While a recession is never pleasant, it isn’t bad news for all sectors of the economy. UK cinema admissions for the first six months of 2009 were 83.5 million, the highest since 2002 and 15 per cent up on the first half of 2008, according to figures by Oxford-based market research firm Nielsen.

And that is good news for Philippa Farrow and Jane Derricott, who recently took over the Ultimate Picture Palace on the Cowley Road in Oxford.

Built in 1910 by local builder Kingerlee, for most of its history the UPP, as it is affectionately known, was a furniture warehouse and, for a period in the 1990s, taken over by squatters.

Owned by Radio Oxford presenter Bill Heine and Pablo Butcher from 1976-1994, and renamed the Penultimate Picture Palace, it was very successful for a while, with 100,000 admissions per year at its peak.

The two men banned smoking, music and advertising, unusual at the time. They also sold homemade brownies, but it went into liquidation in July, 1994. For a month in September 1994 the cinema was occupied by squatters, who named it the Section 106 cinema, the past 14 years under Saied Marham’s stewardship has seen the UPP exist on a diet of cult films, classics and late-showing blockbusters.

Friends for 15 years, the women have wanted to work together on something creative for some time. Miss Farrow has experience running small businesses, first at the Alternative Travel Group, which she ran for 17 years with her former partner, and then as a property developer in Italy.

Mrs Derricott helped set up fashion retailer Miss Selfridge and, more latterly, worked on BBC Radio Oxford on their Action Desk, ironically in the same building as Mr Heine.

A keen cinema-goer, with an interest in film noir, she has also worked as a freelance scriptwriter and editor.

Since the duo bought the cinema from Mr Marham in July, they have already made their mark — putting in comfortable pink seats, fixing the men’s toilets, getting a licence to sell alcohol and putting in a fridge for refreshments.

While planning to continue Mr Marham’s programme of cult, classic and current films, they want to respond more to customer feedback.

Bubbling with enthusiasm and ideas, they think they have two major selling points: Miss Farrow said: “We say to people if you have ideas for a film, let us know. We have great contacts with distributors. We will go to archives, or the British Film Institute, and we will try and get it in,”

Mrs Derricott said. “It is so important that we are responsive to different needs. We are thinking of forming a committee with all ages, all backgrounds and we’ll get together and talk about film.”

Their second selling point is that they still run on 35mm film. These days many cinemas use DVDs.

Miss Farrow explained: “This means that we can put in intermissions — an opportunity to get up, stretch your legs and go to the loo.”

In some cases, they have to — 35mm film often comes in two reels. In October, for example, they showed Quentin Tarantino’s Inglourious Basterds.

Mrs Derricott said: “We explained to the audience that it was a long film, a heavy film and we have a rather elderly projectionist who cannot lift the reels up, so we split them into two. People loved it.”

They have also reduced the number of seats to offer more leg-room. Although one might think that will reduce their profits, they see it as making them more competitive.

“We can only survive by being different, small and intimate,” Miss Farrow explained. “It is better to have fewer people sitting in comfort rather than trying to cram them in.”

According to the British Film Institute (BFI), independent cinemas generally run at 35 per cent capacity. Miss Farrow and Mrs Derricott want to see that become 70-80 per cent.

They plan to make profit on the ancillaries — for example, selling alcohol.

The two women also want to use the cinema during the day for corporate events and private viewings.

“We recently showed Katyn (a Polish war drama) to a group of boys from a local school,” said Miss Farrow.

With all their plans and ideas to make the UPP utterly gorgeous, it looks as though this atmospheric little cinema is about to enjoy a renaissance.

THE STORY OF A PICTURE PALACE 1910: Frank Stuart, owner of the Elm Tree Tavern, commissions architect John R Wilkins to design a purpose-built silent movie house using local builder Kingerlee.

1911: Oxford Picture Palace opens on February 24, 1911, seating 400 people 1920: Closes down after the First World War, and is used as a furniture warehouse until 1974 1974: Bought by Pablo Butcher and Bill Heine 1976: Cinema re-opens as the Penultimate Picture Palace with 185 seats and achieves 100,000 admissions per year at its peak 1994: Penultimate Picture Palace closes and is taken over by squatters who rename it the Section 106 Cinema — a reference to the part of the 1977 Criminal Law act which makes squatting legal 1996: Saied Marham re-opens cinema as the Ultimate Picture Palace with 185 seats 2009: Ultimate Picture Palace taken over by Philippa Farrow and Jane Derricott.