UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-33401

CINEMARK HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)		20-5490327 (I.R.S. Employer Identification No.)
3900 Dallas Parkway Suite 500 Plano, Texas (Address of principal executive offices)		75093 (Zip Code)

Registrant’s telephone number, including area code: (972) 665-1000

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ No o

     Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every interactive data file required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes o No o

     Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o		Accelerated filer þ		Non-accelerated filer o		Smaller reporting company o
				(Do not check if a smaller reporting company)

     Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ

     As of July 31, 2009, 109,329,135 shares of common stock were outstanding.

 

 

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of June 30, 2009 and December 31, 2008 (unaudited)			4
Condensed Consolidated Statements of Income for the three and six months ended June 30, 2009 and 2008 (unaudited)			5
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2009 and 2008 (unaudited)			6
Notes to Condensed Consolidated Financial Statements (unaudited)			7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			25
Item 3. Quantitative and Qualitative Disclosures About Market Risk			38
Item 4. Controls and Procedures			39
PART II. OTHER INFORMATION
Item 1. Legal Proceedings			40
Item 1A. Risk Factors			40
Item 4. Submission of Matters to a Vote of Security Holders			40
Item 6. Exhibits			41
SIGNATURES			42
EX-10.1
EX-31.1
EX-31.2
EX-32.1
EX-32.2

Cautionary Statement Regarding Forward-Looking Statements

Certain matters within this Quarterly Report on Form 10Q include “forward—looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements included in this Form 10Q, other than statements of historical fact, may constitute forward-looking statements. Forward-looking statements can be identified by the use of words such as “may,” “should,” “will,” “could,” “estimates,” “predicts,” “potential,” “continue,” “anticipates,” “believes,” “plans,” “expects,” “future” and “intends” and similar expressions. Forward-looking statements may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. For a description of the risk factors, please review the “Risk Factors” section or other sections in the Company’s Annual Report on Form 10-K filed March 13, 2009 and quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission. All forward-looking statements are expressly qualified in their entirety by such risk factors. We undertake no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

		June 30,				December 31,
		2009				2008
Assets
Current assets
Cash and cash equivalents		$	382,737			$	349,603
Inventories			9,179				8,024
Accounts receivable			30,051				24,688
Income tax receivable			10,806				8,948
Current deferred tax asset			2,788				2,799
Prepaid expenses and other			8,762				9,319
Total current assets			444,323				403,381
Theatre properties and equipment			1,862,138				1,764,600
Less accumulated depreciation and amortization			638,006				556,317
Theatre properties and equipment — net			1,224,132				1,208,283
Other assets
Goodwill			1,100,398				1,039,818
Intangible assets — net			345,313				341,768
Investment in NCM			34,159				19,141
Investments in and advances to affiliates			4,231				4,284
Deferred charges and other assets — net			55,490				49,033
Total other assets			1,539,591				1,454,044
Total assets		$	3,208,046			$	3,065,708
Liabilities and stockholders’ equity
Current liabilities
Current portion of long-term debt		$	12,619			$	12,450
Current portion of capital lease obligations			6,898				5,532
Current FIN 48 liability			10,775				10,775
Accounts payable and accrued expenses			212,911				202,413
Total current liabilities			243,203				231,170
Long-term liabilities
Long-term debt, less current portion			1,553,949				1,496,012
Capital lease obligations, less current portion			136,703				118,180
Deferred income taxes			120,853				135,417
Long-term portion FIN 48 liability			14,395				6,748
Deferred lease expenses			25,686				23,371
Deferred revenue — NCM			204,240				189,847
Other long-term liabilities			44,708				40,736
Total long-term liabilities			2,100,534				2,010,311
Commitments and contingencies (see Note 18)
Stockholders’ equity
Cinemark Holdings, Inc.’s stockholders’ equity:
Common stock, $0.001 par value: 300,000,000 shares authorized and 109,316,647 shares issued and outstanding at June 30, 2009 and 108,835,365 shares issued and outstanding at December 31, 2008			109				109
Additional paid-in-capital			964,985				962,353
Retained deficit			(81,978	)			(78,859	)
Accumulated other comprehensive loss			(33,011	)			(72,347	)
Total Cinemark Holdings, Inc.’s stockholders’ equity			850,105				811,256
Noncontrolling interests			14,204				12,971
Total stockholders’ equity			864,309				824,227
Total liabilities and stockholders’ equity		$	3,208,046			$	3,065,708

The accompanying notes are an integral part of the condensed consolidated financial statements.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

		Three months ended June 30,								Six months ended June 30,
		2009				2008				2009				2008
Revenues
Admissions		$	339,088			$	294,425			$	618,971			$	556,792
Concession			158,926				141,474				288,957				263,631
Other			19,494				21,335				35,380				37,827
Total revenues			517,508				457,234				943,308				858,250
Cost of operations
Film rentals and advertising			190,826				163,799				337,952				301,939
Concession supplies			24,027				23,205				43,744				41,954
Salaries and wages			52,070				45,321				96,420				87,908
Facility lease expense			59,195				56,124				114,933				112,446
Utilities and other			54,168				50,411				102,896				98,576
General and administrative expenses			23,675				24,495				45,463				45,067
Depreciation and amortization			37,535				37,840				73,668				75,247
Amortization of favorable/unfavorable leases			346				699				669				1,403
Impairment of long-lived assets			3,930				1,342				4,969				5,829
Loss on sale of assets and other			1,186				1,109				1,458				910
Total cost of operations			446,958				404,345				822,172				771,279
Operating income			70,550				52,889				121,136				86,971
Other income (expense)
Interest expense			(25,649	)			(30,061	)			(51,113	)			(62,134	)
Interest income			937				2,940				2,769				6,684
Foreign currency exchange gain (loss)			472				(24	)			538				(240	)
Loss on early retirement of debt			(26,795	)			—				(26,795	)			(40	)
Distributions from NCM			5,027				3,403				11,606				8,585
Equity in loss of affiliates			(415	)			(692	)			(1,020	)			(1,327	)
Total other expense			(46,423	)			(24,434	)			(64,015	)			(48,472	)
Income before income taxes			24,127				28,455				57,121				38,499
Income taxes			4,320				11,840				18,963				15,481
Net income		$	19,807			$	16,615			$	38,158			$	23,018
Less: Net income attributable to noncontrolling interests			1,137				1,092				1,923				2,244
Net income attributable to Cinemark Holdings, Inc.		$	18,670			$	15,523			$	36,235			$	20,774
Weighted average shares outstanding
Basic			108,483				106,999				108,473				106,982
Diluted			110,266				109,218				109,922				109,186
Earnings per share attributable to Cinemark Holdings, Inc.’s common stockholders
Basic		$	0.17			$	0.14			$	0.33			$	0.19
Diluted		$	0.17			$	0.14			$	0.33			$	0.19

The accompanying notes are an integral part of the condensed consolidated financial statements.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

		Six months ended June 30,
		2009				2008
Operating activities
Net income		$	38,158			$	23,018
Adjustments to reconcile net income to cash provided by (used for) operating activities:
Depreciation			71,678				73,244
Amortization of intangible and other assets and unfavorable leases			2,659				3,406
Amortization of long-term prepaid rents			750				829
Amortization of debt issue costs			2,399				2,338
Amortization of deferred revenues, deferred lease incentives and other			(2,167	)			(1,748	)
Amortization of accumulated other comprehensive loss related to interest rate swap agreement			2,317				—
Impairment of long-lived assets			4,969				5,829
Share based awards compensation expense			2,403				2,078
Loss on sale of assets and other			1,458				910
Write-off of unamortized debt issue costs related to early retirement of debt			6,089				193
Accretion of interest on senior discount notes			8,085				20,039
Deferred lease expenses			2,121				2,146
Deferred income tax expenses			(16,734	)			(14,506	)
Equity in loss of affiliates			1,020				1,327
Interest paid on repurchased senior discount notes			(151,952	)			(2,929	)
Increase in deferred revenue related to new U.S. beverage agreement			6,550				—
Other			1,078				—
Changes in assets and liabilities			8,384				22,794
Net cash provided by (used for) operating activities			(10,735	)			138,968
Investing activities
Additions to theatre properties and equipment			(60,918	)			(51,916	)
Proceeds from sale of theatre properties and equipment			653				2,224
Increase in escrow deposits due to like-kind exchange			—				(2,089	)
Return of escrow deposits			—				23,439
Acquisition of theatres			(48,950	)			(5,011	)
Investment in joint venture — DCIP			(1,500	)			(1,000	)
Net cash used for investing activities			(110,715	)			(34,353	)
Financing activities
Proceeds from stock option exercises			206				633
Dividends paid to stockholders			(39,269	)			(38,598	)
Repurchase of senior discount notes			(250,507	)			(6,174	)
Proceeds from issuance of senior notes			458,532				—
Payment of debt issue costs			(12,423	)			—
Repayments of long-term debt			(6,289	)			(4,050	)
Payments on capital leases			(2,830	)			(2,363	)
Other			(795	)			(340	)
Net cash provided by (used for) financing activities			146,625				(50,892	)
Effect of exchange rate changes on cash and cash equivalents			7,959				4,504
Increase in cash and cash equivalents			33,134				58,227
Cash and cash equivalents:
Beginning of period			349,603				338,043
End of period		$	382,737			$	396,270
Supplemental Information (See Note 15)

The accompanying notes are an integral part of the condensed consolidated financial statements.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

In thousands, except share and per share data

1. The Company and Basis of Presentation

     Cinemark Holdings, Inc. and subsidiaries (the “Company”) is the second largest motion picture exhibitor in the world in terms of both attendance and the number of screens in operation, with theatres in the United States (“U.S.”), Canada, Brazil, Mexico, Chile, Colombia, Argentina, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Guatemala. The Company also managed additional theatres in the U.S., Brazil, and Colombia during the six months ended June 30, 2009.

     The condensed consolidated financial statements have been prepared by the Company, without audit, according to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, these interim financial statements reflect all adjustments of a recurring nature necessary to state fairly the financial position and results of operations as of, and for, the periods indicated. Majority-owned subsidiaries that the Company controls are consolidated while those subsidiaries of which the Company owns between 20% and 50% and does not control are accounted for as affiliates under the equity method. Those subsidiaries of which the Company owns less than 20% are generally accounted for as affiliates under the cost method, unless the Company is deemed to have the ability to exercise significant influence over the affiliate, in which case the Company would account for its investment under the equity method. The results of these subsidiaries and affiliates are included in the condensed consolidated financial statements effective with their formation or from their dates of acquisition. Intercompany balances and transactions are eliminated in consolidation.

     These condensed consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and the notes thereto for the year ended December 31, 2008, included in the Annual Report on Form 10-K filed March 13, 2009 by the Company under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Operating results for the six months ended June 30, 2009, are not necessarily indicative of the results to be achieved for the full year.

2. New Accounting Pronouncements

     In December 2007, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 141(R), “Business Combinations”. This statement requires all business combinations completed after the effective date to be accounted for by applying the acquisition method (previously referred to as the purchase method); expands the definition of transactions and events that qualify as business combinations; requires that the acquired assets and liabilities, including contingencies, be recorded at the fair value determined on the acquisition date and changes thereafter reflected in income, not goodwill; changes the recognition timing for restructuring costs; and requires acquisition costs to be expensed as incurred rather than being capitalized as part of the cost of acquisition. Adoption of SFAS No. 141(R) was required for business combinations that occurred after December 15, 2008. The adoption of SFAS No. 141(R) did not have a significant impact on the Company’s condensed consolidated financial statements.

     In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interest in Consolidated Financial Statements”. This statement establishes new accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. Specifically, this statement requires the recognition of a noncontrolling interest (minority interest) as equity in the consolidated financial statements and separate from the parent’s equity. The amount of net income attributable to the noncontrolling interest will no longer be shown as an expense item for all periods presented, but will be included in consolidated net income on the face of the income statement. SFAS No. 160 requires disclosure on the face of the consolidated income statement of the amounts of consolidated net income attributable to the parent and the noncontrolling interest. SFAS No. 160 clarifies that changes in a parent’s ownership interest in a subsidiary that do not result in deconsolidation are equity transactions if the parent retains its controlling financial interest. In addition, this statement requires that a parent recognize a gain or loss in net income when a subsidiary is deconsolidated. Such gain or loss will be measured using the fair value of the noncontrolling equity investment on the deconsolidation date. SFAS No. 160 also includes expanded disclosure requirements regarding the interests of the parent and its noncontrolling interest. SFAS No. 160 was effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. Upon adoption of this statement, the Company has recognized its noncontrolling interests as equity in the condensed consolidated balance sheets, has reflected net income attributable to noncontrolling interests in consolidated net income and has provided, in Note 4, a summary of changes in

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

equity attributable to noncontrolling interests, changes attributable to Cinemark Holdings, Inc. and changes in total equity.

     In March 2008, the FASB issued SFAS No. 161 “Disclosures about Derivative Instruments and Hedging Activities—an Amendment of FASB Statement No. 133”. This statement intends to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures about their impact on an entity’s financial position, financial performance, and cash flows. SFAS No. 161 requires disclosures regarding the objectives for using derivative instruments, the fair values of derivative instruments and their related gains and losses, and the accounting for derivatives and related hedged items. SFAS No. 161 was effective for fiscal years and interim periods beginning after November 15, 2008, with early adoption permitted. The adoption of SFAS No. 161 did not impact the Company’s condensed consolidated financial statements, nor did it have a significant impact on the Company’s disclosures.

     In June 2008, the FASB issued FASB Staff Position Emerging Issues Task Force 03-6-1, “Determining Whether Instruments Granted in Share Based Payment Transactions Are Participating Securities” (“FSP-EITF 03-6-1”). Under FSP-EITF 03-6-1, unvested share based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method. FSP-EITF 03-6-1 was effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those years and requires retrospective application. The adoption of FSP-EITF 03-6-1 did not have a significant impact on the Company’s earnings per share calculations.

     In April 2009, the FASB issued FASB Staff Position FAS 107-1 and APB 28-1, “Interim Disclosures about Fair Value of Financial Instruments” (“FSP FAS 107-1 and APB 28-1”). FSP FAS 107-1 and APB 28-1 require that disclosures about the fair value of financial instruments be included in the notes to financial statements issued during interim periods. Fair value information must be presented in the notes to financial statements together with the carrying amounts of the financial instruments. It must be clearly stated whether the amounts are assets or liabilities and how they relate to information presented in the balance sheet. The disclosures must include methods and significant assumptions used to estimate fair values, along with any changes in those methods and assumptions from prior periods. FSP FAS 107-1 and APB 28-1 are effective for interim and annual periods ending after June 15, 2009, with early adoption permitted. Upon adoption of FSP FAS 107-1 and APB 28-1, the Company added a disclosure regarding the fair value of its long-term debt (see Note 9). Below is a summary of the Company’s financial instruments, both of which are liabilities:

		June 30, 2009								December 31, 2008
		Carrying				Fair				Carrying				Fair
		Value				Value				Value				Value
Debt (see Note 9)		$	(1,566,568	)		$	(1,572,038	)		$	(1,508,462	)		$	(1,449,147	)
Interest rate swap agreements (see Note 10)		$	(18,995	)		$	(18,995	)		$	(24,781	)		$	(24,781	)

     In May 2009, the FASB issued SFAS No. 165, “Subsequent Events” (“SFAS No. 165”). SFAS No. 165 should not result in significant changes in the subsequent events that an entity reports. Rather, SFAS No. 165 introduces the concept of financial statements that are available to be issued. Financial statements are considered available to be issued when they are complete in a form and format that complies with generally accepted accounting principles and all approvals necessary for issuance have been obtained. SFAS No. 165 was effective for interim or annual financial periods ending after June 15, 2009. The adoption of SFAS No. 165 did not have a significant impact on the Company’s condensed consolidated financial statements. The Company has evaluated events through August 6, 2009, the day before the financial statements were issued and the date on which they were available to be issued.

     In June 2009, the FASB issued SFAS No. 168, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles” (“SFAS No. 168”), which authorizes the Codification as the sole source for authoritative generally accepted accounting principles in the U.S. (“U.S. GAAP”). SFAS No. 168 is effective for financial statements issued for reporting periods that end after September 15, 2009. Once SFAS No. 168 is effective, it will supersede all accounting standards in U.S. GAAP, aside from those issued by the SEC. SFAS No. 168 replaces SFAS No. 162 to establish a new hierarchy of GAAP sources for non-governmental entities under the FASB Accounting Standards Codification. The adoption of SFAS No. 168 is not expected to have a significant impact on the Company’s condensed consolidated financial statements.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

3. Earnings Per Share

     As of January 1, 2009, the Company adopted FASB Staff Position (“FSP”) EITF 03-6-1, “Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities". Under FSP-EITF 03-6-1, unvested share based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method. The adoption of FSP-EITF 03-6-1 did not have a significant impact on the Company’s earnings per share calculations.

     Basic earnings per share for the two classes of stock (common stock and unvested restricted stock) is calculated by dividing net income by the weighted average number of shares of common stock and unvested restricted stock outstanding during the reported period. Diluted earnings per share is calculated using the weighted average number of shares of common stock and unvested restricted stock plus the potentially dilutive effect of common equivalent shares outstanding determined under both the two class method and the treasury stock method. For the three and six months ended June 30, 2009 and 2008, diluted earnings per share was the same under both the two class method and the treasury stock method. The following table presents computations of basic and diluted earnings per share under the two class method:

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2009				2008				2009				2008
Numerator:
Net income attributable to Cinemark Holdings, Inc.		$	18,670			$	15,523			$	36,235			$	20,774
Earnings allocated to participating share-based awards (1)			(129	)			(49	)			(185	)			(37	)
Net income attributable to common stockholders		$	18,541			$	15,474			$	36,050			$	20,737
Denominator (shares in thousands):
Basic weighted average common stock outstanding			108,483				106,999				108,473				106,982
Common equivalent shares for stock options			1,744				2,184				1,428				2,196
Common equivalent shares for restricted stock units			39				35				21				8
Diluted			110,266				109,218				109,922				109,186
Basic earnings per share attributable to common stockholders		$	0.17			$	0.14			$	0.33			$	0.19
Diluted earnings per share attributable to common stockholders		$	0.17			$	0.14			$	0.33			$	0.19

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

4. Stockholders’ Equity

     Below is a summary of changes in equity attributable to Cinemark Holdings, Inc., noncontrolling interests and total equity for the six months ended June 30, 2009 and 2008:

		Cinemark
		Holdings, Inc.								Total
		Stockholders’				Noncontrolling				Stockholders’
		Equity				Interests				Equity
Balance at January 1, 2009		$	811,256			$	12,971			$	824,227
Share based awards compensation expense			2,403				—				2,403
Exercise of stock options			206				—				206
Dividends paid to stockholders			(39,269	)			—				(39,269	)
Dividends accrued on unvested restricted stock unit awards			(85	)			—				(85	)
Dividends paid to noncontrolling interests			—				(700	)			(700	)
Purchase of noncontrolling interest share of an Argentina subsidiary			23				(117	)			(94	)
Comprehensive income:
Net income			36,235				1,923				38,158
Fair value adjustments on interest rate swap agreements, net of taxes of $2,181			3,605				—				3,605
Amortization of accumulated other comprehensive loss on terminated swap agreement			2,317				—				2,317
Foreign currency translation adjustment			33,414				127				33,541
Balance at June 30, 2009		$	850,105			$	14,204			$	864,309

     On February 13, 2009, the Company’s board of directors declared a cash dividend for the fourth quarter of 2008 in the amount of $0.18 per share of common stock payable to stockholders of record on March 5, 2009. The dividend was paid on March 20, 2009 in the total amount of approximately $19,595. On May 13, 2009, the Company’s board of directors declared a cash dividend for the first quarter of 2009 in the amount of $0.18 per share of common stock payable to stockholders of record on June 2, 2009. The dividend was paid on June 18, 2009 in the total amount of approximately $19,674.

		Cinemark
		Holdings, Inc.								Total
		Stockholders’				Noncontrolling				Stockholders’
		Equity				Interests				Equity
Balance at January 1, 2008		$	1,019,203			$	16,182			$	1,035,385
Share based awards compensation expense			2,078				—				2,078
Exercise of stock options			633				—				633
Dividends paid to stockholders			(38,598	)			—				(38,598	)
Dividends accrued on unvested restricted stock unit awards			(25	)			—				(25	)
Dividends paid to noncontrolling interests			—				(340	)			(340	)
Comprehensive income:
Net income			20,774				2,244				23,018
Fair value adjustments on interest rate swap agreements, net of taxes of $677			1,087				—				1,087
Foreign currency translation adjustment			27,440				210				27,650
Balance at June 30, 2008		$	1,032,592			$	18,296			$	1,050,888

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

     During the six months ended June 30, 2009, the Company’s additional paid in capital increased by approximately $23 due to the Company’s purchase of the noncontrolling interests’ share in one of the Company’s Argentina subsidiaries. During the six months ended June 30, 2008, there were no increases or decreases to the Company’s additional paid in capital for purchases or sales of existing noncontrolling interests.

5. Acquisitions

     On March 18, 2009, the Company acquired four theatres with 82 screens from Muvico Entertainment L.L.C. in an asset purchase for $48,950 in cash. The acquisition resulted in an expansion of the Company’s U.S. theatre base, as three of the theatres are located in Florida and one theatre is located in Maryland. The Company incurred approximately $113 in transaction costs, which are reflected in general and administrative expenses on the condensed consolidated statement of income for the six months ended June 30, 2009.

     The transaction was accounted for by applying the acquisition method in accordance with SFAS No. 141(R) “Business Combinations”. The following table represents the identifiable assets acquired and liabilities assumed that have been recognized by the Company in its condensed consolidated balance sheet as of June 30, 2009:

Theatre properties and equipment		$	25,575
Brandname			3,500
Noncompete agreement			1,630
Goodwill			44,565
Unfavorable lease			(3,600	)
Capital lease liability (for one theatre)			(22,720	)
Total		$	48,950

     The goodwill recorded is fully deductible for tax purposes.

6. Investment in National CineMedia

     In March 2005, Regal Entertainment Inc. (“Regal”) and AMC Entertainment Inc. (“AMC”) formed National CineMedia, LLC, or NCM, and on July 15, 2005, the Company joined NCM, as one of the founding members. NCM operates the largest digital in-theatre network in the U.S. for providing cinema advertising and non-film events and combines the cinema advertising and non-film events businesses of the three largest motion picture exhibitors in the U.S. Upon joining NCM, the Company and NCM entered into an Exhibitor Services Agreement, pursuant to which NCM provides advertising, promotion and event services to the Company’s theatres.

     In consideration for NCM’s exclusive access to the Company’s theatre attendees for on-screen advertising and use of off-screen locations within the Company’s theatres for the lobby entertainment network and lobby promotions, the Company receives a monthly theatre access fee under the Exhibitor Services Agreement. The theatre access fee is composed of a fixed payment per patron, initially seven cents, and a fixed payment per digital screen, which may be adjusted for certain enumerated reasons. The payment per theatre patron will increase by 8% every five years, with the first such increase taking effect after the end of fiscal 2011, and the payment per digital screen, initially eight hundred dollars per digital screen per year, will increase annually by 5%, beginning after 2007. For 2009, the annual payment per digital screen is eight hundred eighty-two dollars. The theatre access fee paid in the aggregate to Regal, AMC and the Company will not be less than 12% of NCM’s Aggregate Advertising Revenue (as defined in the Exhibitor Services Agreement), or it will be adjusted upward to reach this minimum payment. Additionally, with respect to any on-screen advertising time provided to the Company’s beverage concessionaire, the Company is required to purchase such time from NCM at a negotiated rate. The Exhibitor Services Agreement has, except with respect to certain limited services, a term of 30 years.

     During March 2008, NCM performed a common unit adjustment calculation in accordance with the Common Unit Adjustment Agreement dated as of February 13, 2007 between NCM, Inc. and the Company, Regal and AMC. The common unit adjustment is based on the change in the number of screens operated by and attendance of the Company, AMC and Regal. As a result of the common unit adjustment calculation, the Company received an additional 846,303 common units of NCM, each of which is convertible into one share of NCM, Inc. common stock. The Company recorded

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

the additional common units received at fair value as an investment with a corresponding adjustment to deferred revenue of $19,020. The common unit adjustment resulted in an increase in the Company’s ownership percentage in NCM from approximately 14.0% to approximately 14.5%. Subsequent to the annual common unit adjustment discussed above, in May 2008, Regal completed an acquisition of another theatre circuit that required an extraordinary common unit adjustment calculation by NCM in accordance with the Common Unit Adjustment Agreement. As a result of this extraordinary common unit adjustment, Regal was granted additional common units of NCM, which resulted in dilution of the Company’s ownership interest in NCM from 14.5% to 14.1%.

     During March 2009, NCM performed its annual common unit adjustment calculation under the Common Unit Adjustment Agreement. As a result of the calculation, the Company received an additional 1,197,303 common units of NCM, each of which is convertible into one share of NCM, Inc. common stock. The Company recorded the additional common units received at fair value as an investment with a corresponding adjustment to deferred revenue of $15,536. The common unit adjustment resulted in a change in the Company’s ownership percentage in NCM from approximately 14.1% to 15.0%. As of June 30, 2009, the Company owned a total of 15,188,955 common units of NCM.

     The Company accounts for its investment in NCM under the equity method of accounting due to its ability to exercise significant control over NCM. The Company has substantial rights as a founding member, including the right to designate a total of two nominees to the ten-member Board of Directors of NCM Inc., the sole manager.

     Below is a summary of activity with NCM included in the Company’s condensed consolidated financial statements:

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2009				2008				2009				2008
Other revenue		$	1,469			$	521			$	2,870			$	922
Equity income		$	383			$	37			$	407			$	37
Distributions from NCM		$	5,027			$	3,403			$	11,606			$	8,585

		As of
		June 30,				December 31,
		2009				2008
Accounts receivable from NCM		$	525			$	228

     Below is summary financial information for NCM for the three month period ended April 2, 2009 (data for the six month period ended July 2, 2009 is not yet available):

Gross revenues		$	73,510
Operating income		$	22,363
Net earnings		$	11,941

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

7. Investment in Digital Cinema Implementation Partners

     On February 12, 2007, the Company, AMC and Regal entered into a joint venture known as Digital Cinema Implementation Partners LLC (“DCIP”) to facilitate the implementation of digital cinema in the Company’s theatres and to establish agreements with major motion picture studios for the financing of digital cinema. Future digital cinema developments will be managed by DCIP, subject to the Company’s approval along with the Company’s partners, AMC and Regal. As of June 30, 2009, the Company has invested $7,000 and has a one-third ownership interest in DCIP. The Company is accounting for its investment in DCIP under the equity method of accounting.

     During the six months ended June 30, 2008 and 2009, the Company recorded equity losses in DCIP of $1,343 and $1,478, respectively, relating to this investment. The Company’s investment basis in DCIP was $1,017 and $1,039 at December 31, 2008 and June 30, 2009, respectively, which is included in investments in and advances to affiliates on the condensed consolidated balance sheets.

8. Share Based Awards

     During March 2008, the Company’s board of directors approved the Amended and Restated Cinemark Holdings, Inc. 2006 Long Term Incentive Plan (the “Restated Incentive Plan”). The Restated Incentive Plan amends and restates the 2006 Plan, to (i) increase the number of shares reserved for issuance from 9,097,360 shares of common stock to 19,100,000 shares of common stock and (ii) permit the compensation committee of the Company’s board of directors (the “Compensation Committee”) to award participants restricted stock units and performance awards. The right of a participant to exercise or receive a grant of a restricted stock unit or performance award may be subject to the satisfaction of such performance or objective business criteria as determined by the Compensation Committee. With the exception of the changes identified in (i) and (ii) above, the Restated Incentive Plan does not materially differ from the 2006 Plan. The Restated Incentive Plan was approved by the Company’s stockholders at its annual meeting of stockholders held on May 15, 2008.

     During August 2008, the Company filed a registration statement with the Securities and Exchange Commission on Form S-8 for the purpose of registering the additional shares available for issuance under the Restated Incentive Plan.

     Stock Options — A summary of stock option activity and related information for the six months ended June 30, 2009 is as follows:

										Weighted
										Average
						Weighted				Grant				Aggregate
		Number of				Average				Date Fair				Intrinsic
		Options				Exercise Price				Value				Value
Outstanding at December 31, 2008			6,139,670			$	7.63			$	3.51
Granted			—				—				—
Exercised			(26,992	)		$	7.63			$	3.51
Forfeited			—				—				—
Outstanding at June 30, 2009			6,112,678			$	7.63			$	3.51			$	22,556
Options exercisable at June 30, 2009			6,112,678			$	7.63			$	3.51			$	22,556

     The total intrinsic value of options exercised during the six month period ended June 30, 2009 was $35.

     During the six months ended June 30, 2009, the Company changed its estimated forfeiture rate of 5% to 2.5% based on actual cumulative stock option forfeitures. The cumulative impact of the reduction in forfeiture rate was $260 and was recorded as additional compensation expense during the six months ended June 30, 2009.

     The Company recorded compensation expense of $1,020, including the aforementioned $260 related to the change in forfeiture rate, and a tax benefit of approximately $385 during the six months ended June 30, 2009, related to the outstanding stock options. As of June 30, 2009, there was no remaining unrecognized compensation expense related to

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

outstanding stock options and all outstanding options fully vested on April 2, 2009. All options outstanding at June 30, 2009 have an average remaining contractual life of approximately 5.25 years.

     Restricted Stock — During the six months ended June 30, 2009, the Company granted 472,881 shares of restricted stock to independent directors and employees of the Company. The fair value of the shares of restricted stock was determined based on the market value of the Company’s stock on the dates of grant, which ranged from $9.50 to $11.32 per share. The Company assumed forfeiture rates ranging from zero to 5% for the restricted stock awards. The restricted stock vests over periods ranging from one year to four years based on continued service by the directors and employees.

     A summary of restricted stock activity for the six months ended June 30, 2009 is as follows:

						Weighted
		Shares of				Average
		Restricted				Grant Date
		Stock				Fair Value
Outstanding at December 31, 2008			385,666			$	13.32
Granted			472,881			$	9.69
Forfeited			(18,591	)		$	11.02
Vested			(38,369	)		$	13.03
Outstanding at June 30, 2009			801,587			$	11.24
Unvested restricted stock at June 30, 2009			801,587			$	11.24

     The Company recorded compensation expense of $1,065 related to these restricted stock awards during the six months ended June 30, 2009. As of June 30, 2009, the remaining unrecognized compensation expense related to these restricted stock awards was approximately $7,057 and the weighted average period over which this remaining compensation expense will be recognized is approximately three years. The total fair value of shares vested during the six months ended June 30, 2009 and 2008 was $419 and $286, respectively. Upon vesting, the Company receives an income tax deduction. The recipients of restricted stock are entitled to receive dividends and to vote their respective shares, however the sale and transfer of the restricted shares is prohibited during the restriction period.

     Restricted Stock Units — During the six months ended June 30, 2009, the Company granted restricted stock units representing 303,168 hypothetical shares of common stock under the Restated Incentive Plan. Similar to the restricted stock unit awards granted during 2008, the restricted stock units vest based on a combination of financial performance factors and continued service. The financial performance factors are based on an implied equity value concept that determines an internal rate of return (“IRR”) during the three fiscal year period ending December 31, 2011 based on a formula utilizing a multiple of Adjusted EBITDA subject to certain specified adjustments (as defined in the restricted stock unit award agreement). The financial performance factors for the restricted stock units have a threshold, target and maximum level of payment opportunity. If the IRR for the three year period is at least 8.5%, which is the threshold, one-third of the restricted stock units vest. If the IRR for the three year period is at least 10.5%, which is the target, two-thirds of the restricted stock units vest. If the IRR for the three year period is at least 12.5%, which is the maximum, 100% of the restricted stock units vest. All payouts of restricted stock units that vest are subject to an additional one year service requirement and will be paid in the form of common stock if the participant continues to provide services through the fourth anniversary of the grant date. Restricted stock unit award participants are eligible to receive dividend equivalent payments if and at the time the restricted stock unit awards become vested.

     Below is a table summarizing the potential awards at each of the three levels of financial performance (excludes estimated forfeitures):

		Number of
		Shares				Value at
		Vesting				Grant
at IRR of at least 8.5%			101,051			$	963
at IRR of at least 10.5%			202,117			$	1,927
at IRR of at least 12.5%			303,168			$	2,891

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

     Due to the fact that the IRR for the three year period ending December 31, 2011 cannot be determined at the time of the grants, the Company has estimated that the most likely outcome is the achievement of the mid-point IRR level. As a result, the total compensation expense to be recorded for the restricted stock unit awards is $1,835 assuming a total of 192,407 units will vest at the end of the four year period. The Company assumed forfeiture rates ranging from zero to 5% for the restricted stock unit awards. If during the service period, additional information becomes available to lead the Company to believe a different IRR level will be achieved for the three year period ending December 31, 2011, the Company will reassess the number of units that will vest and adjust its compensation expense accordingly on a prospective basis over the remaining service period.

     Below is a summary of outstanding restricted stock units:

						Weighted
						Average
		Number of				Grant Date
		Units				Fair Value
Unvested restricted stock units at December 31, 2008 (1) (2)			135,027			$	13.00
Granted (1)			192,407			$	9.54
Forfeited			(13,279	)		$	11.02
Vested			—				—
Unvested restricted stock units at June 30, 2009			314,155			$	10.96

     The Company recorded compensation expense of $318 related to these awards during the six months ended June 30, 2009. As of June 30, 2009, the remaining unrecognized compensation expense related to these restricted stock unit awards was $2,883 and the weighted average period over which this remaining compensation expense will be recognized is approximately three years.

9. Long-Term Debt Activity

     Issuance of Cinemark USA, Inc. 8.625% Senior Notes Due 2019

     On June 29, 2009, Cinemark USA, Inc. issued $470,000 aggregate principal amount of 8.625% senior notes due 2019 with an original issue discount of $11,468, resulting in proceeds of approximately $458,532. The proceeds were primarily used to fund the repurchase of a majority of Cinemark, Inc.’s 9 ³/4% senior discount notes discussed below. Interest is payable on June 15 and December 15 of each year beginning on December 15, 2019. The senior notes mature on June 15, 2019. The Company incurred debt issue costs of approximately $11,976 in connection with the issuance.

     The senior notes are fully and unconditionally guaranteed on a joint and several senior unsecured basis by certain of the Company’s subsidiaries that guarantee, assume or become liable with respect to any of the Company’s or a guarantor’s debt. The senior notes and the guarantees are senior unsecured obligations and rank equally in right of payment with all of the Company’s and its guarantor’s existing and future senior unsecured debt and senior in right of payment to all of the Company’s and its guarantor’s existing and future subordinated debt. The senior notes and the guarantees are effectively subordinated to all of the Company’s and its guarantor’s existing and future secured debt to the extent of the value of the assets securing such debt, including all borrowings under the Company’s senior secured credit facility. The senior notes and the guarantees are structurally subordinated to all existing and future debt and other liabilities of the Company’s subsidiaries that do not guarantee the senior notes.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

     The indenture to the senior notes contains covenants that limit, among other things, the ability of Cinemark USA, Inc. and certain of its subsidiaries to (1) consummate specified asset sales, (2) make investments or other restricted payments, including paying dividends, making other distributions or repurchasing subordinated debt or equity, (3) incur additional indebtedness and issue preferred stock, (4) enter into transactions with affiliates, (5) enter new lines of business, (6) merge or consolidate with, or sell all or substantially all of its assets to, another person and (7) create liens. Upon a change of control of Cinemark Holdings, Inc., Cinemark, Inc. or Cinemark USA, Inc., Cinemark USA, Inc. would be required to make an offer to repurchase the senior notes at a price equal to 101% of the aggregate principal amount outstanding plus accrued and unpaid interest, if any, through the date of repurchase. Certain asset dispositions are considered triggering events that may require Cinemark USA, Inc. to use the proceeds from those asset dispositions to make an offer to purchase the notes at 100% of their principal amount, plus accrued and unpaid interest, if any, to the date of repurchase if such proceeds are not otherwise used within 365 days as described in the indenture. The indenture governing the senior notes allows Cinemark USA, Inc. to incur additional indebtedness if we satisfy the coverage ratio specified in the indenture, after giving effect to the incurrence of the additional indebtedness, and in certain other circumstances.

     Prior to June 15, 2014, Cinemark USA, Inc. may redeem all or any part of the senior notes at its option at 100% of the principal amount plus a make-whole premium. After June 15, 2014, Cinemark USA, Inc. may redeem the senior notes in whole or in part at redemption prices described in the senior notes. In addition, Cinemark USA, Inc. may redeem up to 35% of the aggregate principal amount of the senior notes from the net proceeds of certain equity offerings at the redemption price set forth in the senior notes.

     The Company and its guarantor subsidiaries have agreed to file a registration statement with the Securities and Exchange Commission (the “Commission”) pursuant to which the Company will either offer to exchange the senior notes for substantially similar registered senior notes or register the resale of the senior notes, except that the exchanged registered senior notes will not contain terms with respect to transfer restrictions or provide for payment of additional interest as specified below. The registration rights agreement provides that (i) the Company will use its commercially reasonable best efforts to file an exchange offer registration statement with the Commission on or prior to 90 days after the closing of the senior notes offering, (ii) the Company will use its commercially reasonable best efforts to have the exchange offer registration statement declared effective by the Commission on or prior to 180 days after the closing of the senior notes offering, (iii) unless the exchange offer would not be permissible by applicable law or Commission policy, the Company will commence the exchange offer and use its commercially reasonable best efforts to issue on the earliest practicable date after the date on which the exchange offer registration statement was declared effective by the Commission, but not later than 30 days thereafter, exchange registered senior notes in exchange for all senior notes tendered prior thereto in the exchange offer and (iv) if obligated to file the shelf registration statement, the Company will use its commercially reasonable best efforts to file the shelf registration statement with the Commission on or prior to 30 days after such filing obligation arises (and in any event within 210 days after the closing of the senior notes offering) and to cause the shelf registration statement to be declared effective by the Commission on or prior to 180 days after such obligation arises. If applicable, the Company will use its commercially reasonable best efforts to keep the shelf registration statement effective for a period of two years after the closing of the senior notes offering, subject to certain exceptions.

     If (a) the Company fails to file any of the registration statements required by the registration rights agreement on or before the date specified for such filing, (b) any of such registration statements is not declared effective by the Commission on or prior to the date specified for such effectiveness (the “Effectiveness Target Date”), (c)  the Company fails to consummate the exchange offer within 30 business days of the effectiveness target date with respect to the exchange offer registration statement or (d) the shelf registration statement or the exchange offer registration statement is declared effective but thereafter ceases to be effective or usable in connection with resales of notes during the periods specified in the registration rights agreement without being succeeded within two business days by a post-effective amendment to such registration statement that cures such failure and that is itself immediately declared effective (each such event a “Registration Default”), the Company will pay additional interest to each holder of secured notes. Such additional interest, with respect to the first 90-day period immediately following the occurrence of any such Registration Default, shall equal an increase in the annual interest rate on the notes by 0.5% per annum.

     The amount of the additional interest will increase by an additional 0.5% per annum with respect to each subsequent 90-day period relating to such Registration Default until all Registration Defaults have been cured, up to a maximum amount of additional interest for all Registration Defaults of 1.0% per annum. The senior notes will not accrue additional interest from and after the third anniversary of the closing of the senior notes offering even if the Company is not in compliance with its obligations under the registration rights agreement. The receipt of additional interest shall be the sole remedy available to holders of senior notes as a result of one or more Registration Defaults. Following the cure of all Registration Defaults, the accrual of additional interest will cease.

     Cash Tender Offer for Cinemark, Inc.’s 9 ³/4% Senior Discount Notes due 2014

     On June 15, 2009, Cinemark, Inc. commenced a cash tender offer for any and all of its 9 ³/4% senior discount notes due 2014, of which $419,403 aggregate principal amount at maturity remained outstanding. In connection with the tender offer, Cinemark, Inc. solicited consents to adopt proposed amendments to the indenture to eliminate substantially all restrictive covenants and certain events of default provisions. On June 29, 2009, approximately $402,459 aggregate principal amount at maturity of the 9 ³/4% senior discount notes were tendered and repurchased by the Company for approximately $433,415, including accrued interest of $11,336 and tender premiums paid of $19,620. The Company funded the repurchase with the proceeds from the issuance of the Cinemark USA, Inc. senior notes discussed above. The Company recorded a loss on early retirement of debt of approximately $26,795 during the six months ended June 30, 2009, which included tender premiums paid, other fees and the write-off of unamortized debt issue costs. As of June 30, 2009, Cinemark, Inc. had $16,944 aggregate principal amount at maturity of 9 ³/4% senior discount notes remaining outstanding.

     Effective as of June 29, 2009, Cinemark, Inc. and the Bank of New York Trust Company, N.A. as trustee to the indenture dated March 31, 2004, executed the First Supplemental Indenture to amend the Indenture by eliminating substantially all restrictive covenants and certain events of default provisions.

     Fair Value of Long Term Debt

     The Company estimates the fair value of its long term debt using quoted market prices and present value techniques, as appropriate. The carrying value of the Company’s long term debt was $1,566,568 and $1,508,462 as of June 30, 2009 and December 31, 2008, respectively. The fair value of the Company’s long term debt was $1,572,038 and $1,449,147 as of June 30, 2009 and December 31, 2008, respectively.

10. Interest Rate Swap Agreements

     During 2007 and 2008, the Company entered into three interest rate swap agreements. The interest rate swap agreements qualify for cash flow hedge accounting in accordance with SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities.” The fair values of the interest rate swaps are recorded on the Company’s condensed consolidated balance sheet as an asset or liability with the effective portion of the interest rate swaps’ gains or losses reported as a component of accumulated other comprehensive income (loss) and the ineffective portion reported in earnings. The Company’s fair value measurements are based on projected future interest rates as provided by the counterparties to the interest rate swap agreements and the fixed rates that the Company is obligated to pay under these agreements. Therefore, the Company’s measurements use significant unobservable inputs, which fall in Level 3 under

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

SFAS No. 157 “Fair Value Measurements.”

     In March 2007, the Company entered into two interest rate swap agreements with effective dates of August 13, 2007 and terms of five years each. The interest rate swaps were designated to hedge approximately $500,000 of the Company’s variable rate debt obligations under its senior secured credit facility. Under the terms of the interest rate swap agreements, the Company pays fixed rates of 4.918% and 4.922% on $375,000 and $125,000, respectively, of variable rate debt and receives interest at a variable rate based on the 3-month LIBOR. The 3-month LIBOR rate on each reset date determines the variable portion of the interest rate swaps for the three-month period following the reset date. No premium or discount was incurred upon the Company entering into the interest rate swaps because the pay and receive rates on the interest rate swaps represented prevailing rates for each counterparty at the time the interest rate swaps were consummated. The Company estimates the fair values of the interest rate swaps by comparing estimated future interest payments to be made under forecasted future 3-month LIBOR to the fixed rates in accordance with the interest rate swaps.

     On September 14, 2008, the counterparty to the $375,000 interest rate swap agreement filed for bankruptcy protection. As a result, the Company determined that on September 15, 2008, when the counterparty’s credit rating was downgraded, the interest rate swap was no longer highly effective. On October 1, 2008, this interest rate swap was terminated by the Company. The change in fair value of this interest rate swap agreement from inception to September 14, 2008 was recorded as a component of accumulated other comprehensive loss. The change in fair value from September 15, 2008 through September 30, 2008 and the gain on termination were recorded in earnings as a component of interest expense during the year ended December 31, 2008. The Company determined that the forecasted transactions hedged by this interest rate swap are still probable to occur, thus the total amount reported in accumulated other comprehensive loss related to this swap of $18,147 is being amortized on a straight-line basis to interest expense over the period during which the forecasted transactions are expected to occur, which is September 15, 2008 through August 13, 2012. The Company amortized approximately $0 and $2,317 to interest expense during the six months ended June 30, 2008 and 2009, respectively. The Company will amortize approximately $4,633 to interest expense over the next twelve months.

     On October 3, 2008, the Company entered into one interest rate swap agreement with an effective date of November 14, 2008 and a term of four years. The interest rate swap was designated to hedge approximately $100,000 of the Company’s variable rate debt obligations under its senior secured credit facility for three years and $75,000 of the Company’s variable rate debt obligations under its senior secured credit facility for four years. Under the terms of the interest rate swap agreement, the Company pays a fixed rate of 3.63% on $175,000 of variable rate debt and receives interest at a variable rate based on the 1-month LIBOR. The 1-month LIBOR rate on each reset date determines the variable portion of the interest rate swap for the one-month period following the reset date. No premium or discount was incurred upon the Company entering into the interest rate swap because the pay and receive rates on the interest rate swap represented prevailing rates for the counterparty at the time the interest rate swap was consummated.

     As of June 30, 2009, the fair values of the $125,000 interest rate swap and the $175,000 interest rate swap were liabilities of approximately $10,593 and $8,402, respectively which have been recorded as a component of other long-term liabilities. A corresponding cumulative amount of $11,660, net of taxes, has been recorded as an increase in accumulated other comprehensive loss on the Company’s condensed consolidated balance sheet as of June 30, 2009. The interest rate swaps exhibited no ineffectiveness during the six months ended June 30, 2009.

     Below is a reconciliation of our interest rate swap values, as included in other long-term liabilities on the condensed consolidated balance sheets, from the beginning of the year to June 30, 2009:

Beginning liability balance — January 1, 2009		$	24,781
Total gain included in accumulated other comprehensive loss			(5,786	)
Ending liability balance — June 30, 2009		$	18,995

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

11. Goodwill and Other Intangible Assets

     The Company’s goodwill was as follows:

		U.S.				International
		Operating				Operating
		Segment				Segment				Total
Balance at December 31, 2008		$	903,461			$	136,357			$	1,039,818
Acquisition of theatres (1)			44,565				—				44,565
Foreign currency translation adjustments			—				16,015				16,015
Balance at June 30, 2009		$	948,026			$	152,372			$	1,100,398

     In accordance with SFAS No. 142, “Goodwill and Other Intangible Assets”, the Company evaluates goodwill for impairment on an annual basis during the fourth quarter or whenever events or changes in circumstances indicate, the carrying value of goodwill might exceed its estimated fair value.

     The Company evaluates goodwill for impairment at the reporting unit level and has allocated goodwill to the reporting unit based on an estimate of its relative fair value. The Company considers the reporting unit to be each of its sixteen regions in the U.S. and each of its eight countries internationally (Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Guatemala are considered one reporting unit). Goodwill impairment is evaluated using a two-step approach requiring the Company to compute the fair value of a reporting unit and compare it with its carrying value. If the carrying value exceeds the estimated fair value, a second step is performed to measure the potential goodwill impairment. Fair values are determined based on a multiple of cash flows, which was six and a half times for the evaluation performed during the fourth quarter of 2008. These fair value estimates fall in Level 3 under SFAS No. 157 “Fair Value Measurements”. Significant judgment is involved in estimating cash flows and fair value. Management’s estimates are based on historical and projected operating performance as well as recent market transactions.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

     Intangible assets consisted of the following:

		Balance at																Balance at
		December 31,																June 30,
		2008				Additions(1)				Amortization				Other(2)				2009
Intangible assets with finite lives:
Vendor contracts:
Gross carrying amount		$	55,840			$	(375	)		$	—			$	670			$	56,135
Accumulated amortization			(26,664	)			—				(1,568	)			—				(28,232	)
Net carrying amount			29,176				(375	)			(1,568	)			670				27,903
Other intangible assets:
Gross carrying amount			22,856				5,130				—				(790	)			27,196
Accumulated amortization			(19,366	)			—				(1,145	)			772				(19,739	)
Net carrying amount			3,490				5,130				(1,145	)			(18	)			7,457
Total net intangible assets with finite lives			32,666				4,755				(2,713	)			652				35,360
Intangible assets with indefinite lives:
Tradename			309,102				—				—				851				309,953
Total intangible assets — net		$	341,768			$	4,755			$	(2,713	)		$	1,503			$	345,313

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

     Aggregate amortization expense of $2,659 for the six months ended June 30, 2009 consisted of $2,713 of amortization of intangible assets and $(54) of net amortization of other assets and unfavorable leases. Estimated aggregate future amortization expense for intangible assets is as follows:

For the six months ended December 31, 2009		$	3,702
For the twelve months ended December 31, 2010			5,531
For the twelve months ended December 31, 2011			5,242
For the twelve months ended December 31, 2012			4,355
For the twelve months ended December 31, 2013			3,625
Thereafter			12,905
Total		$	35,360

12. Impairment of Long-Lived Assets

     In accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” the Company reviews long-lived assets for impairment on a quarterly basis or whenever events or changes in circumstances indicate the carrying amount of the assets may not be fully recoverable.

     The Company considers actual theatre level cash flows, future years budgeted theatre level cash flows, theatre property and equipment carrying values, amortizing intangible assets carrying values, the age of a recently built theatre, competitive theatres in the marketplace, changes in foreign currency exchange rates, the impact of recent ticket price changes, available lease renewal options and other factors considered relevant in its assessment of impairment of individual theatre assets. Long-lived assets are evaluated for impairment on an individual theatre basis, which the Company believes is the lowest applicable level for which there are identifiable cash flows. The impairment evaluation is based on the estimated cash flows from continuing use through the remainder of the theatre’s useful life. The remainder of the useful life correlates with the available remaining lease period, which includes the probability of renewal periods for leased properties and a period of twenty years for fee owned properties. If the estimated cash flows are not sufficient to recover a long-lived asset’s carrying value, the Company then compares the carrying value of the asset group (theatre) with its estimated fair value. Fair value is determined based on a multiple of cash flows, which was eight times for the evaluations performed during the six months ended June 30, 2008 and six and a half times for the evaluations performed during the six months ended June 30, 2009. When estimated fair value is determined to be lower than the carrying value of the asset group (theatre), the asset group (theatre) is written down to its estimated fair value. These fair value estimates fall in Level 3 under SFAS No. 157 “Fair Value Measurements”. The estimated aggregate fair value of the long-lived assets impaired during the six months ended June 30, 2009 was approximately $6,100. Significant judgment is involved in estimating cash flows and fair value. Management’s estimates are based on historical and projected operating performance as well as recent market transactions.

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2009				2008				2009				2008
United State theatre properties		$	3,844			$	1,058			$	4,665			$	5,545
International theatre properties			86				284				233				284
Subtotal		$	3,930			$	1,342			$	4,898			$	5,829
Intangible assets			—				—				71				—
Impairment of long-lived assets		$	3,930			$	1,342			$	4,969			$	5,829

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

13. Foreign Currency Translation

     The accumulated other comprehensive loss account in stockholders’ equity of $72,347 and $33,011 at December 31, 2008 and June 30, 2009, respectively, includes the cumulative foreign currency adjustments from translating the financial statements of the Company’s international subsidiaries into U.S. dollars.

     In 2009 and 2008, all foreign countries where the Company has operations were deemed non-highly inflationary. Thus, any fluctuation in the currency results in a cumulative foreign currency translation adjustment recorded to accumulated other comprehensive loss.

     On June 30, 2009, the exchange rate for the Brazilian real was 1.95 reais to the U.S. dollar (the exchange rate was 2.36 reais to the U.S. dollar at December 31, 2008). As a result, the effect of translating the June 30, 2009 Brazilian financial statements into U.S. dollars is reflected as a cumulative foreign currency translation adjustment to the accumulated other comprehensive loss account as an increase in stockholders’ equity of $29,378. At June 30, 2009, the total assets of the Company’s Brazilian subsidiaries were U.S. $215,272.

     On June 30, 2009, the exchange rate for the Mexican peso was 13.23 pesos to the U.S. dollar (the exchange rate was 13.78 pesos to the U.S. dollar at December 31, 2008). As a result, the effect of translating the June 30, 2009 Mexican financial statements into U.S. dollars is reflected as a cumulative foreign currency translation adjustment to the accumulated other comprehensive loss account as an increase in stockholders’ equity of $1,982. At June 30, 2009, the total assets of the Company’s Mexican subsidiaries were U.S. $127,321.

     On June 30, 2009, the exchange rate for the Chilean peso was 539.98 pesos to the U.S. dollar (the exchange rate was 648.00 pesos to the U.S. dollar at December 31, 2008). As a result, the effect of translating the June 30, 2009 Chilean financial statements into U.S. dollars is reflected as a cumulative foreign currency translation adjustment to the accumulated other comprehensive loss account as an increase in stockholders’ equity of $2,705. At June 30, 2009, the total assets of the Company’s Chilean subsidiaries were U.S. $25,948.

     The effect of translating the June 30, 2009 financial statements of the Company’s other international subsidiaries, with local currencies other than the U.S. dollar, is reflected as a cumulative foreign currency translation adjustment to the accumulated other comprehensive loss account as a decrease in stockholders’ equity of $651.

14. Comprehensive Income

     SFAS No. 130, “Reporting Comprehensive Income,” establishes standards for the reporting and display of comprehensive income and its components in the condensed consolidated financial statements. The Company’s comprehensive income was as follows:

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2009				2008				2009				2008
Net income		$	19,807			$	16,615			$	38,158			$	23,018
Fair value adjustments on interest rate swap agreements , net of taxes (see Note 10)			3,553				13,045				3,605				1,086
Amortization of accumulated other comprehensive loss related to terminated swap agreement (see Note 10)			1,159				—				2,317				—
Foreign currency translation adjustment (see Note 13)			36,090				17,829				33,541				27,650
Comprehensive income		$	60,609			$	47,489			$	77,621			$	51,754
Comprehensive income attributable to noncontrolling interests (1)			(2,085	)			(369	)			(2,050	)			( 2,454	)
Comprehensive income attributable to Cinemark Holdings, Inc.		$	58,524			$	47,120			$	75,571			$	49,300

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

15. Supplemental Cash Flow Information

     The following is provided as supplemental information to the condensed consolidated statements of cash flows:

		Six Months Ended
		June 30,
		2009				2008
Cash paid for interest(1)		$	191,507			$	42,931
Cash paid for income taxes, net of refunds received		$	33,893			$	7,504
Noncash investing and financing activities:
Change in accounts payable and accrued expenses for the acquisition of theatre properties and equipment (2)		$	(7,118	)		$	(3,349	)
Theatre properties acquired under capital lease (3)		$	20,400			$	7,911
Investment in NCM (see Note 6)		$	15,536			$	19,020
Dividends accrued on unvested restricted stock unit awards		$	(85	)		$	(25	)

16. Segments

     The Company manages its international market and its U.S. market as separate reportable operating segments. The international segment consists of operations in Brazil, Mexico, Chile, Colombia, Argentina, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Guatemala. The U.S. segment includes U.S. and Canada operations. Each segment’s revenue is derived from admissions and concession sales and other ancillary revenues, primarily screen advertising. The primary measure of segment profit and loss the Company uses to evaluate performance and allocate its resources is Adjusted EBITDA, as defined in the reconciliation table below. The Company’s management evaluates the performance of its assets on a consolidated basis.

     Below is a breakdown of selected financial information by reportable operating segment:

		Three Months Ended June 30,								Six Months Ended June 30,
		2009				2008				2009				2008
Revenues
U.S.		$	419,575			$	360,247			$	761,019			$	669,047
International			98,962				97,900				184,158				191,009
Eliminations			(1,029	)			(913	)			(1,869	)			(1,806	)
Total Revenues		$	517,508			$	457,234			$	943,308			$	858,250
Adjusted EBITDA
U.S.		$	100,576			$	78,815			$	182,295			$	143,691
International			20,216				21,023				36,485				40,307
Total Adjusted EBITDA		$	120,792			$	99,838			$	218,780			$	183,998
Capital Expenditures
U.S.		$	27,171			$	12,490			$	43,422			$	38,385
International			10,875				8,625				17,496				13,531
Total Capital Expenditures		$	38,046			$	21,115			$	60,918			$	51,916

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

     The following table sets forth a reconciliation of net income to Adjusted EBITDA:

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2009				2008				2009				2008
Net income		$	19,807			$	16,615			$	38,158			$	23,018
Add (deduct):
Income taxes			4,320				11,840				18,963				15,481
Interest expense (1)			25,649				30,061				51,113				62,134
Loss on early retirement of debt			26,795				—				26,795				40
Other income (2)			(994	)			(2,224	)			(2,287	)			(5,117	)
Depreciation and amortization			37,535				37,840				73,668				75,247
Amortization of favorable/unfavorable leases			346				699				669				1,403
Impairment of long-lived assets			3,930				1,342				4,969				5,829
Loss on sale of assets and other			1,186				1,109				1,458				910
Deferred lease expenses			1,034				914				2,121				2,146
Amortization of long-term prepaid rents			360				425				750				829
Share based awards compensation expense			824				1,217				2,403				2,078
Adjusted EBITDA		$	120,792			$	99,838			$	218,780			$	183,998

     Financial Information About Geographic Areas

     The Company has operations in the U.S., Canada, Brazil, Mexico, Chile, Colombia, Argentina, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Guatemala, which are reflected in the condensed consolidated financial statements. Below is a breakdown of selected financial information by geographic area:

		Three Months Ended June 30,								Six Months Ended June 30,
Revenues		2009				2008				2009				2008
U.S. and Canada		$	419,575			$	360,247			$	761,019			$	669,047
Brazil			49,323				47,000				92,581				91,634
Mexico			15,311				21,002				29,528				40,404
Other foreign countries			34,328				29,898				62,049				58,971
Eliminations			(1,029	)			(913	)			(1,869	)			(1,806	)
Total		$	517,508			$	457,234			$	943,308			$	858,250

		June 30,				December 31,
Theatre Properties and Equipment-net		2009				2008
U.S. and Canada		$	1,069,319			$	1,073,551
Brazil			73,281				58,641
Mexico			39,042				38,290
Other foreign countries			42,490				37,801
Total		$	1,224,132			$	1,208,283

17. Related Party Transactions

     The Company leases one theatre from Plitt Plaza Joint Venture (“Plitt Plaza”) on a month-to-month basis. Plitt Plaza is indirectly owned by Lee Roy Mitchell, who owns approximately 12% of the Company’s issued and outstanding shares of common stock. Annual rent is approximately $118 plus certain taxes, maintenance expenses and insurance. The Company recorded $63 and $59 of facility lease and other operating expenses payable to Plitt Plaza joint venture during the six months ended June 30, 2008 and 2009, respectively.

     The Company manages one theatre for Laredo Theatre, Ltd. (“Laredo”). The Company is the sole general partner and owns 75% of the limited partnership interests of Laredo. Lone Star Theatres, Inc. owns the remaining 25% of the limited partnership interests in Laredo and is 100% owned by Mr. David Roberts, Lee Roy Mitchell’s son-in-law. Under

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
In thousands, except share and per share data

the agreement, management fees are paid by Laredo to the Company at a rate of 5% of annual theatre revenues up to $50,000 and 3% of annual theatre revenues in excess of $50,000. The Company recorded $48 and $49 of management fee revenues during the six months ended June 30, 2008 and 2009, respectively. All such amounts are included in the Company’s condensed consolidated financial statements with the intercompany amounts eliminated in consolidation.

     The Company leases 22 theatres and two parking facilities from Syufy Enterprises, LP (“Syufy”) or affiliates of Syufy, which owns approximately 8% of the Company’s issued and outstanding shares of common stock. Raymond Syufy is one of the Company’s directors and is an officer of the general partner of Syufy. Of these 24 leases, 20 have fixed minimum annual rent in an aggregate amount of approximately $21,646. The four leases without minimum annual rent have rent based upon a specified percentage of gross sales as defined in the lease with no minimum annual rent. For the six months ended June 30, 2008 and 2009, the Company paid approximately $658 and $645, respectively, in percentage rent for these four leases.

18. Commitments and Contingencies

     From time to time, the Company is involved in various legal proceedings arising from the ordinary course of its business operations, such as personal injury claims, employment matters, landlord-tenant disputes and contractual disputes, some of which are covered by insurance. The Company believes its potential liability with respect to proceedings currently pending is not material, individually or in the aggregate, to the Company’s financial position, results of operations and cash flows.

19. Subsequent Event — Dividend Declaration

     On July 29, 2009, the Company’s board of directors declared a cash dividend in the amount of $0.18 per common share payable to stockholders of record on August 17, 2009. The dividend will be paid on September 1, 2009.

20. Subsequent Event — Notice of Call of 9 ³/4% Senior Discount Notes

     On August 3, 2009, the Company delivered to the Bank of New York Trust Company N.A., as trustee, a notice to redeem the $16,944 aggregate principal amount at maturity of the Company’s 9³/4% senior discount notes remaining outstanding. The notice specified September 8, 2009 as the redemption date. On the redemption date, the Company will pay a redemption price of 104.875% of the face amount of the discount notes remaining outstanding plus any accrued and unpaid interest to, but not including, the redemption date. The Company will use proceeds from the issuance of the Cinemark USA, Inc. senior notes to fund the redemption. The Company will record a loss on early retirement of debt of approximately $1,078 during the three months ended September 30, 2009, which includes call premiums paid and the write-off of unamortized debt issue costs.

Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations

     The following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and related notes and schedules included elsewhere in this report.

     We are the second largest motion picture exhibitor in the world, in terms of both attendance and the number of screens in operation, with theatres in the U.S., Canada, Brazil, Mexico, Chile, Colombia, Argentina, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Guatemala. For financial reporting purposes at June 30, 2009, we have two reportable operating segments, our U.S. operations and our international operations.

     We generate revenues primarily from box office receipts and concession sales with additional revenues from screen advertising sales and other revenue streams, such as vendor marketing programs, pay phones, ATM machines and electronic video games located in some of our theatres. Our investment in NCM has assisted us in expanding our offerings to advertisers, exploring ancillary revenue sources such as digital video monitor advertising, third party branding, and the use of theatres for non-film events. In addition, we are able to use theatres during non-peak hours for concerts, sporting events, and other cultural events. Successful films released during the six months ended June 30, 2009 included Transformers: Revenge of the Fallen, Disney Pixar’s, Up, Star Trek, The Hangover, Night at the Museum 2: Battle of the Smithsonian, Monsters vs. Aliens, X-Men Origins: Wolverine, Taken and Fast & Furious. Film releases scheduled for the remainder of 2009 include Ice Age: Dawn of the Dinosaurs, Harry Potter and the Half-Blood Prince, Twilight 2: New Moon, Alvin and the Chipmunks: The Squeakuel, 2012, G.I. Joe: The Rise of Cobra, Funny People, Old Dogs, Sherlock Holmes and 3-D movies such as Cloudy With a Chance of Meatballs, The Final Destination, Avatar and A Christmas Carol. Our revenues are affected by changes in attendance and average admissions and concession revenues per patron. Attendance is primarily affected by the quality and quantity of films released by motion picture studios.

     Film rental costs are variable in nature and fluctuate with our admissions revenues. Film rental costs as a percentage of revenues are generally higher for periods in which more blockbuster films are released. Film rental costs can also vary based on the length of a film’s run. Film rental rates are negotiated on a film-by-film and theatre-by-theatre basis. Advertising costs, which are expensed as incurred, are primarily fixed at the theatre level as daily movie directories placed in newspapers represent the largest component of advertising costs. The monthly cost of these advertisements is based on, among other things, the size of the directory and the frequency and size of the newspaper’s circulation.

     Concession supplies expense is variable in nature and fluctuates with our concession revenues. We purchase concession supplies to replace units sold. We negotiate prices for concession supplies directly with concession vendors and manufacturers to obtain bulk rates.

     Although salaries and wages include a fixed cost component (i.e. the minimum staffing costs to operate a theatre facility during non-peak periods), salaries and wages move in relation to revenues as theatre staffing is adjusted to address changes in attendance.

     Facility lease expense is primarily a fixed cost at the theatre level as most of our facility leases require a fixed monthly minimum rent payment. Certain of our leases are subject to percentage rent only while others are subject to percentage rent in addition to their fixed monthly rent if a target annual revenue level is achieved. Facility lease expense as a percentage of revenues is also affected by the number of theatres under operating leases versus the number of theatres under capital leases and the number of fee-owned theatres.

     Utilities and other costs include certain costs that possess both fixed and variable components such as utilities, property taxes, janitorial costs, repairs and maintenance and security services.

Recent Developments

     On July 29, 2009, our board of directors declared a cash dividend in the amount of $0.18 per common share payable to stockholders of record on August 17, 2009. The dividend will be paid on September 1, 2009.

     On August 3, 2009, we delivered to the Bank of New York Trust Company N.A., as trustee, a notice to redeem the $16.9 million aggregate principal amount at maturity of our 9¾% senior discount notes remaining outstanding. The notice specified September 8, 2009 as the redemption date. On the redemption date, we will pay a redemption price of 104.875% of the face amount of the discount notes remaining outstanding plus any accrued and unpaid interest to, but not including, the redemption date.

Results of Operations

     The following table sets forth, for the periods indicated, the percentage of revenues represented by certain items reflected in our condensed consolidated statements of income:

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2009				2008				2009				2008
Operating data (in millions):
Revenues
Admissions		$	339.1			$	294.4			$	619.0			$	556.8
Concession			158.9				141.5				288.9				263.6
Other			19.5				21.3				35.4				37.8
Total revenues		$	517.5			$	457.2			$	943.3			$	858.2
Theatre operating costs (1)
Film rentals and advertising		$	190.9			$	163.8			$	338.0			$	301.9
Concession supplies			24.0				23.2				43.7				42.0
Salaries and wages			52.0				45.3				96.4				87.9
Facility lease expense			59.2				56.1				114.9				112.4
Utilities and other			54.1				50.4				102.9				98.6
Total theatre operating costs		$	380.2			$	338.8			$	695.9			$	642.8
Operating data as a percentage of revenues:
Revenues
Admissions			65.5	%			64.4	%			65.6	%			64.9	%
Concession			30.7	%			30.9	%			30.6	%			30.7	%
Other			3.8	%			4.7	%			3.8	%			4.4	%
Total revenues			100.0	%			100.0	%			100.0	%			100.0	%
Theatre operating costs (1) (2)
Film rentals and advertising			56.3	%			55.6	%			54.6	%			54.2	%
Concession supplies			15.1	%			16.4	%			15.1	%			15.9	%
Salaries and wages			10.0	%			9.9	%			10.2	%			10.2	%
Facility lease expense			11.4	%			12.3	%			12.2	%			13.1	%
Utilities and other			10.5	%			11.0	%			10.9	%			11.5	%
Total theatre operating costs			73.5	%			74.1	%			73.8	%			74.9	%
Average screen count (month end average)			4,862				4,683				4,826				4,672
Revenues per average screen (in dollars)		$	106,450			$	97,642			$	195,452			$	183,701