The charity running the Edinburgh Filmhouse has been put into administration.
The trustees of the Centre for the Moving Image (CMI), which runs both the Filmhouse cinema and the Edinburgh International Film Festival, have appointed administrators.
In a statement, the charity stated that it was facing a "perfect storm" of soaring costs along with reduced income as a result of the Covid-19 pandemic and the cost of living crisis.
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CMI added: "The combination and scale of these challenges is unprecedented and means that there was no option but to take immediate action."
Both the Edinburgh Filmhouse and Café Bar and the Edinburgh International Film Festival, as well as the Belmont Filmhouse in Aberdeen, will halt trading immediately.
Administrators FRP Advisory will work alongside Creative Scotland, The City of Edinburgh Council and Aberdeen City Council to assess the future of the cinemas and the film festival as well as their staff.
The CMI's board said: “We have been proud to have led the CMI through incredibly challenging times, and in particular during the worst days of the pandemic.
“Unfortunately, the combination of sharply increasing energy and other costs, together with both the lasting impacts of the pandemic and the rapidly emerging cost of living crisis affecting cinema attendances, means that we have had no other option but to appoint administrators at this time.
“We would like to put on record our immense gratitude to the entire staff team whose passion for film as an artform and for the audiences and communities we work with and serve has remained undented by the challenges of recent years. We’re fully aware that this will be an exceptionally stressful time for them.”
Over the next 12 months, the CMI’s energy costs are increasing by around £200,000 — even with the newly announced energy price cap for businesses.
In addition, since CMI is an accredited Real Living Wage employer, it also faces an increase of 10.1 per cent in payroll costs over the next year.
The charity added: "Additionally, our funders and the Scottish Government have indicated that the outlook beyond March 2023 for public funding is highly uncertain, given the other pressures that they have, making planning and beyond that point almost impossible."
In addition, general cost inflation is between 10 per cent and 30 per cent for goods and services, with the CMI continuing: "There is no way of addressing this without passing on the cost increases to customers, but at a time when the cost of living crisis is beginning to hit more and more people this would make coming to the cinema less affordable for more people.
Cinema admissions at the Edinburgh Filmhouse have been around half of what they were before the Covid-19 pandemic.
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