Evening star., 1942-05-03
Larger Profits
Anticipated in
Film Industry
Increased Attendance
And Prices Likely to
Offset Rising Costs
Special Dispatch to The Star.

dIIoldCo tliCdUCL ICNClluSS ON llIS
rise in notion picture attendance
and admission prices are expected to
prove sufficiently satisfactory to abb
sorb the principal part of unfavor-
able factors, such as higher costs.
expenses and heavier taxes, Fitch
Investors Service reported today.
Earnings. therefore, are expected
to reflect this improvement, and
over the near-term show moderate
gains from year-ago profits More
over. the industry is apparently well
adjusted to the war economy, while
dependency upon foreign activities
has been lessened to a large extent.
Continuing the improvement ex-
hibited last year, motion picture at
tendance during 1912 is expected to
rise to new heights, while operations
and revenues Of the industry reflect
this betterment.
Major Factors Listed.
However, in the final analysis,
the factors likely to be responsible
for the anticipated rise in admis-
sions are the following: Cd The
improved trend of public income;
co increased efforts of the public
to seek relief from war nerves; 90
restricted use of automobiles for
weekend trips and pleasure driving.
and (4 diversion of at least part
of the increased consumer income,
formerly earmarked for various
goods now unobtainable because OF
Government restrictions on pro-
duction, into greater spending, for
amusement purposes.
In addition to domestic theater
revenues showing favorable i'm
provement from the above-men-
toned stimulating influences, the
seasonal decline in motion picture
attendance during the approaching
summer months Is not expected to
be as severe as formerly. In the first
place, a large number Of theaters
are satisfactorily air-conditioned,
and this should aid in drawing
patronage Of the public already well
acquainted with this method OF
cooling off"
Secondly, the restrictions in ef-
feet on automobile usage, and re-
strictions likely to be placed in ef-
feet on attendance at open lair
amusement centers, may result in
the diversion Of large part OF this
entertainment-seeking public into
the movies.
Thirdly, British experience indi-
Gates that the public Is less suscep-
tible to "blackout" nervousness when
in a crowd, and theaters, should
therefore find attendance at high
level as more extensive prepara-
tions for blackout tests get under
way in this country.
War Effort Aided.
"As motion pictures have been
ofncially adjudged by the Govern
ment to be one Of the best forms of
"escapist" entertainment from war
nerves, no serious restrictions or
priorities. adversely affecting op-
erations for the industry in general,
are expected.
Moreover, the trade is co-operat-
ing with the Federal authorities to
an appreciable extent in the war ef-
fort. A large number of shorts, to
be used in educating the newly in
Quoted men of the armed forces Of
the Nation in military and naval
duties, have been completed, and
these have been approved by the
high command.
I'm addition, films are being pro-
duced for the purpose of educating
and familiarizing civilians In de-
fense duties. All of this work is be-
ing done by the industry on a non
profit basis. The movies have also
been doing big job on the mill
tary front.
Motion pictures for entertain
ment purposes are being supplied to
Army posts throughout the country
and abroad, and to Navy ships on
the seven seas, at minimum rates
which just about cover the actual
cost OF distribution. Although these
activities are not expected to be
productive of immediate earnings.
the good will and esteem being built
up for the trade through these
gestures should prove to be a favor
able factor over the longer period.
Output to Be Sustained.
The schedule of film releases for
the 1912 season indicates that no
reduction will occur in the number
OF pictures to be produced. In fact,
some expansion in the quantity of
releases Is probable in reflection of
the improved trend of business ac-
tlvltles for this industry.
Among the more favorable as
poets for the trade is the fact that
never in its history has the motion
picture industry been in so strong
a position, financially, as it is today
With domestic revenues in
rising trend and costs being kept
under closer control, the Golfers of
the big picture making companies
are bulging more comfortably than
the treasures in most lines of bust
ness. while long range program of
debt reduction has brought down
funded debt
Since the early part of this year,
Paramount and LoeW's have re-
funded obligations falling due over
the next few years and have re-
placed them with long-term debt
at interest rates as favorable as
those commanded by other indus
tries. Some simplification in capital
structure has also been undergone,
and current indications are that the
industry is we'll situated to meet any
adverse developments that may oc-
cur over the forthcoming years"