FORM 10 - K    
 
	SECURITIES AND EXCHANGE COMMISSION 
	WASHINGTON, D.C. 20549 
(Mark One) 
     (X)    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) 
             OF THE SECURITIES EXCHANGE ACT OF 1934 
	 For the fiscal year ended:  December 31, 1996 
                             OR                      
     ( )    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) 
             OF THE SECURITIES EXCHANGE ACT OF 1934 
	 For the transition period from             to             
 
	 Commission file number: 1-9454 
 
               CINEPLEX ODEON CORPORATION       
	(Exact name of Registrant as specified in its charter) 
 
	      Ontario, Canada        			Non-Resident Alien 
	(State or other jurisdiction			(I.R.S. Employer 
	 of incorporation or organization)		 Identification No.) 
 
	  1303 Yonge Street, Toronto, Ontario   	  M4T 2Y9     
	(Address of principal executive offices)	(Postal Code) 
 
	          416-323-6600         
	(Registrant's telephone number  
	including area code) 
								 
Securities registered pursuant to Section 12(b) of the Act: 
Title of each class:	Name of each exchange on which  registered: 

Common Shares		New York Stock Exchange 
			Toronto Stock Exchange 
 
Securities registered pursuant to Section 12(g) of the Act: 
	None 
 
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 periods that the Registrant was required to  
file such reports), and (2) has been subject to such filing  
requirements for the past 90 days.	 Yes X or No   
                                       ---
Indicate by check mark if disclosure of delinquent filers  
pursuant to Item 405 of Regulation S-K is not contained herein,  
and will not be contained, to the best of registrant's knowledge,  
in definitive proxy or information statements incorporated by  
reference in Part III of the Form 10-K or any amendment to this  
Form 10-K	(X) 
 
TOTAL NO. OF PAGES  
EXHIBIT INDEX PAGE  
 
 
As of February 20, 1997, Cineplex Odeon Corporation had  
103,334,157 Common Shares without par value, outstanding, and the  
aggregate market value of the Common Shares (based on the last  
sale price of such stock as reported by the New York Stock  
Exchange for February 20, 1997) held by nonaffiliates on such  
date was approximately $83,230,000. All officers, directors and  
more than 5% shareholders of the registrant have been deemed  
"affiliates" for the purpose of calculating such aggregate market  
value. The registrant does not represent that such persons, or  
any of them, would be deemed "affiliates" of the registrant for  
any other purpose of the United States Federal Securities Laws. 
 
DOCUMENTS INCORPORATED BY REFERENCE 
 
Portions of the Corporation's definitive Proxy Statement for the  
annual meeting to be held on June 5, 1997 (the "Proxy Statement")  
are incorporated by reference into Part III of this Form 10-K. 
 
 
 
			PART I 
 
ITEM 1. 	BUSINESS 
 
General 
 
The Corporation is engaged primarily in the operation of motion  
picture theatres in the United States and Canada.  The  
Corporation was originally incorporated in Ontario, Canada on  
July 19, 1977, and commenced operations in April 1979. It  
maintains its principal executive offices at 1303 Yonge Street,  
Toronto, Ontario, Canada M4T 2Y9.  The Corporation's telephone  
number is (416) 323-6600.  Unless otherwise specified, or the  
context otherwise requires, the term "Corporation" as used herein  
shall mean the Corporation and its consolidated subsidiaries. 
 
Recent Developments 
 
The Corporation's bank credit facilities contain restrictive  
covenants which require maintenance of specific financial ratios.  
At December 31, 1996, the Corporation failed to meet certain  
financial covenants under its bank credit facilities and  
subsequent to that date, the Corporation's bankers agreed to  
amend specific financial covenants for the quarter ended December  
31, 1996 and for all four quarters of 1997.  Given the  
uncertainty with respect to the admission and concession revenue  
that the Corporation will generate, there is a possibility that  
the Corporation may not meet certain financial covenants in the  
future.  The Corporation believes that the bank syndicate  
participating in the bank credit facilities would waive the  
particular financial covenants if the Corporation is not in  
compliance at a measurement date during the next twelve month  
period. 
 
For a further discussion of 1996 events, see Part II - Item 7  
"Management's Discussion and Analysis of Results of Operations  
and Financial Condition." 
 
Theatre Operations 
 
At December 31, 1996, the Corporation operated 183 theatres in  
the United States, 132 in Canada and one in Hungary with an  
aggregate of 1,549 screens. Most of the Corporation's theatres  
are multi-screen facilities. 
 
The Corporation's head office is located in Toronto. Regional  
offices are located in Los Angeles, New York, Chicago, Seattle,  
Montreal, Minneapolis, Salt Lake City, and Washington, D.C. Head  
office activities include corporate policy development, strategic  
planning, site selection, theatre design, construction  
coordination, labour negotiations, advertising, concession and  
supply purchases, finance, accounting and data processing  
activities. 
 
Theatre Circuit Development 
 
In 1996 the Corporation opened 2 new theatres and refurbished 5  
theatres in the United States adding a total of 31 new screens.  
In Canada in 1996 the Corporation opened 3 new theatres and  
refurbished 8 theatres adding a total of 44 new screens. The  
Corporation is also a partner in 4 new Canadian theatres which  
opened in 1996 (adding 30 new screens). In addition, as part of  
its longer term strategy, the Corporation opened its first  
theatre outside of North America in Budapest, Hungary adding 6  
new screens. 
 
In July 1996, the Corporation sold 5 theatres, encompassing 27  
screens located in Texas. In addition to this sale the  
Corporation sold or closed an additional 17 theatre locations,  
encompassing 57 screens during 1996.  
 
Management's current strategy is to increase its revenue and  
operating cash flow by developing and building additional  
theatres and screens in target markets that complement the  
Corporation's existing position in such markets or that provide  
the Corporation with a strategic position in a new market.   
During 1997 the Corporation expects, in North America, to open 14  
new theatre locations (adding 151 new screens) and refurbish a  
total of 7 theatres (adding 38 new screens).  
 
Film Licensing 
 
The Corporation obtains licenses to exhibit "first-run" films  
by directly negotiating with or, in limited circumstances,  
submitting bids to film distributors.  Film exhibition licenses  
typically specify rental fees based upon the higher of a gross  
receipts formula or a theatre admissions revenue-sharing formula.  
 Under a gross receipts formula, the distributor receives a  
specified percentage of box office receipts, with the percentage  
generally declining over the term of the run. Under a theatre  
admissions revenue-sharing formula, the distributor receives a  
specified percentage of the excess of box office receipts over  
certain house expenses. 
 
A distributor will either require the exhibitors in a zone to bid  
for a film or will allocate its films among the exhibitors in the  
zone. When films are licensed under the allocation process, a  
distributor will choose which exhibitor is offered a movie and  
then that exhibitor will negotiate film rental terms directly  
with the distributor for the film. Over the past several years,  
distributors have generally used the allocation rather than the  
bidding process to license their films. 
 
The Corporation's theatre exhibition business is dependent upon  
the availability of popular well-marketed motion pictures.  
Accordingly, consistent poor performance of major release films  
or disruption in the production of motion pictures by the major  
studios and/or independent producers could, over time, have a  
material adverse affect on the Corporation. 
 
Film Distribution 
 
The Corporation's distribution entity, Cineplex Odeon Films  
Canada, is primarily in the business of distributing films in  
Canada to the Corporation and other exhibitors for theatre  
exhibition and for broadcast by network, syndicated and pay  
television, as well as for home viewing through video-cassette  
systems. In 1996, distribution activity in Canada included the  
provision of theatrical distribution services for Columbia Tri- 
Star Films Canada, Gramercy Pictures Inc. and PolyGram Filmed  
Entertainment, in addition to the ongoing distribution of motion  
pictures in all media for various other producers and/or  
distributors. 
 
Geographic Financial Information 
 
For information concerning revenue, income(loss) from operations  
and assets in the Corporation's different geographic areas for  
the last three years, reference should be made to Note 14 of the  
Notes to the Consolidated Financial Statements in Part II - Item  
8 "Financial Statements and Supplementary Data."  
 
 
Competition 
 
The Corporation is the fifth largest film exhibitor in North  
America in terms of number of screens and the third largest in  
terms of box office revenue as of December 31, 1996. The major  
market focus of the Corporation allows its theatre assets to  
serve above average patron volumes compared to the industry.  
Approximately 88% of the Corporation's U.S. screens are located  
in 10 of the 15 largest U.S. Areas of Dominant Influence.  
Approximately 78% of the Corporation's Canadian screens are  
located in the 10 largest Canadian cities. The Corporation is the  
largest film exhibitor in Canada and the ninth largest in the  
United States based upon number of screens. 
 
The Corporation competes with other theatre circuits and  
independent theatres with respect to acquiring licenses to  
successful films, attracting patrons and finding new theatre  
sites.  Throughout 1996 there has been an approximate 7.8% growth  
in the total number of screens in North America.  This growth has  
been largely fuelled by exhibitors in the United States building  
enormous complexes with 25 to 35 screens.  While management  
agrees that megaplexes are important there is no evidence that  
more screens and more flexible show times have an appreciable  
effect in expanding audiences.  In certain markets such growth is  
having an impact on the Corporation's theatres.  The Corporation,  
through its 1997 expansion program, will attempt to address the  
increase in the industry screen count with its continuing  
expansion program so as to increase market share. 
 
Film distributors seek to place films in theatres from which they  
can derive the greatest box office revenues. The Corporation  
believes the principal competitive factors in obtaining films  
from distributors include licensing terms, seating capacity,  
location, prestige of the theatre circuit and of the particular  
theatre, quality of projection and sound equipment and the  
exhibitor's ability and willingness to promote the distributor's  
films. 
 
The Corporation believes that the principal competitive factors  
in attracting film audiences are the availability of marketable  
films, the location of theatres, theatre comfort and environment,  
projection and sound quality, level of service and ticket price.  
 
The theatre exhibition industry also faces competition from other  
motion picture exhibition delivery systems, such as network,  
syndicated and pay television and home video systems. The  
Corporation believes that theatre exhibition competes effectively  
with these and other alternative exhibition delivery systems for  
a variety of reasons including the larger screen size and  
superior audio quality. Further, the strength of these  
alternative media are largely dependent on the successful  
theatrical release in North America of first-run film product. In  
addition, there has been significant growth in theatrical  
exhibition markets outside of North America. Although this growth  
and successful first run exhibitions of motion pictures help  
companies in these other business areas derive greater returns,  
the Corporation believes that such returns also benefit the  
Corporation by providing additional capital to producers and  
distributors to finance and distribute new motion pictures which  
may be exhibited in the Corporation's theatres.   
 
Regulatory Environment 
 
The Corporation, as an exhibitor of motion pictures, is affected  
by certain United States judicial decrees (the "Decrees")  
regulating the trade practices of major motion picture  
distributors and a small number of motion picture exhibitors  
formerly owned by such distributors. The Corporation is not a  
party to the Decrees. The Decrees provide, among other things,  
that parties subject to the Decrees must distribute motion  
pictures to exhibitors on a picture-by-picture and theatre-by- 
theatre basis. 
 
The Federal Americans With Disabilities Act ("the Disabilities  
Act") prohibits discrimination on the basis of disability in  
public accommodations and employment. The Disabilities Act became  
effective as to public accommodations in January 1992 and as to  
employment in July 1992. The Corporation is unable to predict  
precisely the extent to which the Disabilities Act will impact  
the Corporation. However, the Corporation currently constructs  
new theatres to be accessible to the disabled and believes that  
it is otherwise in substantial compliance with all current  
applicable regulations relating to accommodations for the  
disabled. The Corporation intends to comply with future  
regulations relating to accommodating the needs of the disabled,  
and the Corporation does not currently anticipate that such  
compliance will have a material adverse effect on the Company. 
 
Employees 
 
As of December 31, 1996, the Corporation had 1,480 full-time  
employees in the United States, 847 full-time employees in  
Canada, 3,248 part-time employees in the United States and 2,087  
part-time employees in Canada. The number of employees fluctuates  
due to the seasonal nature of the Corporation's business.  
Approximately 39.8% of the part-time employees are paid the  
minimum wage. Approximately 7.5% of the employees of the  
Corporation are film projectionists, who are represented by the  
International Alliance of Theatrical Stagehand Employees and  
Moving Picture Machine Operators ("I.A.T.S.E."). Approximately  
5.0% of the employees of the Corporation are ushers, ticket  
takers, cashiers, cleaners, stagehands or concession workers who  
are represented by the Service Employees International Union, the  
B.C. Government Employees Union, the I.A.T.S.E. Stagehands Union,  
the I.A.T.S.E. Front of House Union, the United Food and  
Commercial Workers Union or the Transportation Technical  
Warehouse Industrial and Service Employees Union. 
 
The Corporation experienced a work stoppage between October 26,  
1996 and March 17, 1997 when it locked out projectionists of  
Local 173 in the following markets in Ontario:  Toronto, Ottawa,  
Niagara Peninsula, Thunder Bay, and Sudbury. On March 9, 1997 the  
union members of Local 173 accepted the Corporation's new  
contract offer and members of the union will return to work as of  
March 18, 1997. On February 24, 1997 the Corporation locked out  
projectionists of Local 303 in Hamilton and Burlington, Ontario  
as members of that union local rejected the new contract offer  
from the Corporation.  All of the Corporation's theatres  
continued to operate throughout the lockouts and there has been  
no adverse effect on theatre revenues as a result of the  
lockouts. The Corporation is currently in negotiations with  
I.A.T.S.E. in Alberta and Quebec City and there is the chance of  
a work stoppage in 1997 in these markets. However, all theatres  
will continue to operate as they did throughout the lockout in  
Ontario.  Contracts will be expiring in 1997 in the following  
Canadian markets: Saskatchewan, Manitoba, and the Greater  
Montreal area.  There is the possibility of labour disputes in  
all those markets but the theatres will continue to operate  
should a labour dispute occur. 
 
In the province of Quebec, the front of house bargaining  
agreement is currently in arbitration. 
 
In the United States, negotiations with projectionists continue  
in Tacoma, Washington and San Francisco, California.  The  
Corporation will be entering into negotiations in Seattle,  
Washington and Los Angeles, California.  The possibility of  
labour disputes exist in all those markets.  However, the  
theatres will continue to operate in the event of a strike or  
lockout.  
 
 Seasonality 
 
Admission and concession revenues are subject to seasonal  
fluctuations which affect all motion picture exhibitors. These  
fluctuations are the result of the distribution practices of the  
major motion picture studios which have historically concentrated  
the release of films during the summer and holiday seasons.  The  
major motion picture studios have, to some degree, addressed the  
seasonality of motion picture exhibition with a strong first  
quarter release schedule in both 1996 and 1997. 
 
 
ITEM 2.		PROPERTIES. 
 
As of December 31, 1996, the Corporation leased an aggregate of  
271 theatre locations, approximating 86% of all its theatre  
locations, having terms (including options) generally ranging  
from 15 to 40 years.  For further information regarding leased  
locations see Note 11 of the Notes to the Consolidated Financial  
Statements in Part II - Item 8 "Financial Statements and  
Supplementary Data." In addition to leasing premises the  
Corporation owned 44 theatres at December 31, 1996, of which 22  
are in the United States and 22 are in Canada, and one office  
building in Toronto which is the site of the Corporation's head  
office.   
 

ITEM 3.		LEGAL PROCEEDINGS. 
  
The Corporation has been, and continues to be, involved in  
numerous legal proceedings.  However, although such matters  
cannot be predicted with certainty, the Corporation does not  
believe that such lawsuits are likely to result in a judgment  
which would have a material adverse effect on the Corporation's  
financial condition. 
 
 
ITEM 4.		SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. 
 
		Not applicable. 
 
 
 
 
Executive Officers 
 
 
As of February 1, 1997, the Corporation's executive officers were  
as follows: 
 
 
	Name			Age			Office 
 
Ernest Leo Kolber		68		Chairman of the Board and 
						Director 
 
Allen Karp			56		President, Chief Executive 									Officer and Director 
 
Irwin A. Cohen			56		Executive Vice-President, 
						Operations for North America 
 
Michael Herman			42		Executive Vice-President, 
 						Corporate Affairs and  Secretary 
 
Ellis Jacob			43		Executive Vice-President,  Chief 
						Financial Officer and Director 
 
Howard I. Lichtman		42		Executive Vice-President, 
						Marketing and Communications 
 
Robert Tokio			53		Executive Vice-President 
 
Stephen Brown			38		Senior Vice-President, 
						Treasury and Tax 
 
Michael McCartney		42		Senior Vice-President, 
						Head Film Buyer, North America 
 
James Vassos			42		Senior Vice-President, 
						Business Affairs and Planning 
 
 
Senator Kolber was appointed Chairman of the Board of the  
Corporation in December 1989. He has been a Member of the Senate  
of Canada since December 1983. From October 1987 to September  
1993, Senator Kolber was Chairman of Claridge Inc. Senator Kolber  
is a director of The Seagram Company Ltd. and The Toronto- 
Dominion Bank. Senator Kolber has been a director of the  
Corporation since December 1989. 
 
Mr. Karp has been President and Chief Executive Officer of the  
Corporation since June 1990. He served as President and Chief  
Operating Officer from December 1989 to June 1990. Mr. Karp was  
Senior Executive Vice-President of the Corporation from July 1986  
to December 1989, and President, North American Theatres Division  
of the Corporation from August 1988 to December 1989. Mr. Karp is  
a director of Alliance Communications Corporation and Speedy  
Muffler King Inc. Mr Karp has been a director of the Corporation  
since May 1987. 
 
Mr. Cohen has been Executive Vice-President, Operations for North  
America since January 1993. From October 1988 to January 1993 he  
served as Senior Vice-President, Theatre Operations, U.S. and  
from November 1985 to October 1988 he served as Vice-President,  
Northern Division. 
 
Mr. Herman has been Executive Vice-President, Corporate Affairs  
and Secretary of the Corporation since January, 1995. He served  
as Senior Vice President, Corporate Affairs and Secretary of the  
Corporation from May 1992 to December 1994. Mr. Herman was a  
partner in the law firm of Goodman and Carr, Toronto from  
February 1987 to May 1992. 
 
Mr. Jacob has been Executive Vice-President and Chief Financial  
Officer of the Corporation since December 1989. From February  
1989 to December 1989, he served as Senior Vice-President and  
Chief Financial Officer; from October 1987 to February 1989 he  
served as Vice-President Finance and Corporate Controller. Mr.  
Jacob is a director of Alliance Communications Corporation. Mr.  
Jacob has been a director of the Corporation since June 1990. 
 
Mr. Lichtman has been Executive Vice-President, Marketing and  
Communications since December 1989. From August 1988 to December  
1989, he served as Senior Vice-President, Marketing; as Vice- 
President, Marketing & Promotions from August 1987 to August  
1988; as Vice-President, Theatre Publicity and Promotions from  
October 1986 to August 1987; and as Director of Publicity and  
Promotions for Canadian Theatre Operations from July 1985 to  
October 1986.  
 
Mr. Tokio has been Executive Vice-President since November 1990.  
He served as Executive Vice-President, Real Estate, from December  
1989 to November 1990. From November 1988 to December 1989, he  
served as Senior Vice-President, Real Estate Administration.  
 
Mr. Brown has been Senior Vice-President, Treasury and Tax of the  
Corporation since January 1995. He served as Vice President,  
Taxation and Treasurer from August 1990 to December, 1994. Mr.  
Brown joined the Corporation in March 1990 as Director of  
Internal Audit. 
 
Mr. McCartney has been Senior Vice-President, Head Film Buyer,  
North America, since November 1995. From December 1991 to  
November 1995 he served as Senior Vice-President, Film, U.S. and  
from September 1988 to December 1991 he served as Vice-President,  
Film, U.S. Mr. McCartney joined the Corporation in September 1986  
as Regional Film Buyer handling the southern division.  
 
Mr. Vassos has been Senior Vice President, Business Affairs and  
Planning since January 1995. He served as Vice President,  
Business Affairs and Corporate Controller from May 1991 to  
December 1994. Mr. Vassos had been Vice President and Corporate  
Controller from January 1990 to April 1991. From February 1989 to  
January 1990, Mr. Vassos held the position of Senior Controller -  
Planning and Consolidation. Mr Vassos joined the Corporation in  
November 1987 as Controller - Planning.  
 
 
			PART II 
 
ITEM 5.		MARKET FOR THE REGISTRANT'S COMMON EQUITY AND
 		RELATED STOCKHOLDER  MATTERS. 
 
Market Information 
 
The Corporation's Common Shares trade on the New York Stock Exchange and  
the Toronto Stock Exchange under the ticker symbol CPX. The following table  
indicates the quarterly price range of the Common Shares for the past two  
years. 
 
			Toronto Stock Exchange	New York Stock Exchange 
			(CDN. DOLLARS)	(U.S. DOLLARS) 
			  --------------------------------------------------------------- 
 
Fiscal 1995:		   High	 Low		High	 Low 
-------------------------------------------------------- 
First  Quarter		   3.95	2.63		2.88	 1.75 
Second Quarter		   3.40	2.62		2.50	 1.88 
Third  Quarter		   3.15	2.55		2.38	 1.88 
Fourth Quarter		   2.73	1.92		2.00	 1.38 
 
Fiscal 1996:		   High	  Low		High	Low 
-------------------------------------------------------- 
First  Quarter		   2.73	1.70		2.50	1.25 
Second Quarter		   3.35	1.65		2.50	1.25
Third  Quarter		   2.80	2.05		2.13	1.50 
Fourth Quarter		   2.25	1.87		1.63	1.38 
 
The Corporation's Common Shares began trading on the Toronto Stock Exchange  
on October 29, 1982 and on the New York Stock Exchange on May 14, 1987.  
 
Holders 
 
The Corporation had 1,842 registered common shareholders of record as at  
February 25, 1997.  This amount excludes shareholders whose shares are held  
in the name of investment dealers and other nominees. 
 
Dividends 
 
The Corporation has not paid any cash dividends. Under lending agreement  
restrictions currently in effect, the Corporation cannot pay any dividends  
unless it is in compliance with specified financial ratios. The Corporation  
is not currently in compliance with such financial ratios. Any such payment  
of dividends is further subject to annual limitations. 
 
Dividends paid to United States shareholders on the Corporation's Common  
Shares, if any, will be subject to Canadian non-resident withholding tax at  
the treaty reduced rate of 15% of the dividend which is generally  
applicable to dividends paid to a resident of the United States or 10% of  
the dividend where the beneficial owner is a company which owns 10% of the  
voting stock of the Corporation. A United States holder of Common Shares  
will generally not be subject to Canadian income tax in respect of capital  
gains realized on the disposition of Common Shares. 
 
 
ITEM 6.		SELECTED FINANCIAL DATA 

<TABLE>
<CAPTION>
 
      (In thousands of U.S. dollars except per share data) 
-----------------------------------------------------------------------------
			-------------Year ended December 31,------------------- 
		             1996             1995          1994         1993          1992 
----------------------------------------------------------------------------- 
<S>		      <C>		<C>	      <C>	          <C>	<C>

Revenues *	       $509,692	$513,150   $541,112   $546,230   $518,723 
 
Earnings before 
interest, taxes 
depreciation and 
amortization *	          49,438           51,966      62,725      72,244       38,230  
     
 
Operating cash flow 
excluding net change 
in non-cash working 
capital *		          10,468            10,972      27,767      38,158        2,618  
      
 
Operating cash 
flow *	     	          12,416              3,522      31,435      38,674       (1,698)  
 
Income(loss) *	         (31,082)          (32,907)   (14,173)         969      (39,713)   
 
Total assets	         644,171          649,643    688,693    697,105     741,652  
-------------------------------------------------------------------------------------------------
Long-term 
obligations                   335,447          393,556    390,752    344,967       422,580 
-------------------------------------------------------------------------------------------------
Shareholders' equity    218,580          165,992     196,175    200,387    	  198,966 
-------------------------------------------------------------------------------------------------
Earning(loss) per share * 
	Basic	             (0.19)          (0.29)         (0.13)         0.01             (0.46) 
 	Fully diluted       (0.19)          (0.29)         (0.13)         0.01             (0.46) 
------------------------------------------------------------------------------------------------ 
* From Continuing Operations 

</TABLE>
 
See the Notes to the Consolidated Financial Statements and Part II - Item 7  
"Management's Discussion and Analysis of Results of Operations and  
Financial Condition" with respect to various factors affecting the  
comparability of information with respect to the three fiscal years ended  
December 31, 1996. See Part II - Item 7 "Management's Discussion and  
Analysis of Results of Operations and Financial Condition" with respect to  
various factors which may have an effect on the Corporation's future  
financial condition and results of operations. 
 
<PAGE> 

ITEM. 7		Management's Discussion and Analysis of   
		Results of Operations and Financial Condition
	(All figures are in U.S. dollars except where otherwise noted)

INTRODUCTION

Management's discussion and analysis of results of operations and financial 
condition focuses on liquidity, capital resources and the results of the 
Corporation's operations. This section should be read in conjunction with 
the consolidated financial statements, the notes thereto and other 
information presented elsewhere herein.

The Corporation recorded a net loss for the year ended December 31, 1996 of 
$31,082,000 compared to a net loss for the year ended December 31, 1995 of 
$32,907,000 and a net loss for the year ended December 31, 1994 of 
$14,173,000.

LIQUIDITY AND CAPITAL RESOURCES

Cash Flow from Continuing Operations

Cash flow from operations in 1996 amounted to a net inflow of $12,416,000 
compared to a net inflow of $3,522,000 in 1995. Excluding the impact of the 
net change in non-cash working capital, the Corporation's cash flow from 
operations for the year ended December 31, 1996 amounted to a net inflow of 
$10,468,000 compared to a net inflow of $10,972,000 for the year ended 
December 31, 1995. 

Long-Term Debt

In March of 1996 the Corporation issued 25,000,000 Common Shares to the 
public at a price of $1.375 per share for an aggregate consideration of 
$34,375,000. In addition, in accordance with the provisions of the Amended 
and restated Subscription Agreement Universal Studios, Inc. and the Charles 
Rosner Bronfman Trust subscribed for 24,242,181 Subordinate Restricted 
Voting (SRV) Shares and 12,121,454 Common Shares respectively at the same 
price as the offering to the public for an aggregate consideration of 
$50,000,000. In April 1996, as part of the over-allotment option provided 
to the underwriters pursuant to the public offering, the Corporation issued 
a further 355,958 Common Shares at a price of $1.375 to the public. The 
aggregate consideration from this issuance was $489,000. The proceeds from 
the issuance of both the SRV and Common Shares were used to reduce the 
Corporation's revolving credit facilities.

Long-term debt decreased from $381,857,000 at December 31, 1995 to 
$326,058,000 at December 31, 1996. This decrease is the result of the 
equity proceeds raised by the Corporation in the first quarter of 1996 
which have been used to initially reduce the Corporation's revolving long-
term credit facilities.

Included in long-term debt at December 31, 1996 is an amount of $79,940,000 
relating to the Corporation's bank credit facilities. These bank credit 
facilities contain restrictive covenants which require the Corporation to 
maintain certain financial ratios. At December 31, 1996, the Corporation 
failed to meet certain financial covenants under these bank credit 
facilities. Subsequent to that date, the Corporation's bankers agreed to 
amend certain financial covenants for the quarter ended December 31, 1996 
and for all four quarters of 1997. Given the uncertainty with respect to 
the admission and concession revenue that the Corporation will generate, 
there is a possibility that the Corporation may not meet certain financial 
covenants in the future. The Corporation believes that the bank syndicate 
participating in the bank credit facilities would waive the particular 
financial covenants if the Corporation is not in compliance at a 
measurement date during the next twelve month period.

At December 31, 1996 the Corporation had approximately $68,000,000 
available under its bank credit facilities. The amount available under such 
facilities from time to time is dependent on the operating results of the 
Corporation. Scheduled repayments under the bank credit facilities in 1997 
are $20,000,000.

At December 31, 1996 the Corporation has three interest rate swap 
agreements outstanding. The aggregate notional principal associated with 
the three swap agreements is $55,000,000 and all such agreements require 
the Corporation to pay a fixed interest rate and receive a floating rate. 
The fixed interest rates associated with the swap agreements range from a 
low of 5.72% per annum to a high of 5.78% per annum and all such swaps 
expire in 1998. Of the Corporation's long-term debt at December 31, 1996 
approximately 92% is subject to fixed rates of interest. During the second 
half of 1996, Canadian dollar denominated interest rates decreased 
significantly relative to such rates denominated in United States dollars. 
The Corporation has the ability under its bank credit facilities to borrow 
a portion of its funds in Canadian dollars and at December 31, 1996 has 
availed itself of this option, with approximately 45% of the outstanding 
bank credit facilities at that date being denominated in Canadian dollars.

Future Commitments

In 1996 the Corporation opened 2 new theatres and refurbished 5 theatres in 
the United States adding a total of 31 new screens. In Canada in 1996 the 
Corporation opened 3 new theatres and refurbished 8 theatres adding a total 
of 44 new screens. The Corporation is also a partner in 4 new Canadian 
theatres which opened in 1996 (adding 30 new screens). In addition, as part 
of its longer term strategy, the Corporation opened its first theatre 
outside of North America in Budapest, Hungary. The total cost associated 
with the construction of these theatres was approximately $17,000,000.

In 1997 the Corporation expects to open 14 new theatre locations (adding 
151 new screens) and refurbish a total of 7 theatres (adding 38 new 
screens) in North America. It is estimated that the total cost for this 
expansion will be approximately $30,000,000. The Corporation through 1997 
will continue to look at opportunities outside of North America although at 
this stage there are no definite plans for additional theatres. The 
Corporation intends to fund the above noted expansion through a combination 
of internally generated cash flow and funds available under its bank credit 
facilities.

The Corporation's current strategy is to develop and build additional 
theatres and screens in target markets that complement the Corporation's 
existing position in such markets or that provide the Corporation with a 
strategic position in a new market. Prior to commitment, management 
conducts an exhaustive study of each potential site. Such study includes a 
review of competition currently in the market and any proposed competition 
and market demographics.

RESULTS OF OPERATIONS - 1996 AND 1995

Industry admission revenue and attendance increased in 1996 by 7.7% and 
6.4% respectively compared to 1995 figures.

The Corporation reports its results in United States dollars. In order to 
eliminate the impact of exchange rate fluctuations on the yearly comparison 
of both admission and concession revenue, the results for the Canadian 
operations discussed below are stated in Canadian dollars. The 
Corporation's United States results have been impacted by the sale of 28 
theatres, located in Florida and Georgia, to Carmike Cinemas, Inc. in the 
second quarter of 1995. In 1996 the Corporation sold 5 theatres located in 
Texas.  The impact of this sale is not considered significant to the 
Corporation's United States results.

The Corporation's United States theatre circuit box office revenue 
decreased for both the year and the quarter ended December 31, 1996 by 4.0% 
and 8.6% respectively when compared to the corresponding period in the 
prior year. Adjusting for the impact of the sale of the Florida and Georgia 
theatres, the Corporation's United States theatre circuit box office 
revenue decreased by 1.9% for the year ended December 31, 1996 compared to 
the year ended December 31, 1995. This decrease in box office revenue for 
the year ended December 31, 1996 was the result of a decrease in attendance 
of 4.3% offset by an increase in box office revenue per patron of 2.4%. The 
decrease in attendance in 1996 compared to 1995 is a direct result of 
increasing competition from other film exhibitors who have been 
aggressively building new theatres. This fact is evidenced by an increase 
in the total theatrical screen count in the United States of 6% when 
compared to 1995. The decrease in box office revenue in the fourth quarter 
of 1996 was the result of an attendance decrease of 10.3% offset by an 
increase in box office revenue per patron of 1.7%. The decrease in 
attendance in the fourth quarter reflects the fact that the film product in 
the fourth quarter of 1996 was not as strong as the prior year and the 
aforementioned increasing competition. The Corporation anticipates that its 
expansion program will address, at least in part, this issue of increasing 
competition.

The Corporation's Canadian theatres reported an increase in box office 
revenue of 2.8% in 1996 compared to 1995 (when measured in Canadian 
dollars). This increase was the result of an increase in attendance of 3.5% 
offset by a decrease in box office revenue per patron of 0.7%. In the 
fourth quarter of 1996 the Corporation's Canadian theatres reported an 
increase in box office revenue of 5.0% compared to the fourth quarter of 
1995 (when measured in Canadian Dollars). This increase was the result of 
an increase in attendance of 4.1% and an increase in box office revenue per 
patron of 0.9%. The increase in attendance experienced by the Corporation's 
Canadian theatre circuit in 1996 compared to 1995 was a result of the 
Corporation's relationships with certain film distributors who enjoyed 
comparatively more successful film product in 1996 compared to 1995.

The Corporation's United States concession revenue decreased by 3.0% in 
1996 compared to 1995. In the fourth quarter of 1996, the Corporation's 
United States concession revenue decreased by 5.1% when compared to the 
fourth quarter of 1995. Adjusting for the impact of the sale of the Florida 
and Georgia theatres, the Corporation's United States concession revenue 
for the year ended December 31, 1996 was equivalent to that of the year 
ended December 31, 1995. This was achieved due to an increase in concession 
revenue per patron of 4.3% which offset the decrease in attendance. For the 
fourth quarter the decrease was the result of a decrease in attendance of 
10.3% offset by a 5.2% increase in concession revenue per patron.

The Corporation's Canadian concession revenue increased in 1996 by 6.0% 
(when measured in Canadian dollars) compared to 1995, reflecting an 
increase in concession revenue per patron of 2.5% and an increase in 
attendance of 3.5%. For the fourth quarter of 1996, the Corporation's 
Canadian concession revenue increased by 3.7% comprising an increase in 
attendance of 4.1% and a decrease in concession revenue per patron of 0.4%. 
The increase in concession revenue per patron for the year reflects the 
impact of the Corporation's focus in this area and the augmented design of 
concession stands in the Corporation's newer theatres.

Gross Margin and Other Costs

The gross margin from theatre operations (being revenue from theatre 
operations less film cost, cost of concessions, advertising, theatre 
payroll, occupancy and supplies and services), when expressed as a 
percentage of theatre operating revenue, decreased in 1996 to 15.4% 
compared to 15.7% in 1995. The slight decline in gross margin for the year 
was primarily the result of a general increase in certain direct costs 
associated with theatre operations. 

The gross margin from theatre operations, when expressed as a percentage of 
theatre operating revenue, decreased in the fourth quarter of 1996 compared 
to the fourth quarter of 1995 to 14.0% from 16.4%. The decline in gross 
margin for the fourth quarter of 1996 was due to (1) a general increase in 
certain direct costs associated with theatre operations; and (2) the fixed 
component of theatre operating costs (primarily occupancy costs).

Interest on long-term debt decreased by 13.4% in 1996 compared to the prior 
year. The decrease in interest on long-term debt was primarily attributable 
to the initial application of equity proceeds from the public offering in 
the first quarter of 1996 against the Corporation's long-term debt.

During 1996 the value of the Canadian dollar strengthened relative to the 
United States dollar. While currency movements affect the reporting of 
revenues and expenses of the Corporation's Canadian operations, the 
financial impact is limited as the costs of operating the Canadian theatres 
are supported by the revenues of such theatres.

RESULTS OF OPERATIONS - 1995 AND 1994

Industry admission revenue increased in 1995 by 2.0% while industry 
attendance decreased by 2.3%, compared to 1994 figures.

The Corporation's United States results have been impacted by the sale of 
28 theatres, located in Florida and Georgia, to Carmike Cinemas, Inc. in 
the second quarter of 1995.

The Corporation's United States theatre circuit box office revenue 
decreased for both the year and the quarter ended December 31, 1995 by 4.9% 
and 0.9% respectively when compared to the corresponding period in the 
prior year. Adjusting for theatres sold, the Corporation's United States 
theatre circuit box office revenue increased by 0.1% for the year ended 
December 31, 1995 compared to the year ended December 31, 1994 and 
increased by 6.0% in the fourth quarter of 1995 when compared to the same 
period in the prior year. This increase in box office revenue for the year 
ended December 31, 1995 was the result of an increase in box office revenue 
per patron of 0.2% offset by an attendance decrease of 0.1%. The increase 
in box office revenue in the fourth quarter of 1995 was the result of an 
attendance increase of 5.9% and an increase in box office revenue per 
patron of 0.1%. The increase in attendance in the fourth quarter reflects 
the strong film release schedule which included such movies as Ace Ventura 
II, Goldeneye, Toy Story and Jumanji.

The Corporation's Canadian theatres reported a decrease in box office 
revenue of 5.8% in 1995 compared to 1994 (when measured in Canadian 
dollars). This decrease was the result of a decrease in attendance of 4.0% 
and a decrease in box office revenue per patron of 1.8%. In the fourth 
quarter of 1995 the Corporation's Canadian theatres reported a decrease in 
box office revenue of 8.7% compared to the fourth quarter of 1994 (when 
measured in Canadian Dollars). This decrease was the result of a decrease 
in attendance of 5.7% and a decrease in box office revenue per patron of 
3.0%. The decrease in attendance experienced by the Corporation's Canadian 
theatre circuit in 1995 compared to 1994 was a result of the Corporation's 
relationships with certain film distributors who enjoyed comparatively more 
successful film product in 1994 compared to 1995. The decrease in box 
office revenue per patron in Canada was primarily due to selective price 
changes.

The overall results for 1995 reflect the relatively low box office 
performance in the first quarter of 1995, which was the lowest quarter for 
the movie exhibition industry in terms of both attendance and box office 
revenue since 1988.

The Corporation's United States concession revenue decreased by 7.0% in 
1995 compared to 1994. In the fourth quarter of 1995, the Corporation's 
United States concession revenue decreased by 3.7% when compared to the 
fourth quarter of 1994. Adjusting for theatres sold, the Corporation's 
United States concession revenue decreased by 0.5% in the year ended 
December 31, 1995 compared to 1994. In the fourth quarter of 1995, after 
adjusting for theatres sold, the Corporation's United States concession 
revenue increased by 5.4% primarily reflecting an increase in attendance 
for the fourth quarter of 1995 compared to 1994.

The Corporation's Canadian concession revenue decreased in 1995 by 2.8% 
(when measured in Canadian dollars) compared to 1994, reflecting an 
increase in concession revenue per patron of 1.2% offset by the decrease in 
attendance of 4.0%. For the fourth quarter of 1995, the Corporation's 
Canadian concession revenue decreased by 5.2% comprising a decrease in 
attendance of 5.7% and an increase in concession revenue per patron of 
0.5%.

Gross Margin and Other Costs

The gross margin from theatre operations (being revenue from theatre 
operations less film cost, cost of concessions, advertising, theatre 
payroll, occupancy and supplies and services), when expressed as a 
percentage of theatre operating revenue, decreased in 1995 to 15.7% 
compared to 16.9% in 1994. The decline in the gross margin for the year was 
primarily the result of two factors: (1) the gross margin from concession 
sales decreased because of rising costs associated with some product lines 
and the implementation of new products, and (2) the fixed component of 
theatre operating costs (primarily occupancy costs). 

The gross margin from theatre operations, when expressed as a percentage of 
theatre operating revenue, increased in the fourth quarter of 1995 compared 
to the fourth quarter of 1994 to 16.4% from 15.0%. The improvement in gross 
margin in the fourth quarter of 1995 was due to lower operating costs and 
the sale of certain theatres in Florida and Georgia which had generated 
lower gross margin compared to the balance of the Corporation's United 
States theatre circuit.

As a result of the sale of the theatres to Carmike Cinemas, Inc. the 
Corporation recorded a charge against goodwill in the amount of $2,468,000 
and a loss on disposal of tangible assets in the amount of $822,000. These 
amounts have been reflected in Other Income (Expenses) in the Corporation's 
consolidated income statement. Proceeds from the sale of these theatres 
were approximately $22,000,000 and of this amount $13,900,000 was applied 
against debt.

Interest on long-term debt increased by 21.8% in 1995 compared to the prior 
year. The increase in interest on long-term debt was primarily attributable 
to the impact of a full year of the 10.875% Senior Subordinated Notes 
issued as part of the Corporation's debt restructuring in June of 1994. 
Interest on long-term debt was also impacted by the general rise in 
effective interest rates.

While the significant weakening of the United States dollar relative to the 
Canadian dollar throughout 1995 affects the reporting of revenues and 
expenses of the Corporation's Canadian operations, the financial impact is 
limited as the costs of operating the Canadian theatres are supported by 
the revenues of such theatres.

CANADIAN ISSUER

The Corporation is an Ontario corporation and expects to conduct 
approximately one-third of its operations in Canada in 1997. The 
Corporation is subject to certain Canadian economic, fiscal, monetary and 
political policies and factors.

Reference is made to Note 17 of the Notes to the Consolidated Financial 
Statements of the Corporation for a reconciliation of the Corporation's 
financial statements to United States Generally Accepted Accounting 
Principles.

INFLATION

For the three years ended December 31, 1996, inflation has not had a 
pronounced effect on the Corporation's results of operations.

FORWARD LOOKING STATEMENTS

The Corporation and its representatives have made, or may make, forward 
looking statements including those contained in this Management's 
Discussion and Analysis of Results of Operations and Financial Condition.  
Use of the words "believes", "expects", "estimated", "intends", or 
similar expressions identify such forward looking statements.

The results contemplated by the Corporation's forward looking statements 
are subject to certain risks and uncertainties that could result in actual 
performance being materially different from anticipated results, including 
without limitation, lack of high quality commercial film product,
construction risks and delays, failure to obtain future waivers or
amendments under the Corporation's bank credit facilities and other factors
described herein.

<PAGE>

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Shareholders of Cineplex Odeon 
Corporation

We have audited the consolidated balance sheets of Cineplex 
Odeon Corporation as at December 31, 1996 and 1995 and the 
consolidated statements of income and changes in 
shareholders' equity and cash resources for each of the 
years in the three year period ended December 31, 1996.  
These financial statements are the responsibility of the 
Corporation's management.  Our responsibility is to express 
an opinion on these financial statements based on our 
audits.

We conducted our audits in accordance with generally 
accepted auditing standards.  Those standards require that 
we plan and perform an audit to obtain reasonable assurance 
whether the financial statements are free of material 
misstatement.  An audit includes examining, on a test basis, 
evidence supporting the amounts and disclosures in the 
financial statements.  An audit also includes assessing the 
accounting principles used and significant estimates made by 
management, as well as evaluating the overall financial 
statement presentation.

In our opinion, these consolidated financial statements 
present fairly, in all material respects, the financial 
position of the Corporation as at December 31, 1996 and 1995 
and the results of its operations and the changes in its 
shareholders' equity and cash resources for each of the 
years in the three year period ended December 31, 1996 in 
accordance with accounting principles generally accepted in 
Canada.

United States generally accepted accounting principles 
differ from Canadian accounting principles in the 
Corporation's circumstances as described in note 17 to the 
consolidated financial statements.

KPMG

Chartered Accountants

Toronto, Canada
February 18, 1997


<PAGE>


CINEPLEX ODEON CORPORATION			
CONSOLIDATED BALANCE SHEET 			
(in thousands of U.S. dollars)			

<TABLE>
<CAPTION>
				
		                    				December 31, 1996     December 31, 1995
                                                        			-----------------------      -----------------------
<S>                                                     				 <C>     		           <C>
ASSETS					
                             				
CURRENT ASSETS				
  Cash		                                  				   $   2,718      	          $   1,604 
  Accounts receivable (note 3) 		 			        9,552         		10,362 
  Other		                                                 			        8,852 		  7,614 
                                                             				    -----------     	           -----------
                            						       21,122       	              19,580
                                                            
PROPERTY, EQUIPMENT AND LEASEHOLDS (note 4)	                   579,841      	            583,442 
				
OTHER ASSETS				
  Long-term investments and receivables		                  	         2,535          	  3,945  
  Goodwill 				
   (less accumulated amortization of $11,281; 1995 - $10,167)		        32,816      	              33,927 
  Deferred charges 				
   (less accumulated amortization of $3,671; 1995 - $2,395)	   	          7,857 		  8,749 
		                                             			    ------------      	           -----------
                                                                  				        43,208 		46,621
				
                                                             			                 ------------    	           -----------  
TOTAL ASSETS                                                			  $  644,171   	          $ 649,643 
                                                			                            ========    	         ========  
				
LIABILITIES AND SHAREHOLDERS' EQUITY				

CURRENT LIABILITIES				
  Accounts payable and accruals (note 5)                   			  $   59,474  	         $   59,591
  Deferred income (note 6)                                        			       17,150 	              14,930 
  Current portion of long-term debt and other obligations	 	         6,926   	                7,146 
	                                                      				    -----------    	            ----------
                                                                 				       83,550 	              81,667
	                                                      			        	 ========                  =======

LONG-TERM DEBT (note 7)	                                        		     326,058   	            381,857 
				
CAPITALIZED LEASE OBLIGATIONS (note 11)               	                      8,317      	              10,451 
				
DEFERRED INCOME (note 6)	                                                               6,594 	                8,428 
				
PENSION OBLIGATION (note 9)	                               	 	         1,072 	   	  1,248
				
SHAREHOLDERS' EQUITY				
  Capital stock (note 10)	                             	 		     555,374     	           472,479 
  Translation adjustment 		                          			         4,016 	 	 3,241 
  Retained earnings (deficit)		                        		    (340,810)  	         (309,728)
                                           				                 -----------   	        -- ----------
                                                           				     218,580                     165,992 
				
COMMITMENTS AND CONTINGENCIES (note 11)				
                                                           				  ------------   	           ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                   $   644,171  	        $ 649,643
				                             	              ========                  =======

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

</TABLE>



CINEPLEX ODEON CORPORATION				
CONSOLIDATED INCOME STATEMENT				
(in thousands of U.S. dollars except per share figures)				

<TABLE>
<CAPTION>
						
		                                    Year Ended	    	  Year Ended                 Year Ended
		                         December 31, 1996    December 31, 1995     December 31, 1994
                                        	            ---------------------
<S>                                        	 	<C>       	      <C>        		    <C>    
REVENUE						
  Admissions		                        $ 358,973        	  $  365,220               	$ 384,558
  Concessions		                           126,636              	      126,319 	   	   133,850 
  Other		                                    	 24,083 	                     21,611 	                  22,704
                                                		----------                    ----------                         ---------- 
		                                        509,692 	                   513,150                         541,112
EXPENSES						
  Theatre operations and other expenses       418,328                     418,731                        437,534 
  Cost of concessions		               22,357 	                     22,016 	                 21,724 
  General and administrative		 18,192 		       17,575                           16,229 
  Depreciation and amortization		 43,648 		       42,621 	                 40,859
	                         		 ----------           	      ----------                 
                                                  		 502,525 	      500,943                        516,346
                      		----------                     ----------                       -------
Income before the undernoted (note 17)	    7,167		       12,207		   24,766

Other expenses (note 12)	                              (1,377)                     (2,862)                         (2,900)
                                            ----------                   ---------- ---------- 
Income before interest on long-term  		
 debt and income taxes (note 17)		   5,790                        9,345                          21,866 

Interest on long-term debt		               35,482	                     40,983                         33,641 
                                                		 ----------	       ---------                        ---------	

Loss before income taxes		              (29,692)                   (31,638)                       (11,775)
Income taxes (note 13 )		                 1,390 		        1,269                            2,398 
                                                		  ---------                    ---------                         ---------
NET LOSS		                         $ (31,082)	  $ (32,907)	            $ (14,173)
                                                	       =========              ========                    ========

BASIC						  
Weighted average shares outstanding    163,473,000             114,764,000                  110,175,000
Net loss per share		                ($0.19)	       ($0.29)		   ($0.13)

FULLY DILUTED						
Weighted average shares outstanding    176,107,000              122,616,000                 118,245,000
Net loss per share		                ($0.19)	        ($0.29)		   ($0.13)


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

</TABLE>


CINEPLEX ODEON CORPORATION						
CONSOLIDATED STATEMENT OF CHANGES IN CASH RESOURCES			
(in thousands of U.S. dollars except per share figures)						


<TABLE>
<CAPTION>

		                                        	    Year Ended                 Year Ended          	    Year Ended
		                                   December 31, 1996    December 31, 1995   December 31, 1994
                                  -----------------          -----------------           -----------------
<S>                                               			   <C>                <C>                <C> 
CASH PROVIDED BY(USED FOR)						

OPERATING ACTIVITIES						
  Net loss	                                                 $ (31,082)                   $ (32,907)               $ (14,173)
  Depreciation and amortization	                          43,648 	                    42,621                    40,859 
  Other non-cash items	                                        (2,098)                         1,258 	            1,081 
  					          -----------                    -----------                    ----------	
                                         		            10,468                        10, 972                    27,767
  Net change in non-cash working capital	              1,948                         (7,450)                     3,668 
                                                  -----------                   -----------	          ----------	
                                                     12,416                3,522         31,435
                                                  -----------   -----------              ----------
FINANCING ACTIVITIES		 		 		 
  Decrease in long-term debt and other obligations  (58,411)                        (9,289)                (351,735)
  Increase in long-term debt and other obligations	       0 	                    14,085 	        364,274 
  Net change in operating credit facilities	                    0 		             0 	           (8,168)
  Issue of share capital, net of issue costs                   82,895 	                         64 	           14,646 
  Fees associated with refinancing	                                 0 		             0 	           (9,093)
  Other	                                                                       175 	                      (615)	               (27)
                                                     -----------   ----------           ---------
		                                                    24,659                         4,245                        9,897 
                                                  -----------                     ----------                     ---------
INVESTMENT ACTIVITIES						
  Additions to property, equipment and leaseholds   (36,989)                    (30,749)                   (40,728)
  Long-term investments	                                                0 		        (109)	             (590)
  Proceeds on sale of certain theatre properties            1,974                       23,674                          107 
  Proceeds on sale of non-theatre related assets	        0 		              0 	              424 
  Other                                                	                 (946)		         (530)	             (262)
                        -----------                    ----------                     ---------	
	                                                                    (35,961)                     (7,714)                  (41,049)
                        -----------                    ----------                     ---------						
NET INCREASE(DECREASE) DURING YEAR	   1,114 		             53 		  283 

CASH AT BEGINNING OF YEAR		   1,604                         1,551                      1,268 
                               -----------                      ----------                    
CASH AT END OF YEAR           $ 2,718                      $ 1,604 	          $ 1,551 
                                =======                    =======                 =======

CASH FLOW FROM OPERATING ACTIVITIES PER SHARE						
	Basic	                                       	               $  0.08	                       $ 0.03 	            $ 0.29 
	Fully Diluted	                                          $  0.07	                       $ 0.03 	            $ 0.27 


CHANGE IN NON-CASH WORKING CAPITAL						
Current assets						
  Accounts receivable	                                          $ 1,117                    $   629 	          $ 4,657 
  Other	                                                      (1,024)           1,383       2,793
Current liabilities						
  Accounts payable and accruals	                                 (998)	      (9,509)                     (4,264)
  Deferred income	                                             2,157                         508 	               790 
  Income taxes payable	                                                696 	         (461)	              (308)
	                               ----------                   ---------                     ---------	
                                 $ 1,948       $(7,450)        $ 3,668 
                                 =======                =======                   ======

The accompanying notes are an integral part of these consolidated 
financial statements.		
</TABLE>



CINEPLEX ODEON CORPORATION					
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY		
(in thousands of U.S. dollars, except for number of shares)						     

<TABLE>
<CAPTION>
       			     Common Shares    Subordinate Restricted   Retained                      Total
                                     Voting Shares          Earnings   Translation   Shareholders'   
		          Shares        Amount     Shares      Amount      (Deficit)    Adjustment  Equity
----------------------------------------------------------------------------------------
<S>                <C>           <C>         <C>     	 <C>       <C>         <C>    <C>              																
BALANCE AT									
DECEMBER 31, 1993    62,528,852    $206,093   46,729,131  $251,676    ($262,648)      $5,266      $200,387 																
Exercise of options	   537,711           948 				                                        948 
Net loss				                                                              (14,173)		       (14,173)
Translation adjustment		                                                                                   (4,685)          (4,685)
 Issue of shares	              2,475,114         6,849     2,475,114        6,849    13,698 
----------------------------------------------------------------------------------
BALANCE AT													
DECEMBER 31, 1994    65,541,677     213,890    49,204,245    258,525   (276,821)	      581 	      196,175
											

   Exercise of options	    38,950	 64 						              64 
   Net loss							       (32,907)		      (32,907)
   Translation adjustment								    2,660          2,660 
-----------------------------------------------------------------------------------
BALANCE AT													
DECEMBER 31, 1995   65,580,627     213,954     49,204,245   258,525    (309,728)           3,241       165,992
											                                            

   Exercise of options	  276,118           375 					                          375 
   Net loss							       (31,082)   		      (31,082)
   Translation adjustment								       775             775 
   Issue of shares	           37,477,412      49,187      24,242,181     33,333 	             		       82,520 
----------------------------------------------------------------------------------
BALANCE AT
DECEMBER 31, 1996 103,334,157   $263,516    73,446,426   $291,858  ($340,810)         $4,016    $218,580 
===============================================================================

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

</TABLE>

<PAGE>

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  
(all amounts in U.S. dollars unless otherwise stated) 

1. GENERAL 
 
The Corporation is incorporated under the Ontario Business Corporations 
Act.
 
The financial results of the Corporation's operations are presented in 
United States dollars, as approximately two-thirds of the Corporation's 
activities emanate from the United States.
 
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The consolidated financial statements are prepared in accordance with 
accounting principles generally accepted in Canada, which, except as 
described in note 17, conform in all material respects with accounting 
principles generally accepted in the United States. A summary of 
significant accounting policies is set out below.

Principles of Consolidation: The consolidated financial statements include 
the accounts of the Corporation and its subsidiaries. Intercompany accounts 
and transactions have been eliminated. The Corporation accounts for its 
interests in joint ventures through the proportionate consolidation method.

Inventories: Inventories are stated at the lower of cost (first-in, first-
out basis) and net realizable value.

Property, Equipment and Leaseholds: Property, equipment and leaseholds are 
stated at cost less accumulated depreciation and amortization. Depreciation 
and amortization are calculated using the following methods and annual 
rates:

Buildings 		Straight-line over 40 years
Projection equipment	Straight-line over 20 years
Other equipment         	Straight-line over 15 years
Leaseholds		Straight-line over periods from 15 to 40 years

Construction in progress is depreciated from the date the asset is ready 
for productive use.

Goodwill: Goodwill represents the excess of the purchase price of certain 
businesses over the fair value of the net identifiable assets acquired and 
is being amortized, on a straight-line basis, over 40 years. The 
Corporation regularly reviews the recoverability of goodwill by determining 
whether the amortization of the goodwill balance over its remaining life 
can be recovered through projected future undiscounted income from 
operations before interest on long-term debt and effects of goodwill 
amortization.

Deferred Income: Advance payments received under a strategic marketing 
relationship with a major supplier, advance sales of admissions, the sale 
of gift certificates and income from certain promotional programs are 
included as deferred income, and are recognized as income when services are 
rendered.

Deferred Charges: Deferred charges, consisting primarily of costs 
associated with debt refinancing, are amortized over the term of the 
related debt.

Foreign Currency Translation: Assets and liabilities denominated in a 
currency other than U.S. dollars are translated to U.S. dollars at exchange 
rates in effect at the balance sheet date. The resulting gains or losses 
are accumulated in a separate component of shareholders' equity under the 
caption "Translation adjustment". Revenue and expense items are translated 
at average exchange rates prevailing during the year.

Admissions Revenue: Admissions revenue from the exhibition of motion 
pictures is recognized on the dates of exhibition.

Earnings Per Share: Basic earnings per share are calculated using the 
weighted daily average number of Common Shares and Subordinate Restricted 
Voting Shares outstanding. Fully diluted earnings per share are calculated 
assuming the exercise of stock options at the beginning of the year, or for 
those stock options issued during the year, at the date of the grant to the 
extent the impact is dilutive.

Interest Rate Hedging Activities: The Corporation uses interest rate swaps 
to manage interest rate risk. These financial instruments are not held for 
trading purposes and any payments or receipts under such contracts are 
recognized as adjustments to interest expense. 

Measurement Uncertainty: The preparation of financial statements in 
conformity with generally accepted accounting principles requires 
management to make estimates and assumptions that affect the reported 
amounts of assets and liabilities and disclosure of contingent assets and 
liabilities at the date of the financial statements and the reported 
amounts of revenues and expenses during the period. Actual results could 
differ from those estimates.

3. ACCOUNTS RECEIVABLE

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------
				December 31, 1996     December 31, 1995
----------------------------------------------------------------------------------------------
<S>                    			           <C>                            <C>
Trade			    	         $  8,446,000	    $  8,547,000
Current portion of
    long-term receivables                                 150,000            	           840,000
Other                                                           1,098,000	        1,192,000
Employee loans	                                           323,000	           307,000
Allowance for doubtful accounts	               (465,000)	          (524,000)		
-----------------------------------------------------------------------------------------------
		                                     $  9,552,000	    $ 10,362,000
========================================================
</TABLE>

4. PROPERTY, EQUIPMENT AND LEASEHOLDS

<TABLE>
<CAPTION>

-------------------------------------------------------------------------------------------------------
	          				December 31, 1996   December 31, 1995
-------------------------------------------------------------------------------------------------------
<S>                              				   <C>                   <C>
Land                  			                        $63,116,000            $ 62,374,000
          
Buildings     Cost	     		 	          126,217,000	  124,836,000
	      Accumulated depreciation                   (19,919,000)             (17,163,000)
		                                                  -----------------           -----------------
 					          106,298,000              107,673,000
		
Equipment   Cost	                                                   136,521,000              133,100,000
	       Accumulated depreciation                  (70,851,000)             (65,761,000)
		                                                   ----------------             ----------------                        
					            65,670,000               67,339,000
		
Leaseholds    Cost                                                    537,153,000            522,098,000
(including     Accumulated depreciation                  (197,688,000)         (180,426,000)
capital leases)                                                          ----------------          -----------------             
                                                                                339,465,000            341,672,000
		
Construction in progress                                              5,292,000                4,384,000
--------------------------------------------------------------------------------------------------------
		                                                   $579,841,000          $583,442,000
============================================================
</TABLE>

The net book value of assets held under capital leases at December 31, 1996 
was $20,508,000 ($21,857,000 at December 31, 1995), net of accumulated 
amortization of $7,700,000 ($6,655,000 at December 31, 1995).

5. ACCOUNTS PAYABLE AND ACCRUALS

<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------
                             	 December 31, 1996        December 31, 1995
--------------------------------------------------------------------------------------
<S>                                 <C>                     <C>
Trade	                           	          $ 40,332,000	         $38,067,000
Accrued liabilities                            9,809,000	           12,096,000
Sales and other taxes	               8,517,000	             8,584,000
Other				    816,000	               844,000
---------------------------------------------------------------------------------------
			          $ 59,474,000                  $ 59,591,000
==================================================
</TABLE>

6. DEFERRED INCOME

<TABLE>
<CAPTION>

---------------------------------------------------------------------------
	                               December 31, 1996     December 31, 1995
---------------------------------------------------------------------------
<S>                                     <C>                  <C>                       
Strategic marketing relationship       $    8,296,000    $   10,128,000
Advance admission sales                     9,157,000         7,573,000
Gift certificates                           5,001,000         4,432,000
Promotional programs                        1,012,000         1,135,000
Other                                         278,000            90,000  
--------------------------------------------------------------------------------
	                                                   23,744,000                 23,358,000
Less:  Current portion                               17,150,000                 14,930,000
-------------------------------------------------------------------------------------------
	                                                $   6,594,000             $    8,428,000
=====================================================
</TABLE>


7. LONG-TERM DEBT

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------
	                          		  December 31, 1996    December 31, 1995
----------------------------------------------------------------------------------------------
<S>                                  <C>                  <C>
Senior subordinated notes maturing
June 15, 2004, bearing interest 
at 10.875%                             	        $  200,000,000           $ 200,000,000 
 
Bank credit facilities of
$147,930,000 maturing  
December 31, 1999                                       79,940,000             131,568,000
 	
Various notes and mortgages
(interest rates from 8.00% to 11.50%)          49,877,000                54,209,000
-----------------------------------------------------------------------------------------------
	                                                    329,817,000               385,777,000
Less: Current portion                                     3,759,000                  3,920,000
-----------------------------------------------------------------------------------------------
	                                                  $ 326,058,000           $  381,857,000
========================================================

</TABLE>

The bank credit facilities bear interest at variable rates based upon an 
applicable margin over LIBOR or the bank's reference rate. The applicable 
margin for LIBOR borrowings will vary from a maximum of 2.25% to a minimum 
of 1.25% based upon the Corporation meeting certain financial ratios. 
Commitment reductions under the bank credit facilities amount to 
$20,000,000 in 1997, $25,000,000 in 1998 and the remaining balance in 1999. 
The bank credit facilities are secured by certain assets of the Corporation 
and its subsidiaries.

The bank credit facilities contain restrictive covenants which require the 
Corporation to maintain certain financial ratios. At December 31, 1996, the 
Corporation failed to meet certain financial covenants under its bank 
credit facilities. Subsequent to that date, the Corporation's bankers 
agreed to amend certain financial covenants for the quarter ended December 
31, 1996 and for all four quarters of 1997. Given the uncertainty with 
respect to the admission and concession revenue that the Corporation will 
generate, there is a possibility that the Corporation may not meet certain 
financial covenants in the future. The Corporation believes that the bank 
syndicate participating in the bank credit facilities would waive the 
particular financial covenants if the Corporation is not in compliance at a 
measurement date during the next twelve month period.

Principal repayments on long-term debt during each of the next five years 
approximate the following:

----------------------------------------------------------
1997				$  3,759,000
1998				  27,215,000
1999				  84,139,000
2000				   1,939,000
2001				   1,335,000
Thereafter		             211,430,000
----------------------------------------------------------
                                                    $329,817,000
==================================

8. FINANCIAL INSTRUMENTS

(i) Swap Agreements - The Corporation has entered into interest rate swap 
agreements to manage its interest rate exposure. At December 31, 1996 the 
Corporation had outstanding three interest rate swap agreements with a 
commercial bank. The details of the swaps are as follows:

(a) Notional principal - $20,000,000 - The Corporation pays 5.78% per 
annum, payable on a quarterly basis and receives three month LIBOR 
rate. This swap expires July 31, 1998.

(b) Notional principal - $15,000,000 - The Corporation pays 5.74% per 
annum, payable on a quarterly basis and receives three month LIBOR 
rate. This swap expires November 30, 1998.

(c) Notional principal - $20,000,000 - The Corporation pays 5.72% per 
annum, payable on a quarterly basis and receives three month LIBOR 
rate. This swap expires November 30, 1998.

The Corporation is exposed to credit loss in the event of non-performance 
by the other party to the interest rate swap agreements. However, the 
Corporation does not anticipate non-performance by the counterparty.

(ii) Fair Value of Financial Instruments - The carrying value of cash, 
accounts receivable, accounts payable and accruals and the current portion 
of long-term debt and other obligations approximates fair value due to the 
short term maturities of these instruments. Financial instruments with a 
carrying value different from their fair value include:

<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------------
	                               	 	    December 31, 1996               December 31, 1995
------------------------------------------------------------------------------------------------------------------------
	       				  Carrying              Fair           Carrying                Fair
                    			                     Value           Value               Value             Value
-------------------------------------------------------------------------------------------------------------------------
<S>                                   		     <C>             <C>              <C>          	<C>
Financial assets
Long-term investments and receivables
   - Practicable to estimate fair value             $  935,000     $7,873,000      $3,210,000     $10,550,000 
   - Not practicable                                       $1,600,000          --                $  735,000           --       

Financial liabilities
Long-term debt                                        $326,058,000   $326,558,000   $381,857,000  $364,357,000

Swap agreements net receivable (payable)              --             $123, 000                --             ($608,000)

</TABLE>

The fair value of long-term investments and receivables is based on quoted 
market prices (where applicable) or by discounting future cash flows, 
including interest payments, using rates currently available for similar 
investments and receivables. The fair value of long-term debt is based on 
quoted market prices (where applicable) or by discounting future cash 
flows, including interest payments, using rates currently available for 
debt of similar terms and maturity. The fair value of interest rate swap 
agreements are the estimated amounts that the Corporation would receive (or 
pay) upon termination of the agreements.

9. PENSION OBLIGATION

The Corporation has a defined benefit pension plan covering full-time 
employees in the United States. The benefits under this plan are based upon 
years of service and the employees' compensation for certain periods during 
the last years of employment. This plan is non-contributory and the 
Corporation's funding policy is to make the minimum annual contribution 
required by the applicable regulations. At December 31, 1996, approximately 
85% of the assets of this plan were held in bonds and approximately 15% in 
equities. The most recent actuarial estimate for the plan covering these 
employees as at December 31, 1996 indicates pension fund assets of 
$6,557,262 ($6,071,000 at December 31, 1995) and accrued pension benefits 
of $12,185,000 ($12,286,000 at December 31, 1995). 

The Corporation has a pension plan covering full time employees in Canada. 
Prior to January 1, 1993 this plan was a defined benefit plan and effective 
on that date it was converted to a defined contribution plan. At the date 
of the conversion benefits under the defined benefit plan were frozen. The 
most recent actuarial estimate for the plan covering Canadian employees 
indicates a surplus of pension fund assets over accrued benefits of 
approximately $2,686,000.

At December 31, 1996, the Corporation's pension obligation is $2,145,000, 
of which $1,072,000 is the long-term portion ($2,348,000 at December 31, 
1995 of which $1,248,000 was the long-term portion).

10. CAPITAL STOCK
-----------------------------------------------------------------
		                     December 31, 1996     December 31, 1995
-----------------------------------------------------------------
Authorized:
Unlimited number of Common Shares
Unlimited number of First Preference Shares issuable in series
Unlimited number of Subordinate Restricted Voting Shares
		
Issued:
103,334,157 Common Shares 
(December 31, 1995 - 65,580,627)     $263,516,000            $213,954,000
73,446,426 Subordinate Restricted
Voting Shares
(December 31, 1995 - 49,204,245)      291,858,000               258,525,000
--------------------------------------------------------------------------
		                              $555,374,000             $472,479,000
=====================================================

i) On March 20, 1996 the Corporation filed a supplemented short form 
prospectus in Canada and the United States pursuant to the multi-
jurisdictional disclosure system with respect to an offering of 25,000,000 
Common Shares to the public at a price of $1.375 per share, for an 
aggregate consideration of $34,375,000. In addition, in accordance with the 
provisions of the Amended and Restated Subscription Agreement, Universal 
Studios, Inc. (Universal) (formerly MCA INC.) and the Charles Rosner 
Bronfman Trust (the Trust) agreed to subscribe for 24,242,181 Subordinate 
Restricted Voting (SRV) Shares and 12,121,454 Common Shares respectively, 
at the same price as the offering to the public, for aggregate 
consideration of $50,000,000. The public offering and the subscriptions by 
Universal and the Trust were completed on March 28, 1996. On April 16, 
1996, the Corporation issued 355,958 Common Shares at a price of $1.375 per 
share as part of the over-allotment option provided to the underwriters 
pursuant to the public offering. The net proceeds from the issuance of the 
Common and SRV Shares were used to reduce indebtedness owing under the 
Corporation's revolving bank credit facilities. 

ii) The SRV Shares are held by Universal. Under the terms of the shares, 
Universal is entitled to exercise no more than one-third less one vote of 
the voting rights applicable to all issued voting shares.

iii) In 1996 the Amended and Restated Stock Option Plan (the Option Plan) 
was approved. The Option Plan provides for the granting of rights to 
purchase Common Shares under both incentive and non-incentive stock option 
agreements. The options granted under the Option Plan are for 10 year terms 
and vest over various periods to a maximum of 5 years. The maximum number 
of options which can be granted under the Option Plan is 17,646,716.

During 1996 the Corporation amended the exercise price of 6,859,989 of the 
outstanding stock options issued under the Option Plan to Canadian $1.87. 
In addition, the Corporation extended the expiry dates of 2,754,244 
outstanding stock options to the date which is 10 years from the date of 
the original grant of such option. 

The following options to purchase Common Shares expire between October 15, 
2001 and April 16, 2006:
---------------------------------------------------------------
Option price per share                December 31, 1996
---------------------------------------------------------------
$ 1.70  Canadian                                            8,450
   1.87  Canadian                                   14,494,789
---------------------------------------------------------------
Options outstanding end of year              14,503,239
=====================================

Stock option transactions for the respective years were as follows:

<TABLE>
<CAPTION>

-------------------------------------------------------------------------------------------------------------------------------
		                         		December 31, 1996      		December 31, 1995
                                       			Number    Weighted Av.   	Number    Weighted Av.                                 
                                           		of       	   Exercise         		of   Exercise                         
                                       			Options     Price ($Cdn)  		Options     Price ($Cdn)
--------------------------------------------------------------------------------------------------------------------------------
<S>                                   		  <C>          <C>          		 <C>         <C> 
Options outstanding beginning of year      7,835,289        3.06                         7,878,064        3.06
Additional options granted            	          8,019,020        1.87     		   42,000       2.62
Less options exercised                   	             276,118        1.87                               38,950       2.24
Less options terminated, canceled                                
 or expired                                                1,074,952        2.74                               45,825       3.02
-------------------------------------------------------------------------------------------------------------------------------
Options outstanding end of year              14,503,239        1.87                          7,835,289        3.06
==========================================================================
</TABLE>

At December 31, 1996 there were 7,683,136 options exercisable and 2,579,316 
options available for grant.

iv) Under the Corporation's current financing arrangements, the Corporation 
is prohibited from paying any Common Share or Subordinate Restricted Voting 
Share dividends unless it is in compliance with specified financial ratios. 
The Corporation is not currently in compliance with such financial ratios. 
Any such payment of dividends is further subject to annual limitations.

11. COMMITMENTS AND CONTINGENCIES

i) Certain theatre properties and theatre equipment are subject to lease 
agreements. Certain of the property leases require the Corporation to pay 
additional rent and to pay all business and realty taxes and a proportion 
of the landlord's operating costs in respect of the leased premises. Future 
minimum payments, by year and in the aggregate, under theatre operating 
leases and theatre and equipment capital leases, as at December 31, 1996, 
are as follows:

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------
                          	                      Capital leases        Operating leases
----------------------------------------------------------------------------------
<S>                                        <C>                    <C>                      
1997                        	            $ 2,913,000      	  $   74,540,000
1998                           		 2,637,000          	       74,470,000
1999                           		 2,461,000                  72,660,000
2000                         	               2,334,000                  70,908,000
2001                          		 1,089,000                  68,391,000
Thereafter                  		 2,043,000                632,764,000
------------------------------------------------------------------------------------
Total minimum lease payments      13,477,000           $  993,733,000
		                            ========================
Less: Imputed interest at
      rates between 7.5% and
      8.5%                                         3,066,000
      Current portion                         2,094,000
---------------------------------------------------------
		                         $ 8,317,000	
=================================
</TABLE>

ii) The Corporation and its subsidiaries are currently subject to audit by 
taxation authorities in several jurisdictions. The taxation authorities 
have proposed to reassess taxes in respect of certain transactions and 
income and expense items. Management believes that the Corporation and its 
subsidiaries have meritorious defenses and is vigorously contesting the 
adjustments proposed by the taxation authorities. Although such matters 
cannot be predicted with certainty, management does not consider the 
Corporation's exposure to such proposed reassessments to be material to 
these financial statements.

iii) The Corporation and its subsidiaries are also involved in certain 
litigation arising out of the ordinary course and conduct of its business. 
The outcome of this litigation is not currently determinable. Although such 
matters cannot be predicted with certainty, management does not consider 
the Corporation's exposure to such litigation to be material to these 
financial statements.



12. OTHER INCOME(EXPENSES)

Other income(expenses) is comprised of the following:

<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------------
                     			     Year ended               Year ended       Year ended          
                     			 December 31, 1996   December 31, 1995    December 31, 1994
------------------------------------------------------------------------------------------------------------------------
<S>                      			<C>                     <C>                 		   <C> 
Net loss on sale or write down of
theatre related assets       			$ (14,000)              $ (3,014,000)                  $ (32,000)
	
Net gain on sale or realization of
non-theatre related assets       		           ---                    1,175,000                     517,000 

Write-off of deferred
financing charges   			           ---                             ---                    (3,198,000)

Severance and other
corporate charges         			 (1,363,000)                (1,023,000)                 (187,000)
---------------------------------------------------------------------------------------------------------------------------
                       			           $  (1,377,000)            $  (2,862,000)           $ (2,900,000)
========================================================================
</TABLE>

13. INCOME TAXES

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------
                         Year ended                  Year ended                  Year ended 
             December 31, 1996      December 31, 1995      December 31, 1994
---------------------------------------------------------------------------------------------
<S>                  <C>                            <C>                      <C>
Current           $  1,390,000                $  1,269,000                  $  2,398,000 
======================================================
</TABLE>

The Corporation's income tax provision based upon income(loss) from 
continuing operations before income taxes is made up as follows:

<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------------
                                      		           Year ended               Year ended                  Year ended
                                		December 31, 1996    December 31, 1995    December 31, 1994
------------------------------------------------------------------------------------------------------------------------
<S>                               		         <C>                          <C>                             <C> 
Statutory income tax rate                	      44.0%       	           44.0%        	      44.0%
	  
Provision based on statutory
income tax rate                              	        $(13,064,000)           $(13,921,000)              $ (5,183,000) 
	
Increase (decrease) in incom
tax provision resulting from:
	
Tax exempt portion of capital gains                  (6,000)                   (48,000)                   (158,000)
	
Permanent differences other than
capital gains                          		    62,000                    766,000                   1,490,000
	
Non-recognition of tax benefit of
current year's losses for tax purposes:
      Canada                                		         ---                   1,290,000                   2,990,000
      United States                   	           14,050,000                11,913,000	            1,731,000
	
Recognition of tax benefit of 
prior years' losses for tax purposes:
     Canada                          	            (1,042,000)                        ---                               ---
     United States                           		         ---                            ---                               --- 
----------------------------------------------------------------------------
                                                       ---      ---       870,000 
Large Corporations Tax and
state taxes                                                    1,390,000                1,269,000                    1,528,000
-------------------------------------------------------------------------------------------------------------------------
Income tax provision                                $  1,390,000            $  1,269,000                $  2,398,000 
=======================================================================
</TABLE>

For taxation purposes there are net operating loss carryforwards of 
approximately $270,000,000 available to offset future taxable income. These 
losses expire between the years 1997 and 2011. A portion of the United 
States net operating loss carryforwards, in the amount of $53,000,000, are 
subject to annual limitations.

14. SEGMENTED INFORMATION

Substantially all of the Corporation's operations are in the exhibition 
business, including the exhibition and distribution of motion picture 
films.

The geographic distribution of revenue, income(loss) from continuing 
operations and assets are shown below:

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------
                              Year ended                   Year ended               Year ended
                       December 31, 1996   December 31,1995   December 31,1994	
---------------------------------------------------------------------------------------------
<S>                       <C>                    <C>                    <C>
Revenue
   Canada             $   159,068,000           $ 150,026,000         $  157,690,000	
   United States         350,624,000              363,124,000             383,422,000
----------------------------------------------------------------------------------------------
                            $   509,692,000            $ 513,150,000        $  541,112,000
=======================================================

Income(loss) from continuing operations
   Canada              $     2,159,000              $  (2,914,000)         $   (7,576,000)
   United States         (33,241,000)               (29,993,000)              (6,597,000)
----------------------------------------------------------------------------------------------
                            $   (31,082,000)            $ (32,907,000)         $  (14,173,000)
=======================================================
</TABLE>

-------------------------------------------------------------            
	        December 31, 1996        December 31, 1995                      
---------------------------------------------------------                  	
Assets
   Canada              $ 142,448,000             $   134,198,000     
   United States        501,723,000                  515,445,000     
------------------------------------------------------------------------ 
                            $ 644,171,000       $   649,643,000 
============================================================            

Film exhibition operations outside of Canada and the United States are 
currently limited to one theatre (six screens) in Budapest, Hungary. This 
location is not material to the Corporation's financial position or results 
of operations and is included with Canada for segmented disclosure 
purposes.

15. SUMMARY FINANCIAL INFORMATION OF PLITT THEATRES, INC. (PLITT)

The following is summarized consolidated financial information of Plitt:

<TABLE>
<CAPTION>

-------------------------------------------------------------------------    
                          				 Year Ended                   Year Ended	   Year Ended
                   			   December 31, 1996	December 31, 1995   December 31,1994
==========================================================================
<S>                               <C>                 <C>                     <C>     
Revenue                                                 $     350,624,000	    $     363,124,000           $ 383,422,000
==========================================================================
Income from continuing operations
before general and administrative
expenses, depreciation and
amortization, interest on
long-term debt and income
taxes		                                   $      45,847,000	    $      46,148,000             $  57,057,000
==========================================================================
Net loss                                                  $     (33,241,000)	    $     (29,993,000)             $ (6,597,000)
==========================================================================
</TABLE>

The results for the year ended December 31, 1996 include $1,799,000 of 
costs charged to Plitt by the Corporation (1995-$ Nil; 1994-$590,000)

---------------------------------------------------------
			December 31, 1996	December 31, 1995
---------------------------------------------------------
Current assets		$      17,105,000    	$      21,259,000
Noncurrent assets	$     484,618,000     	$     502,989,000
Current liabilities	$      55,078,000		$      54,790,000
Noncurrent liabilities	$     265,386,000		$     282,577,000
===================================================

Current liabilities at December 31, 1996 include a net payable to the 
Corporation and other corporations within the consolidated group in the 
amount of $9,551,000 (December 31, 1995 - net receivable of $3,834,000). 
Noncurrent liabilities at December 31, 1996 and December 31, 1995 include 
$10,000,000 that is owed to the Corporation.	

16. RELATED PARTY TRANSACTIONS

Related party transactions not disclosed elsewhere in these financial 
statements include film distribution and exhibition agreements which the 
Corporation enters into with Universal.  These agreements are conducted in 
accordance with normal business terms and conditions. Pursuant to these 
agreements, the Corporation, in the year ended December 31, 1996, paid 
approximately $20,631,000 in film licensing fees to Universal (1995 - 
$31,198,000, 1994 - $34,734,000) and received from Universal approximately 
$666,000 (1995 - $576,000, 1994 - $879,000) relating to distribution 
services.

17. RECONCILIATION BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED 
ACCOUNTING PRINCIPLES (GAAP)

i) The Corporation has adopted the provisions of Statement of Financial 
Accounting Standards No. 109, "Accounting for Income Taxes" (FAS 109), for 
its financial statements presented under United States accounting 
principles. Under FAS 109 the Corporation's method of accounting for income 
taxes changes from the deferred method, as recorded under Canadian 
accounting principles, to an asset and liability approach. Under the asset 
and liability method of FAS 109, deferred tax assets and liabilities are 
recognized for the future tax consequences attributable to differences 
between the financial statement carrying amounts of existing assets and 
liabilities and their respective tax bases.

The income tax provision for the year ended December 31, 1996 calculated in 
accordance with United States accounting principles was the same as that 
reported under Canadian accounting principles after reflecting a net 
increase in the valuation allowance of $19,400,000 (1995 - net increase of 
$22,700,000, 1994 - net increase of $6,100,000). 

The application of the above noted United States accounting principles on 
the balance sheet of the Corporation as at December 31, 1996 resulted in no 
net difference in deferred taxes from that reported under Canadian 
accounting principles. At December 31, 1996, the gross deferred tax asset 
was $139,000,000 less a valuation allowance of $103,000,000 (December 31, 
1995 - $127,700,000 less a valuation allowance of $83,500,000) and the 
deferred tax liability was $36,000,000 (December 31, 1995 - $44,200,000).

ii) Under GAAP in the United States and the financial reporting 
requirements of the Securities and Exchange Commission, all operating 
income and expenses, such as those listed in note 12 to the consolidated 
financial statements, are required to be included in any subtotal 
purporting to represent income(loss) from operations.  Therefore, under 
U.S. GAAP, income(loss) from operations as cross-referenced from the income 
statement to this note would be as follows:

           Year Ended	    Year Ended	            Year Ended
December 31, 1996    December 31, 1995     December 31, 1994
------------------------------------------------------------------
          $   5,790,00              $    9,345,000 	           $ 21,866,000 
==============================================

iii) As required by Statement of Financial Accounting Standards No. 95, the 
following disclosures are provided.

<TABLE>
<CAPTION>
					
             		                Year Ended	         Year Ended	        Year Ended
               	     December 31, 1996     December 31, 1995        December 31, 1994
-------------------------------------------------------------------------------------------------------------
<S>                            <C>                <C>                    <C>
Interest on long-term
debt paid	  	 $  35,482,000	       $   40,983,000	       $ 33,641,000
Income taxes paid  	  $   1,390,000	        $    1,269,000	        $  2,398,000 
===============================================================
</TABLE>

iv) The Corporation applies APB Opinion No. 25 in accounting for its stock 
options under United States GAAP. Beginning in 1996, United States GAAP 
encourages, but does not require, the recording of compensation cost for 
stock options at fair value. The new United States accounting 
pronouncement, SFAS No. 123, does however, require the disclosure of pro 
forma net income and earnings per share information as if the Corporation 
had accounted for its stock options issued in 1996 and 1995 under the fair 
value method. Accordingly, the fair value of these options has been 
estimated at the date of grant or re-issue using the Black-Scholes option 
pricing model with the following assumptions for 1996: weighted average 
risk free interest rate of 5.96%; dividend yield of 0%; volatility factor 
of the expected market price of the Corporation's Common Shares of 0.60; 
and a weighted average expected life of the options of 2.9 years. The 
weighted-average grant-date fair value of the options issued in 1996 was 
Canadian $0.80. For purposes of pro forma disclosures, the estimated fair 
value of the options is amortized to expense over the options' vesting 
period which ranges from upon issuance or re-issue to four years. 
Retroactive application of the fair value method to prior years is not 
permitted, therefore the full effect of the fair value method will not be 
reflected in the pro forma disclosures until it has been applied to all 
nonvested options. Assuming the Corporation has accounted for its stock 
options issued under the fair value method, United States GAAP pro forma 
net loss and net loss per share for the year ended December 31, 1996 would 
have been $35,059,000 and $0.21 respectively. Compensation cost for the 
year ended December 31, 1995 has not been estimated as the number of 
options issued in the year was insignificant.

18. JOINT VENTURES

The Corporation's prorata share of the joint venture operations through 
which it carries out part of its activities is summarized below.  The 
Balance Sheet amounts below reflect the elimination of accounts between 
these joint ventures and the Corporation.

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------
                	      Year Ended               Year Ended               Year Ended
                      December 31, 1996    December 31, 1995    December 31, 1994
========================================================
<S>               <C>                       <C>                <C> 
Revenue		$      4,727,000           $      3,624,000	       $ 2,449,000
Expenses                     3,519,000                   2,588,000                 $ 1,738,000
------------------------------------------------------------------------------------------------
Net income	$      1,208,000            $      1,036,000                 $   711,000
=========================================================
Cash flow from
operations            $      1,589,000            $      1,251,000	        $   850,000 
=========================================================
</TABLE>

-----------------------------------------------------------------------
				December 31, 1996	December 31, 1995
-----------------------------------------------------------------------
Current assets			$         966,000    	$         680,000
Noncurrent assets		$      10,953,000     	$       8,570,000
Current liabilities		$       1,629,000		$         190,000
Noncurrent liabilities		$       2,167,000		$       2,619,000
==========================================================

19. RECLASSIFICATIONS

Certain prior years' balances have been reclassified to conform with 
financial statement presentation adopted in the current year.

<PAGE>


      Selected Quarterly Financial Data 
      (In thousands of U.S. dollars except per share data) 
        
<TABLE>
<CAPTION>
                                    	  		Unaudited 
-------------------------------------------------------------------------------------------------
					Three Months Ended 
		 	March 31      June 30   September 30   December  31
  			       1995          1995                 1995                1995
------------------------------------------------------------------------------------------------- 
<S>			<C>	        <C>	   <C>	           <C>

Revenues		$ 109,964   $ 122,514        $ 155,667      $  125,005 
Operating income(loss)	     (5,660)           (366)           14,780              3,453 
Income(loss)		   (15,109)      (15,147)             4,333             (6,984) 
 
Earnings(loss) per share 
	Basic		      (0.13)         (0.13)                0.04               (0.06) 
	Fully Diluted	      (0.13)         (0.13)                0.04               (0.06) 
------------------------------------------------------------------------------------------------- 
					Three Months Ended 
			March 31      June 30   September 30   December  31 
			       1996          1996                 1996                1996 
------------------------------------------------------------------------------------------------- 
Revenues		$ 128,351      $ 117,783    $ 141,976       $  121,582 
Operating income(loss)	       3,951           (1,793)          6,523             (1,514) 
Loss   		                   (7,157)         (11,070)        (2,970)            (9,885) 
 
Loss per share 
	Basic		       (0.06)             (0.06)          (0.02)             (0.06) 
	Fully Diluted	       (0.06)             (0.06)          (0.02)             (0.06) 
-------------------------------------------------------------------------------------------------- 
</TABLE>
 
 
		SUPPLEMENTAL SCHEDULES: 
 
Schedules of the Corporation for each of the three years in the  
period ended December 31, 1996 are filed under Item 14 hereto. 
 
 
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON  
ACCOUNTING AND FINANCIAL DISCLOSURE. 
 
		Not Applicable. 
 
<PAGE> 
 
                              PART III 
 
ITEM 10.	DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT. 
 
The information required by Item 10 is set forth in the  
Corporation's Proxy Statement under the caption "Election of  
Directors" and "Security Ownership of Certain Beneficial Owners  
and Management" and is incorporated herein by reference (except  
that certain information regarding the Corporation's executive  
officers is included in Part I under the heading "Executive  
Officers"). 
 
ITEM 11.	EXECUTIVE COMPENSATION. 
 
The information required by Item 11 is set forth in the  
Corporation's Proxy Statement under the caption "Executive  
Compensation" and is incorporated herein by reference. 
 
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND  
		MANAGEMENT. 
 
The information required by Item 12 is set forth in the  
Corporation's Proxy Statement under the caption "Security  
Ownership of Certain Beneficial Owners and Management" and is  
incorporated herein by reference. 
 
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. 
 
The information required by Item 13 is set forth in the  
Corporation's Proxy Statement under the captions "Indebtedness of  
Directors and Senior Officers", "Interests of Insiders in  
Material Transactions" and "Executive Compensation" and is  
incorporated herein by reference.
 
 
<PAGE>
 
 
                            PART IV  
 
ITEM 14.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON  
		FORM 8-K. 
 
(a)	1.	FINANCIAL STATEMENTS 
 
The following financial statements of the Corporation have been  filed 
under Item 8 hereto. 
 
Auditors' Report 
 
Consolidated Balance Sheets at December 31, 1996 and 1995 
 
For each of the years ended December 31, 1996, 1995 and 1994: 
 
	Consolidated Income Statement  
	Consolidated Statement of Changes in Cash Resources 
	Consolidated Statement of Changes in Shareholders' Equity 
 
Notes to the Consolidated Financial Statements 
 
2.	FINANCIAL STATEMENT SCHEDULE 
 
	Auditors' Report on Schedule 
 
	Schedule II   -	Valuation and qualifying accounts 
 
All other schedules have been omitted because the information  
required is included in the consolidated financial statements or  
the notes thereto. 
 
 
 
 
	3.	EXHIBITS: 
 
			(i)  The following Exhibits,  
numbered as they were numbered for filing as Exhibits  
to the Corporation's Form S-1 Registration Statement,  
No. 33-12919, as amended, effective May 14, 1987, are  
incorporated herein by reference: 
 
	10.9	Restated Subscription  Agreement between Cineplex  
		Odeon Corporation and MCA INC. dated
		January 15, 1986, as amended May 6, 1986 
 
	10.11	Cineplex Standstill  Agreement between Cineplex  
		Odeon Corporation and MCA INC. dated
 		May 12, 1986, as amended  January, 1987 
 
	10.14	MCA Registration  Agreement between Cineplex  
		Odeon Corporation and MCA INC. dated
		May 12, 1986 
 
	10.26	Amendment to Restated  Subscription Agreement
		dated  May 4, 1987 
 
	10.27	Amendment to Standstill Agreement dated
 		May 4, 1987 
 
			(ii)	The following Exhibit,  
numbered as it was for filing as an Exhibit to the  
Corporation's Annual Report on Form 10-K for 1987, is  
incorporated herein by reference: 
 
	10.2	Amendment to Cineplex Standstill
 		Agreement dated as of March 3, 1988 
 
			(iii)	The following Exhibits,  
numbered as they were for filing as Exhibits to the  
Corporation's Quarterly Report on Form 10-Q for the  
quarter ended June 30, 1989 are incorporated herein by  
reference: 
 
	10.6	Agreement made May 15, 1989  between Cineplex
		Odeon Corporation and MCA INC., further
		amending the Standstill Agreement between
		them dated May 12, 1986 
 
	10.7	Form of Indemnity as executed by Cineplex Odeon
		Corporation in favour of each of the Corporation's
		directors 
 
			(iv)	The following Exhibits,  
numbered as they were for filing as Exhibits to the  
Corporation's report on Form 8-K which was filed  
October 24, 1989 are incorporated herein by reference: 
 
	3	Agreement made October 24, 1989 between Cineplex
		Odeon Corporation and MCA INC., further amending
		the Standstill Agreement between them dated
 		May 12, 1986 
 
			(v)	The following Exhibits,  
numbered as they were for filing as Exhibits to the  
Corporation's Annual Report on Form 10-K for 1989, are  
incorporated herein by reference: 
 
	3.2	Bylaws		
 	
			(vi)	The following Exhibits,  
numbered as they were for filing as Exhibits to the  
Corporation's Annual Report on Form 10-K for 1990, are  
incorporated herein by reference: 
 
	3.1	Articles of Amalgamation 
 
	10.2	Sample Cineplex Odeon Corporation Option
		Agreement for United States resident 
 
			(vii)	The following Exhibits,  
numbered as they were for filing as an Exhibit to the  
Corporation's Quarterly Report on Form 10-Q for the  
quarter ended June 30, 1994 are incorporated herein by  
reference: 
 
	 4.1	Indenture dated as of June 23, 1994, by and
		among Plitt Theatres, Inc. and Cineplex  
		Odeon Corporation and The Bank  
		of New York as Trustee. 
 
	10.1	Credit Agreement dated as of  June 23, 1994, by
		and among Cineplex Odeon Corporation and 
		Plitt Theatres, Inc. and The Bank of Nova Scotia
		as agent, and the banks party thereto. 
 
	10.2	Letter Agreement dated as of June 23, 1994,
		regarding the establishment of an operating  
		credit facility, between Cineplex Odeon Corporation,
		as borrower, and The Bank of Nova Scotia. 
 
		 
			(viii)	The following Exhibits,  
numbered as they were for filing as an Exhibit to the  
Corporation's Quarterly Report on Form 10-Q for the  
quarter ended March 31, 1995 are incorporated herein by  
reference: 
 
	10.1	Second Amendment Agreement dated as of 
		March 31, 1995 by and among Cineplex Odeon  
		Corporation, Plitt Theatres, Inc., the Guarantors,
		The Bank of Nova Scotia as agent, and the Banks
 		party thereto. 
 
			(ix)	The following Exhibits,  
numbered as they were for filing as an Exhibit to the  
Corporation's Quarterly Report on Form 10-Q for the  
quarter ended September 30, 1995 are incorporated  
herein by reference: 
 
	10.1	Third Amendment Agreement dated as of
		September 30, 1995 by and among Cineplex Odeon  
		Corporation, Plitt Theatres, Inc., the Guarantors,
		The Bank of Nova Scotia as agent, and the Banks
 		party thereto. 
 
			(x)	The following Exhibits,  
numbered as they were for filing as an Exhibit to the  
Corporation's Annual Report on Form 10-K for 1995 are  
incorporated herein by reference: 
 
	10.1	Fifth Amendment Agreement dated as of
		March 26, 1996 by and among Cineplex Odeon  
		Corporation, Plitt Theatres, Inc., the Guarantors
		The Bank of Nova Scotia as agent, and the Banks
		 party thereto. 
 
	10.2	Amended and Restated Subscription Agreement
		dated as of March 19, 1996 by and among Cineplex
		Odeon Corporation, MCA INC. amd the  
		Charles Rosner Bronfman Trust. 
 
			(xi)	The following Exhibits,  
numbered as they were for filing as an Exhibit to the  
Corporation's Quarterly Report on Form 10-Q for the  
quarter ended June 30, 1996 are incorporated herein by  
reference: 
 
	3.1	Articles of the Corporation as amended
		effective June 6, 1996. 
 
	10.1	Stock Option Plan as amended effective
		 June 6, 1996. 
	 
			(xii)	The following Exhibits,  
numbered as they were for filing as an Exhibit to the  
Corporation's Quarterly Report on Form 10-Q for the  
quarter ended September 30, 1996 are incorporated  
herein by reference: 
 
	10.1	Sixth Amendment Agreement dated as of
		August 16, 1996 by and among Cineplex Odeon  
		Corporation, Plitt Theatres, Inc., the Guarantors,
		The Bank of Nova Scotia as agent, and the Banks
 		party thereto.
	 
	10.2	Seventh Amendment Agreement dated as of
		October 31, 1996 by and among Cineplex Odeon  
		Corporation, Plitt Theatres, Inc., the Guarantors,
		The Bank of Nova Scotia as agent, and the Banks
		 party thereto. 
 
			(xiii)	The following Exhibits are  
filed herewith: 
 
	10.1	Eighth Amendment Agreement dated as of
		February 17, 1997 by and among Cineplex Odeon  
		Corporation, Plitt Theatres, Inc., the Guarantors,
		The Bank of Nova Scotia as agent, and the Banks
		 party thereto. 
 
	10.2	Employment Agreement between Cineplex Odeon
		Corporation and Mr. Allen Karp dated as of  
		July 4, 1996 as amended by letter agreement dated
		as of  December 6, 1996. 
			 
	10.3	Employment Agreement between Cineplex Odeon
		Corporation and  Mr. Ellis Jacob dated as of  
		December 6, 1996. 
 
	10.4	Employment Agreement between Cineplex Odeon
		Corporation and Mr. Robert Tokio dated as of  
		December 6, 1996. 
 
	10.5	Employment Agreement between Cineplex Odeon
		Corporation and Mr. Michael Herman dated as of  
		December 6, 1996. 
 
	10.6	Employment Agreement between Cineplex Odeon
		Corporation and Mr. Howard Lichtman dated as  
		of December 6, 1996. 
 
	10.7	Employment Agreement between Cineplex Odeon
		Corporation and Mr. Irwin Cohen dated as of  
		December 6, 1996. 
 
	10.8	Employment Agreement between Cineplex Odeon
		Corporation and Mr. Michael McCartney dated as  
		of September 15, 1995 as amended by letter agreement  
		dated as of January 22, 1997. 
 
	11.1	Statement re computation of earnings per share 
 
              21.1  	Subsidiaries of the Corporation 
 
              23.1	Consent of KPMG 
 
	27	Financial Data Schedule 
 
	(b)	The Corporation did not file any reports on  
Form 8-K during the three months ended December 31,  
1996. 
 
 
 
 
Pursuant to the requirements of Section 13 or 15(d) of  
the Securities Exchange Act of 1934, the Corporation has duly  
caused this report to be signed on its behalf by the undersigned,  
thereunto duly authorized. 
 
				CINEPLEX ODEON CORPORATION 
 
 
				By:  	Allen Karp             
					__________________
					Allen Karp 
					President and Chief 
					Executive Officer 
 
					Date:  March 11, 1997 
 
 
				  By:  	Ellis Jacob             
 				         	____________________
					Ellis Jacob 
	 				Executive Vice-President 
					and Chief Financial Officer 
 
					Date:  March 11, 1997   
 

 
Pursuant to the requirements of the Securities Exchange Act  
of 1934, this report has been signed below by the following  
persons in the capacities and on the dates indicated. 
 
 
Signature		Title				  Date 
 
 
  Allen Karp           	  President, Chief Executive	March 11, 1997 
__________ 		  Officer and Director
 Allen Karp		  (Principal Executive
			  Officer) 
			 
 Ellis Jacob          	Executive Vice-President 		March 11, 1997     
__________  		and Chief Financial Officer 
Ellis Jacob		and Director  (Principal
			Financial and Accounting Officer)

 E. Leo Kolber        	 Chairman of the Board	 	March 11, 1997     
_______________ 
E. Leo Kolber 
 
 Rudolph P. Bratty    	  Director			March 11, 1997	 
_______________
 Rudolph P. Bratty 
 
 ______________
 John H. Daniels 	  	Director		
 
______________
Bruce L. Hack 		Director 
 
________________ 
Andrew J. Parsons        	Director			 	March 11, 1997	 
_______________
Andrew J. Parsons 
 
 
 Eric W. Pertsch      	Director			 	March 11, 1997	 
_______________ 
 Eric W. Pertsch 
 
 
 Robert Rabinovitch   	 Director			 March 11, 1997	 
________________ 
 Robert Rabinovitch 
 
 
 James D. Raymond     	  Director			 March 11,  1997	 
________________
James D. Raymond 
 
__________________  	  Director	
Christopher J. McGurk   
 
 
 __________________        Director			 		 
  Howard L. Weitzman 

<PAGE>


INDEPENDENT AUDITORS' REPORT ON SCHEDULE

The Board of Directors and Shareholders of Cineplex Odeon 
Corporation

Under date of February 18, 1997, we reported on the 
consolidated balance sheets of Cineplex Odeon Corporation as 
at December 31, 1996 and 1995 and the related consolidated 
statements of income and changes in shareholders' equity and 
cash resources for each of the years in the three year 
period ended December 31, 1996, as contained in the annual 
report on Form 10-K for the year 1996.  In connection with 
our audits of the aforementioned consolidated financial 
statements, we also have audited the related financial 
statement schedule in the Form 10-K.  This financial 
statement schedule is the responsibility of the Company's 
management.  Our responsibility is to express an opinion on 
this financial statement schedule based on our audits.

In our opinion, the related financial statement schedule, 
when considered in relation to the basic consolidated 
financial statements taken as a whole, presents fairly, in 
all material respects, the information set forth therein.

KPMG

Chartered Accountants

Toronto, Canada
February 18, 1997 

<PAGE>


CINEPLEX ODEON CORPORATION											
SCHEDULE II											
VALUATION AND QUALIFYING ACCOUNTS											
For fiscal periods 1996, 1995 and 1994							
(in thousands of U.S. dollars)										

<TABLE>
<CAPTION>
											
	Column A		Column B	Column C			Column D	Column E	
											
				Balance at	Charged to	Charged to	Deductions/		
				Beginning of	Costs and	Other		Other		Balance at
Description			Period		Expenses	Accounts	Changes		End of Period
--------------       ---------------        ---------------         ------------- ----------------
<S>                            		   <C>      <C>       <C>        <C>   <C>
Year Ended December 31, 1996											
											
Allowance for doubtful accounts	         $524 	     N/A	    	      N/A		      ($59)		$465 
Goodwill			      10,167 	   1,114 	      	          0 	      	           0 	           11,281
Deferred charges		       	        2,395              1,275 	      	          0           	           1 	             3,671
				---------------         --------------         ---------------         -------------            ----------------- 
				     $13,086	  $2,389	                      $0 	                   ($58)	         $15,417
   ---------------          --------------         ---------------         -------------            -----------------	
Year Ended December 31, 1995										
											
Allowance for doubtful accounts	         $519 	     N/A	                    N/A		         $5 		$524 
Goodwill			        9,702              1,147                         0 	                    (682)(ii)                   10,167 
Deferred charges	  1,170     1,452        0 	                    (227)(iii)	             2,395 
        ---------------          --------------       ----------------          --------------            ----------------
			                   $11,391            $2,599	                     $0 	                  ($904)	         $13,086 
				--------------            -------------      ----------------           --------------             ---------------
Year Ended December 31, 1994	
								
Allowance for doubtful accounts	         $430 	       N/A	     N/A		       $89 		$519 
Goodwill			        8,518 	    1,192 	         0 	                       (8)	             9,702 
Deferred charges		                      5,946 	     2,198 	         0                	   (6,974)(iv)	             1,170
               --------------   -------------   -------------   ------------           --------------
  			                  $14,894 	   $3,390 	       $0 	                ($6,893)                     $11,391 
               ------------   ----------   -------------           ---------------           --------------
											
Notes											
(i)  Unless otherwise stated, Deductions/Other Changes represent the 
     translation adjustment on the conversion of Canadian dollar amounts 
     to U.S. dollars.											
			
(ii) $687 relates to the write-off of the accumulated amortization of 
     goodwill associated with the sale of certain theatres.											
					
(iii) $236 relates to the write-off of a deferred charge item that had 
      become fully amortized during the period.		
											
 (iv) $6,736 relates to the write-off of debt financing charges	

</TABLE>



EXHIBIT INDEX 
 
 
 
Exhibit 		Description 				Page Number 
 
10.1 	Eighth Amendment Agreement dated as  
	of February 17, 1997 by and among  
	Cineplex Odeon Corporation, Plitt  Theatres,
	Inc.,the Guarantors, The Bank of Nova  
	Scotia as agent, and the Banks  
	party thereto. 

10.2 	Employment Agreement between  
	Cineplex Odeon Corporation and  
	Mr. Allen Karp dated as of July 4, 1996
 	as amended by letter agreement dated as
 	of December 6, 1996.  

10.3 	Employment Agreement between  
	Cineplex Odeon Corporation and  
	Mr. Ellis Jacob dated as of  December 6, 1996. 

10.4 	Employment Agreement between  
	Cineplex Odeon Corporation and  
	Mr. Robert Tokio dated as of December 6, 1996.

10.5 	Employment Agreement between  
	Cineplex Odeon Corporation and 
	Mr. Michael Herman dated as of December 6, 1996.

10.6 	Employment Agreement between  
	Cineplex Odeon Corporation and  
	Mr. Howard Lichtman dated as of December 6, 1996. 

10.7 	Employment Agreement between  
	Cineplex Odeon Corporation and  
	Mr. Irwin Cohen dated as of December 6, 1996.

10.8 	Employment Agreement between  
	Cineplex Odeon Corporation and  
	Mr. Michael McCartney dated as of September 15,  
	1995 as amended by  letter agreement dated as of  
	January 22, 1997. 

11.1 	Statement re computation of earnings per share. 

21.1 	Subsidiaries of the Corporation. 

23.1 	Consent of KPMG. 

27 	Financial Data Schedule.