Movie>Q Opening Two New Stores7 Feb, 2013 By: Erik Gruenwedel
Production company Point.360 Feb. 7 said it plans to open two new automated Movie>Q rental and retail stores, underscoring the strength of the kiosk-based market.
Using robot technology, Movie>Q can rent and sell 10,000 to 15,000 DVD and Blu-ray Disc titles and video games via eight terminals in the 24-hour retail locations.
“Within the next few months, we expect to open two stores to test market a smaller physical distribution model,” CEO Haig Bagerdjian said in a statement. “Since the lease costs of these stores have been previously absorbed by the existing three stores, incremental sales are expected to generate greater gross margins.”
Burbank, Calif.-based Point.360 in 2010 launched the first two of three Movie>Q store locations in Westminster, Calif., and La Mirada, Calif., respectively. A third location opened in 2011 in Costa Mesa, Calif. Movies and video game daily rental prices rival Redbox. The stores also offer used titles for sale.
Point.360 does not break out operating income or loss for Movie>Q, which was previously headed by Joe Malugen, founder and former CEO of Movie Gallery.
Overall, the company reported a second-quarter (ended Dec. 31) loss of $400,000 on revenue of $7.7 million. The company posted income of $51,000 on revenue of $8.5 million during the previous-year period.
Bagerdjian attributed the revenue decline to the timing of third-party television content releases as well as a drop in revenue from domestic and foreign distribution of non-current programming.
He added that savings from consolidation of production facilities and lower financing costs would be realized going forward.