CINEMARK, INC. MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION (H)(1)(A) AND (B) OF FORM 10-Q AND THEREFORE IS FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT.

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

For the quarterly period ended ~~June~~March 3031, ~~2007~~2009

Commission File Number: 001-31372

CINEMARK, INC.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)		01-0687923 (I.R.S. Employer Identification No.)
Delaware		01-0687923
3900 Dallas Parkway Suite 500 Plano, Texas (Address of principal executive offices)		75093 (Zip Code)
(State or other jurisdiction		(I.R.S. Employer
of incorporation or organization)		Identification No.)
3900 Dallas Parkway
Suite 500
Plano, Texas		75093
(Address of principal executive offices)		(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 ishas asubmitted ~~large~~electronically ~~accelerated~~and ~~filer,~~posted anon ~~accelerated~~its ~~filer~~corporate Web site, orif aany, ~~non-accelerated~~every ~~filer.~~Interactive ~~See~~Data ~~definition~~File ofrequired ~~“accelerated~~to ~~filer~~be submitted and ~~large accelerated~~posted ~~filer”~~pursuant into Rule ~~12b~~405 of Regulation S-2T (§232.405 of ~~the~~this ~~Exchange~~chapter) ~~Act.~~during the preceding 12 months (~~Check~~or ~~One~~for such shorter period that the registrant was required to submit and post such files):.

~~Large~~Yes ~~accelerated filer~~ o ~~Accelerated~~ ~~filer~~No o ~~Non-accelerated filer þ~~

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 definition 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 o		Non-accelerated filer þ (Do not check if a smaller reporting company)		Smaller Reporting Company o

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~~April 3130, ~~2007~~2009, 27,896,316 shares of common stock were outstanding.

CINEMARK, INC. AND SUBSIDIARIES
TABLE OF CONTENTS

	~~Page~~		Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Item 1.	Financial Statements
Condensed Consolidated Balance Sheets as of June 30, 2007 and December 31, 2006 (unaudited)		3
	Condensed Consolidated Balance Sheets as of March 31, 2009 and December 31, 2008 (unaudited)			4
Condensed Consolidated Statements of Income for the three and six months ended June 30, 2007 and 2006 (unaudited)		4
	Condensed Consolidated Statements of Income for the three months ended March 31, 2009 and 2008 (unaudited)			5
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2007 and 2006 (unaudited)		5
	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2009 and 2008 (unaudited)			6
~~Notes to Condensed Consolidated Financial Statements (unaudited)~~	Notes to Condensed Consolidated Financial Statements (unaudited)	6		7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		21
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations			22
Item 4. Controls and Procedures		29
Item 4T.	Controls and Procedures			26
PART II. OTHER INFORMATION
Item 1. Legal Proceedings		30
Item 1.	Legal Proceedings			26
Item 1A. Risk Factors		30
Item 1A.	Risk Factors			26
Item 5. Other Information		30
Item 5.	Other Information			26
Item 6. Exhibits		34
Item 6.	Exhibits			31
SIGNATURES		36		32
Certification of CEO Pursuant to Section 302
EX-31.1
Certification of CFO Pursuant to Section 302
EX-31.2
Certification of CEO Pursuant to Section 906
EX-32.1
Certification of CFO Pursuant to Section 906
EX-32.2

~~PART~~Cautionary IStatement —Regarding ~~FINANCIAL~~Forward-Looking ~~INFORMATION~~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,” “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, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(inIn thousands, except share data, unaudited)

	June 30,			December 31,
	March 31,			December 31,
	2007			2006
	2009			2008
	(Successor)			(Successor)
Assets
ASSETS
Current Assets
CURRENT ASSETS
Cash and cash equivalents	$	305,203		$	313,687
Cash and cash equivalents	$	138,268		$	147,099
Inventories		7,705			8,024
Inventories		6,786			6,058
Accounts receivable		23,314			24,628
Accounts receivable		32,487			31,165
Income tax receivable		—			6,688
Income tax receivable		—			8,946
Current deferred tax asset		2,727			2,799
Current deferred tax asset		4,711			4,661
Prepaid expenses and other		7,348			9,319
Prepaid expenses and other		8,124			8,424
Total current assets		346,297			365,145
Total current assets		190,376			206,353
Theatre properties and equipment		1,811,281			1,764,600
THEATRE PROPERTIES AND EQUIPMENT		1,834,667			1,736,706
Less accumulated depreciation and amortization		584,233			556,317
Less accumulated depreciation and amortization		496,101			412,134
Theatre properties and equipment, net		1,227,048			1,208,283
Theatre properties and equipment — net		1,338,566			1,324,572
Other assets
OTHER ASSETS
Goodwill		1,083,098			1,039,818
Goodwill		1,150,291			1,205,423
Intangible assets — net		342,794			341,768
Intangible assets — net		356,867			360,752
Investment in NCM		34,229			19,141
Investments in and advances to affiliates		51,~~889~~677			114,~~354~~811
Deferred charges and other assets — net		7150,~~223~~283			6349,~~092~~033
Total other assets		1,~~584~~512,~~270~~081			1,~~640~~454,~~621~~571
TOTAL ASSETS	$	3,113,212		$	3,171,546
Total assets	$	3,085,426		$	3,027,999
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities and Stockholder’s Equity
CURRENT LIABILITIES
Current Liabilities
Current portion of long-term debt	$	1312,~~954~~540		$	1412,~~259~~450
Current portion of capital lease obligations		36,~~944~~642			35,~~649~~532
Income tax payable		354,~~157~~391			—
Accounts payable and accrued expenses		189,078			212,914
Current FIN 48 liability		10,775			10,775
Total current liabilities		242,133			230,822
Accounts payable and accrued expenses		169,036			202,355
LONG-TERM LIABILITIES
Total current liabilities		203,384			231,112
Long-term debt, less current portion		1,561,227			1,897,394
Long-term liabilities
Capital lease obligations, less current portion		113,066			112,178
Long-term debt, less current portion		1,500,996			1,496,012
Deferred income taxes		87,219			198,320
Capital lease obligations, less current portion		138,490			118,180
Long-term portion FIN 48 liability		12,084			—
Deferred income taxes		132,953			135,417
Deferred lease expenses		16,545			14,285
Long-term portion FIN 48 liability		7,232			6,748
Deferred revenues and other long-term liabilities		185,627			12,672
Deferred lease expenses		24,490			23,371
Total long-term liabilities		1,975,768			2,234,849
Deferred revenue — NCM		204,856			189,847
COMMITMENTS AND CONTINGENCIES (see Note 20)
Other long-term liabilities		51,858			40,663
MINORITY INTERESTS IN SUBSIDIARIES		17,300			16,613
Total long-term liabilities		2,060,875			2,010,238
STOCKHOLDERS’ EQUITY
Commitments and Contingencies (see Note 17)
Class A common stock, $0.001 par value: 40,000 shares authorized and 27,896 shares issued and outstanding		28			28
Stockholder’s Equity
Additional paid-in-capital		686,912			685,463
Cinemark, Inc.’s stockholder’s equity:
Retained earnings (deficit)		156,058			(7,692	)
Class A common stock, $0.001 par value: 40,000,000 shares authorized and 27,896,316 shares issued and outstanding		28			28
Accumulated other comprehensive income		35,013			11,463
Additional paid-in-capital		887,663			870,210
Total stockholders’ equity		878,011			689,262
Retained deficit		(6,502	)		(24,213	)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	3,113,212		$	3,171,546
Accumulated other comprehensive loss		(72,865	)		(72,347	)
Total Cinemark, Inc.’s stockholder’s equity		808,324			773,678
Noncontrolling interests		12,843			12,971
Total stockholder’s equity		821,167			786,649
Total liabilities and stockholder’s equity	$	3,085,426		$	3,027,999

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

CINEMARK, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, unaudited)

	Three months ended June 30,							Six months ended June 30,
	Three months ended March 31,
	2007				2006			2007			2006
	2009			2008
	(Successor)				(Predecessor)			(Successor)			(Predecessor)
Revenues
REVENUES
Admissions	$	279,883		$	262,367
Admissions	$	283,117			$	182,862		$	527,107		$	336,530
Concession		130,031			122,157
Concession		138,448				91,901			253,535			169,973
Other		15,886			16,492
Other		18,471				20,342			37,416			34,591
Total revenues		425,800			401,016
Total revenues		440,036				295,105			818,058			541,094
Cost of Operations
COST OF OPERATIONS
Film rentals and advertising		147,126			138,140
Film rentals and advertising		159,084				100,298			287,378			179,246
Concession supplies		19,717			18,749
Concession supplies		22,668				14,807			40,125			26,847
Salaries and wages		44,350			42,587
Salaries and wages		45,444				26,959			85,626			51,486
Facility lease expense		55,738			56,322
Facility lease expense		53,253				36,623			104,898			72,450
Utilities and other		48,728			48,165
Utilities and other		48,219				33,337			92,412			65,457
General and administrative expenses		21,462			20,339
General and administrative expenses		18,297				15,428			36,937			29,510
Depreciation and amortization		36,133			37,407
Termination of profit participation agreement		6,952				—			6,952			—
Amortization of favorable/unfavorable leases		323			704
Depreciation and amortization		36,720				19,968			73,595			40,094
Impairment of long-lived assets		1,039			4,487
Amortization of favorable leases		625				43			1,559			86
(Gain) loss on sale of assets and other		272			(199	)
Impairment of long-lived assets		7,036				647			56,766			923
Total cost of operations		374,888			366,701
(Gain) loss on sale of assets and other		(1,864	)			815			(1,559	)		1,543
Operating income		50,912			34,315
Total cost of operations		396,434				248,925			784,689			467,642
Other income (expense)
OPERATING INCOME		43,602				46,180			33,369			73,452
Interest expense		(25,464	)		(32,073	)
OTHER INCOME (EXPENSE)
Interest income		1,742			2,775
Interest expense		(35,301	)			(22,904	)		(76,798	)		(45,967	)
Foreign currency exchange gain (loss)		66			(216	)
Interest income		2,266				1,580			6,049			3,474
Loss on early retirement of debt		—			(40	)
Gain on NCM transaction		—				—			210,773			—
Distributions from NCM		6,579			5,182
Gain on Fandango transaction		9,205				—			9,205			—
Equity in loss of affiliates		(605	)		(635	)
Foreign currency exchange gain (loss)		(57	)			695			163			755
Total other expense		(17,682	)		(25,007	)
Loss on early retirement of debt		(123	)			(3,315	)		(7,952	)		(3,315	)
Income before income taxes		33,230			9,308
Distributions from NCM		1,362				—			1,362			—
Income taxes		14,733			3,358
Equity in loss of affiliates		(265	)			(79	)		(1,496	)		(1,268	)
Net income	$	18,497		$	5,950
Minority interests in income of subsidiaries		(606	)			(885	)		(895	)		(1,157	)
Less: Net income attributable to noncontrolling interests		786			1,152
Total other income (expense)		(23,519	)			(24,908	)		140,411			(47,478	)
Net income attributable to Cinemark, Inc.	$	17,711		$	4,798
INCOME BEFORE TAXES		20,083				21,272			173,780			25,974
Income taxes		(26,456	)			7,349			8,937			4,881
NET INCOME	$	46,539			$	13,923		$	164,843		$	21,093

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

CINEMARK, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(inIn thousands, unaudited)

	Six months ended June 30,
	Three Months Ended March 31,
	2007				2006
	2009			2008
	(Successor)				(Predecessor)
Operating Activities
OPERATING ACTIVITIES
Net income	$	18,497		$	5,950
Net income	$	164,843			$	21,093
Adjustments to reconcile net income to cash provided by operating activities:
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation		35,229			36,383
Depreciation		71,566				39,047
Amortization of intangible and other assets		1,227			1,728
Amortization of intangible and other assets		3,588				1,133
Amortization of long-term prepaid rents		390			404
Amortization of long-term prepaid rents		511				582
Amortization of debt issue costs		1,193			1,162
Amortization of debt issue costs		2,363				2,056
Amortization of deferred revenues, deferred lease incentives and other		(1,002	)		(846	)
Amortization of debt premium		(678	)			(782	)
Amortization of accumulated other comprehensive loss related to interest rate swap agreement		1,158			—
Amortization of deferred revenues, deferred lease incentives, and other		(875	)			(371	)
Impairment of long-lived assets		1,039			4,487
Impairment of long-lived assets		56,766				923
Share based awards compensation expense		1,453			761
Stock option compensation expense		1,449				1,432
(Gain) loss on sale of assets and other		272			(199	)
Gain on NCM transaction		(210,773	)			—
Write-off of unamortized debt issue costs related to early retirement of debt		—			193
Gain on Fandango transaction		(9,205	)
Accretion of interest on senior discount notes		8,085			10,008
(Gain) loss on sale of assets and other		(1,559	)			1,543
Deferred lease expenses		1,088			1,232
Write-off unamortized bond premiums and unamortized debt issue costs related to the early retirement of debt		(17,098	)			1,183
Deferred income tax expenses		(2,422	)		(8,041	)
Accretion of interest on senior discount notes		21,150				20,258
Equity in loss of affiliates		605			635
Deferred lease expenses		3,311				565
Interest paid on repurchased senior discount notes		—			(2,929	)
Deferred income tax expenses		(126,443	)			(5,796	)
Increase in deferred revenue related to new beverage contract		6,000			—
Equity in loss of affiliates		1,496				1,268
Other		424			—
Minority interests in income of subsidiaries		895				1,157
Changes in assets and liabilities		(21,549	)		(27,066	)
Changes in assets and liabilities:
Net cash provided by operating activities		51,687			23,862
Inventories		(728	)			(484	)
Investing Activities
Accounts receivable		(1,322	)			(7,447	)
Additions to theatre properties and equipment		(22,872	)		(30,801	)
Prepaid expenses and other		300				787
Proceeds from sale of theatre properties and equipment		510			2,439
Other assets		(2,144	)			(4,613	)
Acquisition of theatres in the U.S.		(48,950	)		—
Advances with affiliates		(742	)			(122	)
Increase in escrow deposit due to like-kind exchange		—			(2,089	)
Accounts payable and accrued expenses		(21,175	)			(7,653	)
Investment in joint venture — DCIP		—			(1,000	)
Interest paid on repurchased senior discount notes		—				(5,381	)
Net cash used for investing activities		(71,312	)		(31,451	)
Increase in deferred revenues related to NCM transaction		174,001				—
Financing Activities
Increase in deferred revenues related to Fandango transaction		5,000
Capital contributions from parent		16,000			8,950
Other long-term liabilities		(5,171	)			404
Repurchase of senior discount notes		—			(6,174	)
Income tax receivable/payable		55,094				(9,051	)
Repayments of other long-term debt		(3,147	)		(1,266	)
Net cash provided by operating activities		164,420				51,731
Payments on capital leases		(1,299	)		(1,137	)
INVESTING ACTIVITIES
Other		(94	)		(119	)
Additions to theatre properties and equipment		(73,148	)			(55,064	)
Net cash provided by financing activities		11,460			254
Proceeds from sale of theatre properties and equipment		13,915				178
Effect of exchange rate changes on cash and cash equivalents		(319	)		1,641
Net proceeds from sale of NCM stock		214,842				—
Decrease in cash and cash equivalents		(8,484	)		(5,694	)
Net proceeds from sale of Fandango stock		11,347				—
Cash and cash equivalents:
Investment in joint venture — DCIP		(1,500	)
Beginning of period		313,687			233,402
Other		—				271
End of period	$	305,203		$	227,708
Net cash provided by (used for) investing activities		165,456				(54,615	)
FINANCING ACTIVITIES
Retirement of senior discount notes		—				(24,950	)
Retirement of senior subordinated notes		(332,066	)			(10,000	)
Proceeds from long-term debt		—				963
Repayments of long-term debt		(7,200	)			(3,570	)
Payments on capital leases		(1,760	)			—
Other		(208	)			(1,601	)
Net cash used for financing activities		(341,234	)			(39,158	)
Effect of exchange rate changes on cash and cash equivalents		2,527				(776	)
DECREASE IN CASH AND CASH EQUIVALENTS		(8,831	)			(42,818	)
CASH AND CASH EQUIVALENTS:
Beginning of period		147,099				182,199
End of period	$	138,268			$	139,381

~~SUPPLEMENTAL~~Supplemental ~~INFORMATION~~Information (see Note 1714)

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

CINEMARK, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~(IN~~In ~~THOUSANDS~~thousands, ~~EXCEPT~~except ~~SHARE~~share ~~AND~~and ~~PER~~per ~~SHARE~~share ~~DATA)~~data

1. The Company and Basis of Presentation

Cinemark, Inc. and subsidiaries (the “Company”) are leaders in the motion picture exhibition industry in terms of both revenues and the number of screens in operation, with theatres in the United States (“U.S.”), Canada, Mexico, Argentina, Brazil, Chile, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Colombia. The Company also managed additional theatres in the U.S., Brazil, and Colombia during the ~~six~~three months ended ~~June~~March 3031, ~~2007~~2009.

OnThe ~~August 2~~condensed consolidated financial statements have been prepared by the Company, ~~2006~~without audit, ~~Cinemark~~according ~~Holdings,~~to ~~Inc.~~the ~~was~~rules ~~formed~~and asregulations of the ~~Delaware~~Securities ~~holding~~and ~~company~~Exchange ofCommission. In the ~~Cinemark~~opinion of management, ~~Inc.~~these Oninterim ~~August 7,~~financial ~~2006,~~statements reflect all adjustments of a recurring nature necessary to state fairly the ~~Cinemark~~financial position and results of operations as of, ~~Inc~~and for, the periods indicated. ~~stockholders~~Majority-owned ~~entered~~subsidiaries ~~into~~that athe ~~share~~Company ~~exchange~~controls are consolidated while ~~agreement~~those ~~pursuant~~subsidiaries toof which ~~they~~the ~~agreed~~Company toowns ~~exchange~~between ~~their~~20% ~~shares~~and of50% ~~Class A~~and ~~common~~does ~~stock~~not ~~for~~control anare accounted ~~equal~~for ~~number~~as ofaffiliates ~~shares~~under ofthe ~~common~~equity ~~stock~~method. Those subsidiaries of ~~Cinemark~~which ~~Holdings~~the Company owns less than 20% are generally accounted for as affiliates under the cost method, ~~Inc.~~unless ~~(“Cinemark~~the ~~Share~~Company ~~Exchange”).~~is ~~The~~deemed ~~Cinemark~~to ~~Share~~have ~~Exchange~~the ~~was~~ability ~~completed~~to onexercise ~~October 5~~significant influence over the affiliate, ~~2006~~in ~~and~~which ~~facilitated~~case the ~~acquisition~~Company would ofaccount ~~Century Theatres,~~for ~~Inc.~~its ~~(“Century~~investment ~~Acquisition”)~~under onthe ~~that~~equity ~~date~~method. OnThe ~~October 5,~~results ~~2006,~~of ~~Cinemark,~~these ~~Inc.~~subsidiaries ~~became~~and affiliates aare included in the condensed consolidated financial statements effective with their ~~wholly~~formation ~~owned~~or ~~subsidiary~~from their dates of ~~Cinemark~~acquisition. ~~Holdings,~~Intercompany ~~Inc~~balances and transactions are eliminated in consolidation.

~~Due~~These tocondensed aconsolidated ~~change~~financial instatements ~~reporting~~should ~~entity~~be ~~that~~read ~~occurred~~in asconjunction awith ~~result of~~ the audited ~~Cinemark~~annual ~~Share~~consolidated ~~Exchange, Cinemark~~financial ~~Holdings,~~statements ~~Inc.’s~~and ~~accounting~~the ~~basis~~notes ~~was~~thereto ~~pushed~~for ~~down~~the toyear ~~the~~ended ~~Company~~December 31, ~~effective~~2008, onincluded in the ~~date~~Annual ~~of the~~Report ~~Cinemark~~on ~~Share~~Form ~~Exchange,~~10-K ~~October~~filed March 513, ~~2006.~~2009 ~~The~~by ~~accompanying~~the ~~condensed~~Company ~~consolidated~~under ~~statements of~~the ~~income~~Securities ~~and~~Exchange ~~cash~~Act ~~flows~~of ~~present~~1934, ~~the~~as ~~results~~amended of (the ~~Company’s~~“Exchange ~~operations~~Act”). ~~and~~Operating ~~cash~~results ~~flows~~ for the three ~~periods~~months ~~preceding~~ended ~~the~~March 31, ~~Cinemark~~2009, ~~Share~~are ~~Exchange~~not asnecessarily ~~Predecessor~~indicative ~~and~~of the ~~periods~~results ~~subsequent~~ to ~~the Cinemark~~be ~~Share~~achieved ~~Exchange~~for asthe full ~~Successor~~year. ~~See Note 3.~~

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 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. Significant 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, 2006, included in the 424(b)(1) Prospectus filed April 24, 2007 by the Company pursuant to Rule 424(b)(1) of the Securities Act of 1933, as amended. Operating results for the six months ended June 30, 2007 are not necessarily indicative of the results to be achieved for the full year.

In May 2006, the Company repurchased $39.8 million aggregate principal amount at maturity of its 9 3/4% senior discount notes for approximately $31.7 million, including accreted interest of $5.4 million and a $1.4 million cash premium paid. In the Company’s 2006 second quarter unaudited interim consolidated statements of cash flows included as part of its Form 10-Q filing, the Company presented the payment of accreted interest as a financing activity. The Company believes this presentation to be incorrect and has properly presented the payment as an operating activity in its condensed consolidated statements of cash flows for the six months ended June 30, 2006.

2. New Accounting Pronouncements

In ~~September~~December ~~2006~~2007, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. ~~157~~141(R), “~~Fair~~Business ~~Value Measurements.~~Combinations”. ~~Among~~This ~~other~~statement ~~requirements,~~requires ~~this~~all ~~statement~~business ~~defines~~combinations ~~fair~~completed ~~value,~~after ~~establishes~~the aeffective ~~framework~~date to be accounted for ~~using~~by applying ~~fair~~the ~~value~~acquisition method (previously referred to as the purchase method); expands the ~~measure~~definition of transactions and events that qualify as business combinations; requires that the acquired assets and liabilities, ~~and~~including ~~expands~~contingencies, ~~disclosures~~be ~~about~~recorded at the fair value ~~measurements. The~~determined ~~statement~~on ~~applies~~the ~~whenever~~acquisition ~~other~~date ~~statements~~and ~~require~~changes orthereafter ~~permit~~reflected ~~assets~~in orincome, ~~liabilities~~not goodwill; changes the recognition timing for restructuring costs; and requires acquisition costs to be ~~measured~~expensed as atincurred ~~fair~~rather ~~value~~than being capitalized as part of the cost of acquisition. Adoption of SFAS No. ~~157~~ 141(R) iswas ~~effective~~required for ~~the~~business ~~Company~~combinations ~~beginning~~that ~~January~~occurred after December 115, 2008. Adoption of this statement isdid not ~~expected to~~ have a significant impact on the Company’s condensed consolidated ~~financial~~ financial statements.

In ~~February~~December 2007, the FASB issued SFAS No. ~~159~~160, “~~The~~Noncontrolling ~~Fair~~Interest ~~Value~~in ~~Option~~Consolidated Financial Statements”. This statement establishes new accounting and reporting standards for ~~Financial~~the noncontrolling ~~Assets~~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 ~~Financial~~separate ~~Liabilities”~~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. ~~159~~160 ~~provides~~requires ~~companies~~disclosure ~~with~~on anthe ~~option~~face toof ~~report~~the ~~selected~~consolidated income statement of the ~~financial~~amounts ~~assets~~of ~~and~~consolidated ~~liabilities~~net atincome ~~fair~~attributable ~~value~~to the parent and ~~establishes~~the ~~presentation~~noncontrolling ~~and~~interest. ~~disclosure~~SFAS ~~requirements~~No. 160 ~~designed~~clarifies tothat ~~facilitate~~changes ~~comparisons~~in ~~between~~a ~~companies~~parent’s ownership interest in a subsidiary that ~~choose~~do ~~different~~not ~~measurement~~result ~~attributes~~in ~~for~~deconsolidation ~~similar~~are ~~types~~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 ~~assets~~the noncontrolling ~~and~~equity ~~liabilities~~investment on the deconsolidation date. SFAS No. ~~159~~160 isalso 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 equity attributable to noncontrolling interests, changes attributable to Cinemark, Inc. and changes in total equity.

CINEMARK, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

Company beginning January 1, 2008. Adoption of this statement is not expected to have a significant impact on the Company’s condensed consolidated financial statements.

3. Merger with Madison Dearborn Partners and Related Change in Accounting Basis

On April 2, 2004, a newly formed subsidiary of an affiliate of Madison Dearborn Partners (“MDP”) was merged with and into the Company, with the Company continuing as the surviving corporation (the “MDP Merger”). Simultaneously, an affiliate of MDP purchased shares of the Company’s common stock for $518,245 in cash and became the Company’s controlling stockholder, owning approximately 83% of the Company’s capital stock as of the date of the Merger. Lee Roy Mitchell, the Company’s then Chief Executive Officer, and the Mitchell Special Trust collectively retained approximately 16% ownership of the Company’s capital stock with certain members of management owning the remaining 1% as of the date of the Merger.

On April 2, 2004, the Company accounted for the MDP Merger as a leveraged recapitalization, which resulted in the Company and its subsidiaries retaining their historical book values. As a result of the Cinemark Share Exchange on October 5, 2006, and the resulting change in reporting entity, the Company was required to prepare its financial statements to reflect the accounting basis of its parent, Cinemark Holdings, Inc. Cinemark Holdings, Inc. accounted for the MDP merger under the purchase method of accounting on April 2, 2004. The following table represents the allocation of MDP purchase price to the proportionate share of assets acquired and liabilities assumed as of April 2, 2004:

Current assets	$	79,967
Fixed assets		650,653
Goodwill		620,540
Tradename		173,882
Net favorable leases		31,047
Vendor contracts		52,012
Internally developed software		1,626
Other long term assets		42,384
Current liabilities		(90,940	)
Other long term liabilities		(120,232	)
Long-term debt		(922,694	)
Total	$	518,245

Cinemark Holdings, Inc.’s accounting basis was pushed down to the Company effective October 5, 2006. The successor accounting basis reflects the MDP merger purchase accounting as of April 2, 2004 adjusted for depreciation and amortization as well as other period charges taken subsequent to April 2, 2004 that have affected the basis of the Company’s assets and liabilities. Below is a summary of the impact of this push down on the Company’s balance sheet on October 5, 2006:

Net increase in fixed assets	$	15,013
Net increase in goodwill		508,760
Net increase in intangible assets		228,424
Net increase in investments in and advances to affiliates		2,600
Net decrease in deferred charges and other assets		(7,277	)
Net increase in long-term debt		(9,059	)
Net increase in deferred income taxes		(87,059	)
Net decrease in deferred lease expense		16,561
Net decrease in deferred revenues and other long-term liabilities		2,493
Net increase in stockholders’ equity	$	670,456

The tradename, net favorable leases, and vendor contracts are presented as intangible assets on the Company’s condensed consolidated balance sheets as of December 31, 2006 and June 30, 2007. The goodwill recorded as a result of the MDP Merger is not deductible for tax purposes.

CINEMARK, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ~~(IN~~In ~~THOUSANDS~~thousands, ~~EXCEPT~~except ~~SHARE~~share ~~AND~~and ~~PER~~per ~~SHARE~~share ~~DATA)~~data

4 In March 2008, the FASB issued SFAS No. 161 ~~Cinemark~~“Disclosures ~~Holdings~~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, ~~Inc~~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 ~~Initial~~condensed ~~Public~~consolidated ~~Offering~~financial statements, nor did it have a significant impact on the Company’s disclosures.

OnIn April 242009, ~~2007, Cinemark Holdings, Inc.,~~ the ~~Company’s~~FASB ~~parent,~~issued ~~completed~~FASB ~~its~~Staff ~~initial~~Position ~~public offering~~No. FAS ~~Cinemark~~107-1 ~~Holdings,~~and ~~Inc.~~APB ~~sold 13~~28-1,~~888,889~~ ~~shares of its common stock and selling~~“Interim ~~stockholders~~Disclosures ~~sold~~about anFair ~~additional~~Value ~~14,111,111 shares~~ of ~~common~~Financial ~~stock~~Instruments” ~~at a price of $17.955~~ (~~$19~~“FSP ~~per share~~FAS ~~less~~107-1 ~~underwriting~~and ~~discounts~~APB 28-1”). ~~The~~FSP ~~net~~FAS ~~proceeds~~107-1 ~~(before expenses) received by Cinemark Holdings, Inc. were $249,375~~ and ~~Cinemark Holdings,~~APB ~~Inc.~~28-1 ~~paid~~require ~~approximately~~that ~~$3,397~~disclosures inabout ~~legal,~~the ~~accounting~~fair ~~and~~value ~~other fees, all~~ of ~~which~~financial ~~are~~instruments be ~~recorded~~included in ~~additional paid-in-capital of Cinemark Holdings, Inc. The selling stockholders granted~~ the ~~underwriters~~notes ~~a 30-day option~~ to ~~purchase~~financial upstatements toissued anduring ~~additional~~interim ~~2,800,000 shares of Cinemark Holdings, Inc~~periods. ~~common~~Fair ~~stock~~value ~~at a price of $17.955 ($19 per share less underwriting discounts). On~~information ~~May 21,~~must ~~2007,~~be ~~the~~presented ~~underwriters~~in ~~purchased an additional 269,100 shares from~~ the ~~selling~~notes ~~stockholders pursuant~~ to ~~this~~financial ~~option.~~statements ~~Cinemark~~together ~~Holdings,~~with ~~Inc.~~the ~~did~~carrying ~~not~~amounts ~~receive~~of ~~any proceeds from~~ the ~~sale of~~ ~~shares~~financial ~~by the selling stockholders~~instruments. ~~Cinemark~~It ~~Holdings,~~must ~~Inc.~~be ~~expects~~clearly tostated ~~use~~whether the ~~net~~amounts ~~proceeds~~are ~~that it~~assets ~~received~~or ~~from~~liabilities ~~the~~and how ~~offering~~they relate to ~~repurchase~~information apresented ~~portion~~in of the ~~outstanding~~balance ~~9 3/4% senior discount notes or repay debt outstanding under the senior secured credit facility~~sheet. The 9disclosures ~~3/4%~~must ~~senior~~include ~~discount notes~~methods ~~are~~and ~~not~~significant ~~currently~~assumptions ~~subject~~used to ~~repurchase~~estimate atfair ~~Cinemark Holdings~~values, ~~Inc.’s~~along ~~option.~~with ~~Accordingly,~~any ~~if Cinemark~~changes ~~Holdings,~~in ~~Inc.~~those ~~is unable to repurchase the 9 3/4% senior discount notes at acceptable~~methods ~~prices,~~and ~~Cinemark~~assumptions ~~Holdings,~~from ~~Inc~~prior periods. ~~will~~FSP ~~use~~FAS ~~the~~107-1 ~~net~~and ~~proceeds~~APB to28-1 ~~repay~~are ~~term~~effective ~~loan~~for ~~debt~~interim ~~outstanding~~and ~~under~~annual ~~the~~periods ~~senior~~ending ~~secured~~after ~~credit~~June 15, ~~facility. Cinemark Holdings~~2009, ~~Inc.~~with ~~has significant~~early ~~flexibility~~adoption ~~in applying the net proceeds from the offering~~permitted. ~~Pending~~The ~~the~~adoption ~~utilization~~ of ~~the~~FSP ~~net proceeds, Cinemark~~FAS-107-1 ~~Holdings,~~and ~~Inc.~~APB ~~expects~~28-1 tois ~~invest~~not ~~the~~expected ~~proceeds~~to inhave ~~short-term, investment-grade~~a ~~marketable~~significant ~~securities~~impact oron ~~money~~the ~~market~~Company’s ~~obligations~~disclosures.

53. ~~Acquisition of Century Theatres, Inc. and Related Refinancing of Certain Long-Term Debt~~Acquisitions

On ~~October~~March 518, ~~2006~~2009, the Company acquired ~~Century~~four ~~Theatres,~~theatres ~~Inc.~~with ~~(“Century”),~~82 ascreens ~~national~~from Muvico ~~theatre~~Entertainment ~~chain~~L.L.C. ~~headquartered~~ in ~~San~~an ~~Rafael,~~asset ~~California~~purchase ~~with~~for approximately 77$48,950 ~~theatres~~ in 12cash. ~~states,~~The acquisition ~~for~~results ain ~~purchase~~an ~~price~~expansion of ~~approximately~~the ~~$681,225~~Company’s ~~and~~U.S. ~~the~~theatre ~~assumption~~base, as three of ~~approximately~~the ~~$360,000~~theatres ofare ~~debt~~located in ofFlorida ~~Century~~and ~~(“Century~~one ~~Acquisition”).~~theatre Ofis ~~the~~located ~~total~~in ~~purchase~~Maryland. ~~price,~~The Company incurred approximately $~~150~~113 in transaction costs,~~000~~ ~~consisted~~which ofare ~~the~~reflected ~~issuance of~~in ~~shares~~general ofand ~~Cinemark~~administrative ~~Holdings,~~expenses ~~Inc.’s~~on ~~common~~the ~~stock.~~condensed consolidated ~~The~~statement ~~Company~~of ~~also~~income ~~incurred~~for ~~approximately~~the ~~$7,448 in~~three ~~transaction~~months ~~costs~~ended March 31, 2009.

The transaction was accounted for ~~under~~by applying the ~~purchase~~acquisition method ~~of accounting~~ in accordance with ~~SFAS~~ SFAS No. 141,(R) “Business Combinations”. The following table represents athe ~~preliminary~~identifiable ~~allocation~~assets ofacquired ~~purchase~~and ~~price~~liabilities toassumed that have been recognized by the ~~assets~~Company ~~acquired~~in ~~and~~its ~~liabilities~~condensed ~~assumed~~consolidated balance sheet as of March 31, 2009:

Current assets (1)	$	32,635
Theatre properties and equipment	$	30,500
Fixed assets (2)		548,451
Brandname		2,000
Goodwill (2)		640,436
Noncompete agreement		1,500
Tradename		136,000
Goodwill		43,470
Other long term assets		4,956
Unfavorable lease		(5,800	)
Net unfavorable leases		(9,360	)
Capital lease liability (for one theatre)		(22,720	)
Current liabilities		(74,488	)
Total	$	48,950
Other long term liabilities (2)		(229,957	)
Total	$	1,048,673

(1)		Includes cash of $7,290.
(2)		During the six months ended June 30, 2007, the Company adjusted its preliminary purchase price allocation to fixed assets (increase of $29,398), goodwill (decrease of $18,110) and other long term liabilities (increase of $11,288) due to additional information obtained regarding the fair value of these assets and liabilities acquired.

The amounts listed above are provisional and will be updated by the Company upon completion of the valuation analyses necessary to properly allocate the purchase price. The goodwill recorded is fully deductible for tax purposes.

The tradename and net unfavorable leases are presented as intangible assets on the Company’s condensed consolidated balance sheets as of December 31, 2006 and June 30, 2007. Goodwill represents the excess of the costs of acquiring Century over amounts assigned to assets acquired, including identifiable intangible assets, and liabilities assumed. The goodwill recorded as a result of the Century Acquisition is not deductible for tax purposes.

On October 5, 2006, the Company entered into a new senior secured credit facility, which provided for a $1,120,000 term loan and a $150,000 revolving credit line. The net proceeds of the new term loan were used to fund a portion of the $531,225 cash portion of the purchase price, to pay off approximately $360,000 under Century’s existing senior credit facility and to refinance $253,500 under the Company’s existing senior secured credit facility. The Company used approximately $53,000 of its existing cash to fund the payment of the remaining portion of the purchase price and related

~~transaction expenses~~4. ~~Additionally,~~Stockholder’s ~~the Company advanced approximately~~Equity ~~$17,000 of cash to Century to satisfy working capital obligations.~~

~~The~~Below is ~~Century~~a ~~Acquisition~~summary isof ~~reflected~~changes in ~~the~~equity ~~Company’s~~attributable ~~condensed~~to ~~consolidated~~Cinemark, ~~statements~~Inc., ofnoncontrolling ~~income~~interests ~~for~~and ~~the~~total ~~period~~equity ~~subsequent~~for to the ~~transaction~~three ~~date~~months ~~and~~ended isMarch ~~reported~~31, ~~in the Company’s U.S.~~2009 ~~operating~~and ~~segment.~~2008:

6. Investment in National CineMedia and Transaction Related to its Initial Public Offering


	Cinemark,
	Inc.						Total
	Stockholder’s			Noncontrolling			Stockholder’s
	Equity			Interests			Equity

Balance at December 31, 2008	$	773,678		$	12,971		$	786,649

Capital contributions from Cinemark Holdings, Inc.		16,000			—			16,000
Share based awards compensation expense		1,453			—			1,453
Dividends paid to noncontrolling interests		—			(93	)		(93	)
Comprehensive income:
Net income		17,711			786			18,497
Fair value adjustments on interest rate swap agreements, net of taxes of $31		52			—			52
Amortization of accumulated other comprehensive loss on terminated swap agreement		1,158			—			1,158
Foreign currency translation adjustment		(1,728	)		(821	)		(2,549	)

Balance at March 31, 2009	$	808,324		$	12,843		$	821,167

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 companies 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. On February 13, 2007, National CineMedia, Inc., or NCM, Inc., a newly formed entity that now serves as a member and the sole manager of NCM, completed an initial public offering of its common stock. In connection with the NCM, Inc. initial public offering, the Company amended its operating agreement with NCM and the Exhibitor Services Agreement pursuant to which NCM provides advertising, promotion and event services to the Company’s theatres. In connection with NCM Inc.’s initial public offering and the transactions described below (the “NCM Transaction”), the Company received an aggregate of $389,003.


	Cinemark, Inc.						Total
	Stockholder’s			Noncontrolling			Stockholder’s
	Equity			Interests			Equity
Balance at December 31, 2007	$	915,663		$	16,182		$	931,845

Capital contribution from Cinemark Holdings, Inc.		8,950			—			8,950
Share based awards compensation expense		760			—			760
Dividends paid to noncontrolling interests		—			(119	)		(119	)
Comprehensive income:
Net income		4,798			1,152			5,950
Fair value adjustments on interest rate swap agreements, net of taxes of $7,454		(11,959	)		—			(11,959	)
Foreign currency translation adjustment		8,888			933			9,821


Balance at March 31, 2008	$	927,100		$	18,148		$	945,248

~~Prior to pricing~~ During the ~~initial~~three ~~public~~months ~~offering~~ended ~~of NCM Inc., NCM completed a recapitalization whereby (1)~~March ~~each issued and outstanding Class A unit of NCM was split into 44~~31,~~291~~ ~~Class A~~2009 ~~units,~~ and ~~(2) following such split of Class A Units~~2008, ~~each~~there ~~issued~~were ~~and~~no ~~outstanding~~increases Class A Unit was recapitalized into one common unit and one preferred unit. As a result, the Company received 14,159,437 common units and 14,159,437 preferred units. All existing preferred units of NCM, or ~~55,850,951~~ ~~preferred~~decreases units, held by Regal, AMC and the Company were redeemed on a pro-rata basis on February 13, 2007. NCM utilized the proceeds of its new $725,000 term loan facility and a portion of the proceeds it received from NCM, Inc. from its initial public offering to ~~redeem all of its outstanding preferred units. Each preferred unit was redeemed for $13.7782 and~~ the ~~Company received~~ ~~approximately $195,092 as payment in full for redemption of all of the~~ Company’s ~~preferred~~additional ~~units~~paid in ~~NCM.~~ ~~Upon~~capital ~~payment~~for ofpurchases ~~such~~or ~~amount,~~sales ~~each preferred unit was cancelled and the holders~~ of ~~the preferred~~existing ~~units~~noncontrolling ~~ceased to have any rights with respect to the preferred units~~interests.

~~At the closing of the initial public offering, the underwriters exercised their over-allotment option to purchase additional shares of common stock of NCM, Inc~~5. atInvestment the initial public offering price, less underwriting discounts and commissions. In connection with the over-allotment option exercise, Regal, AMC and the Company each sold to NCM, Inc. common units of NCM on a pro-rata basis at the initial public offering price, less underwriting discounts and expenses. The Company sold 1,014,088 common units to NCM, Inc. for proceeds of $19,910, and upon completion of this sale of common units, the Company owned 13,145,349 common units of NCM. The net proceeds of $215,002 from the above described stock transactions were applied against the Company’s existing investment basis in ~~NCM~~National ~~of $4,069 until such basis was reduced to $0 with the remaining $210,933 of proceeds net of~~CineMedia ~~$160 of transaction related costs, recorded as a gain of $210,773 in the condensed consolidated statement of income for the six months ended June 30, 2007.~~

~~NCM~~In ~~also~~March 2005, ~~paid~~Regal ~~the~~Entertainment ~~Company~~Inc. a(“Regal”) ~~portion~~and ofAMC ~~the~~Entertainment ~~proceeds it received from NCM,~~ Inc. in(“AMC”) ~~the initial~~formed ~~public~~National ~~offering~~CineMedia, ~~for~~LLC, ~~agreeing~~or ~~to modify~~ NCM’s, ~~payment~~and ~~obligation~~on ~~under~~July 15, ~~the~~2005, ~~prior Exhibitor Services Agreement. The modification agreed to by~~ the Company ~~reflects~~joined aNCM, ~~shift~~as ~~from~~one ~~circuit~~of ~~share expense~~the ~~under~~founding ~~the~~members. ~~prior Exhibitor Services Agreement, which obligated~~ NCM tooperates ~~pay~~ the ~~Company~~largest adigital ~~percentage of revenue, to the monthly~~ in-theatre ~~access~~network ~~fee~~in ~~described below. The theatre access fee will significantly reduce~~ the ~~contractual amounts paid to the Company by NCM~~U.S. ~~In exchange~~ for ~~the~~providing ~~Company~~cinema ~~agreeing~~advertising toand sonon-film ~~modify~~events ~~the~~and ~~agreement,~~combines ~~NCM paid~~ the ~~Company~~cinema ~~approximately~~advertising ~~$174,001~~and ~~upon~~non-film events ~~modification~~businesses of the ~~Exhibitor~~three ~~Services~~largest ~~Agreement~~motion onpicture ~~February 13,~~exhibitors ~~2007,~~in the ~~proceeds~~U.S. ofUpon ~~which~~joining ~~were recorded~~NCM, ~~as deferred revenue on~~ the Company~~’s condensed consolidated balance sheet. The Company~~ ~~believes~~and ~~this~~NCM ~~payment~~entered ~~approximates~~into ~~the~~an ~~fair value of the~~ Exhibitor Services Agreement, ~~modification. The~~pursuant ~~deferred~~to ~~revenue~~which isNCM ~~being~~provides ~~amortized into other revenues over the life of the agreement using~~advertising, ~~the~~promotion ~~units of revenue method. Regal~~ and ~~AMC~~event ~~similarly~~services ~~amended~~to ~~their~~the ~~exhibitor~~Company’s ~~service agreements with NCM~~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,

~~Company~~AMC ~~will~~and ~~receive~~Regal. As a ~~monthly~~result ~~theatre~~of ~~access fee under~~ the ~~Exhibitor~~common ~~Services~~unit ~~Agreement.~~adjustment calculation, ~~The~~the ~~theatre~~Company ~~access~~received ~~fee~~an isadditional ~~composed~~846,303 common units of ~~a fixed payment per patron~~NCM, ~~initially~~each ~~seven~~of ~~cents,~~which ~~and~~is aconvertible ~~fixed~~into ~~payment~~one ~~per~~share ~~digital~~of ~~screen~~NCM, ~~which~~Inc. ~~may~~common ~~be adjusted for~~stock. ~~certain~~The ~~enumerated~~Company ~~reasons.~~recorded ~~The~~the ~~payment~~additional ~~per~~common ~~theatre~~units ~~patron~~received ~~will~~at ~~increase~~fair byvalue 8%as ~~every~~an ~~five~~investment ~~years,~~ with ~~the~~a corresponding ~~first~~adjustment ~~such~~to ~~increase~~deferred ~~taking~~revenue ~~effect~~of ~~after~~$19,020. ~~the~~The ~~end~~common ofunit ~~fiscal~~adjustment ~~2011,~~resulted ~~and~~in ~~the payment per~~an ~~digital~~increase ~~screen,~~in ~~initially~~the ~~eight~~Company’s ~~hundred~~ownership ~~dollars~~percentage ~~per~~in ~~digital~~NCM ~~screen~~from ~~per~~approximately ~~year,~~14.0% ~~will~~to ~~increase annually~~approximately by 14.5%~~, beginning after 2007~~. ~~The~~Subsequent ~~theatre~~to ~~access~~the ~~fee~~annual ~~paid~~common inunit ~~the~~adjustment ~~aggregate~~discussed ~~to Regal~~above, ~~AMC~~in ~~and~~May 2008, ~~the~~Regal ~~Company~~completed ~~will~~an ~~not~~acquisition ~~be less than 12%~~ of ~~NCM’s~~another ~~Aggregate~~theatre ~~Advertising~~circuit ~~Revenue~~that ~~(as~~required ~~defined~~an inextraordinary ~~the~~common unit ~~Exhibitor~~adjustment ~~Services~~calculation ~~Agreement),~~by orNCM itin ~~will~~accordance bewith ~~adjusted~~the ~~upward~~Common toUnit ~~reach~~Adjustment ~~this minimum payment~~Agreement. ~~Additionally,~~ ~~with~~As ~~respect~~a toresult of ~~any~~this ~~on-screen~~extraordinary ~~advertising~~common ~~time~~unit ~~provided to the Company’s beverage consessionaire~~adjustment, ~~the~~Regal ~~Company~~was isgranted ~~required~~additional tocommon ~~purchase~~units ~~such~~of ~~time from~~ NCM ~~at a negotiated rate. The~~, ~~Exhibitor~~which ~~Services~~resulted ~~Agreement~~in ~~has,~~dilution ~~except~~of ~~with~~the ~~respect~~Company’s toownership ~~certain~~interest ~~limited~~in ~~services,~~NCM afrom ~~term~~14.5% ofto ~~30 years~~14.1%.

~~Prior~~During ~~to the initial public offering of NCM Inc. common stock~~March 2009, ~~the Company’s ownership interest in~~ NCM ~~was~~performed ~~approximately~~its ~~25%~~annual ~~and~~common ~~subsequent~~unit toadjustment ~~the~~calculation ~~completion of the offering the Company held a 14% interest in NCM. Subsequent to NCM, Inc.’s initial public offering, the Company continues to account for its investment in NCM~~ under the ~~equity method of accounting due to its~~ ~~ability~~Common toUnit ~~exercise~~Adjustment ~~significant control over NCM~~Agreement. ~~The~~As ~~Company has substantial rights as~~ a ~~founding member,~~result ~~including the right to designate a total~~ of ~~two nominees to~~ the ~~ten-member board of directors of NCM Inc.~~calculation, the ~~sole manager. So long as the~~ Company ~~owns~~received atan additional ~~least~~1,197,303 5%common units of NCM~~’s membership interests~~, ~~approval~~each of atwhich ~~least~~is ~~90%~~convertible ~~(80%~~into ifone ~~the~~share ~~board~~of ~~has less than 10 directors) will be required before~~ NCM, Inc. ~~may take certain actions including but not limited to mergers and~~ ~~acquisitions, issuance of~~ common ~~or preferred shares, approval of NCM, Inc~~stock.’s ~~budget,~~The ~~incurrence~~Company ~~of indebtedness,~~recorded ~~entering~~the ~~into~~additional orcommon ~~terminating~~units ~~material~~received ~~agreements,~~at ~~and~~fair ~~modifications~~value toas ~~its articles~~an ofinvestment ~~incorporation~~with ora ~~bylaws.~~corresponding ~~Additionally,~~adjustment ~~if any of the Company’s director designees are not appointed~~ to ~~the~~deferred ~~Board~~revenue of ~~Directors of NCM~~$15, ~~Inc~~536., ~~nominated~~The bycommon ~~NCM, Inc. or elected by NCM, Inc.’s~~unit ~~stockholders,~~adjustment ~~then~~resulted ~~the~~in ~~Company~~a ~~(so~~change ~~long~~in as the Company ~~continues to own at least 5% of NCM~~’s ~~membership~~ ~~interest)~~ownership ~~will~~percentage bein ~~entitled to approve certain actions of~~ NCM ~~including~~from ~~without~~approximately ~~limitation,~~14.1% ~~approval~~to of15.0%. ~~the~~As ~~budget, incurrence~~ of ~~indebtedness~~March 31, ~~consummating or amending material agreements~~2009, ~~approving dividends, amending~~ the ~~NCM~~Company ~~operating~~owned ~~agreement,~~a ~~hiring~~total ~~or termination~~ of ~~the~~ ~~chief executive officer~~15, ~~chief financial officer~~188,955 ~~chief~~common ~~technology~~units ~~officer or chief marketing officer~~ of NCM ~~and the dissolution or liquidation of NCM~~.

~~During~~The ~~the~~Company ~~six~~accounts ~~months~~for ~~ended~~its ~~June 30,~~investment ~~2007~~in ~~and~~NCM ~~2006,~~under the ~~Company recorded~~ equity ~~losses~~method of ~~$1,284~~ ~~and~~accounting ~~$1,299,~~due ~~respectively. The Company recognized $4,402 and $10,444 of other revenue from~~to ~~NCM~~its ~~during~~ability ~~the~~to ~~six~~exercise ~~months~~significant ~~ended~~control ~~June 30,~~over ~~2007 and 2006, respectively~~NCM. The Company ~~had~~has asubstantial ~~receivable due~~rights ~~from NCM of $13,386 and $121~~ as ofa founding ~~December 31~~member, ~~2006~~including ~~and~~the ~~June 30,~~right ~~2007, respectively, related~~ to ~~screen~~designate ~~advertising~~a ~~and~~total ~~other~~of ~~ancillary~~two ~~revenue.~~nominees ~~The Company is entitled~~ to ~~receive mandatory quarterly distributions of excess cash from NCM. During May 2007,~~ the ~~Company~~ten-member ~~received its first~~Board ~~quarterly distribution~~ of ~~approximately~~Directors ~~$1,362, which was in excess~~ of ~~the carrying value of its investment in~~ NCM ~~and~~Inc., ~~is reflected as distributions from NCM on~~ the ~~condensed~~sole ~~consolidated statement of income for the three and six months ended June 30, 2007~~manager.

AsBelow ofis ~~June 30,~~a ~~2007,~~summary ~~the Company owned 13,145,349 common units~~ of ~~NCM.~~activity ~~Each~~with ~~common unit is convertible into one share of~~ NCM, ~~Inc.~~as ~~common~~included ~~stock.~~in ~~As of June 30, 2007,~~ the ~~fair market value of the~~ Company’s ~~shares~~condensed ~~in NCM was approximately $368,201 based on a closing price of $28.01 per~~consolidated ~~share~~financial ~~of NCM, Inc. common stock on June 29, 2007.~~statements:

7. Investment in Digital Cinema Implementation Partners


	Three Months Ended
	March 31,
	2009			2008

Other revenue	$	1,401		$	401
Equity loss	$	(24	)	$	—
Distributions from NCM	$	6,579		$	5,182

On February 12, 2007, the Company, AMC and Regal entered into a joint venture known as Digital Cinema Implementation Partners LLC (“DCIP”) to explore the possibility of implementing digital cinema in the Company’s theatres and to establish agreements with major motion picture studios for the implementation and financing of digital cinema. DCIP has also entered into a digital cinema services agreement with NCM for purposes of assisting DCIP in the development of digital cinema systems. Future digital cinema developments will be managed by DCIP, subject to the Company’s approval along with the Company’s partners, AMC and Regal. During the six months ended June 30, 2007, the Company invested $1,500 for 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, 2007, the Company recorded an equity loss of approximately $235 relating to this investment. The Company’s investment basis in DCIP was $1,265 at June 30, 2007, which is included in investments in and advances to affiliates on the condensed consolidated balance sheet.


	As of
	March 31,		December 31,
	2009		2008
Accounts receivable from NCM	$	480	$	228

Below is summary financial information for NCM for the year ended January 1, 2009 (data for the three month period ended April 2, 2009 is not yet available):


Gross revenues	$	369,524
Operating income	$	172,627
Net earnings	$	95,328

86. ~~Sale of~~ Investment in ~~Fandango,~~Digital ~~Inc.~~Cinema Implementation Partners

InOn ~~May~~February ~~2007~~12, ~~Fandango~~2007, ~~Inc., an on-line ticketing distributor, executed a merger agreement, which resulted in~~ the Company, ~~selling~~AMC ~~its~~and ~~investment~~Regal inentered ~~stock~~into ofa ~~Fandango,~~joint ~~Inc.~~venture ~~for~~known ~~approximately~~as Digital ~~$14,147~~Cinema ofImplementation ~~consideration~~Partners ~~(the~~LLC (“~~Fandango Transaction~~DCIP”). ~~Approximately~~to ~~$1,535~~facilitate of the ~~consideration was~~implementation ~~held~~of indigital ~~escrow~~cinema ~~to secure certain indemnification obligations contained~~ in the ~~merger~~Company’s ~~agreement, which~~theatres isand ~~included~~to inestablish ~~accounts~~agreements ~~receivable~~with onmajor ~~the~~motion ~~condensed~~picture ~~consolidated~~studios ~~balance~~for ~~sheet. The Company~~the ~~paid~~financing ~~$2,800~~ of ~~the~~digital ~~cash~~cinema. ~~consideration~~Future todigital ~~Syufy~~cinema ~~Enterprises,~~developments LPwill inbe ~~accordance~~managed ~~with~~by ~~the~~DCIP, ~~terms~~subject ofto ~~agreements entered into as part of~~ the ~~Century~~Company’s ~~Acquisition.~~approval ~~The~~along ~~carrying~~with ~~value of~~ the Company’s ~~investment~~ ~~in stock of Fandango~~partners, ~~Inc.~~AMC ~~was~~and ~~$2,142~~Regal. As aof ~~result~~March 31, of2009, the Company ~~sale~~has ofinvested ~~its investment~~$5,500 ~~the Company~~and ~~recorded~~has a ~~gain~~one-third ofownership ~~$9,205~~interest in ~~the~~DCIP. ~~condensed~~The ~~consolidated~~Company ~~statement~~is accounting offor ~~income~~its ~~for~~investment ~~the~~in ~~three and~~DCIP ~~six~~under ~~months~~the ~~ended~~equity ~~June 30,~~method ~~2007~~of accounting.

AsDuring ~~part of~~ the ~~sale~~three ofmonths ~~its~~ended ~~investment~~March 31, in2008 ~~stock~~and ~~of Fandango~~2009, ~~Inc.,~~ the Company ~~amended~~recorded ~~its exclusive~~equity ~~ticketing~~losses of $601 and ~~distribution~~$640, ~~agreement with Fandango~~respectively, ~~Inc.~~relating ~~Certain~~to ~~sections~~this ofinvestment. ~~the agreement~~The ~~were modified in which the~~ Company’s noinvestment ~~longer~~basis isin ~~entitled to receive additional shares of~~DCIP ~~stock~~was ~~in Fandango~~$1,017 ~~Inc.~~and ~~nor~~$377 ~~share~~at ~~in future adjusted profits of Fandango~~December 31, ~~Inc.~~2008 Inand ~~exchange for the amendment~~March 31, ~~Fandango~~2009, ~~Inc. paid the Company $5~~respectively,~~000.~~ ~~The~~which ~~proceeds~~is ofincluded ~~$5,000~~in investments ~~were~~in ~~recorded~~and ~~as deferred~~advances ~~revenue~~to affiliates on the ~~Company’s~~ condensed consolidated balance ~~sheet and are being amortized over the term of the amended ticketing and distribution agreement~~sheets.

~~In accordance with the terms of its new senior secured credit facility, the Company used approximately $9,914 of the net proceeds to pay down its term loan~~7. ~~The~~Share ~~payment~~Based ~~was made on August 10, 2007 and was applied against the current portion of long-term debt.~~Awards

During March 2008, Cinemark Holdings, Inc.’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 Cinemark Holdings, Inc.’s ~~Income~~board ~~Taxes~~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 Cinemark Holdings, Inc.’s stockholders at its annual meeting held on May 15, 2008.

OnDuring ~~May~~August 182008, ~~2006~~Cinemark Holdings, ~~the~~Inc. ~~State~~filed ofa ~~Texas~~registration ~~enacted~~statement ~~legislation~~with ~~to replace~~ the ~~current franchise tax~~Securities ~~with~~and aExchange ~~new~~Commission ~~margin~~on ~~tax~~Form toS-8 befor ~~effective~~the ~~January 1,~~purpose ~~2008.~~of ~~The~~registering ~~Company estimates~~ the ~~new~~additional ~~margin~~shares ~~tax~~available ~~will~~for ~~not~~issuance ~~have~~under athe ~~significant~~Restated ~~impact~~Incentive ~~on its income tax expense or its deferred tax assets and liabilities~~Plan.

~~The~~Stock ~~Company~~Options ~~adopted~~– ~~FASB~~A ~~Interpretation~~summary ~~No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”), on January 1, 2007. As a result~~ of ~~the~~stock ~~implementation~~option ofactivity ~~FIN~~and ~~48,~~related ~~the~~information ~~Company recognized an increase to its liability~~ for ~~uncertain~~the ~~tax positions of approximately $1,093, which was~~three ~~accounted~~months ~~for~~ended ~~as a cumulative effect on beginning retained earnings on January~~March 131, ~~2007.~~2009 Atis ~~the adoption~~as ~~date, the Company had approximately $12,084 of total unrecognized tax benefits. Of this~~follows: ~~total, $7,931 represents the amount of unrecognized tax benefits that, if recognized, would favorably affect the effective income tax rate in future periods.~~

The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. As of January 1, 2007, the Company had $1,572 accrued for interest and/or penalties.


						Weighted
				Weighted		Average
				Average		Grant		Aggregate
	Number of			Exercise		Date Fair		Intrinsic
	Options			Price		Value		Value
Outstanding at December 31, 2008		6,139,670		$	7.63	$	3.51
Granted		—			—		—
Exercised		(25,198	)	$	7.63	$	3.51
Forfeited		—			—		—

Outstanding at March 31, 2009		6,114,472		$	7.63	$	3.51	$	10,761

Options exercisable at March 31, 2009		6,108,877		$	7.63	$	3.51	$	10,752

The ~~Company~~total orintrinsic ~~one~~value of ~~its~~options ~~subsidiaries~~exercised ~~files~~during ~~income tax returns in~~ the ~~U.S.~~three ~~federal jurisdiction,~~months ~~and~~ended ~~multiple state and foreign jurisdictions~~March 31, ~~and the Company is routinely under~~2009 ~~audit~~was ~~by many different tax authorities~~$29. ~~Management believes that its accrual for tax liabilities~~ is adequate for all open audit years based on its assessment of many factors including past experience and interpretations of tax law. This assessment relies on estimates and assumptions and may involve a series of complex judgments about future events. The Company is no longer subject to income tax audits from the Internal Revenue Service for years before 2002. The Company is no longer subject to state income tax examinations by tax authorities in its major state jurisdictions for years before 2002. The Company is no longer subject to non-U.S. income tax examinations by tax authorities in its major non-U.S. tax jurisdictions for years before 1998.

~~Income~~During ~~tax expense of $8,937 was recorded for~~ the ~~six~~three months ended ~~June~~March 3031, ~~2007.~~2009, ~~The effective tax rate was 5.1% for~~ the ~~six~~Company ~~months~~changed ~~ended~~its ~~June 30, 2007. Income tax provisions for interim (quarterly) periods are based on~~ estimated ~~annual income tax rates and are adjusted for the~~forfeiture ~~effects~~rate of ~~significant,~~5% ~~infrequent~~to ~~or unusual items occurring during the interim period~~2.5% Asbased ~~a result~~on ofactual ~~the~~cumulative ~~full~~stock ~~inclusion~~option ~~in the interim rate calculation of these items, the interim rate may vary significantly from the normalized annual rate~~forfeitures. The ~~Company’s~~cumulative ~~income tax rate for the six months ended June 30, 2007 includes the~~ impact of the ~~gain~~reduction onin ~~the~~forfeiture ~~NCM transaction and the Fandango transaction as discreet items. The tax~~ rate ~~on the gains~~ was ~~38.4%, which resulted in~~ $~~84,509~~260 ~~of income~~and ~~tax~~was ~~expense.~~recorded ~~The~~as ~~tax~~additional ~~rate~~compensation ~~without the NCM Transaction and the Fandango Transaction is~~expense ~~163.6%~~during ~~resulting in a benefit of $75,572 for~~ the ~~six~~three months ended ~~June~~March 3031, ~~2007~~2009. ~~This rate is~~ ~~reflective of permanent differences such as goodwill impairment, which is recorded for financial statement purposes but not deductible for income tax purposes.~~

10. Stock Options

During September 2004, Cinemark, Inc.’s board of directors approved the 2004 Long Term Incentive Plan (the “2004 Plan”), under which 9,097,360 shares of Class A common stock are available for issuance to selected employees, directors and consultants of the Company. The 2004 Plan provided for restricted share grants, incentive option grants and nonqualified option grants.

OnThe ~~September 30, 2004, the~~ Company ~~granted~~recorded ~~options~~compensation toexpense ~~purchase~~of 6$1,~~986~~020,~~731~~ ~~shares~~including ~~of its common stock under~~ the ~~2004~~aforementioned ~~Plan at an exercise price of~~ $~~7.63~~260 ~~per option (equal~~ related to the ~~market~~change ~~value~~in ~~at the~~forfeiture ~~date of grant). Options to purchase 692~~rate,~~976~~ ~~shares vested immediately~~ and ~~the~~a ~~remaining~~tax ~~options granted~~benefit inof ~~2004~~approximately ~~vest~~$385 ~~daily~~during ~~over~~ the ~~period~~three ~~ending~~months ended ~~April~~March 131, 2009, ~~and~~related ~~expire~~to ~~ten years from~~ the ~~grant~~ ~~date~~outstanding stock options. OnAs ~~January~~of March 2831, ~~2005~~2009, ~~the~~there ~~Company~~was ~~granted~~no ~~options~~remaining tounrecognized compensation ~~purchase~~expense ~~12,055~~related ~~shares~~to ofoutstanding ~~its common~~ stock ~~under~~options ~~the~~and ~~2004~~all ~~Plan~~outstanding atoptions anfully ~~exercise price of $7.63 per option (equal to the market value at~~vested ~~the~~on ~~date~~April 2, ~~of grant)~~2009. ~~The~~All options ~~granted~~outstanding ~~during~~at ~~January~~March ~~2005~~31, ~~vest~~2009 ~~daily~~have ~~over~~an ~~five~~average ~~years~~remaining ~~and the~~contractual ~~options~~life ~~expire~~of ~~ten~~approximately 5.5 years ~~from the grant date~~.

~~For~~Restricted ~~each~~Stock ~~2004~~- ~~and~~During ~~2005~~the ~~grant~~three months ended March 31, 2009, Cinemark Holdings, Inc. granted 406,335 shares of restricted stock to employees of the Company. The fair ~~values~~value of the shares ~~options~~of ~~were~~restricted ~~estimated~~stock was determined based on the ~~dates~~market value of Cinemark Holdings, Inc.’s ~~grant~~stock ~~using~~on the ~~Black-Scholes~~date ~~option-pricing~~of ~~model~~grant, ~~with~~which was $9.50 per share. The Company assumed a forfeiture rate of 5% for the ~~following~~restricted ~~assumptions:~~stock awards. The restricted stock vests over four years based on continued service by the employee.

	September 30, 2004			January 28, 2005
	Grant			Grant
Expected life	6.5		years	6.5		years
Expected volatility (1)		39	%		44	%
Risk-free interest rate		3.79	%		3.93	%
Dividend yield		0	%		0	%

A summary of restricted stock activity for the three months ended March 31, 2009 is as follows:

(1) Expected volatility is based on historical volatility of the common stock price of comparable public companies.


			Weighted
			Average
	Shares of		Grant
	Restricted		Date
	Stock		Fair Value
Outstanding at December 31, 2008		385,666	$	13.32
Granted		406,335	$	9.50
Forfeited		—		—
Vested		—		—

Outstanding at March 31, 2009		792,001

Unvested restricted stock at March 31, 2009		792,001

~~Forfeitures~~The ~~were~~Company ~~estimated~~recorded ~~based~~compensation onexpense of $317 and Cinemark Holdings, Inc. recorded compensation expense of $125 related to restricted stock awards for employees and directors, respectively, during the three months ended March 31, 2009. As of March 31, 2009, the remaining unrecognized compensation expense related to restricted stock awards was $7,198 and the weighted average period over which this remaining compensation expense will be recognized is approximately 3.5 years. Upon vesting, the Company’s ~~historical~~receives a tax deduction. The recipients of restricted stock are ~~option~~entitled ~~activity~~to receive dividends and to vote their respective shares, however the sale and transfer of the restricted shares is prohibited during the restriction period.

OnRestricted ~~August~~Stock Units – During the three months ended March 231, ~~2006~~2009, Cinemark Holdings, Inc. granted ~~was~~restricted ~~formed~~stock asunits ~~the~~representing ~~Delaware~~291,305 ~~holding~~hypothetical ~~company~~shares of common stock under the ~~Cinemark~~Restated Incentive Plan. Similar to the restricted stock unit awards granted during 2008, ~~Inc~~the restricted stock units vest based on a combination of financial performance factors and continued service. ~~Under~~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 ~~share~~formula ~~exchange~~utilizing a multiple of Adjusted EBITDA subject to certain specified adjustments (as defined in the restricted stock unit award agreement). ~~dated~~The ~~August 8,~~financial ~~2006~~performance factors for the restricted stock units have a threshold, ~~each~~target ~~outstanding~~and ~~share~~maximum level of payment ~~Cinemark,~~opportunity. ~~Inc~~If the IRR for the three year period is at least 8.’s5%, ~~common~~which is the threshold, one-third of the restricted stock ~~was~~units ~~exchanged~~vest. If the IRR for anthe ~~equivalent~~three ~~number~~year ofperiod ~~shares~~is at least 10.5%, which is the target, two-thirds of ~~Cinemark~~the restricted stock units vest. If the IRR for the three ~~Holdings~~year period is at least 12.5%, ~~Inc~~which is the maximum, 100% of the restricted stock units vest. All payouts of restricted stock units that vest will be subject to an additional service requirement and will be paid in the form of common stock. ~~The~~if ~~share~~the ~~exchange~~participant ~~was~~continues ~~completed~~to onprovide ~~October~~services through March 527, ~~2006~~2013, which is 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.

In November 2006, Cinemark Holdings, Inc.’s board of directors amended the 2004 Plan to provide that no additional awards may be granted under the 2004 Plan. At that time, the board of directors of Cinemark Holdings, Inc. and the majority of its stockholders approved the Cinemark Holdings, Inc. 2006 Long Term Incentive Plan (the “2006 Plan”) and all options to purchase shares of Cinemark, Inc.’s common stock under the 2004 Plan were exchanged for an equal number of options to purchase shares of Cinemark Holdings, Inc.’s common stock under the 2006 Plan. The 2006 Plan is substantially similar to the 2004 Plan.

All stock option information has been adjusted to give effect to a 2.9585-for-1 stock split effected by Cinemark Holdings, Inc. on April 9, 2007.

ABelow ~~summary~~is ofa ~~Plan~~table ~~activity~~summarizing ~~and related information for~~ the ~~year~~potential ~~ended~~awards ~~December 31,~~at ~~2006~~each ~~and~~ of the ~~six~~three ~~months~~levels ~~ended~~of ~~June 30, 2007 is as follows~~financial performance:

				Weighted
	Number of
				Average
	Shares			Value at
	Number of			Exercise
	Vesting			Grant
	Options			Price
at IRR of at least 8.5%		97,097		$	922
Outstanding at 1/1/06		6,998,786		$	7.63
at IRR of at least 10.5%		194,208		$	1,845
Granted		—		$	—
at IRR of at least 12.5%		291,305		$	2,767
Exercised		(4,603	)	$	7.63
Forfeited		(13,590	)	$	7.63
Outstanding at 12/31/06		6,980,593		$	7.63
Granted		—		$	—
Exercised		(15,387	)	$	7.63
Forfeited		(65,002	)	$	7.63
Outstanding at 6/30/07		6,900,204		$	7.63
Options exercisable at 6/30/07		4,498,973		$	7.63

~~The~~Due ~~Company~~to ~~recorded~~the ~~compensation~~fact ~~expense~~that ofthe $1IRR for the three year period ending December 31,~~449~~ ~~and~~2011 acannot ~~tax~~be determined ~~benefit~~at the time of ~~approximately~~grant, the Company has estimated that the most likely outcome is the ~~$502~~achievement ~~during~~of the ~~six~~mid-point ~~months~~IRR ~~ended~~level. ~~June 30,~~As ~~2007~~a ~~and~~result, ~~recorded~~the total compensation expense ofto be recorded for the restricted stock unit awards is $1,~~432~~808 ~~and~~assuming a ~~tax~~total ~~benefit~~ of ~~approximately~~190,324 ~~$502~~units ~~during~~will vest at the end ~~six~~of ~~months~~the ~~ended~~four ~~June 30,~~year ~~2006~~period. AsIf ofduring ~~June 30,~~the ~~2007~~service period, ~~the~~additional ~~unrecognized~~information ~~compensation~~becomes available ~~expense~~to ~~related~~lead the Company to ~~outstanding~~believe ~~stock~~a ~~options~~different ~~was~~IRR ~~$5,012~~level ~~and~~will ~~the~~be ~~weighted~~achieved ~~average~~for ~~period~~the ~~over~~three ~~which~~year period ~~this~~ending ~~remaining~~December 31, ~~compensation~~2011, ~~expense~~the Company will bereassess ~~recognized~~the isnumber ~~approximately~~of ~~1.75 years.~~units ~~All~~that ~~options~~will vest and adjust ~~outstanding~~its atcompensation ~~June 30,~~expense ~~2007~~accordingly ~~have~~on ana ~~average~~prospective ~~remaining~~basis ~~contractual~~over ~~life~~the ofremaining ~~approximately~~service 7period.25 ~~years.~~

~~11.~~ Below ~~Early~~is ~~Retirement~~a summary of ~~Long-Term~~outstanding ~~Debt~~restricted stock units:

On March 6, 2007, the Company commenced an offer to purchase for cash, on the terms and subject to the conditions set forth in an Offer to Purchase and Consent Solicitation Statement, any and all of its 9% senior subordinated notes, of which $332,250 aggregate principal amount remained outstanding. In connection with the tender offer, the Company solicited consents for certain proposed amendments to the indenture to remove substantially all restrictive covenants and certain events of default provisions. On March 20, 2007, the early settlement date, approximately $332,000 aggregate principal amount of the 9% senior subordinated notes were tendered and repurchased by the Company for approximately $360,164, including accrued interest and premiums paid. The Company funded the repurchase with the net proceeds received from the NCM Transaction (see Note 6).


			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⁾		190,324	$	9.50
Forfeited		—	$	—
Vested		—	$	—

Unvested restricted stock units at March 31, 2009		325,351

On March 20, 2007, the Company and the Bank of New York Trust Company, N.A. as trustee to the Indenture dated February 11, 2003, executed the Fourth Supplemental Indenture. The Fourth Supplemental Indenture became effective on March 20, 2007 and it amends the Indenture by eliminating substantially all restrictive covenants and certain events of default provisions.


⁽¹⁾		Represents the number of shares to be issued, net of estimated forfeitures, if the mid-point IRR level is achieved for each respective grant.

⁽²⁾		The terms of these awards are similar to those discussed for the awards granted during the three months ended March 31, 2009.

OnThe ~~April 3, 2007, the~~ Company ~~repurchased~~recorded ancompensation ~~additional~~expense of $66116 ~~aggregate~~related ~~principal~~to ~~amount~~all ofoutstanding ~~the~~restricted stock 9%unit ~~senior~~awards ~~subordinated~~during ~~notes~~the ~~tendered~~three ~~after~~months ~~the~~ended ~~early~~March 31, ~~settlement date~~2009. As of ~~June~~March 3031, ~~2007~~2009, the remaining ~~Company~~unrecognized ~~had~~compensation ~~outstanding~~expense related to restricted stock unit awards was $~~184~~3,121 ~~aggregate~~and ~~principal~~the weighted ~~amount~~average ofperiod 9%over ~~senior~~which ~~subordinated~~the ~~notes~~remaining compensation expense will be recognized is approximately 3.5 years.

~~The~~8. ~~Company~~Early ~~recorded~~Retirement ~~a loss on early retirement~~ of ~~debt of $7,952 during the six months ended June 30, 2007 related to the repurchases, which consisted of tender offer repurchase costs, including premiums paid and other fees, and the write~~Long-~~off~~Term ~~of unamortized debt issue costs,~~Debt ~~partially offset by the write-off of the unamortized bond premium.~~

~~The~~On ~~loss~~March 20, on2008, ~~early~~in ~~retirement~~one ofopen ~~debt~~market ofpurchase, the Company repurchased $10,000 aggregate principal amount at maturity of its 9 3/4% senior discount notes for approximately $8,~~315~~950. ~~recorded~~The Company byfunded the ~~Company~~transaction ~~during~~with proceeds from the ~~six~~April 2007 ~~months~~initial public offering of ~~ended~~Cinemark ~~June 30~~Holdings, ~~2006~~Inc.’s ~~related~~common tostock. ~~the~~As ~~repurchase~~a result of ~~$10~~the transaction,~~000~~ ~~aggregate~~the ~~principal~~Company ~~amount~~recorded ofa ~~9% senior~~loss ~~subordinated~~on ~~notes~~early ~~and~~retirement ~~the~~of ~~repurchase~~debt of $3940 during the three months ended March 31,~~775~~ ~~aggregate~~2008, ~~principal~~which ~~amount~~primarily includes atthe ~~maturity~~write-off of 9unamortized ~~3/4%~~debt issue costs partially offset by a discount on the repurchased senior discount notes ~~in May 2006~~.

129. Interest Rate Swap Agreements

During ~~March~~ 2007 and 2008, the Company entered into ~~two~~three interest rate swap agreements ~~with effective dates of August 13, 2007 and terms of five years each~~. The interest rate ~~swaps~~swap ~~were~~agreements ~~designated~~qualify ~~to hedge~~for ~~approximately~~cash ~~$500,000~~flow ofhedge ~~the~~accounting ~~Company’s~~in ~~variable~~accordance ~~rate~~with ~~debt~~SFAS ~~obligations under its senior secured credit facility~~No. ~~Under the terms of the interest rate swap agreements~~ 133, ~~the~~“Accounting ~~Company~~for ~~pays fixed~~Derivative ~~rates~~Instruments ~~of 4.918%~~ and 4Hedging Activities.~~922%~~” onThe ~~$375,000~~fair ~~and~~values ~~$125,000, respectively,~~ of ~~variable rate debt and~~the ~~receives~~ interest atrate aswaps ~~variable~~are ~~rate~~recorded ~~based~~ on the ~~3-month~~Company’s ~~LIBOR.~~condensed ~~The~~consolidated ~~3-month~~balance ~~LIBOR~~sheet ~~rate~~as onan ~~each~~asset ~~reset~~or ~~date~~liability ~~determines~~with the ~~variable~~effective portion of the interest rate swaps’ ~~for~~gains ~~the three-month period following the reset date. No premium~~ or ~~discount~~losses ~~was~~reported ~~incurred~~as ~~upon the Company entering into the~~a ~~interest~~component ~~rate~~of ~~swaps~~accumulated ~~because~~other ~~the~~comprehensive ~~pay~~income (loss) and ~~receive rates on~~ the ~~interest~~ineffective ~~rate~~portion ~~swaps~~reported ~~represented~~in ~~prevailing rates for each counterparty at the time the interest rate swaps were consummated~~earnings. The ~~interest~~ ~~rate~~Company’s ~~swaps~~fair ~~qualify~~value ~~for~~measurements ~~cash~~are ~~flow~~based ~~hedge~~on ~~accounting~~projected ~~treatment~~future ininterest ~~accordance~~rates ~~with SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities,” and~~ as ~~such, the Company has~~ ~~effectively~~provided ~~hedged~~by ~~its exposure to variability in~~ the ~~future~~counterparties ~~cash flows attributable~~ to the ~~3-month LIBOR~~interest ~~on $500,000 of variable~~ rate ~~debt.~~swap ~~The~~agreements ~~change~~and in the ~~fair~~fixed ~~values~~rates ofthat the ~~interest rate swaps~~ ~~is recorded on the~~ Company’s ~~condensed~~is ~~consolidated~~obligated ~~balance~~to ~~sheet~~pay asunder anthese ~~asset~~agreements. orTherefore, ~~liability with~~ the ~~effective~~ ~~portion of the interest rate swaps~~Company’s ~~gains~~measurements oruse significant ~~losses~~unobservable ~~reported~~inputs, aswhich afall ~~component~~in ofLevel ~~other comprehensive~~3 ~~income~~under ~~(loss)~~SFAS No. ~~and~~157 ~~the~~“Fair ~~ineffective portion reported in earnings~~Value Measurements.”

AsIn March 2007, the Company entered into two interest rate swap agreements with effective dates of ~~June~~August 3013, 2007, ~~the~~and terms of five years each. The interest rate swaps were andesignated ~~asset~~to ~~with~~hedge approximately an$500,000 ~~aggregate~~of ~~fair~~the ~~value~~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 ~~approximately~~of 4.918% and 4.922% on $10375,~~426~~000 and $125,000, ~~which~~respectively, ~~has~~of ~~been~~variable ~~recorded~~rate asdebt and receives interest at a ~~component~~variable ofrate ~~deferred~~based ~~charges~~on ~~and~~the ~~other~~3-month ~~assets~~ LIBOR. The 3-month ~~net~~LIBOR ~~with~~rate aon ~~corresponding~~each ~~amount~~reset ofdate determines ~~$10,426~~the ~~($6,422~~variable ~~net~~portion of ~~deferred~~the ~~taxes)~~interest ~~recorded~~rate asswaps anfor ~~increase~~the three-month period following the inreset ~~accumulated~~date. ~~other~~No ~~comprehensive~~premium ~~income~~or ondiscount was incurred upon the Company’s ~~condensed~~entering ~~consolidated~~into ~~balance~~the ~~sheet.~~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 ~~exhibited~~by nocomparing ~~ineffectiveness~~estimated ~~during~~future interest payments to be made under forecasted future 3-month LIBOR to the ~~six~~fixed ~~months~~rates ~~ended~~in ~~June 30,~~accordance ~~2007~~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 ~~Goodwill~~Company amortized approximately $0 and ~~Other~~$1,158 ~~Intangible~~to ~~Assets~~interest expense during the three months ended March 31, 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 ~~goodwill~~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 asincurred ~~follows:~~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.

	U.S.			International
	Operating			Operating
	Segment			Segment			Total
Balance at December 31, 2006	$	1,056,816		$	148,607		$	1,205,423
Purchase price allocation adjustment for Century Acquisition (see Note 5)		(18,110	)		—			(18,110	)
Impairment charges		(41,322	)		(3,786	)		(45,108	)
Foreign currency translation adjustments and other		—			8,086			8,086
Balance at June 30, 2007	$	997,384		$	152,907		$	1,150,291

As of March 31, 2009, the fair values of the $125,000 interest rate swap and the $175,000 interest rate swap were liabilities of approximately $13,182 and $11,516, respectively which have been recorded as a component of other long-term liabilities. A corresponding cumulative amount of $15,213, net of taxes, has been recorded as an increase in accumulated other comprehensive loss on the Company’s condensed consolidated balance sheet as of March 31, 2009. The interest rate swaps exhibited no ineffectiveness during the three months ended March 31, 2009.

In accordance with SFAS No. 142, “Goodwill and Other Intangible Assets”, the Company reviews goodwill for impairment on an annual basis at fiscal year-end or whenever events or changes in circumstances indicate the carrying value of goodwill might exceed its estimated fair value.

As a result of the NCM Transaction discussed in Note 6, and more specifically the modification of the NCM Exhibitor Services Agreement with the Company, which significantly reduced the contractual amounts paid to the Company, the Company evaluated the carrying value of its goodwill as of March 31, 2007 resulting in the majority of the goodwill impairment charges reflected above in the table.

The Company evaluates goodwill for impairment at the reporting unit level (generally a theatre) and has allocated goodwill to the reporting unit based on an estimate of its relative fair value. The evaluation is a two-step approach requiring the Company to compute the estimated fair value of a theatre and compare it with its carrying value. If the carrying value exceeds estimated fair value, a second step is performed to measure the potential goodwill impairment. Fair values are determined based on a multiple of undiscounted cash flows, which was eight times for the evaluation performed as of March 31, 2007. 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. The Company’s policy

of Below ~~allocating~~is ~~goodwill~~a ~~at the~~reconciliation ~~theatre~~of ~~level~~our ~~results~~interest inrate ~~more~~swap ~~volatile~~values, ~~impairment~~as ~~charges~~included onin another ~~annual~~long-term liabilities ~~basis~~on ~~due~~the tocondensed ~~changes~~consolidated ~~in market~~balance ~~conditions~~sheets, ~~and~~from ~~box~~the ~~office~~beginning ~~performance~~of ~~and~~ the ~~resulting~~year ~~impact~~to onMarch 31, ~~individual theatres.~~2009:

Intangible assets consisted of the following:


Beginning liability balance — January 1, 2009	$	24,781
Total gain included in accumulated other comprehensive loss		(83	)

Ending liability balance – March 31, 2009	$	24,698

										Foreign
										Currency
										Translation
	Balance at									Adjustments			Balance at
	December 31,									and			June 30,
	2006			Amortization			Impairment			Other			2007
Intangible assets with finite lives:
Capitalized licensing fees:
Gross carrying amount	$	5,138		$	—		$	—		$	—		$	5,138
Accumulated amortization		(1,139	)		(213	)		—			—			(1,352	)
Net carrying amount	$	3,999		$	(213	)	$	—		$	—		$	3,786
Vendor contracts:
Gross carrying amount	$	56,526			—			—			362			56,888
Accumulated amortization		(19,924	)		(1,739	)		—			—			(21,663	)
Net carrying amount	$	36,602		$	(1,739	)	$	—		$	362		$	35,225
Net favorable leases:
Gross carrying amount		21,999			—			(3,700	)		3,115			21,414
Accumulated amortization		(12,023	)		(1,559	)		—			(489	)		(14,071	)
Net carrying amount	$	9,976		$	(1,559	)	$	(3,700	)	$	2,626		$	7,343
Other intangible assets:
Gross carrying amount		70			—			—			2			72
Accumulated amortization		(16	)		(2	)		—			—			(18	)
Net carrying amount	$	54		$	(2	)	$	—		$	2		$	54
Total net intangible assets with finite lives	$	50,631		$	(3,513	)	$	(3,700	)	$	2,990		$	46,408
Intangible assets with indefinite lives:
Tradename		310,118			—			—			338			310,456
Other unamortized intangible assets		3			—			—			—			3
Total intangible assets — net	$	360,752		$	(3,513	)	$	(3,700	)	$	3,328		$	356,867

10. Goodwill and Other Intangible Assets

~~Aggregate~~The ~~amortization~~Company’s ~~expense~~goodwill ofwas $3,588 for the six months ended June 30, 2007 consisted of $3,513 of amortization of intangible assets and $75 of amortization of other assets. Estimated aggregate future amortization expense for intangible assets is as follows:

For the six months ended December 31, 2007	$	4,112
	U.S.		International
For the twelve months ended December 31, 2008		6,462
	Operating		Operating
For the twelve months ended December 31, 2009		5,664
	Segment		Segment			Total
For the twelve months ended December 31, 2010		5,266
Balance at December 31, 2008	$	903,461	$	136,357		$	1,039,818
For the twelve months ended December 31, 2011		4,698
Acquisition of theatres (1)		43,470		—			43,470
Thereafter		20,206
Foreign currency translation adjustments		—		(190	)		(190	)
Total	$	46,408
Balance at March 31, 2009	$	946,931	$	136,167		$	1,083,098


⁽¹⁾		See Note 3.

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 and Panama 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 value is 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.

~~14.~~ Intangible ~~Impairment~~assets consisted of ~~Long-Lived~~the ~~Assets~~following:

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.


										Foreign
										Currency
										Translation
	Balance at									Adjustments			Balance at
	December 31,									and			March 31,
	2008			Additions⁽¹⁾			Amortization			Impairment⁽²⁾			2009
Intangible assets with finite lives:

Vendor contracts:

Gross carrying amount		55,840			(485	)		—			(171	)		55,184

Accumulated amortization		(26,664	)		—			(771	)		—			(27,435	)


Net carrying amount		29,176			(485	)		(771	)		(171	)		27,749


Other intangible assets:

Gross carrying amount		22,856			3,500			—			(263	)		26,093

Accumulated amortization		(19,366	)		—			(454	)		—			(19,820	)


Net carrying amount		3,490			3,500			(454	)		(263	)		6,273


Total net intangible assets with finite lives		32,666			3,015			(1,225	)		(434	)		34,022

Intangible assets with indefinite lives:

Tradename		309,102			—			—			(330	)		308,772


Total intangible assets — net	$	341,768		$	3,015		$	(1,225	)	$	(764	)		342,794

The Company considers actual theatre level cash flows, future years budgeted theatre level cash flows, theatre property and equipment carrying values, theatre goodwill 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 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 undiscounted 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 undiscounted cash flows are not sufficient to recover a long-lived asset’s carrying value, the Company then compares the carrying value of the asset with its estimated fair value. Fair value is determined based on a multiple of undiscounted cash flows, which was eight times for the evaluation performed as of June 30, 2007. When estimated fair value is determined to be lower than the carrying value of the long-lived asset, the asset is written down to its estimated fair value. 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.


⁽¹⁾		The additions to other intangible assets are a result of the acquisition of theatres in the U.S. during March 2009 as discussed in Note 3. The reduction in vendor contracts is a result of an adjustment to the preliminary purchase price allocation related to the acquisition of theatres in Brazil, which occurred during 2008.

⁽²⁾		See Note 11 for summary of impairment charges.

~~The~~Aggregate ~~Company’s~~amortization ~~long-lived~~expense ~~asset~~of ~~impairment~~$1,227 ~~losses~~ for the ~~six~~three months ended ~~June~~March 3031, ~~2007~~2009 ~~were~~consisted of $1,225 of amortization of intangible assets and $2 of amortization of other assets. Estimated aggregate future amortization expense for intangible assets is as follows:

United States theatre properties	$	7,941
For the nine months ended December 31, 2009	$	4,186
International theatre properties		17
For the twelve months ended December 31, 2010		5,376
Subtotal	$	7,958
For the twelve months ended December 31, 2011		5,087
Intangible assets (see Note 13)		3,700
For the twelve months ended December 31, 2012		4,200
Goodwill (see Note 13)		45,108
For the twelve months ended December 31, 2013		3,470
Impairment of long-lived assets	$	56,766
Thereafter		11,703
Total	$	34,022

As11. aImpairment ~~result~~ of ~~the~~Long-Lived NCM Transaction discussed in Note 6, and more specifically the modification of the NCM Exhibitor Services Agreement with the Company, which significantly reduced the contractual amounts paid to the Company, the Company evaluated the carrying value of its goodwill as of March 31, 2007 resulting in the majority of the goodwill impairment charges reflected above in the table. Assets

15 In accordance with SFAS No. 144, ~~Foreign~~“Accounting ~~Currency~~for ~~Translation~~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 accumulated other comprehensive income account in stockholders’ equity of $11,463 and $35,013 at December 31, 2006 and June 30, 2007, respectively, includes the cumulative foreign currency adjustments from translating the financial statements of the Company’s international subsidiaries into U.S. dollars.

In 2007 and 2006, all foreign countries where the Company has operations were deemed non-highly inflationary. Thus, any fluctuation in the currency results in a foreign currency translation adjustment to the accumulated other comprehensive income account recorded as an increase in, or reduction of, stockholders’ equity.

On June 30, 2007, the exchange rate for the Brazilian real was 1.93 reais to the U.S. dollar (the exchange rate was 2.14 reais to the U.S. dollar at December 31, 2006). As a result, the effect of translating the June 30, 2007 Brazilian financial statements into U.S. dollars is reflected as a foreign currency translation adjustment to the accumulated other comprehensive income account as an increase in stockholders’ equity of $15,859. At June 30, 2007, the total assets of the Company’s Brazilian subsidiaries were U.S. $184,669.

On June 30, 2007, the exchange rate for the Mexican peso was 10.80 pesos to the U.S. dollar (the exchange rate was 10.82 pesos to the U.S. dollar at December 31, 2006). As a result, the effect of translating the June 30, 2007 Mexican financial statements into U.S. dollars is reflected as a foreign currency translation adjustment to the accumulated other

~~comprehensive~~ The ~~income~~Company ~~account~~considers actual theatre level cash flows, future years budgeted theatre level ascash anflows, ~~increase~~theatre property and equipment carrying values, amortizing intangible assets carrying values, the age of a recently built theatre, competitive theatres in ~~stockholders’~~the ~~equity~~marketplace, changes in foreign currency exchange rates, the impact of ~~$183~~recent ticket price changes, available lease renewal options and other factors considered relevant in its assessment of impairment of individual theatre assets. AtLong-lived ~~June 30~~assets are evaluated for impairment indicators on an individual theatre basis, which ~~2007~~the Company believes is the lowest applicable level for which there are identifiable cash flows. The impairment evaluation is based on the estimated undiscounted 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 ~~total~~probability ~~assets~~of renewal periods for leased properties and a period of twenty years for fee owned properties. If the estimated ~~Company~~undiscounted cash flows are not sufficient to recover a long-lived asset’s ~~Mexican~~carrying ~~subsidiaries~~value, ~~were~~the Company Uthen compares the carrying value of the asset group (theatre) with its estimated fair value.S Fair value is determined based on a multiple of cash flows, which was eight times for the evaluation performed during the three months ended March 31, 2008 and six and a half times for the evaluation performed during the three months ended March 31, 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 three months ended March 31, 2009 was approximately $~~159~~2,~~555~~600. 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.

16. Comprehensive Income


	Three Months Ended
	March 31,
	2009		2008

United States theatre properties	$	821	$	4,487
International theatre properties		147		—

Subtotal		968
Intangible assets		71		—

Impairment of long-lived assets	$	1,039	$	4,487

12. Foreign Currency Translation

The accumulated other comprehensive loss account in stockholder’s equity of $72,347 and $72,865 at December 31, 2008 and March 31, 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 March 31, 2009, the exchange rate for the Brazilian real was 2.31 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 March 31, 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 stockholder’s equity of $2,841. At March 31, 2009, the total assets of the Company’s Brazilian subsidiaries were U.S. $174,810.

On March 31, 2009, the exchange rate for the Mexican peso was 14.44 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 March 31, 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 a decrease in stockholder’s equity of $4,295. At March 31, 2009, the total assets of the Company’s Mexican subsidiaries were U.S. $116,107.

On March 31, 2009, the exchange rate for the Chilean peso was 586.36 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 March 31, 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 stockholder’s equity of $1,435. At March 31, 2009, the total assets of the Company’s Chilean subsidiaries were U.S. $22,060.

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

The effect of translating the March 31, 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 stockholder’s equity of $1,709.

13. 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,
	March 31,
	2007(Successor)			2006(Predecessor)			2007(Successor)		2006(Predecessor)
	2009			2008
Net income	$	4618,~~539~~497		$	135,~~923~~950		$	~~164,843~~	$	~~21,093~~
Fair value adjustments on interest rate swap agreements (see Note 12)		7,629			—			6,422		—
Fair value adjustments on interest rate swap agreements, net of taxes (see Note 9)		52			(11,959	)
Foreign currency translation adjustment		15,257			(4,466	)		17,127		(2,011	)
Amortization of accumulated other comprehensive loss on terminated swap agreement (see Note 9)		1,158			—
Comprehensive income	$	69,425		$	9,457		$	188,392	$	19,082
Foreign currency translation adjustment (see Note 12)		(2,549	)		9,821
Comprehensive income	$	17,158		$	3,812
Comprehensive income attributable to noncontrolling interests (1)		35			(2,085	)
Comprehensive income attributable to Cinemark, Inc.	$	17,193		$	1,727

~~17.~~(1) ~~Supplemental~~Comprehensive ~~Cash~~income ~~Flow~~attributable ~~Information~~ to noncontrolling interests consisted of net income and foreign currency translation adjustments.

14. Supplemental Cash Flow Information

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

	Six Months Ended
	Three Months Ended
	June 30,
	March 31,
	2007(Successor)			2006(Predecessor)
	2009			2008
Cash paid for interest	$	6915,~~477~~340		$	26,~~196~~522
Cash paid for income taxes, net of refunds received	$	802,~~158~~873		$	19(5,~~567~~063	)
Noncash investing and financing activities:
Change in construction lease obligations related to construction of theatres	$	(2,429	)	$	(2,151	)
Change in accounts payable and accrued expenses for the acquisition of theatre properties and equipment (1)	$	(3,903	)	$	(5,104	)
Change in accounts payable and accrued expenses for the acquisition of theatre properties and equipment	$	(845	)	$	(2,356	)
Theatre properties acquired under capital lease (2)	$	19,800		$	7,911
Equipment acquired under capital lease	$	2,943		$	—
Investment in NCM (See Note 5)	$	15,536		$	—

18. Segments


⁽¹⁾		Additions to theatre properties and equipment included in accounts payable as of December 31, 2008 and March 31, 2009 were $13,989 and $17,892, respectively.

⁽²⁾		Amount recorded during the three months ended March 31, 2009 was a result of the acquisition of theatres in the U.S. as discussed in Note 3.

~~The Company identifies its international market and its U.S. market as separate reportable~~18 operating segments. The international segment consists of operations in Mexico, Argentina, Brazil, Chile, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Colombia. 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. Adjusted EBITDA, as defined below in the reconciliation table, is the primary measure of segment profit and loss the Company uses to evaluate performance and allocate its resources. The Company’s management evaluates the performance of its assets on a consolidated basis.

15.Segments

The Company manages its international market and its U.S. market as separate reportable operating segments. The international segment consists of operations in Mexico, Argentina, Brazil, Chile, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Colombia. 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,

Three Months Ended

2007

2006

2007

2006

March 31,

(Successor)

(Predecessor)

(Successor)

(Predecessor)

2009

2008

Revenues

U.S.

~~349~~341,~~043~~445

~~215~~308,~~956~~799

~~655,418~~

~~396,996~~

International

9185,~~790~~195

7993,~~638~~109

~~164,051~~

~~144,962~~

Eliminations

(~~797~~840

)

(~~489~~892

)

~~(1,411~~

)

~~(864~~

)

Total Revenues

~~440~~425,~~036~~800

~~295~~401,~~105~~016

~~818,058~~

~~541,094~~

Adjusted EBITDA

U.S.

7481,~~895~~920

5165,~~071~~009

~~141,689~~

~~89,389~~

International

2016,~~871~~269

1719,~~836~~284

~~34,264~~

~~29,136~~

Total Adjusted EBITDA

9598,~~766~~189

6884,~~907~~293

~~175,953~~

~~118,525~~

Capital Expenditures

U.S.

2816,~~148~~251

2125,~~566~~895

~~53,045~~

~~45,399~~

International

126,~~935~~621

54,~~251~~906

~~20,103~~

~~9,665~~

Total Capital Expenditures

4122,~~083~~872

2630,~~817~~801

~~73,148~~

~~55,064~~

~~The following table sets forth a reconciliation of net income to Adjusted EBITDA:~~19

	Three Months Ended June 30,					Six Months Ended June 30,
	2007			2006		2007			2006
	(Successor)			(Predecessor)		(Successor)			(Predecessor)
Net income	$	46,539		$	13,923	$	164,843		$	21,093
Add (deduct):
Income taxes		(26,456	)		7,349		8,937			4,881
Interest expense (1)		35,301			22,904		76,798			45,967
Gain on NCM transaction		—			—		(210,773	)		—
Gain on Fandango transaction		(9,205	)		—		(9,205	)		—
Other (income) expense		(2,577	)		2,004		2,769			1,511
Termination of profit participation agreement		6,952			—		6,952			—
Depreciation and amortization		36,720			19,968		73,595			40,094
Amortization of net favorable leases		625			43		1,559			86
Impairment of long-lived assets		7,036			647		56,766			923
(Gain) loss on sale of assets and other		(1,864	)		815		(1,559	)		1,543
Deferred lease expenses		1,704			237		3,311			413
Amortization of long-term prepaid rents		275			301		511			582
Stock option compensation expense		716			716		1,449			1,432
Adjusted EBITDA	$	95,766		$	68,907	$	175,953		$	118,525

(1) Includes amortization of debt issue costs.

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


	Three Months Ended
	March 31,
	2009			2008

Net income	$	18,497		$	5,950
Add (deduct):
Income taxes		14,733			3,358
Interest expense ⁽¹⁾		25,464			32,073
Loss on early retirement of debt		—			40
Other income ⁽²⁾		(1,203	)		(1,924	)
Depreciation and amortization		36,133			37,407
Amortization of favorable/unfavorable leases		323			704
Impairment of long-lived assets		1,039			4,487
(Gain) loss on sale of assets and other		272			(199	)
Deferred lease expenses		1,088			1,232
Amortization of long-term prepaid rents		390			404
Share based awards compensation expense		1,453			761

Adjusted EBITDA	$	98,189		$	84,293


⁽¹⁾		Includes amortization of debt issue costs.

⁽²⁾		Includes interest income, foreign currency exchange gain (loss), and equity in loss of affiliates and excludes distributions from NCM.

Financial Information About Geographic Areas

The Company has operations in the U.S., Canada, Mexico, Argentina, Brazil, Chile, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Colombia, 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,
	Three Months Ended
Revenues	2007			2006			2007			2006
	March 31,
	(Successor)			(Predecessor)			(Successor)			(Predecessor)
	2009			2008
U.S. and Canada	$	349,043		$	215,956		$	655,418		$	396,996
Revenues
Brazil		41,613			35,589			76,025			64,417
U.S. and Canada	$	341,445		$	308,799
Mexico		21,209			19,770			37,888			36,295
Brazil		43,258			44,634
Other foreign countries		28,968			24,279			50,138			44,250
Mexico		14,217			19,402
Eliminations		(797	)		(489	)		(1,411	)		(864	)
Other foreign countries		27,720			29,073
Total	$	440,036		$	295,105		$	818,058		$	541,094
Eliminations		(840	)		(892	)
Total	$	425,800		$	401,016

	June 30,		December 31,
	March 31,		December 31,
Theatre Properties and Equipment-net	2007		2006
	2009		2008
U.S. and Canada	$	1,172,530	$	1,169,456
Theatre Properties and Equipment-net
Brazil		69,884		55,749
U.S. and Canada	$	1,092,027	$	1,073,551
Mexico		49,864		51,272
Brazil		60,778		58,641
Other foreign countries		46,288		48,095
Mexico		36,722		38,290
Total	$	1,338,566	$	1,324,572
Other foreign countries		37,521		37,801
Total	$	1,227,048	$	1,208,283

1916. Related Party Transactions

The Company ~~entered~~leases ~~into~~one antheatre ~~amended~~from ~~and~~Plitt ~~restated~~Plaza ~~profit~~Joint ~~participation~~Venture ~~agreement~~(“Plitt Plaza”) on ~~March 12,~~a ~~2004~~month-to-month ~~with~~basis. ~~its~~Plitt ~~CEO,~~Plaza ~~Alan~~is ~~Stock,~~indirectly ~~which~~owned ~~became~~by ~~effective~~Lee onRoy ~~April 2~~Mitchell, ~~2004,~~Cinemark ~~and amended the profit~~Holdings, ~~participation agreement with Mr~~Inc. ~~Stock~~’s inChairman ~~effect~~of ~~since May 2002. Under~~ the ~~agreement~~Board, ~~Mr. Stock received~~who aowns ~~profit~~approximately ~~interest~~12% ~~in two theatres once the Company recovered its capital investment in these theatres plus its borrowing costs. Upon consummation~~ of Cinemark Holdings, Inc.’s ~~initial~~issued ~~public offering on April 24, 2007, the Company exercised its option to terminate the amended~~ and ~~restated profit~~ ~~participation~~outstanding ~~agreement~~shares ~~and~~of ~~purchased~~common Mrstock. ~~Stock’s~~ ~~interest~~Annual inrent ~~the~~is ~~theatres~~approximately on$118 ~~May 3,~~plus ~~2007~~certain ~~for a~~taxes, ~~price~~maintenance ofexpenses ~~$6,853~~and ~~pursuant to the terms of the agreement~~insurance. The Company ~~also~~recorded ~~paid payroll taxes of approximately~~ $9930 ~~related to the payment made to terminate the amended~~ and ~~restated~~$32 ~~profit participation agreement. The aggregate amount paid~~ of ~~$6,952~~facility islease ~~reflected~~and ~~within cost of~~other ~~operations~~operating inexpenses ~~the~~payable ~~Company’s~~to ~~condensed~~Plitt ~~consolidated~~Plaza ~~statement~~joint ofventure ~~income~~during ~~for~~ the three ~~and six~~ months ended ~~June~~March 3031, 2008 ~~2007~~ and ~~the~~2009, ~~agreement with Mr~~respectively. ~~Stock has been terminated.~~

The Company leases 25 theatres and two parking facilities from Syufy Enterprises, LP (“Syufy”) or affiliates of Syufy, which owns approximately 7.7% of Cinemark Holdings, Inc.’s issued and outstanding shares of common stock as of June 30, 2007. Raymond Syufy is one of Cinemark Holdings, Inc.’s directors and is an officer of the general partner of Syufy. Of these 27 leases, 22 have fixed minimum annual rent in an aggregate amount of approximately $23,500. Of these 22 leases with fixed minimum annual rent, 17 have a remaining lease term plus extension option(s) that exceed 30 years, four have a remaining lease term plus extension option(s) that exceed 18 years, and one has a remaining lease term of approximately three years. Three of these 22 leases have triggering events that allow the Company to convert the fixed minimum rent to a fixed percentage of gross sales as defined in the lease with the further right to terminate the lease if the theatre level cash flow drops below $0. Five of these 22 leases have triggering events that allow the Company to terminate the lease prior to expiration of the term. The five 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. Four of these percentage rent leases have remaining terms of 3 months plus automatic 12 month renewal options, and the Company has the right to terminate the lease if the theatre level cash flow drops below $0. One of these percentage rent leases has a remaining term of 15 months, and Syufy has the right to terminate this lease prior to the end of the term.

The Company also has an office lease with Syufy for corporate office space in San Rafael, California. The lease will expire in September 2008. The lease has a fixed minimum annual rent of approximately $300.

Prior to the completion of the Century Acquisition, Century Theatres, Inc. owned certain shares of Fandango, Inc., an on-line ticketing distributor. In connection with the Century Acquisition, the Company agreed to pay Syufy

CINEMARK, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

the cash proceeds received by the Company in connection with any sale of such shares of Fandango, Inc. up to a maximum amount of $2,800. As discussed in Note 8, the Company sold all of its shares of Fandango, Inc. stock during May 2007 for approximately $14,147 of consideration and paid $2,800 of the cash consideration to Syufy in accordance with the Century Acquisition agreement.

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 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 $39 of management fee revenues during the six months ended June 30, 2007. All such amounts are included in the Company’s condensed consolidated financial statements with the intercompany amounts eliminated in consolidation.

The Company leases one theatre from Plitt Plaza Joint Venture (“Plitt Plaza”). Plitt Plaza is indirectly owned by Lee Roy Mitchell. Annual rent is approximately $118 plus certain taxes, maintenance expenses and insurance. The Company recorded $62 of facility lease expense payable to Plitt Plaza joint venture during the six months ended June 30, 2007.

20. 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 and contractual disputes, most 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.

21. Subsequent Event – Dividend Declaration

On August 13, 2007, Cinemark Holdings, Inc., the Company’s parent, declared a dividend of $0.13 per common share payable to stockholders of record on September 4, 2007. The dividend will be paid on September 18, 2007.

22. Subsequent Event – Repurchase of Senior Discount Notes

During July and August 2007, as part of six open market purchases, the Company repurchased $47,000 aggregate principal amount at maturity of its 9 3/4% senior discount notes for approximately $42,758. The Company funded the transactions with proceeds from Cinemark Holdings, Inc.’s initial public offering. As a result of the transactions, the Company will record a loss on early retirement of debt of approximately $3,484, which includes premiums paid and the write-off of unamortized debt issue costs related to the repurchased notes.

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

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 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 $23 and $22 of management fee revenues during the three months ended March 31, 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 Cinemark Holdings, Inc.’s issued and outstanding shares of common stock. Raymond Syufy is one of Cinemark Holdings, Inc.’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 three months ended March 31, 2008 and 2009, the Company paid approximately $292 and $308, respectively in percentage rent for these four leases.

17. 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.

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 one of the leaders in the motion picture exhibition industry, in terms of both revenues and the number of screens in operation, with theatres in the U.S., Canada, Mexico, Argentina, Brazil, Chile, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Colombia. For financial reporting purposes at March 31, 2009, we have two reportable operating segments, our U.S. operations and our international operations.

Results of Operations

OnThe ~~October 5,~~following ~~2006,~~table wesets ~~completed~~forth, for the ~~Century~~periods ~~Acquisition.~~indicated, ~~Results~~the percentage of ~~operations for the three~~revenues ~~months~~represented ~~and~~by ~~six~~certain ~~months~~items ~~ended~~reflected ~~June 30,~~in ~~2006~~our docondensed ~~not~~consolidated ~~reflect~~statements ~~the inclusion~~ of ~~the Century theatres.~~income:

	Three Months Ended						~~Six Months Ended~~
	June 30,						June 30,
	March 31,
Operating data (in millions)	2007			2006			2007			2006
Operating data (in millions):	2009			2008
Revenues
Admissions	$	~~283~~279.19		$	~~182~~262.94		$	~~527.1~~		$	~~336.5~~
Concession		~~138~~130.40			91122.92			~~253.5~~			~~170.0~~
Other		1815.59			2016.34			~~37.4~~			~~34.6~~
Total revenues	$	~~440~~425.08		$	~~295~~401.10		$	~~818.0~~		$	~~541.1~~
Theatre operating costs (1)
Film rentals and advertising	$	~~159~~147.1		$	~~100~~138.31		$	~~287.4~~		$	~~179.2~~
Concession supplies		2219.7			1418.87			~~40.1~~			~~26.8~~
Salaries and wages		4544.4			2742.06			~~85.6~~			~~51.5~~
Facility lease expense		5355.37			3656.63			~~104.9~~			~~72.5~~
Utilities and other		48.28			3348.32			~~92.4~~			~~65.5~~
Total theatre operating costs	$	~~328~~315.7		$	~~212~~303.09		$	~~610.4~~		$	~~395.5~~
Operating data as a percentage of revenues (2)
Operating data as a percentage of revenues (2):
Revenues
Admissions		6465.37	%		6265.04	%		~~64.4~~	%		~~62.2~~	%
Concession		3130.5	%		3130.15	%		~~31.0~~	%		~~31.4~~	%
Other		43.28	%		64.91	%		~~4.6~~	%		~~6.4~~	%
Total revenues		100.0	%		100.0	%		~~100.0~~	%		~~100.0~~	%
Theatre operating costs (1) (2)
Film rentals and advertising		5652.26	%		5452.87	%		~~54.5~~	%		~~53.3~~	%
Concession supplies		1615.42	%		1615.13	%		~~15.8~~	%		~~15.8~~	%
Salaries and wages		10.34	%		910.16	%		~~10.5~~	%		~~9.5~~	%
Facility lease expense		1213.1	%		1214.40	%		~~12.8~~	%		~~13.4~~	%
Utilities and other		11.05	%		1112.30	%		~~11.3~~	%		~~12.1~~	%
Total theatre operating costs		74.71	%		7175.8	%		~~74.6~~	%		~~73.1~~	%
Average screen count (month end average)		4,~~521~~794			34,~~383~~658			~~4,504~~			~~3,360~~
Revenues per average screen (in dollars)	$	9788,~~326~~815		$	8786,~~225~~101		$	~~181,612~~		$	~~161,026~~

(1)		Excludes depreciation and amortization expense.
(2)		All costs are expressed as a percentage of total revenues, except film rentals and advertising, which are expressed as a percentage of admissions revenues, and concession supplies, which are expressed as a percentage of concession revenues.

Three months ended June 30, 2007 and 2006

Revenues. Total revenues increased $144.9 million to $440.0 million for the three months ended June 30, 2007 (“second quarter of 2007”) from $295.1 million for the three months ended June 30, 2006 (“second quarter of 2006”), a 49.1% increase. The table below, presented by reportable operating segment, summarizes our year-over-year revenue performance and certain key performance indicators that impact our revenues.

								International Operating
	U.S. Operating Segment							Segment							Consolidated
	Three Months Ended							Three Months Ended							Three Months Ended
	June 30,							June 30,							June 30,
					%							%							%
	2007		2006		Change			2007		2006		Change			2007		2006		Change
Admissions revenues (in millions)	$	225.2	$	131.4		71.4	%	$	57.9	$	51.5		12.4	%	$	283.1	$	182.9		54.8	%
Concession revenues (in millions)	$	112.7	$	70.3		60.3	%	$	25.7	$	21.6		19.0	%	$	138.4	$	91.9		50.6	%
Other revenues (in millions) (1)	$	10.3	$	13.8		(25.4	)%	$	8.2	$	6.5		26.2	%	$	18.5	$	20.3		(8.9	)%
Total revenues (in millions) (1)	$	348.2	$	215.5		61.6	%	$	91.8	$	79.6		15.3	%	$	440.0	$	295.1		49.1	%
Attendance (in millions)		38.9		28.3		37.5	%		16.8		16.6		1.2	%		55.7		44.9		24.1	%
Revenues per screen (in dollars) (1)	$	97,870	$	87,659		11.6	%	$	95,317	$	86,072		10.7	%	$	97,326	$	87,225		11.6	%

(1) U.S. operating segment revenues include eliminations of intercompany transactions with the international operating segment. See Note 18 of our condensed consolidated financial statements.

•		Consolidated. The increase in admissions revenues of $100.2 million was attributable to a 24.1% increase in attendance from 44.9 million patrons for the second quarter of 2006 to 55.7 million patrons for the second quarter of 2007, which contributed $49.6 million, and a 25.1% increase in average ticket price from $4.07 for the second quarter of 2006 to $5.09 for the second quarter of 2007, which contributed $50.6 million. The increase in concession revenues of $46.5 million was attributable to the 24.1% increase in attendance, which contributed $26.5 million, and a 21.5% increase in concession revenues per patron from $2.05 for the second quarter of 2006 to $2.49 for the second quarter of 2007, which contributed $20.0 million. The increases in admissions revenues, concession revenues, attendance, average ticket prices and concession revenues per patron were primarily a result of the 77 Century theatres acquired during the fourth quarter of 2006. The $1.8 million, or 8.9% decrease in other revenues was primarily attributable to reduced screen advertising revenues which resulted from the NCM transaction and related Exhibitor Services Agreement amendment.
•		U.S. The increase in admissions revenues of $93.8 million was attributable to a 37.5% increase in attendance from 28.3 million patrons for the second quarter of 2006 to 38.9 million patrons for the second quarter of 2007, which contributed $49.2 million, and a 24.8% increase in average ticket price from $4.64 for the second quarter of 2006 to $5.79 for the second quarter of 2007, which contributed $44.6 million. The increase in concession revenues of $42.4 million was attributable to the 37.5% increase in attendance, which contributed $26.4 million, and a 16.5% increase in concession revenues per patron from $2.49 for the second quarter of 2006 to $2.90 for the second quarter of 2007, which contributed $16.0 million. The increases in admissions revenues, concession revenues, attendance, average ticket prices and concession revenues per patron were primarily a result of the 77 Century theatres acquired. The $3.5 million, or 25.4% decrease in other revenues was primarily attributable to reduced screen advertising revenues which resulted from the NCM transaction and related Exhibitor Services Agreement amendment.

•Three ~~International.~~months ~~The~~ended ~~increase in admissions revenues of $6.4 million was attributable to an 11.6% increase in average ticket price from $3.10 for the second quarter of 2006 to $3.46 for the second quarter of 2007~~March 31, ~~which~~2009 ~~contributed $6.0 million,~~ and a 1.2% increase in attendance, which contributed $0.4 million. The increase in concession revenues of $4.1 million was attributable to an 18.5% increase in concession revenues per patron from $1.30 for the second quarter of 2006 to $1.54 for the second quarter of 2007, which contributed $4.0 million, and a 1.2% increase in attendance, which contributed $0.1 million. The increases in average ticket price and concession revenues per patron were primarily due to price increases and exchange rates. The increase in attendance was primarily due to new theatre openings.2008

~~Theatre~~Revenues. ~~Operating~~Total ~~Costs~~revenues ~~(excludes~~increased ~~depreciation and amortization expense)~~$24.8 million ~~Theatre~~to ~~operating costs were~~ $~~328~~425.78 million, orfor ~~74.7%~~the ofthree ~~revenues~~months ended March 31, ~~for~~2009 ~~the~~(“first ~~second~~ quarter of ~~2007~~2009”) ~~compared~~from to $~~212~~401.0 million, orfor ~~71.8%~~the ofthree ~~revenues,~~months ~~for~~ended ~~the~~March 31, 2008 ~~second~~(“first quarter of ~~2006~~2008”), representing a 6.2% increase. The table below, presented by reportable operating segment, summarizes our year-over-year ~~theatre~~revenue ~~operating~~performance ~~costs.~~and certain key performance indicators that impact our revenues.

					~~International Operating~~			International Operating
	U.S. Operating Segment				~~Segment~~			Segment		~~Consolidated~~					Consolidated
	Three Months Ended				~~Three Months Ended~~			Three Months Ended		~~Three Months Ended~~					Three Months Ended
	June 30,				June 30,					June 30,
	March 31,							March 31,							March 31,
	2007		2006		2007			2006		2007		2006
					%							%							%
Film rentals and advertising	$	129.7	$	73.9	$	29.4		$	26.4	$	159.1	$	100.3
	2009		2008		Change			2009		2008		Change			2009		2008		Change
Concession supplies		16.3		9.2		6.4			5.6		22.7		14.8
Admissions revenues (in millions)	$	225.5	$	202.8		11.2	%	$	54.4	$	59.6		(8.7	)%	$	279.9	$	262.4		6.7	%
Salaries and wages		38.6		21.3		6.8			5.7		45.4		27.0
Concession revenues (in millions)	$	106.0	$	96.7		9.6	%	$	24.0	$	25.5		(5.9	)%	$	130.0	$	122.2		6.4	%
Facility lease expense		40.3		25.5		13.0			11.1		53.3		36.6
Other revenues (in millions) (1)	$	9.1	$	8.4		8.3	%	$	6.8	$	8.0		(15.0	)%	$	15.9	$	16.4		(3.0	)%
Utilities and other		36.3		24.2		11.9			9.1		48.2		33.3
Total revenues (in millions) (1)	$	340.6	$	307.9		10.6	%	$	85.2	$	93.1		(8.5	)%	$	425.8	$	401.0		6.2	%
Total theatre operating costs	$	261.2	$	154.1	$	67.5		$	57.9	$	328.7	$	212.0
Attendance (in millions)		37.3		34.3		8.7	%		16.8		15.4		9.1	%		54.1		49.7		8.9	%
Revenues per screen (in dollars) (1)	$	90,610	$	84,416		7.3	%	$	82,295	$	92,187		(10.7	)%	$	88,815	$	86,101		3.2	%

•		Consolidated. Film rentals and advertising costs were $159.1 million, or 56.2% of admissions revenues, for the second quarter of 2007 compared to $100.3 million, or 54.8% of admissions revenues, for the second quarter of 2006. The increase in film rentals and advertising costs of $58.8 million is due to a $100.2 million increase in admissions revenues, and an increase in our film rentals and advertising rate. The increase in film rentals and advertising costs as a percentage of admissions revenues was due to higher film rental rates on certain blockbuster films released during the second quarter of 2007, three of which grossed over $100 million domestically during their opening weekends. Concession supplies expense was $22.7 million, or 16.4% of concession revenues, for the second quarter of 2007, compared to $14.8 million, or 16.1% of concession revenues, for the second quarter of 2006. The increase in concession supplies expense was primarily due to the 77 Century theatres acquired.
		Salaries and wages increased to $45.4 million for the second quarter of 2007 from $27.0 million for the second quarter of 2006. Facility lease expense increased to $53.3 million for the second quarter of 2007 from $36.6 million for the second quarter of 2006. Utilities and other costs increased to $48.2 million for the second quarter of 2007 from $33.3 million for the second quarter of 2006. Increases in salaries and wages, facility lease expense and utilities and other costs were primarily due to the additional costs related to the 77 Century theatres acquired and new theatre openings. Salaries and wages expense was also impacted by minimum wage increases in certain U.S. states in which we operate.
•		U.S. Film rentals and advertising costs were $129.7 million, or 57.6% of admissions revenues, for the second quarter of 2007 compared to $73.9 million, or 56.2% of admissions revenues, for the second quarter of 2006. The increase in film rentals and advertising costs of $55.8 million is due to a $93.8 million increase in admissions revenues, and an increase in our film rentals and advertising rate. The increase in film rentals and advertising costs as a percentage of admissions revenues was due to higher film rental rates on certain blockbuster films released during the second quarter of 2007, three of which grossed over $100 million domestically during their opening weekends. Concession supplies expense was $16.3 million, or 14.5% of concession revenues, for the second quarter of 2007 compared to $9.2 million, or 13.1% of concession revenues, for the second quarter of 2006. The increase in concession supplies expense was primarily due to the 77 Century theatres acquired.
		Salaries and wages increased to $38.6 million for the second quarter of 2007 from $21.3 million for the second quarter of 2006. Facility lease expense increased to $40.3 million for the second quarter of 2007 from $25.5 million


⁽¹⁾		U.S. operating segment revenues include eliminations of intercompany transactions with the international operating segment. See Note 15 of our condensed consolidated financial statements.

• Consolidated. The increase in admissions revenues of $17.5 million was attributable to an 8.9% increase in attendance from 49.7 million patrons for the first quarter of 2008 to 54.1 million patrons for the first quarter of 2009, partially offset by a 2.1% decrease in average ticket price from $5.28 for the first quarter of 2008 to $5.17 for the first quarter of 2009. The increase in concession revenues of $7.8 million was attributable to the 8.9% increase in attendance, partially offset by a 2.4% decrease in concession revenues per patron from $2.46 for the first quarter of 2008 to $2.40 for the first quarter of 2009. The increase in attendance primarily related to the strong performance of certain films during the first quarter of 2009. The decreases in average ticket price and concession revenues per patron were due to the unfavorable impact of exchange rates in certain countries in which we operate. The 3.0% decrease in other revenues was primarily attributable to the unfavorable impact of exchange rates in certain countries in which we operate.

• U.S. The increase in admissions revenues of $22.7 million was attributable to an 8.7% increase in attendance and a 2.4% increase in average ticket price from $5.91 for the first quarter of 2008 to $6.05 for the first quarter of 2009. The increase in concession revenues of $9.3 million was attributable to the 8.7% increase in attendance and a 0.7% increase in concession revenues per patron from $2.82 for the first quarter of 2008 to $2.84 for the first quarter of 2009. The increase in attendance primarily related to the strong performance of certain films during the first quarter of 2009. The increases in average ticket price and concession revenues per patron were primarily due to price increases.

• International. The decrease in admissions revenues of $5.2 million was attributable to a 16.1% decrease in average ticket price from $3.86 for the first quarter of 2008 to $3.24 for the first quarter of 2009, partially offset by a 9.1% increase in attendance. The decrease in concession revenues of $1.5 million was attributable to a 13.3% decrease in concession revenues per patron from $1.65 for the first quarter of 2008 to $1.43 for the first quarter of 2009, partially offset by the 9.1% increase in attendance. The decreases in average ticket price and concession revenues per patron were due to the unfavorable impact of exchange rates in certain countries in which we operate. The increase in attendance primarily related to the strong performance of certain films during the first quarter of 2009. The 15.0% decrease in other revenues was primarily due to the unfavorable impact of exchange rates in certain countries in which we operate.

		for the second quarter of 2006. Utilities and other costs increased to $36.3 million for the second quarter of 2007 from $24.2 million for the second quarter of 2006. Increases in salaries and wages, facility lease expense and utilities and other costs, were primarily due to the additional costs related to the 77 Century theatres acquired and new theatre openings. Salaries and wages expense was also impacted by minimum wage increases in certain U.S. states in which we operate.
•		International. Film rentals and advertising costs were $29.4 million, or 50.8% of admissions revenues, for the second quarter of 2007 compared to $26.4 million, or 51.3% of admissions revenues, for the second quarter of 2006. The increase in film rentals and advertising costs is primarily due to increased admissions revenues. Concession supplies expense was $6.4 million, or 24.9% of concession revenues, for the second quarter of 2007 compared to $5.6 million, or 25.9% of concession revenues, for the second quarter of 2006. The increase in concession supplies expense was primarily due to increased concession revenues.
		Salaries and wages increased to $6.8 million for the second quarter of 2007 from $5.7 million for the second quarter of 2006 primarily due to new theatre openings. Facility lease expense increased to $13.0 million for the second quarter of 2007 from $11.1 million for the second quarter of 2006 primarily due to new theatre openings. Utilities and other costs increased to $11.9 million for the second quarter of 2007 from $9.1 million for the second quarter of 2006 primarily due to new theatre openings.

Theatre Operating Costs (excludes depreciation and amortization expense). Theatre operating costs were $315.7 million, or 74.1% of revenues, for the first quarter of 2009 compared to $303.9 million, or 75.8% of revenues, for the first quarter of 2008. The table below, presented by reportable operating segment, summarizes our year-over-year theatre operating costs.

General and Administrative Expenses. General and administrative expenses increased to $18.3 million for the second quarter of 2007 from $15.4 million for the second quarter of 2006. The increase was primarily due to increased salaries, consulting fees, and increased service charges related to credit card activity, all of which increased, in part, as a result of the Century Acquisition.


					International Operating
	U.S. Operating Segment				Segment				Consolidated
	Three Months Ended				Three Months Ended				Three Months Ended
	March 31,				March 31,				March 31,
	2009		2008		2009		2008		2009		2008
Film rentals and advertising	$	120.0	$	108.9	$	27.1	$	29.2	$	147.1	$	138.1
Concession supplies		13.4		12.5		6.3		6.2		19.7	$	18.7
Salaries and wages		37.3		35.4		7.1		7.2		44.4	$	42.6
Facility lease expense		42.6		41.5		13.1		14.8		55.7	$	56.3
Utilities and other		36.9		36.3		11.9		11.9		48.8	$	48.2

Total theatre operating costs	$	250.2	$	234.6	$	65.5	$	69.3	$	315.7	$	303.9

~~Termination~~• ofConsolidated. ~~Profit~~Film ~~Participation~~rentals ~~Agreement~~and advertising costs were $147.1 million, ~~Upon~~or ~~consummation~~52.6% of admissions ~~our~~revenues, ~~initial~~for ~~public offering~~the onfirst ~~April~~quarter of 2009 compared to $138.1 24million, ~~2007~~or 52.7% of admissions revenues, wefor ~~exercised~~the ~~our~~first ~~option~~quarter toof ~~terminate~~2008. ~~the~~The ~~amended~~increase ~~and~~in ~~restated~~film ~~profit~~rentals and ~~participation~~advertising ~~agreement~~costs ~~with~~of ~~our~~$9.0 million ~~CEO~~is ~~Alan~~primarily ~~Stock~~due ~~and~~to ~~purchased~~a Mr$17.5 ~~Stock’s~~million ~~interest~~increase in ~~the theatres~~admissions onrevenues, ~~May~~which contributed $9.6 3million, ~~2007~~partially ~~for~~offset by a ~~price~~decrease ofin our film rental and advertising rate. Concession supplies expense was $619.97 million, ~~pursuant~~or to15.2% ~~the~~of ~~terms~~concession revenues, offor the ~~agreement.~~first Inquarter ~~addition~~of 2009, ~~the~~ ~~Company~~compared ~~incurred~~to $018.17 million, ofor ~~payroll~~15.3% ~~taxes~~of ~~related~~concession revenues, tofor the ~~termination~~first quarter of 2008. ~~See~~The ~~Note~~increase 19in concession supplies expense of $1.0 million is primarily due to ~~our~~increased concession revenues, partially offset by a decrease in ~~condensed~~our ~~consolidated~~concession ~~financial~~supplies ~~statements~~rate.

~~Depreciation~~Salaries and ~~Amortization~~wages increased to $44.4 million ~~Depreciation~~for ~~and~~the ~~amortization~~first ~~expense,~~quarter ~~including~~of ~~amortization~~2009 from $42.6 million for the first quarter of ~~favorable~~2008 ~~leases,~~primarily due to increased attendance and new theatre openings, partially offset by the impact of exchange rates in certain countries in which we operate. Facility lease expense decreased to $3755.37 million for the ~~second~~first quarter of ~~2007~~2009 from $2056.03 million for the first quarter of 2008 primarily due to the impact of exchange rates in certain countries in which we operate. Utilities and other costs increased to $48.8 million for the first quarter of 2009 from $48.2 million for the ~~second~~first quarter of ~~2006~~2008 primarily due to increased attendance and new theatre openings, partially offset by the 77impact ~~Century~~of ~~theatres~~exchange ~~acquired~~rates in certain countries in which we operate.

~~Impairment~~• ~~of Long-Lived Assets~~U.S. WeFilm ~~recorded~~rentals ~~asset~~and ~~impairment~~advertising ~~charges~~costs onwere ~~assets held and used of~~ $7120.0 million, or 53.2% of admissions revenues, for the ~~second~~first quarter of ~~2007~~2009 compared to $0108.69 million, ~~during~~or 53.7% of admissions revenues, for the ~~second~~first quarter of ~~2006~~2008. ~~Impairment~~The ~~charges~~increase ~~for~~in ~~the~~film ~~second~~rentals ~~quarter~~and ofadvertising ~~2007~~costs ~~consisted~~ of $111.61 million ofis ~~theatre properties,~~due to a $422.37 million ofincrease ~~goodwill~~in ~~associated~~admissions ~~with~~revenues, ~~theatre~~which ~~properties and~~ contributed $112.12 million, ~~of intangible~~partially ~~assets~~offset ~~associated~~by ~~with~~a ~~theatre~~decrease ~~properties.~~in Weour ~~record~~film ~~goodwill~~rentals atand ~~the~~advertising ~~theatre~~rate. ~~level,~~The ~~which~~decrease ~~results~~ in ~~more~~the ~~volatile~~film ~~impairment~~rentals ~~charges~~and onadvertising anrate ~~annual~~is ~~basis~~primarily due to ~~changes~~reduced inadvertising ~~market~~and ~~conditions~~promotion ~~and~~expense. ~~box~~Concession ~~office~~supplies ~~performance~~expense ~~and~~was $13.4 million for the ~~resulting~~first ~~impact~~quarter onof ~~individual~~2009 and ~~theatres~~$12.5 million ~~Significant judgment~~for isthe ~~involved~~first inquarter ~~estimating~~of ~~cash~~2008. ~~flows~~As ~~and~~a ~~fair~~percentage ~~value.~~of ~~Management’s~~concession ~~estimates~~revenues, concession ~~are~~supplies ~~based~~expense ~~on historical~~decreased ~~and~~from ~~projected~~12.9% ~~operating~~for ~~performance~~the asfirst ~~well~~quarter asof ~~recent~~2008 ~~market~~to ~~transactions~~12.6% ~~See~~for the ~~notes~~first ~~13 and~~quarter 14of to2009 ~~our~~primarily ~~condensed~~due ~~consolidated~~to ~~financial~~increased ~~statements~~concession volume rebates.

~~(Gain)~~Salaries ~~Loss~~and onwages ~~Sale~~increased to $37.3 million for the first quarter of ~~Assets~~2009 ~~and~~from ~~Other~~$35.4 million for Wethe ~~recorded~~first aquarter ~~gain~~of on2008 ~~sale~~primarily ofdue ~~assets~~to increased attendance and ~~other~~new oftheatre openings. Facility lease expense increased to $142.96 million ~~during~~for the ~~second~~first quarter of ~~2007~~2009 ~~compared~~from to$41.5 million afor ~~loss~~the first quarter of 2008 primarily due to new theatre openings. Utilities and other costs increased to $036.89 million ~~during~~for the ~~second~~ first quarter of ~~2006.~~2009 ~~The~~from ~~gain~~$36.3 million ~~recorded~~for ~~during~~ the ~~second~~ first quarter of ~~2007~~2008 ~~was~~ primarily due to aincreased ~~gain recorded~~attendance onand ~~the~~new ~~sale~~theatre ~~of two U~~openings.~~S. theatres.~~

Interest Expense. Interest costs incurred, including amortization of debt issue costs, was $35.3 million for the second quarter of 2007 compared to $22.9 million for the second quarter of 2006. The increase was primarily due to the increased long-term debt related to the financing of the Century Acquisition during the fourth quarter of 2006.

Gain on Fandango transaction. We recorded a gain of $9.2 million as a result of the sale of our investment in stock of Fandango, Inc. See Note 8 to our condensed consolidated financial statements.

Loss on Early Retirement of Debt. We recorded a loss on early retirement of debt of approximately $3.3 million during the second quarter of 2006 related to the repurchase of $10 million aggregate principal amount of our 9% senior subordinated notes and $39.8 million aggregate principal amount at maturity of our 9 3/4% senior discount notes. See Note 11 to our condensed consolidated financial statements.

~~Distributions~~• ~~from~~International. ~~NCM~~Film rentals and advertising costs were $27.1 million, Weor ~~recorded~~49.8% ~~distributions~~of admissions ~~received~~revenues, ~~from~~for ~~NCM~~the first quarter of 2009 compared to $129.42 million, ~~during~~or ~~the~~49.0% of ~~second~~admissions revenues, for the first quarter of ~~2007~~2008. asThe adecrease ~~result~~in film rentals and advertising costs of $2.1 million is primarily due to the ~~mandatory~~$5.2 million ~~quarterly~~decrease ~~distribution~~in ~~required~~admissions revenues ~~under~~that ~~our~~resulted from the unfavorable impact of exchange rates, which contributed $2.5 ~~agreements~~million, ~~with~~partially ~~NCM~~offset by an increase in our film rental and advertising rate. ~~See~~Concession supplies ~~Note~~expense was $6.3 million, or 26.3% of concession revenues, for the first quarter of 2009 compared to ~~our~~$6.2 million, ~~condensed~~or ~~consolidated~~24.3% ~~financial~~of ~~statements~~concession revenues, for the first quarter of 2008. The increase in the concession supplies rate was due to increased concession product costs.

~~Income Taxes.~~Salaries Weand ~~recorded~~wages andecreased ~~income~~to ~~tax~~$7.1 million ~~benefit~~for the first quarter of 2009 from $267.52 million for the ~~second~~first quarter of 2008 primarily due to the impact of exchange rates in certain countries in ~~2007~~which ~~compared~~we operate, partially offset by higher costs due to ~~income~~increased ~~tax~~attendance and new theatre openings. Facility lease expense ofdecreased to $713.31 million ~~recorded~~ for the ~~second~~first quarter of ~~2006.~~2009 from ~~Income~~$14.8 million ~~tax~~for ~~provisions~~the ~~for~~first ~~interim~~quarter ~~(quarterly) period~~of ~~are~~2008 ~~based~~primarily ondue ~~estimated~~to ~~annual~~the ~~income~~impact ~~tax~~of exchange rates in certain countries in which we operate. Utilities and ~~are~~other ~~adjusted~~costs were $11.9 million for the first ~~effects~~quarter of ~~significant,~~2009 ~~infrequent~~and orfor ~~unusual~~the ~~items~~first ~~occurring~~quarter ~~during~~of ~~the interim~~2008, ~~period.~~however, Asour acosts ~~result,~~increased ~~the~~due ~~interim~~to increased ~~rate~~attendance ~~may~~and ~~vary~~new ~~significantly~~theatre ~~from~~openings but the ~~normalized~~increases ~~annual rate.~~were ~~See~~entirely ~~Note~~offset 9by decreases due to ~~our~~the ~~condensed~~impact ~~consolidated~~of ~~financial~~exchange ~~statements~~rates.

~~Six~~ General ~~months~~and ~~ended~~Administrative ~~June~~Expenses. General and administrative expenses increased to $21.5 million for the first quarter of 2009 from $20.3 30million for the first quarter of 2008. The increase was primarily due to increased salaries and incentive compensation expense, ~~2007~~increased share based award compensation expense and ~~2006~~increased service charges related to increased credit card activity.

~~Revenues~~ Depreciation and Amortization. ~~Total~~Depreciation ~~revenues~~and ~~increased~~amortization ~~$276.9 million~~expense, toincluding amortization of favorable/ unfavorable leases, was $~~818~~36.05 million for the ~~six~~first ~~months~~quarter ~~ended June 30,~~of ~~2007~~2009 ~~(“the~~compared ~~2007~~to ~~period”) from~~ $~~541~~38.1 million for the ~~six~~first ~~months~~quarter ~~ended~~of ~~June 30, 2006 (“the 2006 period”), a 51~~2008.2% ~~increase.~~ The ~~table~~decrease ~~below,~~was ~~presented~~primarily byrelated ~~reportable~~to ~~operating~~the ~~segment, summarizes~~impact ~~our~~of ~~year-over-year~~exchange rates ~~revenue~~in ~~performance and~~ certain ~~key~~countries ~~performance~~in ~~indicators~~which ~~that impact~~we ~~our revenues~~operate.

								International Operating
	U.S. Operating Segment							Segment							Consolidated
	Six Months Ended							Six Months Ended							Six Months Ended
	June 30,							June 30,							June 30,
					%							%							%
	2007		2006		Change			2007		2006		Change			2007		2006		Change
Admissions revenues (in millions)	$	422.7	$	242.4		74.4	%	$	104.4	$	94.1		10.9	%	$	527.1	$	336.5		56.6	%
Concession revenues (in millions)	$	208.2	$	130.7		59.3	%	$	45.3	$	39.3		15.3	%	$	253.5	$	170.0		49.1	%
Other revenues (in millions) (1)	$	23.1	$	23.0		0.4	%	$	14.3	$	11.6		23.3	%	$	37.4	$	34.6		8.1	%
Total revenues (in millions) (1)	$	654.0	$	396.1		65.1	%	$	164.0	$	145.0		13.1	%	$	818.0	$	541.1		51.2	%
Attendance (in millions)		73.9		52.9		39.7	%		31.0		30.5		1.6	%		104.9		83.4		25.8	%
Revenues per screen (in dollars) (1)	$	184,569	$	162,302		13.7	%	$	170,709	$	157,641		8.3	%	$	181,612	$	161,026		12.8	%

Impairment of Long-Lived Assets. We recorded asset impairment charges on assets held and used of $1.0 million for the first quarter of 2009 compared to $4.5 million during the first quarter of 2008. Impairment charges for the first quarter of 2009 consisted of $0.8 million of U.S. theatre properties, $0.1 million of Mexico theatre properties and $0.1 million of intangible assets associated with Mexico theatre properties. Impairment charges for the first quarter of 2008 consisted of $4.5 million for U.S. theatre properties.

~~(1)~~ Interest UExpense.S Interest costs incurred, including amortization of debt issue costs, were $25.5 million ~~operating~~for ~~segment~~the ~~revenues~~first ~~include~~quarter ~~eliminations~~of 2009 compared to $32.1 million for the first quarter of 2008. ~~intercompany~~The ~~transactions~~decrease ~~with~~was primarily due to the ~~international~~repurchase ~~operating~~of ~~segment~~$47.0 million ~~See~~aggregate ~~Note~~principal 18amount at maturity of our ~~condensed~~9 ~~consolidated~~3/4% ~~financial~~senior ~~statements~~discount notes between March 2008 and December 2008 and a reduction in the variable interest rates on a portion of our long-term debt.

•		Consolidated. The increase in admissions revenues of $190.6 million was attributable to a 25.8% increase in attendance from 83.4 million patrons for the 2006 period to 104.9 million patrons for the 2007 period, which contributed $97.4 million, and a 24.8% increase in average ticket price from $4.03 for the 2006 period to $5.03 for the 2007 period, which contributed $93.2 million. The increase in concession revenues of $83.5 million was attributable to the 25.8% increase in attendance, which contributed $52.4 million, and an 18.6% increase in concession revenues per patron from $2.04 for the 2006 period to $2.42 for the 2007 period, which contributed $31.1 million. The increases in admissions revenues, concession revenues, attendance, average ticket prices and concession revenues per patron were primarily due to the 77 Century theatres acquired during the fourth quarter of 2006. The 8.1% increase in other revenues was primarily attributable to incremental screen advertising revenues resulting from the 77 Century theatres acquired.
•		U.S. The increase in admissions revenues of $180.3 million was attributable to a 39.7% increase in attendance from 52.9 million patrons for the 2006 period to 73.9 million patrons for the 2007 period, which contributed $95.8 million, and a 24.9% increase in average ticket price from $4.58 for the 2006 period to $5.72 for the 2007 period, which contributed $84.5 million. The increase in concession revenues of $77.5 million was attributable to the 39.7% increase in attendance, which contributed $51.7 million, and a 14.2% increase in concession revenues per patron from $2.47 for the 2006 period to $2.82 for the 2007 period, which contributed $25.8 million. The increase in admissions revenues, concession revenues, attendance, average ticket prices and concession revenues per patron were primarily a result of the 77 Century theatres acquired.

Distributions from NCM. We recorded distributions from NCM of $6.6 million during the first quarter of 2009 and $5.2 million during the first quarter of 2008, which were in excess of the carrying value of our investment. See Note 5 to our condensed consolidated financial statements.

Income Taxes. Income tax expense of $14.7 million was recorded for the first quarter of 2009 compared to $3.4 million recorded for the first quarter of 2008. The effective tax rate was 44.3% for the first quarter of 2009 compared to 36.1% for the first quarter of 2008.

~~Table~~Item 4T. ofControls ~~Contents~~and Procedures

• International. The increase in admissions revenues of $10.3 million was attributable to a 9.1% increase in average ticket price from $3.09 for the 2006 period to $3.37 for the 2007 period, which contributed $8.7 million, and a 1.6% increase in attendance, which contributed $1.6 million. The increase in concession revenues of $6.0 million was attributable to a 13.2% increase in concession revenues per patron from $1.29 for the 2006 period to $1.46 for the 2007 period, which contributed $5.3 million, and a 1.6% increase in attendance, which contributed $0.7 million. The increases in average ticket price and concession revenues per patron were primarily due to price increases and exchange rates. The increase in attendance was primarily due to new theatre openings.

Theatre Operating Costs (excludes depreciation and amortization expense). Theatre operating costs were $610.4 million, or 74.6% of revenues, for the 2007 period compared to $395.5 million, or 73.1% of revenues, for the 2006 period. The table below, presented by reportable operating segment, summarizes our year-over-year theatre operating costs.

					International Operating
	U.S. Operating Segment				Segment				Consolidated
	Six Months Ended				Six Months Ended				Six Months Ended
	June 30,				June 30,				June 30,
	2007		2006		2007		2006		2007		2006
Film rentals and advertising	$	235.2	$	132.1	$	52.2	$	47.1	$	287.4	$	179.2
Concession supplies		28.7		16.8		11.4		10.0		40.1		26.8
Salaries and wages		73.0		40.5		12.6		11.0		85.6		51.5
Facility lease expense		80.2		50.6		24.7		21.9		104.9		72.5
Utilities and other		70.6		47.2		21.8		18.3		92.4		65.5
Total theatre operating costs	$	487.7	$	287.2	$	122.7	$	108.3	$	610.4	$	395.5

•		Consolidated. Film rentals and advertising costs were $287.4 million, or 54.5% of admissions revenues, for the 2007 period compared to $179.2 million, or 53.3% of admissions revenues, for the 2006 period. The increase in film rentals and advertising costs of $108.2 million is due to a $190.6 million increase in admissions revenues and an increase in our film rentals and advertising rate. The increase in film rentals and advertising costs as a percentage of admissions revenues was due to higher film rental rates on certain films in the 2007 period compared with the 2006 period. Concession supplies expense was $40.1 million, or 15.8% of concession revenues, for the 2007 period, compared to $26.8 million, or 15.8% of concession revenues, for the 2006 period. The increase in concession supplies expense was primarily due to the 77 Century theatres acquired.
		Salaries and wages increased to $85.6 million for the 2007 period from $51.5 million for the 2006 period. Facility lease expense increased to $104.9 million for the 2007 period from $72.5 million for the 2006 period. Utilities and other costs increased to $92.4 million for the 2007 period from $65.5 million for the 2006 period. Increases in salaries and wages, facility lease expense and utilities and other costs were primarily due to the additional costs related to the 77 Century theatres acquired and new theatre openings. Salaries and wages expense was also impacted by minimum wage increases in certain U.S. states in which we operate.
•		U.S. Film rentals and advertising costs were $235.2 million, or 55.6% of admissions revenues, for the 2007 period compared to $132.1 million, or 54.5% of admissions revenues, for the 2006 period. The increase in film rentals and advertising costs of $103.1 million is due to a $180.3 million increase in admissions revenues, and an increase in our film rentals and advertising rate. The increase in film rentals and advertising costs as a percentage of admissions revenues was due to higher film rental rates on certain films in the 2007 period compared with the 2006 period. Concession supplies expense was $28.7 million, or 13.8% of concession revenues, for the 2007 period compared to $16.8 million, or 12.9% of concession revenues, for the 2006 period. The increase in concession supplies expense was primarily due to the 77 Century theatres acquired.
		Salaries and wages increased to $73.0 million for the 2007 period from $40.5 million for the 2006 period. Facility lease expense increased to $80.2 million for the 2007 period from $50.6 million for the 2006 period. Utilities and other costs increased to $70.6 million for the 2007 period from $47.2 million for the 2006 period. Increases in salaries and wages, facility lease expense and utilities and other costs were primarily due to the additional costs

		related to the 77 Century theatres acquired and new theatre openings. Salaries and wages expense was also impacted by minimum wage increases in certain U.S. states in which we operate.
•		International. Film rentals and advertising costs were $52.2 million, or 50.0% of admissions revenues, for the 2007 period compared to $47.1 million, or 50.1% of admissions revenues, for the 2006 period. The increase in film rentals and advertising costs is primarily due to increased admissions revenues. Concession supplies expense was $11.4 million, or 25.2% of concession revenues, for the 2007 period compared to $10.0 million, or 25.4% of concession revenues, for the 2006 period. The increase in concession supplies expense is primarily due to increased concession revenues.
		Salaries and wages increased to $12.6 million for the 2007 period from $11.0 million for the 2006 period primarily due to new theatre openings. Facility lease expense increased to $24.7 million for the 2007 period from $21.9 million for the 2006 period primarily due to new theatre openings. Utilities and other costs increased to $21.8 million for the 2007 period from $18.2 million for the 2006 period primarily due to new theatre openings.

General and Administrative Expenses. General and administrative expenses increased to $36.9 million for the 2007 period from $29.5 million for the 2006 period. The increase was primarily due to increased salaries, consulting fees, and increased service charges related to credit card activity, all of which increased, in part, as a result of the Century Acquisition.

Termination of Profit Participation Agreement. Upon consummation of our initial public offering on April 24, 2007, we exercised our option to terminate the amended and restated profit participation agreement with our CEO Alan Stock and purchased Mr. Stock’s interest in the theatres on May 3, 2007 for a price of $6.9 million pursuant to the terms of the agreement. In addition, the Company incurred $0.1 million of payroll taxes related to the termination. See Note 19 to our condensed consolidated financial statements.

Depreciation and Amortization. Depreciation and amortization expense, including amortization of favorable leases, was $75.2 million for the 2007 period compared to $40.2 million for the 2006 period primarily due to the 77 Century theatres acquired.

Impairment of Long-Lived Assets. We recorded asset impairment charges on assets held and used of $56.8 million for the 2007 period compared to $0.9 million during the 2006 period. Impairment charges for the 2007 period consisted of $8.0 million of theatre properties, $45.1 million of goodwill associated with theatre properties and $3.7 million of intangible assets associated with theatre properties. We record goodwill at the theatre level, which results in more volatile impairment charges on an annual basis due to changes in market conditions and box office performance and the resulting impact on individual theatres. 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. See notes 6, 13 and 14 to our condensed consolidated financial statements. See also discussion of gain on NCM Transaction.

(Gain) Loss on Sale of Assets and Other. We recorded a gain on sale of assets and other of $1.6 million during the 2007 period compared to a loss of $1.5 million during the 2006 period. The gain for the 2007 period was primarily due to a gain recorded on the sale of two U.S. theatres.

Interest Expense. Interest costs incurred, including amortization of debt issue costs, was $76.8 million for the 2007 period compared to $46.0 million for the 2006 period. The increase was primarily due to the increased long-term debt related to the financing of the Century Acquisition during the fourth quarter of 2006.

Gain on NCM transaction. We recorded a gain of $210.8 million on the sale of a portion of our equity investment in NCM in conjunction with the initial public offering of NCM, Inc. during the 2007 period. Our ownership interest in NCM was reduced from approximately 25% to approximately 14% as part of this sale of stock in the offering. See Note 6 to our condensed consolidated financial statements.

Gain on Fandango transaction. We recorded a gain of $9.2 million as a result of the sale of our investment in stock of Fandango, Inc. See Note 8 to our condensed consolidated financial statements.

Loss on Early Retirement of Debt. We recorded a loss on early retirement of debt of $8.0 million during the 2007 period, which consisted of tender offer repurchase costs, including premiums paid and other fees, and the write-off of unamortized debt issue costs, partially offset by the write-off of the unamortized bond premium, associated with the repurchase of a total of $332.1 million aggregate principal amount of our 9% senior subordinated notes during March and April 2007. We recorded a loss on early retirement of debt of approximately $3.3 million during the 2006 period related to the repurchase of $10 million aggregate principal amount of our 9% senior subordinated notes and $39.8 million aggregate principal amount at maturity of our 9 3/4% senior discount notes. See Note 11 to our condensed consolidated financial statements.

Distributions from NCM. We recorded distributions received from NCM of $1.4 million during the 2007 period as a result of the mandatory quarterly distribution required under our agreements with NCM. See Note 6 to our condensed consolidated financial statements.

Income Taxes. We recorded income tax expense of $8.9 million for the 2007 period compared to $4.9 million recorded for the 2006 period. The effective tax rate was 5.1% for the 2007 period and 18.8% for the 2006 period. See Note 9 to our condensed consolidated financial statements.

Cautionary Statement Regarding Forward-Looking Statements

This quarterly report on Form 10-Q includes “forward-looking statements” based on our current expectations, assumptions, estimates, and projections about our and our subsidiaries’ business and industry. We intend that this quarterly report be governed by the “safe harbor” provision of the Private Securities Litigation Reform Act of 1995 (the “PSLR Act”) with respect to statements that may be deemed to be forward-looking statements under the PSLR Act. They include statements relating to:

• future revenues, expenses and profitability; • the future development and expected growth of our business; • projected capital expenditures; • attendance at movies generally, or in any of the markets in which we operate; • the number or diversity of popular movies released; • our ability to successfully license and exhibit popular films; • competition from other exhibitors; and • determinations in lawsuits in which we are a defendant.

You can identify forward-looking statements by the use of words such as “may,” “should,” “could,” “estimates,” “predicts,” “potential,” “continue,” “anticipates,” “believes,” “plans,” “expects,” “future” and “intends” and similar expressions which are intended to identify 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. In evaluating these forward-looking statements, you should carefully consider the risks and uncertainties described in this report. These forward-looking statements reflect our view only as of the date of this report. Actual results could differ materially from those indicated by such forward-looking statements due to a number of factors. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement. We undertake no current obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

WeAs ~~maintain~~of aMarch 31, ~~system~~2009, ofwe ~~controls~~carried ~~and~~out ~~other~~an ~~procedures~~evaluation ~~designed~~required toby ~~ensure~~the ~~that~~1934 ~~information~~Act, under the ~~required~~supervision toand bewith ~~disclosed~~the inparticipation of our ~~periodic~~principal ~~reports~~executive ~~filed~~officer ~~under~~and ~~the~~principal ~~Securities~~financial officer, ~~Exchange~~of ~~Act~~the effectiveness of ~~1934 (~~the ~~“Exchange~~design ~~Act”),~~and asoperation ~~amended,~~of isour ~~recorded,~~disclosure ~~processed~~controls and procedures, ~~summarized~~as ~~and~~defined ~~reported~~in ~~within~~Rule 13a-15(e) of the ~~time periods~~1934 ~~specified~~Act. inBased ~~the~~on ~~Securities~~this ~~and~~evaluation, ~~Exchange~~our ~~Commission’s~~principal executive ~~rules~~officer and ~~forms.~~principal ~~These~~financial ~~disclosure~~officer concluded that, as of March 31, 2009, our disclosure controls and procedures ~~have~~were ~~been~~effective ~~evaluated~~to ~~under~~provide ~~the~~reasonable ~~direction~~assurance ofthat ~~our~~information required ~~Chief~~to ~~Executive~~be ~~Officer~~disclosed ~~and Chief~~by ~~Financial~~us ~~Officer~~in ~~for~~ the ~~period~~reports ~~covered~~that bywe ~~this~~file ~~report.~~or ~~Based~~submit onunder ~~such~~the ~~evaluations,~~1934 ~~the~~Act is ~~Chief~~recorded, ~~Executive~~processed, ~~Officer~~summarized, and ~~Chief~~reported ~~Financial~~within ~~Officer~~the ~~have~~time ~~concluded~~periods ~~that~~specified in the ~~disclosure~~SEC’s ~~controls~~rules and forms and ~~procedures~~ ~~are~~were effective into ~~alerting~~provide ~~them~~reasonable inassurance athat ~~timely~~such ~~basis~~information tois ~~material~~accumulated and ~~information~~communicated ~~relating~~ to ~~the Company~~our ~~and~~management, ~~its~~including ~~consolidated~~our ~~subsidiaries~~principal ~~required~~executive toofficer beand ~~included~~principal financial inofficer, ~~our~~as ~~reports~~appropriate ~~filed~~to orallow ~~submitted under~~timely ~~the~~decisions ~~Exchange~~regarding ~~Act~~required disclosures.

Changes in Internal Controls Over Financial Reporting

There have been no ~~material~~ changes in our ~~system~~internal ofcontrol ~~internal~~over ~~controls~~financial orreporting identified in connection ~~other~~with ~~factors~~the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 that occurred during the quarter ended March 31, 2009 that ~~could~~materially ~~significantly~~affected, ~~affect~~or ~~internal~~are ~~controls~~reasonably ~~within~~likely ~~the~~to materially ~~period~~affect, ~~covered~~our byinternal ~~this~~control ~~report~~over financial reporting.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

Previously reported under ~~Item 3~~“Business of— Legal Proceedings” in the Company’s Annual Report on Form 10-K ~~for~~filed ~~the fiscal year ended December~~March 3113, ~~2006~~2009.

Item 1A. Risk Factors

There have been no material changes from risk factors previously disclosed in ~~Item 1A.~~“Risk ~~to Part~~Factors” Iin of the Company’s Annual Report on Form 10-K ~~for~~filed ~~the year ended December~~March 3113, ~~2006~~2009.

Item 5. Other Information

	Page
Supplemental Schedules Specified by the senior discount notes Indenture:
Condensed Consolidating Balance Sheet Information as of June 30, 2007 (unaudited)		31
Condensed Consolidating Statements of Income Information for the six months ended June 30, 2007 (unaudited)		32
Condensed Consolidating Statements of Cash Flows Information for the six months ended June 30, 2007 (unaudited)		33

Supplemental Schedules specified by the senior discount notes Indenture:


		Page
Condensed Consolidating Balance Sheet Information as of March 31, 2009 (unaudited)		28

Condensed Consolidating Statement of Income Information for the three months ended March 31, 2009 (unaudited)		29

Condensed Consolidating Statement of Cash Flows Information for the three months ended March 31, 2009 (unaudited)		30

SUPPLEMENTAL SCHEDULES REQUIRED BY THE INDENTURE FOR THE
SENIOR DISCOUNT NOTES

As required by the Indenture governing the Company’s 9³/4% senior discount notes, the Company has included in this filing, interim financial information for its subsidiaries that have been designated as unrestricted subsidiaries, as defined by the indenture. As required by the Indenture, the Company has included a condensed consolidating balance sheet and condensed consolidating statements of income and cash flows for the Company and its subsidiaries. These supplementary schedules separately identify the Company’s restricted subsidiaries and unrestricted subsidiaries as required by the Indenture.

CINEMARK, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE ~~SHEETS~~SHEET

ASMARCH ~~OF JUNE 30~~31, ~~2007~~2009

(In thousands, unaudited)

	Restricted		Unrestricted
	Group		Group			Eliminations			Consolidated
ASSETS
Assets
CURRENT ASSETS
Current Assets
Cash and cash equivalents	$	~~123~~279,~~177~~069	$	1526,~~091~~134		$	—		$	~~138~~305,~~268~~203
Other current assets		5341,~~446~~088		~~(1,338~~6	)		—			5241,~~108~~094
Total current assets		~~176~~320,~~623~~157		1326,~~753~~140			—			~~190~~346,~~376~~297
THEATRE PROPERTIES AND EQUIPMENT — net		1,338,566		—			—			1,338,566
Theatre properties and equipment, net		1,227,048		—			—			1,227,048
OTHER ASSETS		1,591,230		1,265			(8,225	)		1,584,270
Other assets		1,503,429		16,877			(8,225	)		1,512,081
TOTAL ASSETS	$	3,106,419	$	15,018		$	(8,225	)	$	3,113,212
Total assets	$	3,050,634	$	43,017		$	(8,225	)	$	3,085,426
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities and Stockholder’s Equity
CURRENT LIABILITIES
Current Liabilities
Current portion of long-term debt	$	1312,~~954~~540	$	—		$	—		$	1312,~~954~~540
Current portion of capital lease obligations		36,~~944~~642		—			—			36,~~944~~642
Income tax payable		35,436		(279	)		—			35,157
Accounts payable and accrued expenses		184,202		—			—			184,202
Accounts payable and accrued expenses		189,078		—			—			189,078
Total current liabilities		203,384		—			—			203,384
Total current liabilities		242,412		(279	)		—			242,133
Long-term liabilities
LONG-TERM LIABILITIES
Long-term debt, less current portion		1,500,996		—			—			1,500,996
Long-term debt, excluding current portion		1,561,227		—			—			1,561,227
Other long-term liabilities		559,879		—			—			559,879
Other long-term liabilities		510,457		—			(95,916	)		414,541
Total long-term liabilities		2,060,875		—			—			2,060,875
Total long-term liabilities		2,071,684		—			(95,916	)		1,975,768
Commitments and Contingencies
COMMITMENTS AND CONTINGENCIES
Stockholder’s Equity		786,375		43,017			(8,225	)		821,167
MINORITY INTERESTS IN SUBSIDIARIES		17,300		—			—			17,300
Total liabilities and stockholder’s equity	$	3,050,634	$	43,017		$	(8,225	)	$	3,085,426
STOCKHOLDERS’ EQUITY		775,023		15,297			87,691			878,011
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	3,106,419	$	15,018		$	(8,225	)	$	3,113,212


Note:		“Restricted Group” and “Unrestricted Group” are defined in the Indenture for the senior discount notes.

3128

CINEMARK, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING ~~STATEMENTS~~STATEMENT OF INCOME

~~SIX~~THREE MONTHS ENDED ~~JUNE~~MARCH 3031, ~~2007~~2009

(In thousands, unaudited)

	Restricted			Unrestricted
	Group			Group			Eliminations			Consolidated
REVENUES	$	818,058		$	—		$	—		$	818,058
Revenues	$	425,800		$	—		$	—		$	425,800
COST OF OPERATIONS
Cost of Operations
Theatre operating costs		~~610~~315,~~439~~659			—			—			~~610~~315,~~439~~659
General and administrative expenses and other		43,871			18			—			43,889
General and administrative expenses		21,465			(3	)		—			21,462
Depreciation and amortization		7536,~~154~~456			—			—			7536,~~154~~456
Impairment of long-lived assets		561,~~766~~039			—			—			561,~~766~~039
Gain on sale of assets and other		(1,559	)		—			—			(1,559	)
Loss on sale of assets and other		272			—			—			272
Total cost of operations		~~784~~374,~~671~~891			18(3	)		—			~~784~~374,~~689~~888
OPERATING INCOME (LOSS)		33,387			(18	)		—			33,369
Operating income		50,909			3			—			50,912
OTHER INCOME		48,524			211,887			(120,000	)		140,411
Other income (expense)		(23,637	)		5,955			—			(17,682	)
INCOME BEFORE TAXES		81,911			211,869			(120,000	)		173,780
Income before income taxes		27,272			5,958			—			33,230
Income taxes		2212,~~918~~487			812,~~935~~246			~~(95,916~~—	)		814,~~937~~733
NET INCOME	$	58,993		$	129,934		$	(24,084	)	$	164,843
Net income		14,785			3,712			—			18,497
Less: Net income attributable to noncontrolling interests		786			—			—			786
Net income attributable to Cinemark, Inc.	$	13,999		$	3,712		$	—		$	17,711


Note:		“Restricted Group” and “Unrestricted Group” are defined in the Indenture for the senior discount notes.

3229

CINEMARK, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATING ~~STATEMENTS~~STATEMENT OF CASH FLOWS

~~SIX~~THREE MONTHS ENDED ~~JUNE~~MARCH 3031, ~~2007~~2009

(In thousands, unaudited)

	Restricted			Unrestricted
	Group			Group			Eliminations			Consolidated
OPERATING ACTIVITIES
Operating Activities
Net income	$	5814,~~993~~785		$	~~129~~3,~~934~~712		$	~~(24,084~~—	)	$	~~164~~18,~~843~~497
Noncash items in net income		101,635			(209,255	)		(95,916	)		(203,536	)
Adjustments to reconcile net income to cash provided by operating activities and other		53,650			1,089			—			54,739
Changes in assets and liabilities		~~202~~(23,~~051~~761	)		12,~~062~~212			—			~~203~~(21,~~113~~549	)
Net cash provided by (used for) operating activities		362,679			(78,259	)		(120,000	)		164,420
Net cash provided by operating activities		44,674			7,013			—			51,687
INVESTING ACTIVITIES
Investing Activities
Additions to theatre properties and equipment		(7322,~~148~~872	)		—			—			(7322,~~148~~872	)
Proceeds from sale of theatre properties and equipment		~~13,915~~510			—			—			~~13,915~~510
Net proceeds from sale of NCM stock		—			214,842			—			214,842
Acquisition of theatres in the U.S.		(48,950	)		—			—			(48,950	)
Net proceeds from sale of Fandango stock		11,347			—			—			11,347
Net cash used for investing activities		(71,312	)		—			—			(71,312	)
Investment in joint venture — DCIP		—			(1,500	)		—			(1,500	)
Financing Activities
Net cash provided by (used for) investing activities		(47,886	)		213,342			—			165,456
Capital contribution from parent		16,000			—			—			16,000
FINANCING ACTIVITIES
Repayments of long-term debt		(3,147	)		—			—			(3,147	)
Retirement of senior subordinated notes		(332,066	)		—			—			(332,066	)
Payments on capital leases		(1,299	)		—			—			(1,299	)
Repayments of long-term debt		(7,200	)		—			—			(7,200	)
Other		(94	)		—			—			(94	)
Dividends paid to parent		—			(120,000	)		120,000			—
Net cash provided by financing activities		11,460			—			—			11,460
Other		(1,968	)		—			—			(1,968	)
Effect of exchange rate changes on cash and cash equivalents		(319	)		—			—			(319	)
Net cash used for financing activities		(341,234	)		(120,000	)		120,000			(341,234	)
Increase (decrease) in cash and cash equivalents		(15,497	)		7,013			—			(8,484	)
Effect of exchange rate changes on cash and cash equivalents		2,527			—			—			2,527
Cash and cash equivalents:
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(23,914	)		15,083			—			(8,831	)
Beginning of year		294,566			19,121			—			313,687
Beginning of period		147,091			8			—			147,099
End of year	$	279,069		$	26,134		$	—		$	305,203
End of period	$	123,177		$	15,091		$	—		$	138,268


Note:		“Restricted Group” and “Unrestricted Group” are defined in the Indenture for the senior discount notes.

3330

Item 6. Exhibits

Number		Exhibit Title
*31.1		Certification of Alan Stock, Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
2.1		Stock Contribution and Exchange Agreement, dated as of August 7, 2006, by and between Cinemark Holdings, Inc., Cinemark, Inc., Syufy Enterprises, LP and Century Theatres Holdings, LLC (incorporated by reference to Exhibit 10.2 to Cinemark USA, Inc.’s Current Report on Form 8-K, File No. 033-47040, filed August 11, 2006).
*31.2		Certification of Robert Copple, Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
2.2		Contribution and Exchange Agreement, dated as of August 7, 2006, by and among Cinemark Holdings, Inc. and Lee Roy Mitchell, The Mitchell Special Trust, Alan W. Stock, Timothy Warner, Robert Copple, Michael Cavalier, Northwestern University, John Madigan, Quadrangle Select Partners LP, Quadrangle Capital Partners A LP, Madison Dearborn Capital Partners IV, L.P., K&E Investment Partners, LLC — 2004-B-DIF, Piola Investments Ltd., Quadrangle (Cinemark) Capital Partners LP and Quadrangle Capital Partners LP (incorporated by reference to Exhibit 10.3 to Cinemark USA, Inc.’s Current Report on Form 8-K, File No. 033-47040, filed August 11, 2006).
*32.1		Certification of Alan Stock, Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as added by Section 906 of the Sarbanes-Oxley Act of 2002.
2.3		Agreement and Plan of Merger dated March 12, 2004, by and between Cinemark, Inc. and Popcorn Merger Corp. (incorporated by reference to Exhibit 2.1 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
*32.2		Certification of Robert Copple, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as added by Section 906 of the Sarbanes-Oxley Act of 2002.
2.4		Stock Purchase Agreement dated as of March 12, 2004 by and between Cinemark, Inc. and Madison Dearborn Capital Partners IV, L.P. (incorporated by reference to Exhibit 2.2 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
3.1		Second Amended and Restated Certificate of Incorporation of Cinemark, Inc. filed with the Delaware Secretary of State on April 2, 2004 (incorporated by reference to Exhibit 3.1 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
3.2		Amended and Restated Bylaws of Cinemark, Inc. (incorporated by reference to Exhibit 3.2 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
4.1		Exchange and Registration Rights Agreement dated March 31, 2004 among Cinemark, Inc., certain subsidiary guarantors party thereto and the initial purchasers named therein (incorporated by reference to Exhibit 4.1 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
4.2(a)		Indenture, dated as of March 31, 2004, between Cinemark, Inc. and The Bank of New York Trust Company, N.A. governing the 9 3/4% senior discount notes issued thereunder (incorporated by reference to Exhibit 4.2(a) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
4.2(b)		Form of 9 3/4% senior discount notes (contained in the indenture listed as Exhibit 4.2(a) above) (incorporated by reference to Exhibit 4.2(b) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
4.3(a)		Indenture, dated as of February 11, 2003, between Cinemark USA, Inc. and The Bank of New York Trust Company of Florida, N.A. governing the 9% senior subordinated notes issued thereunder (incorporated by reference to Exhibit 10.2(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 19, 2003).
4.3(b)		First Supplemental Indenture, dated as of May 7, 2003, between Cinemark USA, Inc., the subsidiary guarantors party thereto and The Bank of New York Trust Company of Florida, N.A. (incorporated by reference from Exhibit 4.2(i) to Cinemark USA, Inc.’s Registration Statement on Form S-4/A, File No. 333-104940, filed May 28, 2003).
4.3(c)		Second Supplemental Indenture dated as of November 11, 2004, between Cinemark USA, Inc., the subsidiary guarantors party thereto and The Bank of New York Trust Company of Florida, N.A. (incorporated by reference to Exhibit 4.2(c) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-047040, filed March 28, 2005).
4.3(d)		Third Supplemental Indenture, dated as of October 5, 2006, among Cinemark USA, Inc., the subsidiaries of Cinemark USA, Inc. named therein, and The Bank of New York Trust Company, N.A., as trustee (incorporated by reference to Exhibit 10.7 to Cinemark USA, Inc.’s Current Report on Form 8-K, File No. 033-47040, filed October 12, 2006).
4.3(e)		Fourth Supplemental Indenture, dated March 20, 2007, among Cinemark USA, Inc. and the subsidiaries of Cinemark USA, Inc. named therein, and the Bank of New York Trust Company, N.A. (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, File No. 033-47040, filed by Cinemark USA, Inc. on March 26, 2007).
4.3(f)		Form of 9% Senior Subordinated Note, Due 2013 (contained in the Indenture listed as Exhibit 4.3(a) above) (incorporated by reference to Exhibit 10.2(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 19, 2003).
*31.1		Certification of Chief Executive Officer of Cinemark, Inc., pursuant to Section 302 of the Sarbanes Oxley Act of 2002.
*31.2		Certification of Chief Financial Officer of Cinemark, Inc. pursuant to Section 302 of the Sarbanes Oxley Act of 2002.

Number		Exhibit Title
*32.1		Certification of Chief Executive Officer of Cinemark, Inc. pursuant to Section 906 of the Sarbanes Oxley Act of 2002.
*32.2		Certification of Chief Financial Officer of Cinemark, Inc. pursuant to Section 906 of the Sarbanes Oxley Act of 2002.


*		filed herewith.

3531

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

DATE: August 13, 2007	CINEMARK, INC. Registrant
DATE: May 7, 2009	CINEMARK, INC. Registrant
	/s/ Alan W. Stock
	Alan W. Stock
	Chief Executive Officer
	/s/ Robert Copple
	Robert Copple
	Chief Financial Officer

3632

EXHIBIT INDEX

Number		Exhibit Title
2.1		Stock Contribution and Exchange Agreement, dated as of August 7, 2006, by and between Cinemark Holdings, Inc., Cinemark, Inc., Syufy Enterprises, LP and Century Theatres Holdings, LLC (incorporated by reference to Exhibit 10.2 to Cinemark USA, Inc.’s Current Report on Form 8-K, File No. 033-47040, filed August 11, 2006).
*31.1		Certification of Alan Stock, Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
2.2		Contribution and Exchange Agreement, dated as of August 7, 2006, by and among Cinemark Holdings, Inc. and Lee Roy Mitchell, The Mitchell Special Trust, Alan W. Stock, Timothy Warner, Robert Copple, Michael Cavalier, Northwestern University, John Madigan, Quadrangle Select Partners LP, Quadrangle Capital Partners A LP, Madison Dearborn Capital Partners IV, L.P., K&E Investment Partners, LLC — 2004-B-DIF, Piola Investments Ltd., Quadrangle (Cinemark) Capital Partners LP and Quadrangle Capital Partners LP (incorporated by reference to Exhibit 10.3 to Cinemark USA, Inc.’s Current Report on Form 8-K, File No. 033-47040, filed August 11, 2006).
*31.2		Certification of Robert Copple, Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
2.3		Agreement and Plan of Merger dated March 12, 2004, by and between Cinemark, Inc. and Popcorn Merger Corp. (incorporated by reference to Exhibit 2.1 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
*32.1		Certification of Alan Stock, Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as added by Section 906 of the Sarbanes-Oxley Act of 2002.
2.4		Stock Purchase Agreement dated as of March 12, 2004 by and between Cinemark, Inc. and Madison Dearborn Capital Partners IV, L.P. (incorporated by reference to Exhibit 2.2 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
*32.2		Certification of Robert Copple, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as added by Section 906 of the Sarbanes-Oxley Act of 2002.
3.1		Second Amended and Restated Certificate of Incorporation of Cinemark, Inc. filed with the Delaware Secretary of State on April 2, 2004 (incorporated by reference to Exhibit 3.1 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
3.2		Amended and Restated Bylaws of Cinemark, Inc. (incorporated by reference to Exhibit 3.2 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
4.1		Exchange and Registration Rights Agreement dated March 31, 2004 among Cinemark, Inc., certain subsidiary guarantors party thereto and the initial purchasers named therein (incorporated by reference to Exhibit 4.1 to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
4.2(a)		Indenture, dated as of March 31, 2004, between Cinemark, Inc. and The Bank of New York Trust Company, N.A. governing the 9 3/4% senior discount notes issued thereunder (incorporated by reference to Exhibit 4.2(a) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
4.2(b)		Form of 9 3/4% senior discount notes (contained in the indenture listed as Exhibit 4.2(a) above) (incorporated by reference to Exhibit 4.2(b) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
4.3(a)		Indenture, dated as of February 11, 2003, between Cinemark USA, Inc. and The Bank of New York Trust Company of Florida, N.A. governing the 9% senior subordinated notes issued thereunder (incorporated by reference to Exhibit 10.2(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 19, 2003).
4.3(b)		First Supplemental Indenture, dated as of May 7, 2003, between Cinemark USA, Inc., the subsidiary guarantors party thereto and The Bank of New York Trust Company of Florida, N.A. (incorporated by reference from Exhibit 4.2(i) to Cinemark USA, Inc.’s Registration Statement on Form S-4/A, File No. 333-104940, filed May 28, 2003).
4.3(c)		Second Supplemental Indenture dated as of November 11, 2004, between Cinemark USA, Inc., the subsidiary guarantors party thereto and The Bank of New York Trust Company of Florida, N.A. (incorporated by reference to Exhibit 4.2(c) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-047040, filed March 28, 2005).
4.3(d)		Third Supplemental Indenture, dated as of October 5, 2006, among Cinemark USA, Inc., the subsidiaries of Cinemark USA, Inc. named therein, and The Bank of New York Trust Company, N.A., as trustee (incorporated by reference to Exhibit 10.7 to Cinemark USA, Inc.’s Current Report on Form 8-K, File No. 033-47040, filed October 12, 2006).
4.3(e)		Fourth Supplemental Indenture, dated March 20, 2007, among Cinemark USA, Inc. and the subsidiaries of Cinemark USA, Inc. named therein, and the Bank of New York Trust Company, N.A. (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, File No. 033-47040, filed by Cinemark USA, Inc. on March 26, 2007).
4.3(f)		Form of 9% Senior Subordinated Note, Due 2013 (contained in the Indenture listed as Exhibit 4.3(a) above) (incorporated by reference to Exhibit 10.2(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 19, 2003).
*31.1		Certification of Chief Executive Officer of Cinemark, Inc., pursuant to Section 302 of the Sarbanes Oxley Act of 2002.
*31.2		Certification of Chief Financial Officer of Cinemark, Inc. pursuant to Section 302 of the Sarbanes Oxley Act of 2002.

~~Table~~* offiled ~~Contents~~herewith.

Number		Exhibit Title
*32.1		Certification of Chief Executive Officer of Cinemark, Inc. pursuant to Section 906 of the Sarbanes Oxley of 2002.
*32.2		Certification of Chief Financial Officer of Cinemark, Inc. pursuant to Section 906 of the Sarbanes Oxley of 2002.

* filed herewith

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