The National Film and Video Foundation reports that local films accounted for only R15-million of the R285-million taken at cinema box offices between April 29 and August 31.

This, however, was a vast improvement on the R4.2-million that local films earned out of a total R222-million in ticket sales in the first four months of 2011.

The increase in local earnings was largely driven by 3D animated film Jock of the Bushveld, a joint SA-Canadian production. The movie secured ticket sales of R9.9-million just before the report was released.

The worst performing South African films were Visa Vie, about a French woman searching for a South African husband before her visa expires, and My Hunter's Heart, a documentary feature that tracks the Khomani San of the central Kalahari. Both films failed to make more than R500000.

Nu-Metro distributed 42% of the local films, followed by Ster-Kinekor (33%) and United International Pictures (20%).

Three smaller companies - Indigenous Film Distributors , Swift 2.0 and Crystal Brook Distribution - distributed the remainder. The report noted that the three larger players controlled the market and made it difficult for smaller companies to compete.

Lehlohonolo Mokhosi, economic analyst at the foundation, said local films suffered because there were too few cinemas in certain regions.

"There aren't enough cinemas in predominantly black areas where the black audience can see the movies," Mokhosi said.

He said distribution companies in South Africa used a mall-based business model.

"If you look at how cinemas are based now, every cinema that you see is within a mall. And we've seen this in townships - cinemas that were stand-alones did not survive after 1994 because everyone wanted to have that mall experience," he said.

The report said 272 individual cinema screens showed South African films, amounting to 9.3% of allotted screen time, compared to the first quarter's 6.4%. The overall rental of both foreign and local films over the second quarter was about 2910 screens.

A prominent local director, who asked not to be named, said growing the black audience was vital for the industry.

"The black audience, which is the majority of the audience in the country, has not invested in film and watching film as much as maybe the white audience has," he said.

"That's got to change if there is going to be a viable South African film industry because we need films that you can make in South Africa to be seen by South Africans.

"When your film doesn't do well in your local market, it deters investors because they think: why buy the distribution if no one is watching it where it was made?"

Mokhosi said the government is working on increasing the number of screens.

"We have seen a cinema open in Killarney, and there should be a cinema and an arts centre opening up in Soweto soon. The National Film and Video Foundation is embarking on opening up digital screens across South Africa, except Gauteng because the screen density in Gauteng is already quite heavy.

"We're looking at provinces outside of Gauteng, KwaZulu-Natal and the Western Cape; we're targeting smaller, rural areas and areas that have been previously disadvantaged," he said.

The government has made a significant contribution to the development of the local film industry with the Department of Trade and Industry offering rebates for local filmmakers, allowing them to recoup some of their production costs.

"Last year we had about 23 [local] films that we released, and by the end of the year we will have had 25 films released in the cinema," said Mokhosi.

Nigeria, which boasts the third-largest film industry in the world, uses a more targeted, DVD-type model to distribute locally made movies, whereas South Africa relies heavily on cinema. Mokhosi said neither model was "better" since the two markets are different.

"The South African market is a little more affluent; they've gotten used to better quality, especially from our TV sector. Because of TV's improvement with script, sound and picture quality, our film industry is forced to conform to that level of quality that the audience is used to," said Mokhosi.

Top-grossing films during the second four months of the year included Transformers 3, Harry Potter 7: Part 2 and Pirates of the Caribbean 4.