Britain's box office booms but filming is set to slow

The UK Film Council is predicting another bumper year for production in 2010, despite a slowdown of features in the first half and cinema admissions hit by the World Cup.

The agency yesterday unveiled its Statistical Yearbook covering 2009, a record year for films in Britain. John Woodward, the chief executive of the UK Film Council, said: "In terms of sheer economic value, jobs and overall contribution to the economy, film has had a truly great year and is punching above its weight." He added: "This year could be even higher than last year, or at least match it."

The cinema tills kept ringing last year despite the recession, recording record receipts of £944m. Together with the takings in Ireland the industry breached the £1bn mark for the first time. Last year also marked the highest admissions since 2002, with 173.5 million visits to the cinema.

The record performance was driven by a strong slate of releases, dominated by Avatar. The hit film directed by James Cameron became the biggest-grossing of all time in the UK, bringing in £92m. It smashed the previous record set by Mamma Mia! of £69.2m in 2008.

The top three UK films, Harry Potter and the Half-Blood Prince, Slumdog Millionaire and Sherlock Holmes, brought in a combined $1.5bn (£987m) globally. The country also had a 7 per cent share of the worldwide market.

The Film Council said the rise in takings was helped by the emergence of 3D films. From 0.8 per cent of views in 2008, 16 per cent of screenings were seen in 3D last year, with cinemas benefiting from the higher prices. Total UK production activity £613m in 2008 to £957m, with investment from abroad of £753m. The council said production had continued to perform strongly this year. Movies that started shooting in the first half include the second part of Harry Potter and the Deathly Hallows, Pirates of the Caribbean: On Stranger Tides and Martin Scorsese's Hugo Cabret, starring Jude Law.

Yet, the number of features with budgets of over £500,000 that started production between January and June fell to 51, from 60 in the first half of 2009. Mr Woodward shrugged off fears that the decline spelt trouble for the industry, saying a "chunky number" of projects were chalked in for the second half. He added: "Fewer films are being made, even with the studios. But they are compensating by the increased size of the ones that are being made."

While the amount spent on the new films fell from £726.4m in the first half of 2009 to £643m this year, the council said this still marked the second highest investment for the time period. It was mainly driven by inward investment, dominated by money from the US. The council said the UK's film tax break and the favourable exchange rate between sterling and dollar, as well as the local infrastructure, had helped drive the growth. Mr Woodward said that production, post-production, distribution and cinema "are firing on all cylinders", adding "it is clear British cinema has weathered the global recession well".

While Slumdog Millionaire grossed £31m, making it the biggest UK independent film of all time, it masked problems for independent productions. In the first half, spending on films with budgets of over £500,000 was down to £80m from £180m in 2003. Mr Woodward said the "worries are growing and they are becoming more pronounced". He warned that independent producers were finding it tough in the shift to digital with the "slow erosion of the DVD market, which has not been effectively replaced by revenues for online" adding the transition to digital would be "bumpy".