Q1P2YP1Y1.11.1false0001385280P1Y1 yearP1Y1 yearone yearP1Y--12-3100013852802021-03-310001385280cnk:OtherDeferredRevenuesMember2022-03-310001385280cnk:ScreenAdvertisingScreenRentalAndPromotionalRevenuesMembercnk:UsOperatingSegmentMember2022-01-012022-03-310001385280cnk:SyufyEnterprisesLpMember2022-01-012022-03-310001385280cnk:FivePointEightSevenFivePercentSeniorNoteDueTwentyTwentySixMember2021-12-310001385280cnk:FEConceptsLLCMemberus-gaap:OtherAffiliatesMember2021-12-310001385280srt:MaximumMember2022-01-012022-03-310001385280cnk:TermLoanCreditFacilityMembercnk:SeniorSecuredCreditFacilityMember2022-03-310001385280srt:ReportableGeographicalComponentsMembercountry:US2022-01-012022-03-310001385280country:BRsrt:ReportableGeographicalComponentsMember2021-01-012021-03-310001385280srt:GeographyEliminationsMember2021-01-012021-03-310001385280cnk:FivePointTwoFiveZeroPercentSeniorNoteDueTwentyTwentyEightMember2022-03-310001385280country:PE2022-01-012022-03-310001385280us-gaap:RetainedEarningsMember2022-03-310001385280us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310001385280cnk:TheatresMember2021-12-310001385280country:CL2021-01-012021-03-310001385280cnk:ConvertibleSeniorNotesMember2021-12-310001385280cnk:InternationalOperatingSegmentMember2022-03-310001385280cnk:CopperBeechCapitalLLCMember2021-01-012021-03-310001385280cnk:UsOperatingSegmentMemberus-gaap:TransferredOverTimeMember2022-01-012022-03-310001385280cnk:UsOperatingSegmentMember2021-12-310001385280us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-03-310001385280cnk:FourPointFivePercentConvertibleSeniorNoteDueTwentyTwentyFiveMember2021-12-310001385280cnk:TheatresMember2022-03-310001385280cnk:FourPointFiveZeroConvertibleSeniorNotesMember2022-03-310001385280cnk:FilmRentalsAndAdvertisingMembercnk:ACJVLLCMember2021-01-012021-03-310001385280us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310001385280us-gaap:CommonStockMember2022-03-310001385280cnk:InternationalOperatingSegmentMember2021-01-012021-03-310001385280srt:ReportableGeographicalComponentsMembercountry:US2021-01-012021-03-310001385280us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMembercnk:InterestRateSwapAgreementOneMember2022-03-310001385280country:PE2021-12-310001385280cnk:NcmMembersrt:MinimumMember2022-01-012022-03-310001385280cnk:OtherInternationalCountriesMembersrt:ReportableGeographicalComponentsMember2021-01-012021-03-310001385280country:CL2022-01-012022-03-310001385280country:BR2021-01-012021-03-310001385280cnk:NCMScreenAdvertisingAdvancesMember2022-03-310001385280cnk:EquityLossMember2022-01-012022-03-310001385280cnk:InternationalOperatingSegmentMemberus-gaap:TransferredOverTimeMember2022-01-012022-03-310001385280cnk:NcmMember2022-03-310001385280cnk:InvestmentInNcmMember2021-12-310001385280us-gaap:TreasuryStockMember2022-03-310001385280cnk:AdmissionsRevenueMember2021-01-012021-03-310001385280us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-03-310001385280us-gaap:NoncontrollingInterestMember2022-03-310001385280us-gaap:NoncontrollingInterestMember2022-01-012022-03-310001385280cnk:AdmissionsRevenueMember2022-01-012022-03-310001385280srt:MaximumMember2022-03-310001385280us-gaap:AdmissionMember2022-01-012022-03-310001385280us-gaap:AdditionalPaidInCapitalMembercnk:AccountingStandardUpdate202006Member2021-01-012021-03-310001385280country:AR2021-01-012021-03-310001385280cnk:CashReceivedMember2022-01-012022-03-310001385280cnk:SeniorSecuredCreditFacilityMembercnk:RevolvingCreditLineMember2022-01-012022-03-310001385280cnk:InvestmentInNcmMember2022-01-012022-03-310001385280srt:MinimumMember2022-03-310001385280cnk:ScreenAdvertisingScreenRentalAndPromotionalRevenuesMember2021-01-012021-03-310001385280cnk:FourPointFiveZeroConvertibleSeniorNotesMember2022-01-012022-03-310001385280us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310001385280us-gaap:FairValueMeasurementsRecurringMember2021-12-310001385280cnk:FEConceptsLLCMember2022-03-310001385280us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMembercnk:InterestRateSwapAgreementOneMember2022-01-012022-03-310001385280srt:ReportableGeographicalComponentsMembercountry:US2022-03-310001385280cnk:UsOperatingSegmentMemberus-gaap:TransferredAtPointInTimeMember2021-01-012021-03-3100013852802020-01-012020-09-300001385280cnk:InternationalOperatingSegmentMemberus-gaap:ConcessionsMember2022-01-012022-03-310001385280us-gaap:EquipmentMembercnk:UtilitiesAndOtherMember2021-01-012021-03-310001385280cnk:UsOperatingSegmentMember2022-03-310001385280cnk:UsOperatingSegmentMembercnk:OtherRevenueMember2022-01-012022-03-310001385280cnk:UsOperatingSegmentMemberus-gaap:AdmissionMember2022-01-012022-03-310001385280cnk:FivePointTwoFiveZeroPercentSeniorNoteDueTwentyTwentyEightMember2021-12-310001385280us-gaap:RetainedEarningsMember2020-12-310001385280cnk:FEConceptsLLCMemberus-gaap:OtherAffiliatesMember2022-01-012022-03-310001385280country:BR2021-12-310001385280us-gaap:OtherAffiliatesMember2022-01-012022-03-310001385280cnk:InternationalOperatingSegmentMemberus-gaap:AdmissionMember2022-01-012022-03-310001385280cnk:UsOperatingSegmentMember2021-01-012021-03-3100013852802022-03-310001385280us-gaap:RestrictedStockUnitsRSUMember2021-01-012021-03-310001385280us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001385280srt:MinimumMember2022-01-012022-03-310001385280cnk:OtherInternationalCountriesMembersrt:ReportableGeographicalComponentsMember2022-01-012022-03-310001385280cnk:UsOperatingSegmentMemberus-gaap:ConcessionsMember2021-01-012021-03-310001385280us-gaap:OtherAffiliatesMembercnk:DigitalCinemaImplementationPartnersMember2022-03-310001385280cnk:InternationalOperatingSegmentMembercnk:OtherRevenueMember2022-01-012022-03-3100013852802021-12-310001385280us-gaap:AdditionalPaidInCapitalMember2021-12-310001385280us-gaap:TransferredAtPointInTimeMember2021-01-012021-03-310001385280cnk:UsOperatingSegmentMemberus-gaap:TransferredAtPointInTimeMember2022-01-012022-03-310001385280cnk:EightPointSevenFivePercentSeniorSecuredNoteDueTwentyTwentyFiveMember2021-12-310001385280us-gaap:RetainedEarningsMembercnk:AccountingStandardUpdate202006Member2021-01-012021-03-310001385280us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310001385280country:PE2021-01-012021-03-310001385280cnk:DigitalCinemaDistributionCoalitionMember2022-01-012022-03-310001385280cnk:InternationalOperatingSegmentMemberus-gaap:ConcessionsMember2021-01-012021-03-310001385280us-gaap:RestrictedStockMember2022-01-012022-03-310001385280cnk:SeniorSecuredCreditFacilityMembercnk:RevolvingCreditLineMember2022-03-310001385280us-gaap:RetainedEarningsMember2021-12-310001385280cnk:OtherDeferredRevenuesMember2022-01-012022-03-310001385280us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001385280us-gaap:ParentMember2020-12-310001385280us-gaap:OperatingSegmentsMembercnk:InternationalOperatingSegmentMember2022-01-012022-03-310001385280us-gaap:OperatingSegmentsMembercnk:UsOperatingSegmentMember2021-01-012021-03-310001385280country:CL2022-03-310001385280cnk:DigitalCinemaDistributionCoalitionMemberus-gaap:OtherAffiliatesMember2021-12-310001385280cnk:FourPointFiveZeroConvertibleSeniorNotesMember2020-12-310001385280cnk:OtherRevenueMember2022-03-310001385280cnk:OtherInvestmentMemberus-gaap:OtherAffiliatesMember2022-01-012022-03-310001385280cnk:LaredoTheatreLtdMember2022-01-012022-03-310001385280cnk:InternationalOperatingSegmentMemberus-gaap:TransferredOverTimeMember2021-01-012021-03-310001385280country:BRsrt:ReportableGeographicalComponentsMember2021-12-310001385280us-gaap:AccountsPayableAndAccruedLiabilitiesMember2022-03-310001385280cnk:UnvestedRestrictedStockAwardsMember2022-03-310001385280cnk:ScreenAdvertisingScreenRentalAndPromotionalRevenuesMembercnk:InternationalOperatingSegmentMember2021-01-012021-03-3100013852802021-01-012021-03-310001385280cnk:DigitalCinemaImplementationPartnersMember2022-01-012022-03-310001385280us-gaap:OtherAffiliatesMembercnk:DigitalCinemaImplementationPartnersMember2021-12-310001385280us-gaap:WarrantMembercnk:FourPointFiveZeroConvertibleSeniorNotesMember2022-03-310001385280cnk:AccountingStandardUpdate202006Member2021-01-012021-03-310001385280cnk:RealEstatePropertyMembercnk:FacilityLeasingExpenseMember2021-01-012021-03-310001385280us-gaap:NoncontrollingInterestMember2021-12-310001385280cnk:InternationalOperatingSegmentMember2022-01-012022-03-310001385280cnk:DigitalCinemaDistributionCoalitionMember2021-01-012021-03-310001385280cnk:OtherForeignCountriesMember2021-01-012021-03-310001385280us-gaap:RestrictedStockUnitsRSUMember2022-03-3100013852802020-12-310001385280cnk:OtherRevenuesMember2022-01-012022-03-310001385280us-gaap:ParentMember2021-12-310001385280country:BR2022-01-012022-03-310001385280us-gaap:NaturalDisastersAndOtherCasualtyEventsMember2022-03-310001385280cnk:DigitalCinemaDistributionCoalitionMemberus-gaap:OtherAffiliatesMember2022-01-012022-03-310001385280cnk:OtherRevenueMember2022-01-012022-03-310001385280cnk:OtherInvesteesMember2021-01-012021-03-310001385280us-gaap:ParentMember2021-01-012021-03-310001385280us-gaap:OtherAffiliatesMember2021-12-310001385280us-gaap:IntersegmentEliminationMember2022-01-012022-03-310001385280us-gaap:EquipmentMembercnk:UtilitiesAndOtherMember2022-01-012022-03-310001385280cnk:InternationalOperatingSegmentMemberus-gaap:AdmissionMember2021-01-012021-03-310001385280us-gaap:RestrictedStockMember2021-12-310001385280cnk:ConvertibleSeniorNotesMember2022-03-310001385280cnk:InterestExpenseNcmMember2022-03-310001385280country:BRsrt:ReportableGeographicalComponentsMember2022-01-012022-03-310001385280us-gaap:ParentMember2021-03-310001385280cnk:InterestExpenseNcmMember2022-01-012022-03-3100013852802023-04-01cnk:OtherDeferredRevenuesMember2022-03-310001385280us-gaap:RetainedEarningsMember2021-03-310001385280us-gaap:ConcessionsMember2022-01-012022-03-310001385280us-gaap:OtherAffiliatesMembercnk:DigitalCinemaImplementationPartnersMember2021-01-012021-03-310001385280us-gaap:IntersegmentEliminationMember2021-01-012021-03-310001385280cnk:UsOperatingSegmentMember2022-01-012022-03-310001385280us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310001385280us-gaap:RetainedEarningsMember2021-01-012021-03-310001385280cnk:OtherInternationalCountriesMembersrt:ReportableGeographicalComponentsMember2021-12-310001385280us-gaap:ConcessionsMember2021-01-012021-03-310001385280us-gaap:InterestExpenseMember2021-01-012021-03-310001385280us-gaap:NoncontrollingInterestMember2020-12-310001385280cnk:InternationalOperatingSegmentMembercnk:OtherRevenueMember2021-01-012021-03-310001385280us-gaap:RestrictedStockMember2022-03-310001385280us-gaap:DesignatedAsHedgingInstrumentMembercnk:InterestRateSwapAgreementTwoMemberus-gaap:CashFlowHedgingMember2022-03-310001385280cnk:OtherRevenueMember2022-01-012022-03-310001385280us-gaap:RestrictedStockMembersrt:MinimumMember2022-01-012022-03-310001385280srt:ReportableGeographicalComponentsMembercountry:US2021-12-310001385280us-gaap:OtherAffiliatesMembercnk:DigitalCinemaImplementationPartnersMember2022-01-012022-03-310001385280country:AR2022-01-012022-03-310001385280us-gaap:AdmissionMember2021-01-012021-03-310001385280srt:MinimumMembercnk:FourPointFiveZeroConvertibleSeniorNotesMember2022-01-012022-03-310001385280cnk:UsOperatingSegmentMemberus-gaap:TransferredOverTimeMember2021-01-012021-03-3100013852802022-04-01cnk:NCMScreenAdvertisingAdvancesMember2022-03-310001385280cnk:NcmMember2021-12-300001385280us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMembercnk:InterestRateSwapAgreementThreeMember2022-01-012022-03-3100013852802024-04-01cnk:NCMScreenAdvertisingAdvancesMember2022-03-310001385280cnk:ScreenAdvertisingScreenRentalAndPromotionalRevenuesMember2022-01-012022-03-3100013852802022-04-01cnk:OtherDeferredRevenuesMember2022-03-310001385280cnk:NcmMember2021-12-310001385280cnk:AccountingStandardUpdate202006Memberus-gaap:ParentMember2021-01-012021-03-310001385280cnk:UsOperatingSegmentMembercnk:OtherRevenueMember2021-01-012021-03-3100013852802025-04-01cnk:NCMScreenAdvertisingAdvancesMember2022-03-310001385280us-gaap:AdditionalPaidInCapitalMember2022-03-310001385280cnk:UsOperatingSegmentMemberus-gaap:AdmissionMember2021-01-012021-03-310001385280us-gaap:ParentMember2022-01-012022-03-310001385280cnk:FourPointFivePercentConvertibleSeniorNoteDueTwentyTwentyFiveMember2022-03-310001385280cnk:NcmMember2022-01-012022-03-310001385280cnk:ScreenAdvertisingScreenRentalAndPromotionalRevenuesMembercnk:UsOperatingSegmentMember2021-01-012021-03-310001385280cnk:EightPointSevenFivePercentSeniorSecuredNoteDueTwentyTwentyFiveMember2022-03-3100013852802027-04-01cnk:NCMScreenAdvertisingAdvancesMember2022-03-310001385280us-gaap:TreasuryStockMember2021-12-310001385280us-gaap:OperatingSegmentsMembercnk:InternationalOperatingSegmentMember2021-01-012021-03-310001385280us-gaap:TreasuryStockMember2021-03-310001385280country:PE2022-03-310001385280cnk:EquityLossMember2022-03-310001385280srt:GeographyEliminationsMember2022-01-012022-03-310001385280us-gaap:ParentMember2022-03-310001385280cnk:InternationalOperatingSegmentMember2021-12-310001385280us-gaap:AdditionalPaidInCapitalMember2021-03-310001385280cnk:FEConceptsLLCMemberus-gaap:OtherAffiliatesMember2022-03-310001385280cnk:OtherRevenueMember2021-01-012021-03-310001385280cnk:TermLoanCreditFacilityMembercnk:SeniorSecuredCreditFacilityMember2022-01-012022-03-310001385280country:BRsrt:ReportableGeographicalComponentsMember2022-03-310001385280cnk:NcmMember2021-01-012021-03-310001385280us-gaap:FairValueMeasurementsRecurringMember2022-03-310001385280us-gaap:RestrictedStockMembersrt:MaximumMember2022-01-012022-03-310001385280country:CL2021-12-310001385280cnk:OtherDeferredRevenuesMember2021-12-310001385280us-gaap:OperatingSegmentsMembercnk:UsOperatingSegmentMember2022-01-012022-03-310001385280cnk:InterestRateSwapAgreementTwoMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-01-012022-03-310001385280cnk:ScreenAdvertisingScreenRentalAndPromotionalRevenuesMembercnk:InternationalOperatingSegmentMember2022-01-012022-03-3100013852802023-04-01cnk:NCMScreenAdvertisingAdvancesMember2022-03-310001385280us-gaap:CommonStockMember2021-12-310001385280cnk:DepreciationAndAmortizationMember2022-01-012022-03-310001385280us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMembercnk:InterestRateSwapAgreementThreeMember2022-03-310001385280us-gaap:TreasuryStockMember2022-01-012022-03-310001385280cnk:OtherInternationalCountriesMembersrt:ReportableGeographicalComponentsMember2022-03-310001385280cnk:UnvestedRestrictedStockAwardsMember2022-01-012022-03-310001385280cnk:InvestmentInNcmMember2022-03-310001385280cnk:DigitalCinemaImplementationPartnersMember2022-03-310001385280us-gaap:OtherAffiliatesMember2022-03-310001385280cnk:CashReceivedMember2022-03-310001385280cnk:InternationalOperatingSegmentMemberus-gaap:TransferredAtPointInTimeMember2022-01-012022-03-310001385280us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310001385280cnk:NCMScreenAdvertisingAdvancesMember2021-12-310001385280cnk:ACJVLLCMemberus-gaap:OtherAffiliatesMember2022-01-012022-03-3100013852802026-04-01cnk:NCMScreenAdvertisingAdvancesMember2022-03-3100013852802022-04-290001385280us-gaap:TransferredAtPointInTimeMember2022-01-012022-03-310001385280us-gaap:TransferredOverTimeMember2021-01-012021-03-310001385280cnk:OtherInvestmentMemberus-gaap:OtherAffiliatesMember2022-03-310001385280us-gaap:InterestRateSwapMember2022-01-012022-03-310001385280cnk:OtherRevenuesMember2021-01-012021-03-310001385280cnk:SyufyEnterprisesLpMember2021-01-012021-03-310001385280us-gaap:CommonStockMember2020-12-310001385280us-gaap:TreasuryStockMember2020-12-310001385280us-gaap:InterestExpenseMember2022-01-012022-03-310001385280cnk:NcmMembersrt:MaximumMember2022-01-012022-03-310001385280us-gaap:RestrictedStockMember2021-01-012021-03-310001385280cnk:DigitalCinemaDistributionCoalitionMemberus-gaap:OtherAffiliatesMember2022-03-3100013852802022-01-012022-03-310001385280us-gaap:InterestRateSwapMember2021-01-012021-03-310001385280cnk:FilmRentalsAndAdvertisingMembercnk:ACJVLLCMember2022-01-012022-03-310001385280cnk:ACJVLLCMemberus-gaap:OtherAffiliatesMember2021-12-310001385280us-gaap:TransferredOverTimeMember2022-01-012022-03-3100013852802021-01-012021-12-310001385280cnk:NCMScreenAdvertisingAdvancesMember2022-01-012022-03-310001385280cnk:UsOperatingSegmentMemberus-gaap:ConcessionsMember2022-01-012022-03-310001385280cnk:DepreciationAndAmortizationMember2021-01-012021-03-310001385280us-gaap:RetainedEarningsMember2022-01-012022-03-310001385280us-gaap:OtherNoncurrentLiabilitiesMember2022-03-310001385280us-gaap:CommonStockMember2021-03-310001385280cnk:LaredoTheatreLtdMember2021-01-012021-03-310001385280us-gaap:NoncontrollingInterestMember2021-01-012021-03-310001385280us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-3100013852802024-04-01cnk:OtherDeferredRevenuesMember2022-03-310001385280cnk:OtherInvestmentMemberus-gaap:OtherAffiliatesMember2021-12-310001385280us-gaap:AdditionalPaidInCapitalMember2020-12-310001385280cnk:InternationalOperatingSegmentMemberus-gaap:TransferredAtPointInTimeMember2021-01-012021-03-310001385280cnk:OtherInvesteesMember2022-01-012022-03-310001385280us-gaap:NoncontrollingInterestMember2021-03-310001385280cnk:CopperBeechCapitalLLCMember2022-01-012022-03-310001385280country:BR2022-03-310001385280cnk:ACJVLLCMemberus-gaap:OtherAffiliatesMember2022-03-310001385280cnk:RealEstatePropertyMembercnk:FacilityLeasingExpenseMember2022-01-012022-03-310001385280cnk:NcmMember2021-01-012021-04-010001385280cnk:FivePointEightSevenFivePercentSeniorNoteDueTwentyTwentySixMember2022-03-31xbrli:purecnk:Agreementcnk:Studioxbrli:sharescnk:Theatreutr:Diso4217:USDxbrli:sharesiso4217:USD

 

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 March 31, 2022

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Commission File Number: 001-33401

CINEMARK HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

 

Delaware

 

20-5490327

(State or other jurisdiction

of incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

3900 Dallas Parkway

 

 

Plano, Texas

 

75093

(Address of principal executive offices)

 

(Zip Code)

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

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $.001 per share

CNK

New York Stock Exchange

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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit files). Yes ☒ No ☐

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

 

Large accelerated filer

 

 

Accelerated filer

 

 

 

 

 

 

 

 

Non-accelerated filer

 

 

Smaller reporting company

 

 

 

 

 

 

 

 

Emerging growth company

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No ☒

As of April 29, 2022, 120,449,483 shares of common stock were issued and outstanding.

 


 

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

TABLE OF CONTENTS

 

 

 

 

 

Page

PART I. FINANCIAL INFORMATION

 

 

 

 

 

 

 

 

Item 1.

Financial Statements

 

4

 

 

 

 

 

 

 

Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021 (unaudited)

 

4

 

 

 

 

 

 

 

Condensed Consolidated Statements of Loss for the three months ended March 31, 2022 and 2021 (unaudited)

 

5

 

 

 

 

 

 

 

Condensed Consolidated Statements of Comprehensive Loss for the three months ended March 31, 2022 and 2021 (unaudited)

 

6

 

 

 

 

 

 

 

Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021 (unaudited)

 

7

 

 

 

 

 

 

 

Notes to Condensed Consolidated Financial Statements (unaudited)

 

8

 

 

 

 

 

 

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

 

27

 

 

 

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

37

 

 

 

 

 

 

Item 4.

Controls and Procedures

 

37

 

 

 

 

 

PART II. OTHER INFORMATION

 

 

 

 

 

 

 

 

Item 1.

Legal Proceedings

 

38

 

 

 

 

 

 

Item 1A.

Risk Factors

 

38

 

 

 

 

 

 

Item 6.

Exhibits

 

39

 

 

 

 

 

SIGNATURES

 

40

 

2


 

Cautionary Statement Regarding Forward-Looking Statements

Certain matters within this Quarterly Report on Form 10Q include “forward–looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. The “forward-looking statements” may include our current expectations, assumptions, estimates and projections about our business and our industry. They may include statements relating to:

future revenues, expenses and profitability;
currency exchange rate and inflationary impacts;
the future development and expected growth of our business;
projected capital expenditures;
access to capital resources;
attendance at movies generally or in any of the markets in which we operate;
the number or diversity of popular movies releases, the length of exclusive theatrical release windows and our ability to successfully license and exhibit popular films;
national and international growth in our industry;
competition from other exhibitors, alternative forms of entertainment and content delivery via streaming and other formats;
determinations in lawsuits in which we are a party; and
the impact of the COVID-19 pandemic on us and the motion picture exhibition industry.

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. These statements are neither historical facts nor guarantees of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions and are, therefore, subject to risks, inherent uncertainties and other factors, some of which are beyond our control and difficult to predict, including, among others, the impacts of the COVID-19 pandemic. Such risks and uncertainties could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. For a description of the risk factors, please review the “Risk Factors” section or other sections of, or incorporated by reference to, Cinemark Holdings, Inc.'s Annual Report on Form 10-K filed February 25, 2022. 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.

Unless the context otherwise requires, all references to “we,” “our,” “us,” “the issuer”, “the Company” or “Cinemark” relate to Cinemark Holdings, Inc. and its consolidated subsidiaries. All references to Latin America are to Brazil, Argentina, Chile, Colombia, Peru, Ecuador, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, Guatemala, Bolivia, Curacao and Paraguay.

 

3


 

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except per share data, unaudited)

 

 

 

March 31,

 

 

December 31,

 

 

 

2022

 

 

2021

 

Assets

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

568.6

 

 

$

707.3

 

Inventories

 

 

16.8

 

 

 

15.5

 

Accounts receivable

 

 

52.9

 

 

 

68.8

 

Current income tax receivable

 

 

46.5

 

 

 

46.6

 

Prepaid expenses and other

 

 

35.0

 

 

 

36.2

 

Total current assets

 

 

719.8

 

 

 

874.4

 

Theatre properties and equipment

 

 

3,415.8

 

 

 

3,368.8

 

Less: accumulated depreciation and amortization

 

 

2,066.8

 

 

 

1,985.9

 

Theatre properties and equipment, net

 

 

1,349.0

 

 

 

1,382.9

 

Operating lease right-of-use assets, net

 

 

1,201.6

 

 

 

1,230.8

 

Other assets

 

 

 

 

 

 

Goodwill

 

 

1,256.9

 

 

 

1,248.8

 

Intangible assets, net

 

 

310.8

 

 

 

310.8

 

Investment in NCM

 

 

131.9

 

 

 

135.4

 

Investments in affiliates

 

 

25.8

 

 

 

25.2

 

Deferred charges and other assets, net

 

 

28.5

 

 

 

22.3

 

Total other assets

 

 

1,753.9

 

 

 

1,742.5

 

Total assets

 

$

5,024.3

 

 

$

5,230.6

 

 

 

 

 

 

 

 

Liabilities and equity

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Current portion of long-term debt

 

$

27.2

 

 

$

24.3

 

Current portion of operating lease obligations

 

 

219.4

 

 

 

217.1

 

Current portion of finance lease obligations

 

 

14.7

 

 

 

14.6

 

Accounts payable and accrued expenses

 

 

384.3

 

 

 

513.1

 

Total current liabilities

 

 

645.6

 

 

 

769.1

 

Long-term liabilities

 

 

 

 

 

 

Long-term debt, less current portion

 

 

2,476.6

 

 

 

2,476.3

 

Operating lease obligations, less current portion

 

 

1,044.1

 

 

 

1,078.3

 

Finance lease obligations, less current portion

 

 

98.8

 

 

 

102.6

 

Long-term deferred tax liability

 

 

39.0

 

 

 

39.8

 

Long-term liability for uncertain tax positions

 

 

46.4

 

 

 

45.9

 

NCM screen advertising advances

 

 

343.8

 

 

 

346.0

 

Other long-term liabilities

 

 

30.6

 

 

 

38.1

 

Total long-term liabilities

 

 

4,079.3

 

 

 

4,127.0

 

Equity

 

 

 

 

 

 

Cinemark Holdings, Inc.'s stockholders' equity:

 

 

 

 

 

 

Common stock, $0.001 par value: 300.0 shares authorized, 125.94 shares issued and 120.47 shares outstanding at March 31, 2022 and 125.10 shares issued and 119.75 shares outstanding at December 31, 2021

 

 

0.1

 

 

 

0.1

 

Additional paid-in-capital

 

 

1,202.9

 

 

 

1,197.8

 

Treasury stock, 5.47 and 5.35 shares, at cost, at March 31, 2022 and December 31, 2021, respectively

 

 

(92.7

)

 

 

(91.1

)

Retained earnings (deficit)

 

 

(463.4

)

 

 

(389.4

)

Accumulated other comprehensive loss

 

 

(360.6

)

 

 

(394.5

)

Total Cinemark Holdings, Inc.'s stockholders' equity

 

 

286.3

 

 

 

322.9

 

Noncontrolling interests

 

 

13.1

 

 

 

11.6

 

Total equity

 

 

299.4

 

 

 

334.5

 

Total liabilities and equity

 

$

5,024.3

 

 

$

5,230.6

 

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

4


 

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF LOSS

(in millions, except per share data, unaudited)

 

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

2021

 

Revenues

 

 

 

 

 

 

Admissions

 

$

235.8

 

 

$

56.1

 

Concession

 

 

173.0

 

 

 

39.5

 

Other

 

 

51.7

 

 

 

18.8

 

Total revenues

 

 

460.5

 

 

 

114.4

 

Cost of operations

 

 

 

 

 

 

Film rentals and advertising

 

 

127.6

 

 

 

23.2

 

Concession supplies

 

 

30.0

 

 

 

7.2

 

Salaries and wages

 

 

79.8

 

 

 

31.2

 

Facility lease expense

 

 

73.7

 

 

 

64.8

 

Utilities and other

 

 

86.9

 

 

 

49.1

 

General and administrative expenses

 

 

40.7

 

 

 

35.9

 

Depreciation and amortization

 

 

61.7

 

 

 

68.2

 

Restructuring costs

 

 

 

 

 

(0.2

)

(Gain) loss on disposal of assets and other

 

 

(6.9

)

 

 

4.5

 

Total cost of operations

 

 

493.5

 

 

 

283.9

 

Operating loss

 

 

(33.0

)

 

 

(169.5

)

Other income (expense)

 

 

 

 

 

 

Interest expense

 

 

(38.1

)

 

 

(36.6

)

Interest income

 

 

1.6

 

 

 

0.6

 

Loss on extinguishment of debt

 

 

 

 

 

(2.6

)

Foreign currency exchange gain (loss)

 

 

3.2

 

 

 

(3.0

)

Distributions from NCM

 

 

 

 

 

0.1

 

Interest expense - NCM

 

 

(5.8

)

 

 

(5.8

)

Equity in loss of affiliates

 

 

(2.2

)

 

 

(6.8

)

Total other expense

 

 

(41.3

)

 

 

(54.1

)

Loss before income taxes

 

 

(74.3

)

 

 

(223.6

)

Income tax benefit

 

 

(1.8

)

 

 

(14.7

)

Net loss

 

$

(72.5

)

 

$

(208.9

)

Less: Net income (loss) attributable to noncontrolling interests

 

 

1.5

 

 

 

(0.6

)

Net loss attributable to Cinemark Holdings, Inc.

 

$

(74.0

)

 

$

(208.3

)

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

 

 

 

 

Basic

 

 

117.9

 

 

 

117.2

 

Diluted

 

 

117.9

 

 

 

117.2

 

Loss per share attributable to Cinemark Holdings, Inc.'s common stockholders

 

 

 

 

 

 

Basic

 

$

(0.62

)

 

$

(1.75

)

Diluted

 

$

(0.62

)

 

$

(1.75

)

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

5


 

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in millions, unaudited)

 

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

2021

 

Net loss

 

$

(72.5

)

 

$

(208.9

)

Other comprehensive income (loss), net of tax

 

 

 

 

 

 

Unrealized gain due to fair value adjustments on interest rate swap agreements, net of taxes and settlements

 

 

18.4

 

 

 

5.7

 

Foreign currency translation adjustments

 

 

14.4

 

 

 

(9.5

)

Total other comprehensive income (loss), net of tax

 

$

32.8

 

 

$

(3.8

)

Total comprehensive loss, net of tax

 

 

(39.7

)

 

 

(212.7

)

Comprehensive (income) loss attributable to noncontrolling interests

 

 

(1.5

)

 

 

0.6

 

Comprehensive loss attributable to Cinemark Holdings, Inc.

 

$

(41.2

)

 

$

(212.1

)

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

6


 

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions, unaudited)

 

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

2021

 

Operating activities

 

 

 

 

 

 

Net loss

 

$

(72.5

)

 

$

(208.9

)

Adjustments to reconcile net loss to cash used for operating activities:

 

 

 

 

 

 

Depreciation

 

 

61.1

 

 

 

67.5

 

Amortization of intangible and other assets

 

 

0.6

 

 

 

0.7

 

Amortization of debt issue costs

 

 

2.7

 

 

 

2.6

 

Interest accrued on NCM screen advertising advances

 

 

5.8

 

 

 

5.8

 

Amortization of NCM screen advertising advances and other deferred revenues

 

 

(8.2

)

 

 

(7.9

)

Amortization of accumulated losses for amended swap agreements

 

 

1.1

 

 

 

1.1

 

Share based awards compensation expense

 

 

5.1

 

 

 

4.7

 

(Gain) loss on disposal of assets and other

 

 

(6.9

)

 

 

4.5

 

Loss on extinguishment of debt

 

 

 

 

 

2.6

 

Non-cash rent expense

 

 

(2.3

)

 

 

0.1

 

Equity in loss of affiliates

 

 

2.2

 

 

 

6.8

 

Deferred income tax benefit

 

 

(3.2

)

 

 

(18.1

)

Distributions from equity investees

 

 

0.6

 

 

 

0.2

 

Changes in assets and liabilities and other

 

 

(104.9

)

 

 

14.2

 

Net cash used for operating activities

 

 

(118.8

)

 

 

(124.1

)

 

 

 

 

 

 

 

Investing activities

 

 

 

 

 

 

Additions to theatre properties and equipment

 

 

(18.7

)

 

 

(17.7

)

Proceeds from sale of theatre properties and equipment and other

 

 

10.6

 

 

 

 

Net cash used for investing activities

 

 

(8.1

)

 

 

(17.7

)

 

 

 

 

 

 

 

Financing activities

 

 

 

 

 

 

Restricted stock withholdings for payroll taxes

 

 

(1.6

)

 

 

 

Proceeds from issuance of senior notes

 

 

 

 

 

405.0

 

Proceeds from other borrowings

 

 

 

 

 

9.0

 

Redemption of senior notes

 

 

 

 

 

(400.0

)

Repayments of long-term debt

 

 

(3.4

)

 

 

(2.0

)

Payment of debt issue costs

 

 

 

 

 

(6.0

)

Fees paid related to debt refinancing

 

 

 

 

 

(1.5

)

Payments on finance leases

 

 

(3.6

)

 

 

(3.7

)

Net cash provided by (used for) financing activities

 

 

(8.6

)

 

 

0.8

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

 

(3.2

)

 

 

(1.6

)

 

 

 

 

 

 

 

Decrease in cash and cash equivalents

 

 

(138.7

)

 

 

(142.6

)

 

 

 

 

 

 

 

Cash and cash equivalents:

 

 

 

 

 

 

Beginning of period

 

 

707.3

 

 

 

655.3

 

End of period

 

$

568.6

 

 

$

512.7

 

 

 

 

 

 

 

 

 

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

7


CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

 

1.
The Company and Basis of Presentation

The Company and its subsidiaries operate in the motion picture exhibition industry, with theatres in the United States (“U.S.”), Brazil, Argentina, Chile, Colombia, Peru, Ecuador, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, Guatemala, Bolivia, Curacao and Paraguay.

The accompanying condensed consolidated balance sheet as of December 31, 2021, which was derived from audited financial statements, and the unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete consolidated financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from these estimates. Majority-owned subsidiaries of which the Company has control are consolidated while those affiliates of which the Company owns between 20% and 50% and does not control are accounted for under the equity method. Those affiliates of which the Company owns less than 20% are generally accounted for under the cost method, unless the Company is deemed to have the ability to exercise significant influence over the affiliate, in which case the Company would account for its investment under the equity method. The results of these subsidiaries and affiliates are included in the condensed consolidated financial statements effective with their formation or from their dates of acquisition. Intercompany balances and transactions are eliminated in consolidation.

These condensed consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and the notes thereto for the year ended December 31, 2021, included in the Annual Report on Form 10-K filed February 25, 2022 by the Company under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Operating results for the three months ended March 31, 2022 are not necessarily indicative of the results to be achieved for the full year.

Amounts included in the condensed consolidated financial statements of this Quarterly Report on Form 10-Q are rounded in millions. The amounts reported in the consolidated financial statements, and the notes thereto, of the Annual Report on Form 10-K for the year ended December 31, 2021 filed February 25, 2022 are rounded in thousands.

2.
Impact of the COVID-19 Pandemic

The COVID-19 pandemic has had an unprecedented impact on the world and the movie exhibition industry with widespread social and economic effects. The Company temporarily closed its theatres in the U.S. and Latin America during March of 2020 at the onset of the COVID-19 outbreak. During that time, the Company implemented various cash preservation strategies, including, but not limited to, temporary personnel and salary reductions, halting non-essential operating and capital expenditures, negotiating modified timing and/or abatement of contractual payments with landlords and other major suppliers, and the suspension of its quarterly dividend.

Throughout 2020 and 2021 the Company reopened theatres as local restrictions and the status of the COVID-19 pandemic would allow. All of the Company's domestic and international theatres were reopened by the end of the fourth quarter of 2021. The industry’s recovery from the COVID-19 pandemic is still underway and is contingent upon the volume of new film content available, as well as the box office performance of new film content released, consumer sentiment in returning to move theaters and government restrictions. The industry is also adjusting to the evolution of the exclusive theatrical window, competition from streaming platforms, supply chain constraints, inflationary impacts and other economic factors.

Restructuring Charges

During June 2020, Company management approved and announced a restructuring plan to realign its operations to create a more efficient cost structure (referred to herein as the “Restructuring Plan”) in response to the COVID-19 pandemic. The Restructuring Plan primarily included a headcount reduction at its domestic corporate office and the permanent closure of certain domestic and international theatres. The Company paid approximately $0.5 related to previously accrued restructuring costs during the three months ended March 31, 2022. The remaining accrued restructuring costs of $1.0, which are primarily related to facility closure costs, are reflected in accounts payable and accrued expenses on the condensed consolidated balance sheet as of March 31, 2022.

3.
New Accounting Pronouncements

Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, (“ASU 2020-04”) and ASU 2021-01, Reference Rate Reform (Topic 848): Scope, (“ASU 2021-01”). The purpose of ASU 2020-04 is to provide optional guidance for a limited period of time to ease the potential burden in accounting for

8


CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

 

(or recognizing the effects of) reference rate reform on financial reporting. More specifically, the amendments in ASU 2020-04 provide optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in ASU 2021-01 clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The amendments in ASU 2020-04 and ASU 2021-01 are effective as of March 12, 2020 through December 31, 2022. The Company does not expect ASU 2020-04 and ASU 2021-01 to have a material impact on its condensed consolidated financial statements.

ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance, (“ASU 2021-10”). The purpose of ASU 2021-10 is to provide annual disclosure guidance about transactions with a government for which the entity is applying a grant or contribution accounting model by analogy. More specifically, the amendments in ASU 2021-10 require disclosure of a) the nature of the transactions and the related accounting policy used to account for the transactions, b) the line items on the balance sheet and income statement, including the amounts applicable to each line item, that are affected by the transactions and c) significant terms and conditions of the transactions, including commitments and contingencies. The amendments in ASU 2021-10 are effective for annual periods beginning after December 15, 2021. The amendments in ASU 2021-10 should be applied either a) prospectively to all transactions at the date of initial application and new transactions that are entered into after the date of initial application or b) retrospectively to those transactions. The Company will provide the disclosures required by ASU 2021-10 in its Form 10-K for the year ended December 31, 2022.

4.
Lease Accounting

Lease Deferrals and Abatements

Upon the temporary closure of theatres in March 2020, the Company began negotiating the deferral of rent and other lease-related payments with its landlords while theatres remained closed. These discussions and negotiations have remained ongoing as the Company continues to be impacted by the COVID-19 pandemic. These negotiations resulted in amendments to the leases that involve varying concessions, including the abatement of rent payments during closure, deferral of all or a portion of rent payments to later periods and deferrals of rent payments combined with an early exercise of an existing renewal option or extension of the lease term. Total remaining deferred payments as of March 31, 2022 and December 31, 2021 were $22.1 and $31.9, respectively, and are included in accounts payable and accrued expenses in the condensed consolidated balance sheets.

The following table represents the Company’s aggregate lease costs, by lease classification, for the periods presented.

 

 

 

Three Months Ended

 

 

 

 

March 31,

 

Lease Cost

Classification

 

2022

 

 

2021

 

Operating lease costs

 

 

 

 

 

 

 

Equipment (1)

Utilities and other

 

$

0.6

 

 

$

0.4

 

Real Estate (2)(3)

Facility lease expense

 

 

75.0

 

 

 

63.8

 

Total operating lease costs

 

 

$

75.6

 

 

$

64.2

 

 

 

 

 

 

 

 

 

Finance lease costs

 

 

 

 

 

 

 

Amortization of leased assets

Depreciation and amortization

 

$

3.1

 

 

$

3.2

 

Interest on lease liabilities

Interest expense

 

 

1.4

 

 

 

1.6

 

Total finance lease costs

 

 

$

4.5

 

 

$

4.8

 

(1)
Includes approximately $0.5 and $0.3 of short-term lease payments for the three months ended March 31, 2022 and 2021, respectively.
(2)
Includes approximately $5.9 and $(2.3) of variable lease payments based on a change in index, such as CPI or inflation, variable payments based on revenues or attendance and variable common area maintenance costs for the three months ended March 31, 2022 and 2021, respectively. The credit amount for the three months ended March 31, 2022 is due to the abatement of certain lease payments as discussed at Lease Deferrals and Abatements above.
(3)
Approximately $0.3 and $0.4 of lease payments are included in general and administrative expenses primarily related to office leases for the three months ended March 31, 2022 and 2021, respectively.

9


CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

 

The following table represents the minimum cash lease payments included in the measurement of lease liabilities and the non-cash addition of lease right-of-use assets for the periods presented.

 

 

Three Months Ended

 

 

 

March 31,

 

Other Information

 

2022

 

 

2021

 

Cash paid for amounts included in the measurement of lease liabilities

 

 

 

 

 

 

Cash outflows for operating leases

 

$

69.3

 

 

$

66.2

 

Cash outflows for finance leases - operating activities

 

$

1.4

 

 

$

1.6

 

Cash outflows for finance leases - financing activities

 

$

3.6

 

 

$

3.7

 

Non-cash amount of right-of-use assets obtained in exchange for:

 

 

 

 

 

 

Operating lease liability additions, net of write-offs

 

$

11.8

 

 

$

24.9

 

As of March 31, 2022, the Company had signed lease agreements with total noncancelable lease payments of approximately $90.8 related to theatre leases that had not yet commenced. The timing of lease commencement is dependent on the completion of construction of the related theatre facility. Additionally, these amounts are based on estimated square footage and costs to construct each facility and may be subject to adjustment upon final completion of each construction project. In accordance with ASC Topic 842, fixed minimum lease payments related to these theatres are not included in the right-of-use assets and lease liabilities as of March 31, 2022.

5.
Revenue Recognition

The Company’s patrons have the option to purchase movie tickets well in advance of a movie showtime or right before the movie showtime, or at any point in between those two timeframes depending on seat availability. The Company recognizes such admissions revenue when the showtime for a purchased movie ticket has passed. Concession revenue is recognized when products are sold to the consumer. Other revenues primarily consist of screen advertising and screen rental revenues, promotional income, studio trailer placements and transactional fees. Except for National CineMedia, LLC. ("NCM") screen advertising advances discussed below in Note 9, these revenues are generally recognized when the Company has performed the related services. The Company sells gift cards and discount ticket vouchers, the proceeds from which are recorded as deferred revenue. Deferred revenue for gift cards and discount ticket vouchers is recognized when they are redeemed for concession items or, if redeemed for movie tickets, when the showtime has passed. The Company generally records breakage revenue on gift cards and discount ticket vouchers based on redemption activity and historical experience with unused balances. The Company offers a subscription program in the U.S. whereby patrons can pay a monthly or annual fee to receive a monthly credit for use towards a future movie ticket purchase. The Company records the subscription program fees as deferred revenue and records admissions revenue when the showtime for a movie ticket purchased with a credit has passed. The Company has loyalty programs in the U.S. and many of its international locations that either have a prepaid annual fee or award points to customers as purchases are made. For those loyalty programs that have a prepaid annual fee, the Company recognizes the fee collected as other revenue on a straight-line basis. For those loyalty programs that award points to customers based on their purchases, the Company records a portion of the original transaction proceeds as deferred revenue based on the number of reward points issued to customers and recognizes the deferred revenue when the customer redeems such points. The value of loyalty points issued is based on the estimated fair value of the rewards offered. The Company records breakage revenue on its loyalty and subscription programs generally upon the expiration of loyalty points or subscription credits. Advances collected on other contracts are deferred and recognized during the period in which the Company satisfies the related performance obligations, which may differ from the period in which the advances are collected.

Accounts receivable as of March 31, 2022 and December 31, 2021 included approximately $22.6 and $23.5 respectively, of receivables related to contracts with customers. The Company did not record any assets related to the costs to obtain or fulfill a contract with customers during the three months ended March 31, 2022.

 

10


CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

 

Disaggregation of Revenue

The following tables represent revenues, disaggregated based on major type of good or service and by reportable operating segment, for the periods presented.

 

 

Three Months Ended

 

 

 

March 31, 2022

 

 

 

U.S.

 

 

International

 

 

 

 

 

 

Operating

 

 

Operating

 

 

 

 

 

 

Segment (1)

 

 

Segment

 

 

Consolidated

 

Admissions revenues

 

$

191.8

 

 

$

44.0

 

 

$

235.8

 

Concession revenues

 

 

141.1

 

 

 

31.9

 

 

 

173.0

 

Screen advertising, screen rental and promotional revenues (2)

 

 

18.7

 

 

 

8.1

 

 

 

26.8

 

Other revenues

 

 

20.4

 

 

 

4.5

 

 

 

24.9

 

Total revenues

 

$

372.0

 

 

$

88.5

 

 

$