Exhibit 99.1
(CINE MARK LOGO)
For Immediate Release
Contact: Robert Copple or Nikki Sacks
972-665-1500
CINEMARK REPORTS RESULTS FOR FOURTH QUARTER AND FISCAL YEAR 2007
Plano, TX, March 6, 2008 – Cinemark Holdings, Inc. (NYSE: CNK), a leading motion picture exhibitor, today reported results for the three months and year ended December 31, 2007.
Cinemark Holdings, Inc.’s admissions revenues increased 2.6% to $252.4 million and concession revenues increased 2.7% to $118.6 million for the three months ended December 31, 2007, primarily related to a 7.5% increase in average ticket prices and a 7.3% increase in concession revenues per patron. Total revenues for the three months ended December 31, 2007 increased to $393.3 million.
Adjusted EBITDA for the three months ended December 31, 2007 decreased 8.2% to $83.8 million from $91.3 million for the three months ended December 31, 2006. The Company’s Adjusted EBITDA margin was 21.3% for the three months ended December 31, 2007. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.
“Cinemark delivered consistent revenue growth and industry-leading financial performance in 2007 due to the efficient operation of our theaters, our continued focus on organic expansion in domestic and international markets and the integration of the Century Theatres,” stated Alan Stock, Cinemark’s Chief Executive Officer. “We are pleased with our worldwide performance for the quarter and experienced another quarter of outperformance with our international business. For 2008, we believe there is a solid slate of movies in the pipeline. Additionally, we operate in an industry that provides one of the lowest cost forms of out-of-home entertainment, and in light of a weakening economy, we expect our industry to show resilience as it has exhibited in past recessionary periods. We remain dedicated to improving our profitability, developing our new theatre pipeline, and positioning Cinemark to capitalize on industry innovations, such as digital cinema, to return value to shareholders over the long term.”
Net loss before taxes for the three months ended December 31, 2007 was $11.6 million. As a result of the interim period income tax allocations required under U.S. generally accepted accounting principles (“GAAP”), the Company recorded income tax expense of $42.2 million for the three months ended December 31, 2007. The impact of the interim period income tax allocation combined with asset impairment charges of $26.2 million for the three months ended December 31, 2007 were the primary reasons for the Company’s net loss after taxes of $53.8 million. The effective tax rate for the three months ended December 31, 2007 was (364.8%). The Company’s effective tax rate for the year ended December 31, 2007 was 55.7%. Excluding goodwill impairment charges of approximately $67.7 million, which are not deductible for income tax purposes, the Company’s effective tax rate for the year ended December 31, 2007 was approximately 41.7%.
Cinemark Holdings, Inc.’s revenues for the year ended December 31, 2007 increased 37.9% to $1,682.8 million from $1,220.6 million for the year ended December 31, 2006. During the year ended December 31, 2007, admissions revenues increased 43.0% and concession revenues increased 37.4%. The increases were primarily related to a 19.3% increase in attendance; a 20.0% increase in average ticket prices; and a 15.2% increase in concession revenues per patron, all of which were favorably impacted by the acquisition of Century Theatres, Inc. that occurred on October 5, 2006. On a pro forma basis giving effect to the Century Acquisition as if it had occurred on January 1, 2006, the Company’s total revenues for the year ended December 31, 2007 increased 4.4%, admissions revenues increased 5.6% and concession revenues increased 6.0%. The increases were primarily related to increases in average ticket price and concession revenues per patron.

 

 

Adjusted EBITDA for the year ended December 31, 2007 increased 38.8% to $376.9 million from $271.6 million for the year ended December 31, 2006. The Company’s Adjusted EBITDA margin was 22.4% for the year ended December 31, 2007. Reconciliations of non-GAAP financial measures are provided in the financial schedules accompanying this press release.
Net income for the year ended December 31, 2007 was $88.9 million compared to net income of $0.8 million for the year ended December 31, 2006.
During the year ended December 31, 2007, the Company repurchased approximately $332.1 million aggregate principal amount of its 9% senior subordinated notes, primarily utilizing the proceeds received upon the sale of shares in connection with the National CineMedia, Inc. initial public offering, and repurchased $69.2 million aggregate principal amount at maturity of its 9 3/4% senior discount notes utilizing the proceeds from its initial public offering. The Company recorded a loss on early retirement of debt of approximately $13.5 million related to these note repurchases.
On December 31, 2007, the Company’s aggregate screen count was 4,665, with screens in the United States, Canada, Mexico, Argentina, Brazil, Chile, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama and Colombia. As of December 31, 2007, the Company had signed commitments to open 13 new theatres with 147 screens during 2008 and open five new theatres with 78 screens subsequent to 2008.
Conference Call
The Company will host a conference call and audio webcast with investors, analysts and other interested parties today at 5:00 P.M. Eastern time. The call can be accessed live over the phone by dialing (800) 374-1346, or for international callers, (706) 679-3149. The passcode is 36984398. A replay will be available shortly after the call and can be accessed by dialing (800) 642-1687, or for international callers, (706) 645-9291. The passcode for the replay is 36984398. The replay will be available until March 8, 2008.
About Cinemark Holdings, Inc.
Headquartered in Plano, TX, Cinemark is a leader in the motion picture exhibition industry. As of December 31, 2007, Cinemark operates 408 theatres and 4,665 screens in 38 states in the United States and internationally in 12 countries, mainly in Mexico, South and Central America. For more information go to www.cinemark.com.
Forward-looking Statements
This press release includes “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. The “forward-looking statements” include our current expectations, assumptions, estimates and projections about our business and our industry. 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 and our ability to successfully license and exhibit popular films, national and international growth in our industry, competition from other exhibitors and alternative forms of entertainment and determinations in lawsuits in which we are defendants. You can identify forward-looking statements by the use of words such as “may,” “should,” “will,” “could,” “estimates,” “predicts,” “potential,” “continue,” “anticipates,” “believes,” “plans,” “expects,” “future” and “intends” and similar expressions 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 forward-looking statements, you should carefully consider the risks and uncertainties described in the “Risk Factors” section or other sections in the Company’s 424(b)(1) prospectus filed April 24, 2007 and quarterly reports on Form 10-Q. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements and risk factors. Forward-looking statements contained in this press release reflect our view only as of the date of this press release. 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.

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Cinemark Holdings, Inc.
Financial and Operating Summary
(unaudited, in thousands)
                                         
                                    Pro Forma  
    Three months ended     Years ended     Year ended  
    December 31,     December 31,     December 31,  
    2007     2006     2007     2006     2006 (1)  
Statement of Operations Data:
                                        
Revenues
                                        
Admissions
   $ 252,422     $ 246,092     $ 1,087,480     $ 760,275     $ 1,029,881  
Concession
     118,644       115,575       516,509       375,798       487,416  
Other
     22,218       29,838       78,852       84,521       94,807  
           
Total revenues
     393,284       391,505       1,682,841       1,220,594       1,612,104  
           
 
                                        
Cost of operations
                                       
Film rentals and advertising
     135,517       130,982       589,717       405,987       546,144  
Concession supplies
     18,403       17,157       81,074       59,020       75,359  
Facility lease expense
     52,889       48,246       212,730       161,374       206,950  
Other theatre operating expenses
     89,243       83,498       364,569       263,424       345,388  
General and administrative expenses
     21,787       21,810       79,518       67,768       84,619  
Termination of profit participation agreement
     —       —       6,952       —       —  
Depreciation and amortization
     38,289       34,947       151,716       99,470       141,416  
Impairment of long-lived assets
     26,168       23,338       86,558       28,537       28,943  
(Gain) loss on sale of assets and other
     (2,336 )     2,345       (2,953 )     7,645       7,706  
           
Total cost of operations
     379,960       362,323       1,569,881       1,093,225       1,436,525  
           
Operating income
     13,324       29,182       112,960       127,369       175,579  
 
                                        
Interest expense (2)
     (33,830 )     (42,220 )     (145,596 )     (109,328 )     (168,051 )
Gain on NCM transaction
     —       —       210,773       —       —  
Gain on Fandango transaction
     —       —       9,205       —       —  
Loss on early retirement of debt
     (1,920 )     (5,782 )     (13,456 )     (8,283 )     (8,283 )
Distributions from NCM
     5,745       —       11,499       —       —  
Other income
     5,114       1,600       15,497       3,768       3,727  
           
Income (loss) before taxes
     (11,567 )     (17,220 )     200,882       13,526       2,972  
Income taxes
     42,198       3,109       111,962       12,685       6,520  
           
Net income (loss)
   $ (53,765 )   $ (20,329 )   $ 88,920     $ 841     $ (3,548 )
           
Net Earnings (Loss) Per Share:
                                        
Basic
   $ (0.50 )   $ (0.22 )   $ 0.87     $ 0.01     $ (0.04 )
           
Diluted
   $ (0.50 )   $ (0.22 )   $ 0.85     $ 0.01     $ (0.04 )
           
 
                                        
Other Financial Data:
                                        
Adjusted EBITDA (3)
   $ 83,800     $ 91,330     $ 376,938     $ 271,615          
Adjusted EBITDA margin
     21.3 %     23.3 %     22.4 %     22.3 %        
 
                                        
Other Operating Data:
                                        
Attendance (patrons):
                                        
Domestic
     34,891       37,156       151,712       118,714       155,981  
International
     12,669       12,621       60,958       59,550       59,550  
           
Worldwide
     47,560       49,777       212,670       178,264       215,531  
           
 
                                        
Average screen count (month end average):
                                        
Domestic
     3,631       3,516       3,581       2,695          
International
     1,001       955       977       933          
             
Worldwide
     4,632       4,471       4,558       3,628          
             

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    As of   As of
    December 31,   December 31,
    2007   2006
Balance Sheet Data:
                
Cash and cash equivalents
   $ 338,043     $ 147,099  
Theatre properties and equipment, net
     1,314,066       1,324,572  
Total assets
     3,296,892       3,171,582  
Long-term debt, including current portion
     1,523,745       1,911,653  
Stockholders’ equity
     1,019,203       689,297  
Segment Information
(unaudited, in thousands)
                                 
    Three months ended   Years ended
    December 31,   December 31,
    2007   2006   2007   2006
Revenues
                               
U.S.
   $ 318,207     $ 328,955     $ 1,352,042     $ 936,684  
International
     75,663       63,074       333,624       285,854  
Eliminations
     (586 )     (524 )     (2,825 )     (1,944 )
     
Total Revenues
   $ 393,284     $ 391,505     $ 1,682,841     $ 1,220,594  
     
Adjusted EBITDA (3)
                               
U.S.
   $ 72,195     $ 82,771     $ 309,800     $ 217,845  
International
     11,605       8,559       67,138       53,770  
     
Total Adjusted EBITDA
   $ 83,800     $ 91,330     $ 376,938     $ 271,615  
     
Capital Expenditures
                               
U.S.
   $ 28,649     $ 20,855     $ 110,496     $ 80,786  
International
     7,606       8,324       35,808       26,295  
     
Total Capital Expenditures
   $ 36,255     $ 29,179     $ 146,304     $ 107,081  
     

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Reconciliation of Adjusted EBITDA
(unaudited, in thousands)
                                 
    Three months ended   Years ended
    December 31,   December 31,
    2007   2006   2007   2006
Net income (loss)
   $ (53,765 )   $ (20,329 )   $ 88,920     $ 841  
Income taxes
     42,198       3,109       111,962       12,685  
Interest expense (2)
     33,830       42,220       145,596       109,328  
Gain on NCM transaction
     —       —       (210,773 )     —  
Gain on Fandango transaction
     —       —       (9,205 )     —  
Loss on early retirement of debt
     1,920       5,782       13,456       8,283  
Other income
     (5,114 )     (1,600 )     (15,497 )     (3,768 )
Termination of profit participation agreement
     —       —       6,952       —  
Depreciation and amortization
     38,289       34,947       151,716       99,470  
Impairment of long-lived assets
     26,168       23,338       86,558       28,537  
(Gain) loss on sale of assets and other
     (2,336 )     2,345       (2,953 )     7,645  
Deferred lease expenses (4)
     1,373       605       5,979       4,717  
Amortization of long-term prepaid rents (4)
     321       197       1,146       1,013  
Share based awards compensation expense (5)
     916       716       3,081       2,864  
     
Adjusted EBITDA (3)
   $ 83,800     $ 91,330     $ 376,938     $ 271,615  
     
 
(1)   Pro forma financial and operating data for the year ended December 31, 2006 gives effect to the Century acquisition as if it had occurred on January 1, 2006. Pro forma data for the year ended December 31, 2006 represents Cinemark’s historical data for the year ended December 31, 2006 plus Century’s historical data for the period from January 1, 2006 to October 4, 2006. Pro forma adjustments have been made to eliminate the impact of the change of control payment made to Century’s management at the time of the acquisition, to reflect additional depreciation and amortization expense related to the increase in long-lived assets to fair value pursuant to purchase accounting and to reflect the increase in interest expense related to the changes in the Company’s debt structure that occurred as a result of the acquisition.
 
(2)   Includes amortization of debt issue costs and excludes capitalized interest.
 
(3)   Adjusted EBITDA as calculated in the chart above represents net income (loss) before income taxes, interest expense, gain on NCM transaction, gain on Fandango transaction, loss on early retirement of debt, other income, termination of profit participation agreement, depreciation and amortization, impairment of long-lived assets, (gain) loss on sale of assets and other, changes in deferred lease expense, amortization of long-term prepaid rents and share based awards compensation expense. Adjusted EBITDA is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to net income (loss) as an indicator of operating performance or as an alternative to cash flow provided by operating activities as a measure of liquidity (as determined in accordance with GAAP). Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. We have included Adjusted EBITDA because we believe it provides management and investors with additional information to measure our performance and liquidity, estimate our value and evaluate our ability to service debt. In addition, we use Adjusted EBITDA for incentive compensation purposes. Adjusted EBITDA margin represents Adjusted EBITDA divided by total revenues.
 
(4)   Non-cash expense included in facility lease expense.
 
(5)   Non-cash expense included in general and administrative expenses.

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