Battle to keep big screens and popcorn. British cinema chains are fighting off the threat from streaming giants with a string of blockbuster hits. 

Chest-bursting aliens and a talking raccoon have made it a good week for Tim Richards, chief executive of Vue Entertainment. Two of the summer’s early blockbusters, Alien: Covenant and Guardians of the Galaxy Vol 2, have delivered on their box office hype, raking in £8.4m in the UK last weekend as Hollywood toasts yet more success for its sci-fi hits.

“The last 115 years of cinema has proven we are inherently social beings and enjoy being in the company of others,” says Richards. “There will always be a demand for people to leave their homes and spend a few hours enjoying an incredible story.”

He is sitting in the foyer of what he says is Britain’s top-grossing cinema, the Vue at Westfield shopping centre in west London. With 17 screens, it shows almost every film in mainstream distribution as well as independent and foreign films.

In spite of the threat from streaming platforms such as Netflix and Amazon Prime, which make staying in more appealing, the cinema is holding its own.

In Britain last year, 168m cinema tickets were sold — and numbers are steady. Those people each spent an average of £19.18 at the cinema, according to figures from research firm Screen Digest.

The footfall is being driven by blockbusters. With key franchises planning releases years into the future, revenues become more predictable.

Vue, as well as its larger rivals Odeon and Cineworld, is riding the wave, clocking up underlying UK and Europe profits of £56.3m in the first three months of the year, its second-strongest quarter ever.

Britain’s third-ranked chain, co-owned by Omers and Alberta Investment Management, two Canadian pension funds, has been tipped as a London stock market candidate and is likely to explore a listing later this year. That is expected to value the business at about £1.5bn.

“The commitment to production is unprecedented,” said Richards, a former senior Warner Bros executive. “Hollywood studios are planning four or five years out.” Blockbusters for the next decade are already in the pipeline.

Titanic director James Cameron is working on four sequels to Avatar, the 2009 hit, planned for 2020, 2021, 2024 and 2025. Four new Star Wars movies in the works promise a ticket sales bonanza.

Hollywood studios are placing huge bets on star-studded, effects-laden spectaculars, mostly sequels and spin-offs, to keep customers flocking to cinemas. New technology for 3D and ultra-high resolution, as well as Imax, have helped chains fill seats in the internet age.

City investors have ploughed cash into the sector in recent years — and enjoyed a spectacular payback.

If Vue joins the London market it will face inevitable comparisons to Cineworld, which listed in 2007 and now has a market valuation of £1.9bn. On Thursday, the 220-strong Cineworld chain said revenues had jumped 15.8% so far this year (to May 11) thanks to the success of Disney’s Beauty and the Beast and Oscarnominated La La Land. Food sales were up nearly 20% in the period.

Investors have flocked to Cineworld. Its share price has risen by 237% in the past five years as City fund managers cash in on Hollywood’s success. Analysts have tipped the shares to go even higher, helped by a falling pound, due to its operations across Europe.

Nigel Parson, leisure analyst at Canaccord Genuity, said Hollywood studios had become more adept at picking hits. “Studios have understood the power of franchises and sequels. Part of the bet on [cinema] companies is people will keep that habit of going to the movies. Cinemas are also the best way for a studio to maximise a film’s earnings over its total life.”

Despite the upturn in fortunes, Parson warned that the sector may face a challenge from the streaming giants. “There has been a big shift in customer habits following the advent of TV . . . but the [cinema] industry has coped.”

Netflix’s tilt at cinema has been fiercely debated at this year’s Cannes film festival. Two Netflix-funded movies are set to be banned from entering for the Palme d’Or by the jury president, director Pedro Almodovar. The streaming giant recently bought rights to The Irishman, a Martin Scorsese film set to star Robert De Niro and Al Pacino. This week it releases War Machine, starring Brad Pitt, straight to people’s homes.

Amazon, meanwhile, has made its own foray against Hollywood, with Manchester by the Sea, which it distributed. winning Oscars. However, Amazon is viewed as a lesser threat than Netflix, as founder Jeff Bezos has indicated that he has no plans to bypass cinemas. Vue’s Richards does not believe streaming sites can usurp the studios: “No young director or producer has grown up dreaming of making a movie for an iPad.”

And technology can help as well as threaten. Apart from the draw of computer-generated imagery, big data is helping the cinema chains manage their margins.

Six months ago, Vue drafted in Opera Solutions, a San Francisco data analytics company, to mine its customer database. Information provided by the geeks has helped Vue choose the best movie screenings for any of its locations. The tech wizardry even helps Vue assess how the weather influences footfall. It can plan shift patterns — and popcorn supplies — accordingly

Although the British market is increasingly crowded, with each of the chains continuing to open new sites, the industry sees greater potential abroad. Nisan Cohen, finance director at Cineworld, said: “There is growth potential in Romania and Poland, where visitor spend is growing. We will find new opportunities to take the business forward.”

Vue, meanwhile, is searching for its next European deal after snapping up Italian and Dutch cinema chains in recent years. As British operators look outwards, Chinese money starts to flow in. Last year Dalian Wanda, the owner of American giant AMC Theatres, acquired Odeon for £921m. The deal marked a bumper exit for Guy Hands’s Terra Firma, which had owned the chain for more than a decade. More Chinese cash is likely to follow, particularly if Vue’s owners explore options for a sale or listing.

This year’s film slate includes a new Star Wars movie. The Last Jedi, due out in December, is projected to earn more than $1bn (£768m). Jurassic World 2, a further Avengers movie, a sequel to Transformers and another Spider-Man film will be released in the next few years.

Not all the sequels, prequels and reboots have been big commercial successes — the latest X-Men, Star Trek and Independence Day movies all underperformed their predecessors last year. Yet the cinema operators insist that a lack of originality is what will keep moviegoers gripped — and lure them away from their screens at home.

Not all the sequels, prequels and reboots have been big commercial successes — the latest X-Men, Star Trek and Independence Day movies all underperformed their predecessors last year. Yet the cinema operators insist that a lack of originality is what will keep moviegoers gripped — and lure them away from their screens at home.