost fully recline and even have wireless phone chargers built into their arm-rests. They are set to be a dream ticket for Vox.
“We do foresee returning to pre-pandemic revenue levels as soon as next year as a result of a higher focus on premium experiences and upgrading cinemas to capture more value from customers,” says Ignace Lahoud, chief executive of Majid Al Futtaim Entertainment.
It is a stark contrast to the outlook for the cinema sector in its heartland of the United States. Wall Street media analysts Eric Wold and Eric Handler don’t expect US ticket sales to top their pre-pandemic peak of $10 billion until 2026.
Majid Al Futtaim Entertainment’s performance
Last year Majid Al Futtaim Entertainment generated AED 193 million of underlying profit on AED 2 billion of revenue. It isn’t just driven by cinemas as the division also operates the Magic Planet chain of indoor amusement parks as well as four indoor snow parks, including the iconic Ski Dubai.
Last year Majid Al Futtaim Entertainment’s revenue was up 7 percent on 2022 and around 8 percent off its peak of AED 2.2 billion in 2019. Total admissions to Vox Cinemas rose 6 percent to 20m so it is heading in the right direction.
The movie industry has faced a perfect storm of challenges in recent years. First, the pandemic temporarily brought the curtain down on cinemas around the world and forced customers to stay indoors leading to a surge in the popularity of streaming.
Just when the industry was starting to get back on its feet last year, actors and writers went on strike in Hollywood for more than six months in a bid to boost the royalties they receive. It delayed the release dates of movies from this year to 2025 and set the stage for Majid Al Futtaim to diversify its range in an attempt to mitigate risk.
“The cinema industry is becoming increasingly unpredictable due to a variety of factors such as production delays so it is imperative that we do not become overly reliant on the movie line-up,” explains Lahoud. “Instead, we must proactively seek avenues to diversify and strengthen our offering. At Vox Cinemas, we provide more than just a place to watch movies. We offer a place where audiences can come together for a collective experience and a shared connection whilst immersing themselves in the magic of storytelling.” It is set to have a magic touch.
Lahoud says that the high-end venues are becoming increasingly popular as customers are looking for experiences they can’t get when streaming movies at home.
“Generally, we see the best returns from our premium formats, whether it be our Theatre or Gold offerings that focus on providing luxury seating and an enhanced food and beverage experience, or our PLFs (premium large formats). Customers are increasingly seeking these elevated experiences that create the sense of an event when visiting the cinema and provide an experience that can’t be replicated at home.”
Theatre rolls out the red carpet for guests by giving them access to a private lounge which looks like it has come from the golden age of cinema. In classic Art Deco style, its purple wallpaper is covered with geometric shapes and the furnishings have a blue and gold colour scheme. Old-fashioned cameras, clapperboards and other curios of cinematography sit on the wooden shelves next to the plush sofas and billiards tables.
“We wanted it to be not just a lounge where you come before you go to a movie, we wanted this to feel like home, a place where you are comfortable and you come to chat,” says Lahoud. “If you want to sit after the movie you can hang out here. So, to us, this is part of what the future of cinema is about. It is about creating social hubs right where you have a cinema and making you feel at home.” That really is a happy ending.
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