The British film industry is enjoying a golden age at the moment.
The numbers speak for themselves. UK box office revenues reached a record £1.24bn in 2015, a rise of 17% over the previous year (BFI). This was the fifth year in a row in which the £1bn barrier has been exceeded.
The story is not just about the numbers, either. Six British films were nominated for Oscars in 2015. And almost 20% of awards at the industry’s major film festivals in 2014 and 2015 went to British-made films.
As Amanda Nevill, CEO of the British Film Institute (BFI) said recently: “Britain loves film, and the world loves British films.”
With this in mind, here are five reasons to invest in the UK film industry.
1. Government support
The success of the UK film industry hasn’t happened by chance. It is due in large part to government support. Tax relief for the industry reached £251m last year, leading to £1bn worth of direct investment. For every £1 of relief, £12.49 is generated for the UK economy (HMRC).
There is no indication that this will cease. Before being replaced as Chancellor George Osborne said: “2015 was a record year for the film industry and I’m proud that our support for this fast growing sector is securing investment, boosting productions and creating jobs across the UK.”
2. Growing export markets for UK films
The biggest chunk of this is in the US and this is the largest export market for UK films. This is unlikely to change, at least in the short term, but new markets are being opened.
BFI head of international Isabel Davis says: “English becoming ever more widely spoken will boost sales. France and Germany remain key, but Latin America and Asia are important growth markets.”
An example of this is the phenomenal success of British spy thriller Kingsman in South Korea last year. The film earned more than $40m in the country, making it the highest-grossing market behind the UK and Australia.
3. Returns can be huge and not just for investment in blockbusters
You don’t have to invest in a blockbuster to make money in British films. UK films The King’s Speech and Slumdog Millionaire achieved international acclaim and financial success. Yet both were funded in part by private investors.
These are great examples of relatively small investments leading to large returns.
One reason for hits like these is the help UK films receive from organisations such as Film Export UK, UKTI and the British Council. This support allows them to attend overseas festivals and win international distribution contracts that might otherwise have been out of reach.
As the British Council’s director of film Briony Hanson explains: “We work with premiere international film festivals to arrange preview screenings of the best new UK feature films. We also run programmes designed to create opportunities for the UK film industry to collaborate with international partners. Recently, for example, we organised UK film industry delegations to Russia, Argentina and China, to facilitate an in-depth understanding of how each market works.”
4. The UK is at the cutting of film making
The UK is home to some of the key facilities and skills that go into making a successful film. These include areas such as sound production and visual effects (VFX). The Star Wars franchise is making its new trilogy in the UK and has set up a new VFX facility for this purpose.
Such is the confidence in the UK as a world-class centre for film production that Pinewood has plans to invest £200m in its facilities. This will include doubling the size of its studios as well as adding stages, workshops and production facilities.
Speaking of the growth of the UK as a film production centre, Adrian Wootton, chief executive of the British Film Commission said:
“The UK’s creative sector tax reliefs have been a tremendous success, attracting inward investment through film, television and animation while stimulating growth in jobs and infrastructure across the UK.”
5. Personal tax benefits
One way for outsiders to gain entry to the industry is through funds that comply as enterprise investment scheme (EIS) schemes. These give 30% tax relief provided the investment is held for three years.
Filmmakers can also receive film production tax credits of 20% of their costs as a tax rebate.
The future is bright for the UK film industry. For information about how you can invest in a UK film fund and take advantage of this growing market, please contact Raimund Berens.