German producer-distributor ConstantinFilm has raised its forecast for the current financial year to a sales targetof around $235m (Euros 200m) for 2005.

But the good news was largely due to home entertainmentandTV service production operations rather than theatrical.

In its third-quarter results,Constantin did report an improvement in the performance of its theatricaldivision thanks to the box-office successes of Siegfried and The White Masai.

However, taken for the nine months, "the resultsproduced by the segment this year continue to be unsatisfactory", althoughit was admitted that this was "a development that is affecting the wholeof the German theatrical environment."

The $30.5m (Euros 26.7m) dip in salescompared with 2004 was in line with Constantin's expectations, since thecompany had had a particularly successful last year with Dreamship Surprise - Period1and Downfall.

On the production side, Constantin willhave been involved in the production of eight German and four international in-houseand co-productions in 2005, including Oskar Roehler's Atomised, CoreyYuen's Dead Of Alive and Tom Tykwer's Perfume - The Story Of AMurderer. This autumn has seen the Constantin Group producing James Isaac'swerewolf horror action film Skinwalkers and moving into pre-productionon the comedy Schwere Jungs and the third installment in the ResidentEvil franchise, Resident Evil: Afterlife.

Looking to the future, Constantin's management board istaking steps to address the challenges of "considerable structuralchange" in the theatrical sector.

"Technical developments arecreating new possibilities and it is up to the consumer to decide how he wantsto be provided with content in future. Our job is to adapt to this," thereport said.

Consequently, Constantin is looking atthe potential of expanding its current "five-pillar strategy" ofproduction, distribution, licence trading, home entertainment distribution andTV service production to include a sixth "pillar" dedicated to mobileapplications.