In contrast to Hungary'sbooming production industry, theatrical business looks quite grim. Local boxoffices saw 10.8 million admissions in 2005 - just over three million feweradmissions than in the previous year. Sales fell to $43.2m (HUF9.1bn)

Indeed 2005 saw the lowest admissions in 11 years. In thepast five years, admissions have dropped by nearly a third. With the exceptionof slight rises in 2004 and 2001, results have been sliding since 1997, whenHungarian box offices saw 16.6 million tickets sold.

Growth in the exhibition industry has halted and the marketappears ripe for correction. "There has been a slight decrease in thenumber of multiplexes and screens in Hungaryrecently," said Norbert Koebli, head oftheatrical releases for Best Hollywood. Cinema City closed one Budapestmultiplex in January, Budapest Film sold its Mammutmultiplex, the second largest in Budapest,to Palace Cinemas in November, and Hollywood Multiplexes currently are forsale.

In 2005 local films saw 12% of total admissions, up from 10%of admissions in 2004. Hungarydoes not have screen quotas to protect local films from internationalcompetition, but the country's film law has motivated more local production,while fewer Hollywood films made it into the Hungarianmarket. As in other territories, local films are essential to exhibitors."We support local content. It's the key to success," Palace Cinemasgeneral director V.J. Maury told Screendaily.com.

The top local film, Lajos Koltai's Fateless, ranked fourth in terms of admissions, with justunder 500,000 tickets sold, but seventh in sales. Top grossing Star Wars: Episode III - Revenge of the Sithsold over 714,098 tickets, nearly 200,000 more than Harry Potter and the Goblet of Fire.

Top distributors in 2005 were Intercom, with 45% marketshare, UIP-Dunafilm with 20% and SPIHungary with roughly 9%. Top local distributors were Hungaricom,Intercom and Best Hollywood, with 39%, 29% and 25% market share, respectively.

Best Hollywoodwas the top distributor of art-house films, as designated by the National FilmOffice; Best Hollywood was the only Hungarian distributor to increase itsmarket share in 2005.

TOP 10 FILMS

ADMS.

1. Star Wars: Episode III : Revenge of the Sith (US) Intercom $2.9m 714,098

2. Harry Potter and The Goblet of Fire (UK-US) Intercom $2.3m 550,121

3. Madagascar (US) UIP-Dunafilm $1.9m 495,083

4. War of the Worlds (US) UIP-Dunafilm $1.4m 340,437

5. Meet the Fockers (US) UIP-Dunafilm $1.4m 330,109

6. Mr and Mrs Smith (US) Forum-Hungary $1.3m 303,284

7. Fateless (HU-UK-GER) INTERCOM $1.3m 449,240

8. One Skirt and a Pair of Trousers

(HU) BestHollywood $1m 254,327

9. Hitch (US) INTERCOM $1m 249,480

10. Kingdom of Heaven (US) INTERCOM $0.8m 200,563

TOP 10 LOCAL FILMS

1. Fateless Intercom $1.3m 449,240

2. One Skirt and a Pair of Trousers Best Hollywood $1m 254,327

3. Just Sex and Nothing Else Hungaricom $0.6m 146,107

4. Miracle Film Hungaricom $0.6m 180,480

5. Heads Off! Hungaricom $0.5m 131,139

6. Shortcut SPIHungary $0.1m 21,826

7. Black Brush Budapestfilm $43,000 18,602

8. Bedlam Budapestfilm $39,000 15,553

9. The Real Santa Hungarotop $34,000 34,765

10. Dallas Pashamende Budapestfilm $27,000 19,693