A woman's touch proves box-office hit

BY GARETH VAUGHN

You might expect the manager of the country's biggest cinema chain to be a life-long film buff who worked her way up through the industry. But that's not the case with Jane Hastings.

Stepping into the role in October 2008 with no industry background, Ms Hastings reckons she was no more than a regular movie-going customer. "But I've definitely grown to appreciate them [films] a lot more." But then you'd expect her to say that.

After a childhood in Auckland's Papatoetoe and obtaining a commerce and Japanese degree at the University of Auckland, Ms Hastings entered Air New Zealand's management trainee programme.

That experience, plus later marketing and customer relationship management work on behalf of Cathay Pacific and Singapore Airlines stood her in good stead, given the similarities between the airline and cinema businesses.

"You're selling bums on seats and you're trying to get the best yield you possibly can," Ms Hastings explains. "Lining them (airlines) up one by one, you have to create the difference. So I apply a lot of the airline learnings into the cinemas business."

After graduating from the trainee programme, Ms Hastings worked on Air New Zealand's Koru Club project and helped launch its first air-points programme.

Then, in 1999, she went with her husband to Asia, living in Singapore and Tokyo. "We were going over for 18 months and we stayed for eight years."

Her Asian experience included marketing, sales and brand management work for Wunderman Cato Johnson, Draft Worldwide and Tequila. Being a New Zealander, a woman and Japanese speaker had its advantages in Japan's rigid business world – she couldn't be pigeon-holed.

"I wasn't American so that baffled them. I was female. That was hard to work out. And I spoke Japanese. That terrified them. So they couldn't hide around the corner and whisper something because I might understand," she says.

Singapore, as the major regional hub, meant working with companies such as Shell on projects covering countries as diverse as Pakistan, Thailand and Australia.

Ms Hastings, now a mother of three, returned to New Zealand in 2007 and took the role of SkyCity general manager of group marketing and sales. It was as the casino operator's founding managing director Evan Davies' 11-year reign came to an end. At the same time, a potential takeover by private equity interests lingered for several months before petering out as the global credit crunch bared its teeth.

Then Ms Hastings took the helm at SkyCity Cinemas last year, after a convoluted and failed sales attempt by the SkyCity group. This included slicing $58.4 million (about half) off the cinema business's book value. Ms Hastings' brief from her boss, SkyCity chief executive Nigel Morrison, was to extract more money from the capital-intensive cinema chain.

In this, she has succeeded.

SkyCity's recent first-quarter update noted a 14 per cent rise in cinema revenue year-on-year with film admissions up 17 per cent. That followed a 61 per cent rise in SkyCity Cinemas' earnings before interest, tax, depreciation and amortisation to $4.5m for the six months to June.

And, according to Ms Hastings, SkyCity Cinemas has also lifted its market share to about 40 per cent nationally from about 36 per cent a year ago.

Against this backdrop, SkyCity revealed late last month a $59m deal, conditional on due diligence and Overseas Investment Office approval, to sell its cinemas to Australia's Amalgamated Holdings.

Assuming all goes well, the sale – of a business that produces just 2 per cent of SkyCity group ebitda – will be completed on February 15.

Speaking before the sale was announced, Ms Hastings noted it was always a possibility. "It's a public company. If anyone came in and made an attractive offer we should consider it and we would consider it."

Both SkyCity and Amalgamated say it's too soon to say where Ms Hastings will end up, assuming the sale is completed. Amalgamated's managing director David Seargeant is yet to meet her.

For Amalgamated, which owns cinemas in Australia, Germany and the Middle East plus the Rydges Hotels & Resorts group, the SkyCity deal means it will own about 1300 screens globally. Mr Seargeant says Amalgamated looked at buying SkyCity Cinemas two years ago but the timing was not right. The opportunity re-emerged two months ago. He notes that admissions globally are up this year boosted by some "great product". This includes films such as Up, Transformers, New Moon and the soon-to-be released Avatar and The Lovely Bones. Andrew Cornwell, Sony Pictures general manager and a Motion Pictures Distributors Association board member, expects New Zealand-wide annual box-office revenue growth of 6 to 9 per cent from last year's $150m.

Mr Cornwell is hopeful Ms Hastings will stay with the cinema chain. He reckons she has been a breath of fresh air and played a supportive role in pan-industry initiatives.

"I would hope to see a really strong commitment to quality local management [from Amalgamated Holdings]," Mr Cornwell says.

"I'd be really keen for her to stay because I think she has done a pretty good job, has got a good team and the results are all there to see really."

Ms Hastings viewed the industry as a very traditional one when she entered it, seeing a need to work harder to bring in customers. She established a new management team and structure. This includes an analyst whose full-time job is assessing the business and some "really good" retail minds. The next move was to decentralise decision-making, or empower cinema managers so SkyCity Cinemas became a collection of 15 independent businesses. This means they can act locally and quickly, engaging with their communities.

"Every week there's two new products coming in of different genres with different target audiences. So if you can't act fast you'll lose the opportunity," Ms Hastings says, noting an example of localising content was bringing in a documentary on rapper Notorious B.I.G. to screen at Manukau City.

AS SOMEONE who had lived in Asia and noted Auckland's growing Asian population upon her homecoming, there was the "glaringly obvious" move to offer movies from Hong Kong, China and Bollywood, in some cases on the same day and date they're released in their home markets. SkyCity Cinemas generates 6 per cent of its box-office takings from these films.

Mr Cornwell reckons SkyCity Cinemas has been re-energised with simple but important details like better-presented cinema layouts and movie directories in newspapers. It has forced rival chains to also lift their game.

Other initiatives included making family concession tickets cheaper, developing merchandising opportunities including through strategic partnerships with the likes of Max Fashions, introducing kiosk service to save the punters' time and rolling out 3D screens, which now generate 10 per cent of box-office takings.

Just nine of SkyCity's 109 screens are 3D and Mr Seargeant points out 109 of Amalgamated's 450 Australian screens will be 3D for the Avatar opening. "That gives an indication of how we view 3D. We have a big commitment to 3D in Australia."

Merchandising opportunities for SkyCity Cinemas include being exclusive sellers of T-shirts related to the Michael Jackson film This Is It and selling CDs, with cinema sales at times comprising a quarter of all national sales.

"My view was we're another channel to market," Ms Hastings explains. "Movies help determine fashion trends. They help determine what books you read, they help determine what games people play. We're starting that trend [so] why aren't we leveraging that?"

Ms Hastings sees plenty more changes and opportunities to come. SkyCity Cinemas is aiming to introduce a service next year enabling customers to zap themselves into films using their mobile phones. It's also talking to PlayStation about gaming opportunities and Ms Hastings hints of new events in the next 12 months.

"We have fantastic screens to deliver content and a great environment in which to receive it. We can do concerts, we can do gaming, we can do corporate presentations, we can do so many more things. We're just at the tip of the iceberg."

And despite threats from movie piracy and improving broadband, Ms Hastings is adamant the cinema industry has a bright future, as long as it remains an enjoyable social outing. "I know parents love the fact they can go and relax for three hours and give their kids entertainment."

Or escape them.

- © Fairfax NZ News