Century Theatres, Inc.

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Century Theatres, Inc.

150 Pelican Way
San Rafael, California 94901
U.S.A.
Telephone: (415) 448-8400
Toll Free: (877) 236-8879
Fax: (415) 448-8475
Web site: http:/www.centurytheatres.com

Private Company
Incorporated: 1940
Employees: 3,000
Sales: $300 million (1998 est.)
NAIC: 512131 Motion Picture Theaters (Except Drive-ins); 512132 Drive-In Motion Picture Theaters

Century Theatres, Inc. is one of the top 15 motion Picture exhibitors in the United States. Based for years in the West, the company has been aggressively expanding in its home territory and has been moving eastward since the mid-1990s. Century’s theaters (the company spells its name with the final “e” and “r” in the word reversed) are renowned for their stadium seating, plush interiors, and state-of-the-art projection quality. The company also has earned a reputation for being a tough competitor, which on numerous occasions has resulted in legal action, either brought by rivals, the government, or Century itself. Founded in 1940 by Raymond J. Syufy, the company continues to be owned by the Syufy family, with sons Raymond W. and Joseph serving as CEO and president, respectively. Century theaters consistently report some of the top grosses nationwide for new releases.

Beginnings

Raymond Syufy was born near the end of the First World War into a family of Lebanese immigrants in Sacramento, California. Growing up in nearby Berkeley, he worked at his parents’ grocery store and later attended college and law school. While there, he worked nights at a movie theater to help support himself. In 1940, at the age of 23, Syufy took charge of his own theater, the Rita in Vallejo, California.

The theater business at this time was firmly in the grip of the major film producers such as Paramount, Loew’s, Inc. (MGM), and RKO, who controlled the top product offered to exhibitors. They often kept the best first-run films away from independent operators, exclusively showing them in the chains of theaters that they owned, and the U.S. Justice Department had been trying since the late 1930s to force them to open their product to others. Independent exhibitors were also in on the fight, forming trade associations and initiating lawsuits against the majors. Raymond Syufy, with his legal background, was perfectly suited to take up this cause, and he did starting in the late 1940s. A major battle for independents was won in 1949 when the Supreme Court ordered RKO and Paramount to sell off many of their theaters and separate their chains from the production and distribution ends of their companies. In 1950 the ruling was extended to Warner Brothers, Loew’s, and Twentieth Century Fox. Rules also were enacted to prevent shareholders in the production/distribution businesses from gaining control over the divested theater chains.

This legal settlement enabled independent theater operators like Raymond Syufy to improve their film offerings dramatically, and the company expanded during the 1950s and 1960s, opening additional theaters as well as many drive-ins. Syufy’s circuit gradually moved outward from California to Utah, Arizona, Nevada, and New Mexico. The company’s buildings gained a reputation for interesting architecture, with a number of its indoor theaters featuring a domed “igloo” design. In 1968 in San Jose, California the company opened its first theater to use so-called “stadium” seats, in which each succeeding row is positioned higher than the one in front, allowing patrons an unobstructed view of the screen. By the end of the decade, Syufy Enterprises, as the company was then known, owned more drive-ins than indoor screens and was in fact one of the top drive-in chains in the world.

The movie exhibition business was often a cutthroat one, and the company continued to find itself in court over various matters. In the early 1970s Syufy filed suit against General Cinema Corp. for allegedly preventing its theaters from booking certain films. The company was itself sued by competitor American Mul-ticinema, Inc. for alleged unfair trade practices in the late 1970s.

In the mid-1980s Orion Pictures, then a major film distributor, sued the company for breach of contract for reneging on an agreement to play “The Cotton Club” in its Las Vegas multiplexes. In a rare loss for Syufy, Orion prevailed, but Syufy banned Orion product from its Las Vegas theaters for five years as a result. The court had given Orion no compensation, and the distributor ultimately lost revenues because of the affair. By 1986 Syufy Enterprises had grown to some 267 screens (including drive-ins). The closely held company did not reveal annual revenues or profits, but analysts estimated that Syufy was one of the most profitable theater chains in the United States.

Seeking To Dominate the Las Vegas Market in the 1980s

The company decided in 1981 to aggressively target the first-run film market in Las Vegas, Nevada, and that year it opened a new multiplex there, supplementing the drive-ins it already had been operating. Syufy began to consistently outbid its rivals, including Mann Theaters, Plitt Theaters, and United Artists Theaters, for the rights to show first-run titles. Within several years all of Syufy’s major competitors either had sold out to the company or changed their focus to second-run releases. On the heels of lawsuits by several of these companies, in 1986 the U.S. Justice Department initiated an antitrust suit against the company, charging that it had unfairly monopolized film exhibition in Las Vegas. Although Syufy settled out of court with one of the competing theater owners, it fought back against a second one and also vigorously challenged the government’s case. When the latter reached the U.S. Court of Appeals it was found for the company, which, the judge noted, had still been paying relatively high rates for films and had not charged more for tickets or concessions than it did in similar markets. Syufy retained a virtual lock on Las Vegas until the mid-1990s, when its competitors returned to the fray and opened a number of new theaters, nearly doubling the number of area screens within a year’s time.

Also in the mid-1980s, Syufy expanded its holdings in the San Francisco area. The company’s headquarters had long been established there, and it had opened several multiplexes and drive-ins in the Bay area over the years. In 1984 a new 8-plex was introduced, and the following year the Mountain View ten-screen theater opened on the site of the former Syufy-owned Moffet Drive-in. The Mountain View reportedly featured the largest theater lobby in the world. In 1986 Syufy purchased the 650-seat Presidio single-screen theater, an art house. The company also was continuing to open new theaters throughout its territory, such as the 12-screen Century Park 12 in Tucson, which opened in 1989 on the former site of one of its drive-ins. By 1990 Syufy Enterprises had 325 screens.

More Expansion: “1,000 Screens by 2000”

Raymond J. Syufy, the company’s patriarch, passed away in the spring of 1995. His son, Raymond W., had assumed the mantle of company CEO, and several of his siblings also worked for the company. Syufy Enterprises gave way to the name Century Theatres, Inc. around this time. In late 1995 Century announced plans to expand from its then-total of 476 to nearly 700 screens and, a few months later, changed the plan to “1,000 Screens by 2000.” The company, which now had some $200 million in annual revenues, estimated it would spend a comparable sum on the expansion. The plans also included upgrading all of the company’s theaters that were more than ten years old. This included installing stadium seating, “love seats” (pairs of seats with no armrests in the middle), adding more screens to some smaller multiplexes, adding cafe areas and video arcades to lobbies, improving projection equipment, and the like. The company’s theaters generally were considered to be a cut above most of its competitor’s theaters in terms of quality.

Century was taking its cue in part from an increase in film revenues nationally, but the exhibition business also was going through a period of consolidation, with a number of regional chains being gobbled up by national ones. The company was seeking to become a national presence to keep its edge against the competition. At this time the Syufys toyed with the idea of going public, but ultimately rejected it and decided to use their own money to fund the expansion.

In 1997 Century opened its two largest theaters ever, the Century 24 in Albuquerque, New Mexico and the Century 25 in Orange, California. A major competitor, Portland, Oregon’s Act III, entered Century’s Las Vegas turf in the mid-1990s and the company responded by announcing plans to build a multiplex in Portland. In the late 1990s the company moved its headquarters to the San Francisco suburb San Rafael. Century also introduced a Web site that offered directions to theaters, film times and reviews, and even the option of ordering tickets online.

Company Perspectives:

It is important to know what “Century Standards” are meant to achieve. The goal we have set is to run the best-operated theaters in the country. Furthermore, all of the theaters in the company are to meet that standard. We desire to set a standard of excellence against which other companies will measure their operations. The “Century Theatres Standard” consists of two components: What is seen from the perspective of our customers and what is seen from the perspective of the employees who work at the theater. Both are important to the successful operation of a theater. For our customers, the theater-going experience is more than just the film they have selected and the auditorium in which they are sitting. It commences when they open the local newspaper or call the theater recording and continues until the moment that they depart from our parking lot. We must examine every aspect of the theater operation from the perspective of the customer.

As the year 2000 approached, Century found that its ambitious goal of 1,000 screens was impossible to reach, with red tape of various kinds and even the E1 Nino weather conditions causing delays. The company still expected to reach that total, but was now giving itself at least another year. Plans were announced for the furthest expansion eastward to date, with at least one theater slated for the Chicago, Illinois market during 2000. The project, in Evanston, was to be an all-stadium seating art film multiplex, the first of its kind in the country. Three new San Francisco Bay area multiplexes, with a total of 61 screens, were also on the agenda. The company had many other projects open or under way, including its first forays into Texas, South Dakota, Montana, Alaska, and Colorado.

Century’s attention to detail and attractively built multiplexes were highly appealing to the public, and it ranked first in grosses among the 15 biggest theater chains, with the largest average attendance per screen in the country. The company’s multiplexes typically held as many as half the positions in the list of top 15 or 20 grossing theaters nationwide for a new blockbuster film. Century offered many amenities to bring in customers, in addition to its popular stadium seating, cafés, and video arcades. Patrons could order tickets up to five days in advance from a theater, or via the Web site. Screens were large, often curved, and sound systems were all-Dolby and all-digital, with many given George Lucas’s THX certification for exceptional sound. Though films were booked centrally, Century gave individual theater managers total control over day-to-day operations.

As Century neared the start of its seventh decade in business, the company had embarked upon its most ambitious undertaking ever, a move toward becoming a national presence in the film exhibition business. The company’s history of assertive-ness and successful expansion were strong factors in its favor, as were its dedication to quality presentation and customer

Principal Competitors

AMC Entertainment, Inc.; Edwards Theatres Circuit, Inc.; Pacific Theatres Corp.; Carmike Cinemas, Inc.; Loew’s Cineplex Entertainment Corp.; Regal Cinemas, Inc.; United Artists Theatre Circuit, Inc.

Key Dates:

1940:: Raymond J. Syufy enters theater business with the Rita in Vallejo, California.
1940–1960:: Syufy participates in lawsuits that help break stranglehold on independent exhibitors.
1960s:: Syufy opens numerous drive-ins in the West, becoming a leader in this category.
1968:: Stadium seating first introduced in San Jose multiplex.
1970s:: Century expands its indoor theaters, builds more multiplexes.
1980s:: Century becomes dominant film exhibitor in Las Vegas.
1990:: Major antitrust case against Century thrown out in U.S. Court of Appeals.
1990s:: Name change from Syufy Enterprises to Century Theatres.
1995:: Ambitious expansion plans announced; Raymond J. Syufy passes away.