TWO acclaimed independent cinemas in Scotland have announced they will stop trading with immediate effect as administrators are called in.

The Filmhouse Cinema and Café Bar in Edinburgh and the Belmont Filmhouse in Aberdeen have faced the “perfect storm of sharply rising costs”, according to the charity running the venues.

The Centre for the Moving Image (CMI) also runs the Edinburgh International Film Festival – which will stop trading too as administrators assess the charity’s future.

The National: Belmont Filmhouse, AberdeenBelmont Filmhouse, Aberdeen (Image: Google)

According to the CMI, energy costs and reduced trade have had a major impact on the cinema sector. Now “immediate action” is required in the face of “unprecedented” challenges.

In a statement, the charity’s board said: “We have been proud to have led the CMI through incredibly challenging times, and in particular during the worst days of the pandemic. Unfortunately, the combination of sharply increasing energy and other costs, together with both the lasting impacts of the pandemic and the rapidly emerging cost-of-living crisis affecting cinema attendances, means that we have had no other option but to appoint administrators at this time.

“We would like to put on record our immense gratitude to the entire staff team whose passion for film as an artform and for the audiences and communities we work with and serve has remained undented by the challenges of recent years. We’re fully aware that this will be an exceptionally stressful time for them.”

Media in Aberdeen reported that workmen were on the Belmont site changing the locks after the news was announced.

READ MORE: Scotland and France's historic ties championed as French Film Festival returns next month

The National: Edinburgh Filmhouse, Lothian RoadEdinburgh Filmhouse, Lothian Road (Image: Google)

What is causing the spike in running costs?

The CMI said that its energy costs are going up by around £200,000 over the next 12 months. With the UK Government’s energy cap only scheduled to last six months, planning into next year is difficult.

As a registered Real Living Wage employer, the charity is also facing an increase of payroll costs of 10.1% on top of the additional energy fees.

The CMI also blamed stagnant public funding, general inflation and poor trading for the financial struggles – with cinema admissions at just 50% of their pre-pandemic levels.

What happens now?

Tom MacLennan and Chad Griffin of FRP Advisory have been appointed as joint-administrators, and will work alongside Creative Scotland, City of Edinburgh Council and Aberdeen City Council to find a way forward.

A spokesperson for Creative Scotland said:  “We are saddened by the news from CMI, the loss of employment, of cultural cinema programming in Edinburgh and Aberdeen, and the impact on the Edinburgh International Film Festival.  

"We are working to explore future options for such cinema programming in both Edinburgh and Aberdeen, and for Edinburgh International Film Festival’s 2023 edition.”

Culture Secretary Angus Robertson added: “I’m concerned by the situation facing the Centre for the Moving Image and the implications this has for its staff, as well as for the creative and cultural sector in Scotland. This will be an incredibly worrying time for everyone involved.

“CMI plays an important role in Scotland’s cinema and festival landscape, across the Edinburgh Filmhouse, the Belmont Filmhouse in Aberdeen and the Edinburgh International Film Festival.

“We understand that Creative Scotland is in talks to explore alternative options for cultural programming and we are continuing to engage with Creative Scotland on this developing situation.”

Challenges in the sector

It comes as Holyrood's Culture Committee heard that rising costs are creating a “perfect storm” for Scotland’s cultural organisations, with up to a quarter facing insolvency in the next few months.

On Thursday morning, the chief executive of Creative Scotland said problems are particularly bad for groups based in buildings with large fixed costs, such as theatres.

Iain Munro told the committee: “It is fighting for survival in many quarters.

“I’m very concerned about that perfect storm at the moment and I don’t want us to do anything that’s going to add to the challenges of that.”

Culture Secretary Angus Robertson spoke to the committee later on Thursday.

He acknowledged the difficulties the sector is facing, noting government spending is currently under review.

Robertson said there is a “mixed picture” around audiences returning after the pandemic, adding: “Most of all, there is continuing uncertainty as the rising cost of living means that people are undoubtedly cutting back on leisure spending.”