CinemaStar Luxury Theaters Inc. announced an $848,000-loss forthe quarterending June 30, nearly double the loss it also postedfor the same time lastyear. Like other chains, CinemaStar has beenforced to rethink its growthplans as hundreds of new SouthernCalifornia movies screens have popped upover the last fiveyears.

But a CinemaStar executive says the worst may be over. "We aresuccessfully weathering a down-cycle in this industry," says JackCrosby, co-chief executive officer of CinemaStar. "We hope toimprove margins by closing losing operations, avoiding excessiveleverage, and capturing migrated audience flow from terminatedtheater operations in our markets."

The movie house chain has grown especially fast in the InlandEmpire, whereit finished a 20,000-sf expansion of its Mission GroveTheater in Riversidea few months ago. However, the company closedits six-screen theater onThird Avenue in the San Diego County cityof Chula Vista at the end of Juneand is selling the property,company officials say.