National CineMedia Posts Strong Performance

LOS ANGELES The nation’s largest in-cinema digital advertising chain, National CineMedia, today said cinema ad revenue increased despite a weak fourth-quarter box office nationwide.

The company reported that ad revenue grew 42.7 percent in Q4 to $85.6 million over the comparable period in 2006. For the year, NCN’s revenue grew 24 percent revenue to $310 million. (CPM advertising rates improved 1.6 percent in 2007.)

Local ad revenue was particularly robust, showing a 21.2 percent bump year-over-year, even though theater attendance flagged.

CEO Kurt Hall said any downturn was offset by a shift in media spending to digital platforms (like in-cinema networks). “The fourth quarter was solid,” he said, “even without tent-pole events.

He added that 40 advertisers that work with the firm now spend more than $1 million per annum, and “several” now spend over $10 million.
The company said that in 2008 the expanding chain would offer 16,500 screens, adding 1 billion advertising impressions. Attendance last year was 542 million.

Hall said longer-form commercials, including 3- and 3 1/2-minute versions of ads from the Army National Guard, helped improve the flow of the advertising pre-show.

New major advertisers included Wendy’s, JC Penney and LG Electronics. Hall said he hoped that the next areas of growth would be packaged goods and quick-serve restaurants, as well as key non-cinema advertisers such as Apple.