Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SUNDAY, March 27, 1994                   TAG: 9403230157
SECTION: BUSINESS                    PAGE: F-1   EDITION: METRO 
SOURCE: By JOE EARLE COX NEWS SERVICE
DATELINE: COLUMBUS, GA.                                LENGTH: Medium

CARMIKE NOW SHOWING A 415-THEATER BOX-OFFICE HIT

"I said I had in mind a necktie," the senior Patrick recalled.

But soon the talk turned serious. In 1982, Carl Patrick and his son Michael bought Martin Theaters, a chain Carl had managed for 21 years. The Patricks' company, Carmike Cinemas, went into business with about 250 theaters in small towns across the Southeast.

Now, from a computer keyboard built into his desk and a big-screen monitor on the wall of his office, Michael Patrick controls the second-largest movie theater chain in the country.

Carmike has been on an expansion binge since 1989, three years after it sold stock to the public at $8.50 a share. It now operates 1,732 screens in 415 theaters.

In January, Carmike took over operation of multiple-screen theaters at Tanglewood and Valley View malls in Roanoke from General Cinema Corp. It already operated the Salem Valley 8 theaters.

Carmike is growing so quickly that last year it jumped two rungs - from fourth to second - in the rankings of theater companies by number of screens.

And it shows no sign of slowing down.

"We should pass 2,000 screens somewhere around Christmas to Valentine's Day of 1995," said Michael Patrick, chief executive of the company that was named for him and his brother, Carl Jr., an Atlanta lawyer and CPA not actively involved in the operation of the company.

With current expansion plans - the company wants to build 178 screens this year and continues to seek theaters to buy - Carmike is rapidly closing in on the largest chain, 2,300-screen United Artists. In fact, Michael Patrick says Carmike could be operating 3,000 screens within three years.

One reason Carmike has succeeded, analysts and company officials say, is that while competitors tried to expand in and around large cities, Carmike concentrated on small- and medium-size communities, where costs are lower.

"Since everybody else was concentrating on the top 25 markets, I figured I'd take 26-down," Michael Patrick said. "If everybody was going to go east, I'd go west."

Now Carmike shows movies from Artesia, N.M., to Moscow, Idaho, and from Sioux Falls, S.D., to Surfside, S.C.

That strategy, coupled with Carmike's emphasis on tight, computerized control of its operations, has earned it the nickname of "the Wal-Mart of movie-theaterdom."

"They run a very tight ship," said Mark Allen, an analyst with Robinson-Humphrey Company Inc. in Atlanta.

Carmike's small-town emphasis pays off in market control, Allen said. In more than half its markets, Carmike has the only theater in town, he said, and in 80 percent, the company is dominant.

Alan Gould, an entertainment company analyst for Kidder, Peabody & Co. in New York, calls Carmike "one of the best-managed theater companies in the country" and says its recent expansion demonstrates that it is well-run.

"In the '80s, there were a lot of silly acquisitions made in the theater industry. People were paying crazy prices," Gould said. Carmike "sat on the sidelines until the end of '89. By that time, most of the companies that had overpaid had themselves gone into financial distress. Carmike was about the only one out there buying theaters. It became a buyer's market, and they were about the only buyer out there."

The strategy has translated into a stock whose price jumped 26 percent last year. So far this year, however, it's done very little. In trading on the New York Stock Exchange, the company's stock has ranged from $14.25 to $20.75 per share over the past 52 weeks.

Carmike's computer system links theaters across the country to the Columbus office. It permits Michael Patrick to summon information on nearly every detail - down to whether Milk Duds are moving in Missoula and Minot or "The Beverly Hillbillies" is drawing crowds in Little Rock.

That means virtually all decisions - from when to change movies to when to reorder popcorn - can be made in Columbus, rather than at individual theaters.

At the same time, computerization means the headquarters can efficiently operate more and more theaters, Michael Patrick says. "We have the same number of people [65] here with 1,730 screens as we had with 250," he said.

So how big is too big for Carmike?

Michael Patrick says he doesn't know.

"I would like to have half the screens in the continental U.S.," he said.

Then he grinned.