Nigeria box office to reach 50 billion naira in 4 years – CEAN President

Nigeria’s film industry, known as Nollywood, has become a major player on the world stage, valued at $6.4 billion.

Over the past four years, the sector has gained international attention thanks to growing demand for high-quality products and culturally resonant storytelling.

While Nollywood is yet to reach the heights of its counterpart in the music industry, it has seen significant growth in 2024, with September releases such as Queen Lateefah and Farmer’s Bride collectively grossing over N400 million in a matter of weeks and still playing in cinemas. .

Given this impulse, Nairametrics met with the President of the Film Exhibitors Association of Nigeria, Ope Ajayi, to understand the intricacies and also conducted an in-depth study of the Nigerian film industry.

This interview features insights from the President, who is also the founder of Cinemax Distribution Limited, as he discussed the challenges facing the industry, the potential and opportunities for expansion, and the industry’s ability to achieve viral success in an environment that is increasingly receptive to African storytelling. perspectives and narratives.

Nairametrics: Box office revenue in West Africa recently reached N7 billion, a significant portion of which comes from Nollywood productions. What key factors do you believe are driving the industry’s rapid growth and revenue-generating capabilities?

Ope Ajayi: The quality of production in Nollywood has improved significantly and filmmakers are increasingly experimenting with different genres. This year, for example, we have seen the release of biographical and religious films, as well as a noticeable increase in the number of epic films. This reflects the entrepreneurial spirit of Nigerians in the industry.

As for reception, we are also experiencing growth. Last year, our total revenue was N7.24 billion and by October this year, we had already surpassed that figure. Remarkably, in 2024, we had at least one movie grossing up to N100 million at the box office every month.

This achievement used to be a major milestone, but is now becoming more common with many films crossing the 100 million naira mark.

With this upward trend, the box office is on track to achieve a projected revenue of between N11 billion and N12 billion by the end of the year. The Nollywood landscape is becoming increasingly promising, indicating a bright future for the industry.

Nairametrics: With global players like Netflix and Amazon investing in local content, what impact do you foresee on cinema attendance and the growth trajectory of Nollywood in the coming years?

Ope Ajayi: The entry of Netflix and Amazon Prime into the market has prompted stakeholders to significantly improve the quality of their projects. We can attribute the improvement in cinematography and storytelling to the need to meet the high production standards required by platforms as well as global competition.

The Nigerian audience is very savvy and consumes content from all over the world.

Additionally, streaming services have created a dual source of income for filmmakers. The film can be shown in theaters first and then released on streaming platforms, maximizing its earning potential.

Moreover, this exposure expanded Nollywood’s reach, allowing it to connect with a global and more diverse audience, bringing even more attention to the industry.

Overall, while it is critical to continue to rebalance the ecosystem and ensure that more blockbusters are shown in theaters, the impact of streaming services has been largely positive for Nollywood, contributing to its growth and development.

Nairametrics: What is driving the growing demand for Yoruba epic films like Jagun Jagun, Lisabi, Agesinkole and others and how will this impact future indigenous films?

Ope Ajayi: Firstly, the novelty of storytelling in Nollywood is unparalleled. No other industry or people can tell Nigeria’s historical and traditional stories with such authenticity as Nigerians.

This unique perspective, coupled with world-class product quality, has stimulated growing demand both locally and internationally. Audiences are naturally drawn to stories and cultural narratives, and with the advent of streaming platforms, it has become easier than ever to share these traditional stories around the world.

The appeal of traditional Nollywood productions is underscored by the growing appreciation for authentic, culturally rich stories. While other genres are also well-crafted, Nigeria’s rich history and culture gives viewers a special flavor that captivates and leaves a lasting impression.

This trend reflects changing audience preferences and highlights Nollywood’s potential to carve out a unique niche in the global film industry. By consistently delivering high-quality, culturally resonant content, Nollywood can further cement its place on the global stage, attracting greater attention from both local and international audiences.

Nairametrics: What is the process for inclusion of films in Nigerian cinemas? Are there criteria or requirements that filmmakers must meet, and how does this process affect the variety of films available to audiences?

Ope Ajayi: There are registered distributors and cinemas with their own associations. Both associations are registered with the NFVCB (National Film and Video Censors Board), our regulatory body. If you have a film, you will find a distributor who believes in it and is willing to distribute and promote it. In some cases, invest. They will then approach cinemas to organize screenings.

This is after the film was classified. All films are classified and rated by the regulatory body, the Nigerian Film Video and Censorship Board. Of course, there are contracts between producers, distributors and cinemas. There is also usually a structure that guides the entire process.

Nairametrics: Streaming platforms often use revenue sharing models with content creators. Do cinemas in Nigeria have similar agreements with filmmakers where they get a share of the box office receipts and how does this impact the financial ecosystem of the industry?

Ope Ajayi: There are standard frameworks that define the relationship between the producer and the distributor, and then between the distributor and the theater. There may be slight differences in each case depending on negotiations, perceived strength of titles, etc.

Nairametrics: What policy initiatives or regulatory changes do you think could be made to support and improve the performance of movie theaters in Nigeria, both in terms of sustainability and growth?

Ope Ajayi: Significant investments in infrastructure and production are required. Although there is some level of financing through government agencies such as the Bank of Industry, it still requires cinemas and all practitioners to provide bank guarantees or collateral.

In fact, it may be that few players are able to access this funding due to stringent requirements, leaving a large portion of the industry without access to funding, especially low-cost funding.

In addition to funding, many film businesses and players require capacity development, such as training programs (financial, legal and regulatory, business development, marketing, etc.). Access to funds is one piece of the puzzle; another is the presence of appropriate structures that allow one to qualify for the receipt and effective use of funds.

Nairametrics: How does the Film Association of Nigeria see the future of cinemas in Nigeria and what opportunities and challenges do you foresee in the coming years?

Ope Ajayi: I truly see significant growth potential in the industry. We forecast that by the end of this year, box office receipts will be between N11 billion and N12 billion, representing an increase of over 50% compared to last year.

I believe that with a sustainable growth rate of 40-45% per annum, we can realistically reach 45 billion naira in the next four years, and perhaps 50 billion naira.

This forecast is based on the expectation that the industry will be stimulated by high-quality content and the expansion of cinemas.

Projected box office growth is only part of the movie theater revenue model. In some cases, box office receipts account for less than 50% of theaters’ total revenue.

Thus, the N45 billion box office revenue could become an industry worth over N100 billion when advertising, food and beverage sales and other revenue streams are taken into account. We will then be on the path to a multi-million dollar industry, signaling to both local and global players that the sector should continue to be invested in.

With stronger content, strategic marketing and new talent, the industry can signal enormous potential both locally and globally.

Nairametric: While Nollywood continues to show promise with production values ​​and strong earnings, box office collections when measured on a global scale continue to lag due to the devaluation of the naira. How has this affected production costs and overall marketing budgets?

Ope Ajayi: While Nollywood has shown promise with increasing production values ​​and rising revenues, its box office performance when measured globally is still lacking due to the devaluation of the naira. The impact of exchange rates led to a noticeable increase in production costs and increased marketing budgets.

Overall, the cost of producing a high-quality film has effectively doubled, but the potential for significant revenue growth remains high. The devaluation of the dollar erases some of our growth internationally, but creates an opportunity to continue to look inward and build locally.

The double-digit growth in admissions expected over the next few years is a strong indicator. I believe that in a couple of years, Nigerian movies will become the norm if they gross over 1 billion naira at the box office and we can see this up to 4 times a year (every quarter) or more.

Nairametrics: What are the specific challenges faced in the area of ​​production costs and logistics?

Ope Ajayi: Production costs in Nollywood can vary greatly. With cast, crew, equipment, locations, hotels, logistics, feeding, extras, costumes, etc., the production can cost hundreds of millions of naira.

You also often have unforeseen circumstances when filming in Nigeria, where there are so many moving parts, very few privately owned filming villages, and you have to largely ensure production safety. Other specialized costs, such as music licensing, are also expense items that can make production very expensive. It costs a lot of money to create great productions.

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