UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q
             QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended March 31, 2003


Commission File Nos. 33-47040; 333-11895; 333-45417



                               CINEMARK USA, INC.
             (Exact name of registrant as specified in its charter)

                        Texas                             75-2206284
            (State or other jurisdiction               (I.R.S. Employer
          of incorporation or organization)           Identification No.)

                 3900 Dallas Parkway
                       Suite 500
                     Plano, Texas                            75093
        (Address of principal executive offices)           (Zip Code)

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




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

                                  Yes X No ____

    Indicate by check mark whether the  registrant is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act).

                                  Yes ____ No X




    As of May 15, 2003,  1,500 shares of Class A common stock and 182,648 shares
of Class B common stock were outstanding.





<PAGE>


                       CINEMARK USA, INC. AND SUBSIDIARIES

                                      Index

                                                                            Page
                                                                            ----

PART I          FINANCIAL INFORMATION

        Item 1. Financial Statements

                Condensed Consolidated Balance Sheets
                    as of March 31, 2003 (unaudited)
                    and December 31, 2002                                     3

                Condensed Consolidated Statements of Operations
                    (unaudited) for the three month periods
                    ended March 31, 2003 and 2002                             4

                Condensed Consolidated Statements of Cash
                    Flows (unaudited) for the three month
                    periods ended March 31, 2003 and 2002                     5

                Notes to Condensed Consolidated Financial
                    Statements (unaudited)                                    6

        Item 2. Management's Discussion and Analysis of
                    Financial Condition and Results of
                    Operations                                                23

        Item 3. Quantitative and Qualitative Disclosures
                    About Market Risk                                         34

        Item 4. Controls and Procedures                                       35

PART II         OTHER INFORMATION

        Item 1. Legal Proceedings                                             36

        Item 2. Changes in Securities and Use of Proceeds                     36

        Item 3. Defaults Upon Senior Securities                               36

        Item 4. Submission of Matters to a Vote of Security Holders           36

        Item 5. Other Information                                             36

        Item 6. Exhibits and Reports on Form 8-K                              36


SIGNATURES                                                                    38


                                        2


<PAGE>
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements

                       CINEMARK USA, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                                                                March 31,          December 31,
                                                                                  2003                 2002
                                                                               (Unaudited)
                                                                            ------------------------------------
<S>                                                                         <C>                  <C>
                                     ASSETS

CURRENT ASSETS
    Cash and cash equivalents                                               $   42,648,574       $   63,718,515
    Inventories                                                                  3,689,432            3,688,915
    Accounts receivable                                                         11,376,916           12,441,849
    Income tax receivable                                                        1,948,064              715,931
    Prepaid expenses and other                                                   4,525,443            4,094,135
                                                                            ------------------------------------
      Total current assets                                                      64,188,429           84,659,345

THEATRE PROPERTIES AND EQUIPMENT                                             1,185,967,627        1,177,508,981
    Less accumulated depreciation and amortization                            (401,673,402)        (385,778,478)
                                                                            ------------------------------------
      Theatre properties and equipment - net                                   784,294,225          791,730,503

OTHER ASSETS
    Goodwill                                                                    10,755,311           10,751,844
    Investments in and advances to affiliates                                    2,928,159            3,040,940
    Deferred charges and other - net                                            36,759,548           26,631,296
                                                                            ------------------------------------
      Total other assets                                                        50,443,018           40,424,080
                                                                            ------------------------------------

TOTAL ASSETS                                                                $  898,925,672       $  916,813,928
                                                                            ====================================
                      LIABILITIES AND SHAREHOLDER'S EQUITY

CURRENT LIABILITIES
    Current portion of long-term debt                                       $    6,002,004       $   30,190,449
    Accounts payable and accrued expenses                                       83,967,831          124,237,312
                                                                            ------------------------------------
      Total current liabilities                                                 89,969,835          154,427,761

LONG-TERM LIABILITIES
    Senior credit agreements                                                   167,945,407          282,237,221
    Senior subordinated notes                                                  530,152,040          380,159,167
    Deferred lease expenses                                                     25,216,959           24,837,457
    Deferred gain on sale leasebacks                                             4,281,140            4,372,620
    Deferred income taxes                                                       14,990,145           11,170,128
    Deferred revenues and other long-term liabilities                            3,933,302            5,129,370
                                                                            ------------------------------------
      Total long-term liabilities                                              746,518,993          707,905,963

MINORITY INTERESTS IN SUBSIDIARIES                                              28,098,667           26,714,929

SHAREHOLDER'S EQUITY
    Class A common stock, $.01 par value: 10,000,000 shares
      authorized, 1,500 shares issued and outstanding                                   15                   15
    Class B common stock, no par value: 1,000,000 shares
      authorized, 239,893 shares issued and outstanding                         49,543,427           49,543,427
    Additional paid-in-capital                                                  12,249,157           11,974,860
    Retained earnings                                                           85,726,249           80,273,323
    Treasury stock, 57,245 Class B shares at cost                              (24,232,890)         (24,232,890)
    Accumulated other comprehensive loss                                       (88,947,781)         (89,793,460)
                                                                            ------------------------------------
      Total shareholder's equity                                                34,338,177           27,765,275
                                                                            ------------------------------------

TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY                                  $  898,925,672       $  916,813,928
                                                                            ====================================

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


                                        3


<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

                                                                                Three Months Ended March 31,
                                                                                  2003                 2002
                                                                            ------------------------------------
<S>                                                                         <C>                  <C>
REVENUES
    Admissions                                                              $  128,681,137       $  146,411,564
    Concession                                                                  64,373,240           69,286,218
    Other                                                                       10,947,382           11,004,324
                                                                            ------------------------------------
          Total revenues                                                       204,001,759          226,702,106

COSTS AND EXPENSES
    Cost of operations:
       Film rentals and advertising                                             67,249,207           76,885,027
       Concession supplies                                                       9,913,574           11,981,820
       Salaries and wages                                                       22,609,749           22,550,434
       Facility lease expense                                                   28,814,130           29,149,610
       Utilities and other                                                      25,479,127           26,685,341
                                                                            ------------------------------------
          Total cost of operations                                             154,065,787          167,252,232

    General and administrative expenses                                          9,589,814           10,643,017
    Depreciation and amortization                                               16,136,914           17,166,781
    Asset impairment loss                                                              -                558,398
    (Gain) loss on sale of assets and other                                       (616,429)             539,192
                                                                            ------------------------------------
          Total costs and expenses                                             179,176,086          196,159,620
                                                                            ------------------------------------

OPERATING INCOME                                                                24,825,673           30,542,486

OTHER INCOME (EXPENSE)
    Interest expense                                                           (13,295,608)         (14,783,937)
    Amortization of debt issue cost                                               (583,620)            (591,170)
    Interest income                                                                658,629              483,339
    Foreign currency exchange gain (loss)                                           16,131             (220,997)
    Loss on early retirement of debt                                            (1,645,759)                 -
    Equity in income of affiliates                                                 196,356              116,741
    Minority interests in income of subsidiaries                                  (770,205)            (876,471)
                                                                            ------------------------------------
          Total other expenses                                                 (15,424,076)         (15,872,495)
                                                                            ------------------------------------

INCOME BEFORE INCOME TAXES AND
    CUMULATIVE EFFECT OF AN ACCOUNTING CHANGE                                    9,401,597           14,669,991

Income taxes                                                                     3,948,671            4,439,269
                                                                            ------------------------------------

INCOME BEFORE CUMULATIVE EFFECT
    OF AN ACCOUNTING CHANGE                                                      5,452,926           10,230,722

Cumulative effect of a change in accounting principle, net of income tax
    benefit of $0.                                                                     -             (3,389,779)
                                                                            ------------------------------------

NET INCOME                                                                  $    5,452,926       $    6,840,943
                                                                            ====================================
EARNINGS PER SHARE:
    Basic:
       Income before accounting change                                      $        29.61       $        55.56
       Cumulative effect of an accounting change                                       -                 (18.41)
                                                                            ------------------------------------
       Net income                                                           $        29.61       $        37.15
                                                                            ====================================
    Diluted:
       Income before accounting change                                      $        29.61       $        54.56
       Cumulative effect of an accounting change                                       -                 (18.08)
                                                                            ------------------------------------
       Net income                                                           $        29.61       $        36.48
                                                                            ====================================

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


                                        4


<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

                                                                                Three Months Ended March 31,
                                                                                  2003                 2002
                                                                            ------------------------------------
<S>                                                                         <C>                  <C>
OPERATING ACTIVITIES
    Net income                                                              $    5,452,926       $    6,840,943

    Noncash items in net income:
       Depreciation                                                             15,982,276           16,957,553
       Amortization of other assets                                                154,638              209,228
       Amortization of foreign advanced rents                                      423,607              497,963
       Amortized compensation - stock options                                      274,297              277,280
       Amortization of debt issue costs                                            583,620              591,170
       Amortization of gain on sale leasebacks                                     (91,480)             (91,480)
       Amortization of debt discount and premium                                    (7,127)              (7,127)
       Amortization of deferred revenues                                        (1,168,226)          (1,168,226)
       Loss on impairment of assets                                                    -                558,398
       (Gain) loss on sale of assets and other                                    (616,429)             539,192
       Loss on early retirement of debt                                          1,645,759                  -
       Deferred lease expenses                                                     379,502              454,202
       Deferred income tax expenses                                              3,820,017           10,350,697
       Equity in income of affiliates                                             (196,356)            (116,741)
       Minority interests in income of subsidiaries                                770,205              876,471
       Cumulative effect of an accounting change                                       -              3,389,779

    Cash provided by (used for) operating working capital:
       Inventories                                                                    (517)            (111,214)
       Accounts receivable                                                       1,064,933              163,330
       Prepaid expenses and other                                                 (431,308)              21,849
       Other assets                                                             (2,227,076)           3,990,846
       Advances with affiliates                                                    312,451              853,362
       Accounts payable and accrued expenses                                   (40,518,413)         (25,437,179)
       Other long-term liabilities                                                 (27,842)             221,589
       Income tax receivable/payable                                            (1,232,133)          (6,452,183)
                                                                            -------------------------------------

         Net cash provided by (used for) operating activities                  (15,652,676)          13,409,702

INVESTING ACTIVITIES
    Additions to theatre properties and equipment                               (8,603,274)          (8,656,770)
    Sale of theatre properties and equipment                                     1,490,574            1,504,441
    Investment in affiliates                                                        (3,314)                 -
    Dividends/capital returned from affiliates                                         -                500,000
                                                                            ------------------------------------

         Net cash used for investing activities                                 (7,116,014)          (6,652,329)

FINANCING ACTIVITIES
    Issuance of senior subordinated notes                                      150,000,000                  -
    Increase in long-term debt                                                 226,004,596           17,772,828
    Decrease in long-term debt                                                (364,361,185)         (15,170,540)
    Increase in debt issue cost                                                (10,712,267)                 -
    Increase in minority investment in subsidiaries                                894,354              421,855
    Decrease in minority investment in subsidiaries                               (280,821)            (209,028)
                                                                            ------------------------------------

         Net cash provided by financing activities                               1,544,677            2,815,115

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
    CASH EQUIVALENTS                                                               154,072             (334,209)
                                                                            ------------------------------------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                               (21,069,941)           9,238,279

CASH AND CASH EQUIVALENTS:
    Beginning of period                                                         63,718,515           50,199,223
                                                                            ------------------------------------

    End of period                                                           $   42,648,574        $  59,437,502
                                                                            ====================================

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


                                        5


<PAGE>


                       CINEMARK USA, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.  The Company and Basis of Presentation

        Cinemark USA, Inc. and its  subsidiaries  (the  "Company") is one of the
leaders in the motion picture exhibition  industry in terms of both revenues and
numbers of screens in operation,  with  theatres in the United States  ("U.S."),
Canada, Mexico, Argentina,  Brazil, Chile, Ecuador, Peru, Honduras, El Salvador,
Nicaragua, Costa Rica, Panama, Colombia and the United Kingdom. The Company also
manages additional theatres in the U.S. and provides management services for one
theatre in Taiwan at March 31, 2003.

        The condensed  consolidated  financial  statements have been prepared by
the  Company,  without  audit,  according  to the rules and  regulations  of the
Securities and Exchange Commission. In the opinion of management,  these interim
financial  statements reflect all adjustments (which,  except for the cumulative
effect of an  accounting  change,  include  only normal  recurring  adjustments)
necessary to state fairly the financial position and results of operations as of
and for the periods indicated.  The condensed  consolidated financial statements
include the accounts of Cinemark USA, Inc. and its subsidiaries.  Majority-owned
subsidiaries that the Company controls are consolidated while those subsidiaries
of which the Company owns between 20% and 50% and does not control are accounted
for as  affiliates  under the equity  method.  Those  subsidiaries  of which the
Company  owns  less  than 20% are  accounted  for as  affiliates  under the cost
method.  The results of these  subsidiaries  and  affiliates are included in the
financial  statements  effective  with their  formation  or from their  dates of
acquisition.  Significant  intercompany balances and transactions are eliminated
in consolidation. Certain reclassifications have been made to the 2002 financial
statements to conform to the 2003 presentation.

        These  financial  statements  should  be read in  conjunction  with  the
audited  annual  financial  statements  and the notes thereto for the year ended
December  31, 2002,  included in the Annual  Report filed March 19, 2003 on Form
10-K by the Company under the Securities Exchange Act of 1934. Operating results
for the three month period ended March 31, 2003 are not  necessarily  indicative
of the results to be achieved for the full year.

2.  Earnings Per Share

        Earnings per share are computed  using the  weighted  average  number of
shares of Class A and Class B common stock outstanding  during each period.  The
following  table sets forth the  computation  of basic and diluted  earnings per
share.

<TABLE>
<CAPTION>
                                                                                           Three Months Ended
                                                                                                March 31,
                                                                                                ---------
                                                                                         2003              2002
                                                                                         ----              ----
<S>                                                                                 <C>               <C>
   Income before cumulative effect of an accounting change                             $5,452,926       $10,230,722
                                                                                    ==============    ==============

   Basic:
   Weighted average common shares outstanding                                             184,148           184,148
                                                                                    ==============    ==============

   Income before cumulative effect of an accounting change per common share                $29.61            $55.56
                                                                                    ==============    ==============

   Diluted:
   Weighted average common shares outstanding                                             184,148           184,148
   Common equivalent shares for stock options                                                   -             3,365
                                                                                    --------------    --------------
   Weighted average common and common equivalent shares outstanding                       184,148           187,513
                                                                                    ==============    ==============

   Income before cumulative effect of an accounting change per common and common
       equivalent share                                                                    $29.61            $54.56
                                                                                    ==============    ==============
</TABLE>


                                        6


<PAGE>

        Basic  income per share is computed by dividing  income by the  weighted
average number of shares of common stock of all classes  outstanding  during the
period.  Diluted income per share is computed by dividing income by the weighted
average  number of shares of common stock and  potential  issuable  common stock
outstanding using the treasury stock method.

        The dilutive  effect of the options to purchase common stock is excluded
from  the   computation   of  diluted  income  per  share  if  their  effect  is
antidilutive.  At March 31, 2002, no options to purchase  common stock have been
excluded  from  the  diluted  income  per  share  calculation  as  a  result  of
antidilution.

        On May 16,  2002,  Cinemark,  Inc.  was formed as the  Delaware  holding
company of Cinemark USA, Inc.  Under a share exchange  agreement,  dated May 17,
2002, and after giving effect to a reverse stock split,  each outstanding  share
and each outstanding  option to purchase shares of the Company was exchanged for
shares  and  options  to  purchase  shares,  respectively,  of  common  stock of
Cinemark,  Inc. As a result,  weighted average common shares outstanding for the
three month  period  ended  March 31,  2003 do not  include  options to purchase
shares of Cinemark, Inc.'s common stock.

3.  Comprehensive Income (Loss)

        Statement of Financial  Accounting  Standards (SFAS) No. 130 establishes
standards  for  reporting  and display of  comprehensive  income  (loss) and its
components in the financial  statements.  The following components are reflected
in the Company's comprehensive income (loss):

<TABLE>
<CAPTION>
                                                                    Three Months Ended
                                                                         March 31,
                                                                         ---------
                                                                  2003               2002
                                                                  ----               ----
<S>                                                            <C>               <C>
        Net income                                             $5,452,926        $ 6,840,943
        Foreign currency translation adjustment                   845,679         (9,930,514)
                                                               ----------        ------------
        Comprehensive income (loss)                            $6,298,605        $(3,089,571)
                                                               ==========        ============
</TABLE>

4.  Foreign Currency Translation

        The accumulated other comprehensive loss account in shareholder's equity
of  $88,947,781  and  $89,793,460  at March  31,  2003 and  December  31,  2002,
respectively,  primarily relates to the cumulative foreign currency  adjustments
from translating the financial statements of Cinemark Argentina,  S.A., Cinemark
Brasil S.A. and Cinemark de Mexico, S.A. de C.V. into U.S. dollars.

        In January 2002, the Argentine  government ended the peso-dollar  parity
regime and established a dual exchange rate system, with a "commercial rate" and
a "market rate".  The market rate traded for the first time on January 11, 2002.
On January 14, 2002, the Argentine  government  unified the commercial  rate and
the market rate into one  floating  rate which is presently in use. On March 31,
2003, the floating rate was 3.0 pesos to the U.S.  dollar (the exchange rate was
3.4 pesos to the U.S. dollar at December 31, 2002).  As a result,  the effect of
translating the March 31, 2003 Argentine financial  statements into U.S. dollars
resulted  in  a  cumulative  foreign  currency  translation  adjustment  to  the
accumulated  other  comprehensive  loss account as an increase to  shareholder's
equity of  approximately  $2 million at March 31, 2003.  At March 31, 2003,  the
total assets of Cinemark Argentina, S.A. were approximately U.S. $16 million.


                                        7


<PAGE>


        On March 31, 2003,  the  exchange  rate for the  Brazilian  real was 3.4
reais to the U.S.  dollar (the exchange rate was 3.5 reais to the U.S. dollar at
December 31, 2002).  As a result,  the effect of translating  the March 31, 2003
Brazilian  financial  statements  into U.S.  dollars  resulted  in a  cumulative
foreign currency  translation  adjustment to the accumulated other comprehensive
loss account as an increase to shareholder's  equity of approximately $1 million
at March 31, 2003. At March 31, 2003,  the total assets of Cinemark  Brasil S.A.
were approximately U.S. $49 million.

        On March 31, 2003, the exchange rate for the Mexican peso was 10.7 pesos
to the U.S.  dollar  (the  exchange  rate was 10.4  pesos to the U.S.  dollar at
December 31, 2002).  As a result,  the effect of translating  the March 31, 2003
Mexican financial  statements into U.S. dollars resulted in a cumulative foreign
currency  translation  adjustment to the accumulated  other  comprehensive  loss
account as a reduction of  shareholder's  equity of  approximately $2 million at
March 31, 2003. At March 31, 2003, the total assets of Cinemark de Mexico,  S.A.
de C.V. were approximately U.S. $81 million.

        In  2002  and  2003,  all  foreign   countries  where  the  Company  has
operations,  including  Argentina,  Brazil and  Mexico  were  deemed  non-highly
inflationary.  Thus,  any  fluctuation  in the  currency  results in the Company
recording  a  cumulative   foreign  currency   translation   adjustment  to  the
accumulated  other  comprehensive  loss  account as an increase or  reduction to
shareholder's equity.

5.  Supplemental Cash Flow Information

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

<TABLE>
<CAPTION>
                                                                Three Months Ended March 31,
                                                                  2003               2002
                                                                  ----               ----
<S>                                                          <C>                <C>
        Cash paid for interest                                $21,162,524        $23,270,639
        Cash paid for income taxes (net of refunds)             1,396,051            764,884
</TABLE>

6.  Financial Information About Geographic Areas

        The Company  operates in a single  business  segment as a motion picture
exhibitor.  The  Company  is  a  multinational   corporation  with  consolidated
operations in the U.S., Canada, Mexico, Argentina, Brazil, Chile, Ecuador, Peru,
Honduras, El Salvador,  Nicaragua,  Costa Rica, Panama,  Colombia and the United
Kingdom.  Revenues  in the United  States and Canada,  Mexico,  Brazil and other
foreign  countries for the three month periods ended March 31, 2003 and 2002 are
as follows:

<TABLE>
<CAPTION>
                                                                   Three Months Ended
                                                                        March 31,
                                                                        ---------
        Revenues                                                 2003               2002
        --------                                                 ----               ----
<S>                                                          <C>                <C>
        U.S. and Canada                                      $157,593,144       $169,061,159
        Mexico                                                 15,672,170         22,051,762
        Brazil                                                 15,074,834         19,328,049
        Other foreign countries                                16,152,194         16,547,126
        Eliminations                                             (490,583)          (285,990)
                                                             -------------      -------------
        Total                                                $204,001,759       $226,702,106
                                                             =============      =============
</TABLE>


                                        8


<PAGE>


        Long-lived  assets in the U.S.  and  Canada,  Mexico,  Brazil  and other
foreign countries as of March 31, 2003 and December 31, 2002 are as follows:

<TABLE>
<CAPTION>
                                                               March 31,        December 31,
        Long-Lived Assets                                        2003               2002
        -----------------                                        ----               ----
<S>                                                          <C>                <C>
        U.S. and Canada                                      $625,825,056       $633,896,654
        Mexico                                                 67,644,964         67,990,885
        Brazil                                                 38,361,039         37,892,202
        Other foreign countries                                52,463,166         51,950,762
                                                             ------------       ------------
        Total                                                $784,294,225       $791,730,503
                                                             ============       ============
</TABLE>

7.  Goodwill and Other Intangible Assets

        The Company adopted Statement of Financial Accounting Standards ("SFAS")
No. 142 Goodwill and Other  Intangible  Assets,  effective  January 1, 2002.  In
accordance  with SFAS No.  142,  beginning  on January 1,  2002,  the  Company's
goodwill  and its  other  intangible  assets,  which  have  been  deemed to have
indefinite  lives,  are no longer  being  amortized  and are  subject  to annual
impairment  tests.  As of January 1, 2002 the  Company  performed  the  required
transitional  impairment  tests of  goodwill  and other  intangible  assets with
indefinite  useful  lives,  and as a  result,  recorded  impairment  charges  of
$3,325,611  and  $64,168,  respectively.   These  charges  are  reflected  as  a
cumulative  effect  of  a  change  in  accounting  principle  in  the  condensed
consolidated  statement of operations for the three month period ended March 31,
2002.

        The Company recorded an additional  impairment of goodwill in the amount
of $558,398  in the three month  period  ended  March 31,  2002  (recorded  as a
component of asset  impairment loss in the condensed  consolidated  statement of
operations).  The additional  impairment of goodwill  related to a write-down of
goodwill to fair value associated with the Company's Argentina operations. As of
December 31, 2002, the Company performed the required annual impairment tests of
goodwill  and  other  intangible  assets  with  indefinite  useful  lives and no
additional  impairment was present.  Goodwill and other intangible assets can be
affected by foreign currency  adjustments from  translating  foreign  subsidiary
financial statements into U.S. dollars.

        Goodwill and other intangible  assets at March 31, 2003 and December 31,
2002 are as follows:

<TABLE>
<CAPTION>
                                                                March 31,        December 31,
                                                                  2003               2002
                                                                  ----               ----
<S>                                                           <C>                <C>
        Amortized Other Intangible Assets:
        Capitalized licensing fees                            $ 9,000,000        $ 9,000,000
        Other intangible assets                                   511,432             72,403
        Less - accumulated amortization                        (1,264,070)        (1,139,070)
                                                               -----------       ------------
        Net other intangible assets                           $ 8,247,362        $ 7,933,333
                                                              ============       ============

        Unamortized Goodwill and Other Intangible Assets:
        Goodwill                                              $10,755,311        $10,751,844
        Other intangible assets                                    23,663             16,163
                                                              ------------       ------------
                                                              $10,778,974        $10,768,007
                                                              ============       ============


    Aggregate Amortization Expense:
    For the three month period ended March 31, 2003              $154,638
                                                                 ========
    For the three month period ended March 31, 2002              $209,228
                                                                 ========
</TABLE>


                                        9


<PAGE>


        Aggregate  amortization  expense for the three month  period ended March
31, 2003 consists of $125,000 of  amortization  of other  intangible  assets and
$29,638 of  amortization of other assets (both of which are included in deferred
charges and other on the condensed consolidated balance sheet).

        Estimated Amortization Expense of Other Intangible Assets:
        For the year ended December 31, 2003                         $  526,386
        For the year ended December 31, 2004                            526,386
        For the year ended December 31, 2005                            526,386
        For the year ended December 31, 2006                            526,386
        For the year ended December 31, 2007                            526,386
        Thereafter                                                    5,615,432

8.  New Accounting Pronouncements

        In April 2002, the Financial Accounting Standards Board issued Statement
of  Financial  Accounting  Standards  ("SFAS")  No.  145,  "Rescission  of  FASB
Statements No. 4, 44, and 64,  Amendment of FASB Statement No. 13, and Technical
Corrections". This statement requires, among other things, that gains and losses
on the early  extinguishment of debt be classified as extraordinary only if they
meet the criteria for extraordinary treatment set forth in Accounting Principles
Board Opinion No. 30. The provisions of this statement related to classification
of gains and losses on the early extinguishment of debt are effective for fiscal
years  beginning  after May 15, 2002.  This statement  became  effective for the
Company  on  January 1, 2003.  See note 12 for  discussion  of the debt  retired
during the three  month  period  ended March 31,  2003 in  conjunction  with the
Company's long-term debt refinancing.

        In November  2002,  the  Financial  Accounting  Standards  Board  issued
Interpretation  Number 45, "Guarantor's  Accounting and Disclosure  requirements
for Guarantees,  Including Indirect  Guarantees of Indebtedness of Others" ("FIN
45").  This  interpretation  elaborates  on  the  disclosures  to be  made  by a
guarantor in its interim and annual  financial  statements about its obligations
under certain  guarantees that it has issued. It also clarifies that a guarantor
is required to recognize,  at the inception of a guarantee,  a liability for the
fair value of the obligation undertaken in issuing the guarantee. The disclosure
requirements  of FIN 45 are  effective  for  interim  and annual  periods  after
December 15, 2002. The initial recognition and initial measurement  requirements
of FIN 45 are effective  prospectively  for guarantees  issued or modified after
December 31, 2002. The adoption of this statement had no impact on the condensed
consolidated financial statements.

9.   Related Party Transactions

        The Company manages one theatre with 12 screens for Laredo Theatre,  Ltd
("Laredo").  Lone  Star  Theatres,  Inc.  owns  25% of the  limited  partnership
interests  in Laredo.  The  Company  is the sole  general  partner  and owns the
remaining limited partnership interests.  Lone Star Theatres, Inc. is owned 100%
by Mr. David Roberts,  who is Mr.  Mitchell's  son-in-law.  Under the agreement,
management  fees are paid by Laredo to the  Company  at a rate of 5% of  theatre
revenues in each year up to $50,000,000 and 3% of theater  revenues in each year
in excess of  $50,000,000.  The  Company  recorded  $36,410  of  management  fee
revenues and  received no dividends  from Laredo in the three month period ended
March 31,  2003.  All such  amounts  are  included  in the  Company's  condensed
consolidated  financial  statements with the intercompany  amounts eliminated in
consolidation.

        The  Company  manages  one  theatre  with  eight  screens  for  Mitchell
Theatres.  Mitchell Theatres is 100% owned by members of Mr. Mitchell's  family.
Under  the  agreement,  management  fees are paid by  Mitchell  Theatres  to the
Company at a rate of 5% of theatre  revenues.  The term ends in  November  2003.
However,  the Company has the option to renew for one or more five-year periods.
The Company recorded $6,023 of management fee revenues from Mitchell Theatres in
the three month period ended March 31, 2003.


                                       10


<PAGE>


        The  Company  leases one theatre  with 7 screens  from Plitt Plaza joint
venture.  Plitt Plaza joint venture is indirectly owned by Lee Roy Mitchell. The
term of the  lease  expires  in July  2003.  The  annual  rent is  approximately
$264,000 plus certain taxes,  maintenance expenses,  insurance, and a percentage
of gross admissions and concession  receipts in excess of certain  amounts.  The
Company  recorded $73,074 of facility lease expense payable to Plitt Plaza joint
venture during the three month period ended March 31, 2003.

        The Company entered into a profit participation  agreement dated May 17,
2002 with its  President,  Alan Stock,  pursuant to which Mr.  Stock  receives a
profit  interest in two recently  built theatres after the Company has recovered
its capital  investment in these theatres plus its borrowing  costs.  Under this
agreement,  operating  losses and disposition  losses for any year are allocated
100% to the  Company.  Operating  profits  and  disposition  profits  for  these
theatres for any fiscal year are allocated first to the Company to the extent of
total  operating  losses  and losses  from any  disposition  of these  theatres.
Thereafter, net cash from operations from these theatres or from any disposition
of these  theatres is paid first to the Company  until such  payments  equal the
Company's  investment  in these  theatres,  plus  interest,  and then 51% to the
Company  and 49% to Mr.  Stock.  In the event  that Mr.  Stock's  employment  is
terminated without cause, profits will be distributed  according to this formula
without  first  allowing  the  Company to recoup its  investment  plus  interest
thereon.  No amounts have been paid to Mr. Stock to date  pursuant to the profit
participation  agreement.  Upon consummation of an initial public offering,  the
Company  will have the option to purchase Mr.  Stock's  interest in the theatres
for a price equal to the fair market value of the profit interest, as determined
by an independent  appraiser.  The Company does not intend to enter into similar
arrangements with its executive officers in the future.

10.  Litigation and Litigation Settlements

        The Company is currently a defendant in certain  litigation  proceedings
alleging certain  violations of the Americans with Disabilities Act of 1990 (the
"ADA")  relating to  accessibility  of movie theatres for  handicapped  and deaf
patrons.

        In March 1999, the Department of Justice filed suit in the U.S. District
Court, Northern District of Ohio, Eastern Division, against the Company alleging
certain  violations  of the ADA  relating to the  Company's  wheelchair  seating
arrangements and seeking remedial action.  An Order granting Summary Judgment to
the Company was issued in November  2001. The Department of Justice has appealed
the district  court's  ruling with the Sixth  Circuit  Court of Appeals.  If the
Company loses this  litigation,  the Company's  financial  position,  results of
operations and cash flows may be materially and adversely affected.  The Company
is unable to predict the outcome of this  litigation  or the range of  potential
loss,  however,  management  believes  that based  upon  current  precedent  the
Company's potential liability with respect to such proceeding is not material in
the aggregate to the Company's  financial  position,  results of operations  and
cash flows.  Accordingly,  the Company has not established a reserve for loss in
connection with this proceeding.

        In August 2001,  David  Wittie,  Rona Schnall,  Ron  Cranston,  Jennifer
McPhail,  Peggy  Garaffa  and ADAPT of Texas  filed  suit in the 201st  Judicial
District Court of Travis County,  Texas alleging certain violations of the Human
Resources Code, the Texas  Architectural  Barriers Act, the Texas  Accessibility
Standards and the Deceptive  Trade  Practices Act relating to  accessibility  of
movie  theatres for patrons  using  wheelchairs  at two theatres  located in the
Austin,   Texas  market.   The  plaintiffs  were  seeking  remedial  action  and
unspecified  damages. On February 20, 2003, a jury determined that the Company's
theatres  located in the Austin,  Texas market complied with the Human Resources
Code,  the  Texas  Architectural   Barriers  Act  and  the  Texas  Accessibility
Standards. The judge granted summary judgment to the Company with respect to the
Deceptive Trade Practices Act. The Company cannot predict whether the plaintiffs
will appeal the jury's decision. If the jury's finding is appealed,  the Company
is unable to predict the outcome of this  litigation  or the range of  potential
loss,  however,  management  believes  that based  upon  current  precedent  the
Company's potential liability with respect to such proceeding is not material in
the aggregate to the Company's  financial  position,  results of operations  and
cash flows.  Accordingly,  the Company has not established a reserve for loss in
connection with this proceeding.


                                       11


<PAGE>


        In July 2001, Sonia Rivera-Garcia and Valley Association for Independent
Living filed suit in the 93rd Judicial  District Court of Hidalgo County,  Texas
alleging certain violations of the Human Resources Code, the Texas Architectural
Barriers  Act,  the  Texas  Accessibility  Standards  and  the  Deceptive  Trade
Practices  Act relating to  accessibility  of movie  theatres for patrons  using
wheelchairs  at one theatre in the Mission,  Texas market.  The  plaintiffs  are
seeking remedial action and unspecified damages. The Company has filed an answer
denying the  allegations  and is vigorously  defending this suit. The Company is
unable to predict the outcome of this litigation or the range of potential loss,
however,  management  believes  that based upon current  precedent the Company's
potential  liability  with  respect to such  proceeding  is not  material in the
aggregate to the Company's  financial  position,  results of operations and cash
flows.  Accordingly,  the  Company  has not  established  a reserve  for loss in
connection with this proceeding.

        The plaintiffs in the Department of Justice  litigation,  Austin,  Texas
litigation  and Mission,  Texas  litigation  have argued that the theatres  must
provide  wheelchair seating locations with viewing angles to the screen that are
at the median or better than all seats in the  auditorium.  To date three courts
and one jury in a fourth court have rejected that position. In three of the four
courts,  the Company was the defendant,  and the courts or a jury have found the
Company's  theatres to comply with the ADA; Lara v. Cinemark USA,  Inc.,  United
States  Court of  Appeals  for the Fifth  Circuit;  United  States of America v.
Cinemark USA, Inc.,  United States  District Court for the Northern  District of
Ohio; and Wittie v. Cinemark USA, Inc., 201st Judicial  District Court of Travis
County,  Texas.  Oregon  Paralyzed  Veterans of America v. Regal Cinemas,  Inc.,
United States  District Court for the District of Oregon,  adopted the reasoning
established in Lara and granted summary judgment in favor of Regal Cinemas, Inc.

        In May 2002,  Robert Todd on behalf of Robert  Preston  Todd,  his minor
child  and "all  individuals  who are  deaf or are  severely  hearing  impaired"
brought this case in the United States District Court for the Southern  District
of Texas,  Houston Division against several movie theatre  operators,  including
AMC  Entertainment,  Inc.,  Regal  Entertainment,  Inc., the Company and Century
Theaters  as well as eight  movie  Production  companies.  The  lawsuit  alleges
violation of Title III of the ADA and the First Amendment to the Constitution of
the United States.  Plaintiffs seek unspecified  injunctive relief,  unspecified
declaratory relief,  unspecified monetary damages (both actual and punitive) and
unspecified  attorney's  fees.  The Company has denied any  violation of law and
intends to vigorously  defend against all claims.  On March 7, 2003, the federal
district  judge  presiding  over  the  case  granted  summary  judgment  to  the
defendants on the alleged First Amendment  violations.  The Company is unable to
predict the outcome of this litigation or the range of potential loss,  however,
management  believes that based upon current  precedent the Company's  potential
liability  with respect to such  proceeding  is not material in the aggregate to
the  Company's  financial  position,  results  of  operations  and  cash  flows.
Accordingly,  the Company has not  established  a reserve for loss in connection
with this proceeding.

        The Company is also  currently a  defendant  in other legal  proceedings
discussed below:

        In April 2002, the Malthouse  Development  Company Limited, as landlord,
filed a lawsuit in the High Court of  Justice,  Chancery  Division,  in England,
against  Cinemark  Theatres UK Limited and  Cinemark  International  L.L.C.,  as
tenant and guarantor of tenant's  obligations,  respectively,  under a lease for
the construction and operation of a movie theatre in Banbury, England. The lease
was  previously  terminated  for cause by  Cinemark  Theatres  UK  Limited.  The
Malthouse  Development  Company  Limited is seeking  damages for the U.S. dollar
equivalent  of   approximately   $1.5  million  based  on  an  alleged  improper
termination.  Cinemark  Theatres UK Limited and Cinemark  International,  L.L.C.
have filed an answer to the  complaint,  denying  the  allegations.  The Company
intends to  vigorously  defend  this suit.  The Company is unable to predict the
outcome of this litigation or the range of potential loss, however, based on the
opinion  of its  barristers  and  Queen's  counsel,  the  Company  believes  its
potential  liability  with  respect to such  proceeding  is not  material in the
aggregate  to its  financial  position,  results of  operations  and cash flows.
Accordingly,  the Company has not  established  a reserve for loss in connection
with this proceeding.


                                       12


<PAGE>


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

11.  Stock Option Accounting

        On May 16,  2002,  Cinemark,  Inc.  was formed as the  Delaware  holding
company of Cinemark USA, Inc.  Under a share exchange  agreement,  dated May 17,
2002, and after giving effect to a reverse stock split,  each outstanding  share
and each outstanding  option to purchase shares of the Company was exchanged for
shares  and  options  to  purchase  shares,  respectively,  of  common  stock of
Cinemark,  Inc. As a result,  the Company no longer has any options  outstanding
under existing stock option plans. However,  compensation expense resulting from
amortization of unearned  compensation  related to outstanding  stock options of
Cinemark, Inc. is still being recorded in the Company's statement of operations.

        The  Company  applies  Accounting  Principles  Board  Opinion No. 25 and
related  interpretations in accounting for the Company's stock option plans. Had
compensation  costs been determined based on the fair value at the date of grant
for awards under the plans, consistent with the method of Statement of Financial
Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based Compensation"
and SFAS No.  148,  "Accounting  for  Stock-Based  Compensation  Transition  and
Disclosure",  the  Company's  net income and  earnings per share would have been
reduced to the proforma amounts indicated below:

<TABLE>
<CAPTION>

                                                                    Three Months Ended
                                                            March 31, 2003     March 31, 2002
                                                            --------------     --------------
<S>                                                         <C>                <C>
        Net income as reported                                 $5,452,926         $6,840,943
        Compensation expense included in reported
            net income, net of tax                                274,297            277,280
        Compensation expense under fair value method,
            net of tax                                           (339,414)          (342,397)
                                                               -----------        -----------
        Pro-forma net income                                   $5,387,809         $6,775,826
                                                               ===========        ===========
        Earnings per share:
        Basic earnings per share                                   $29.61             $37.15
        Pro-forma basic earnings per share                         $29.26             $36.80
        Diluted earnings per share                                 $29.61             $36.48
        Pro-forma diluted earnings per share                       $29.26             $36.14
</TABLE>

        No stock  options  were  granted in 2002 or the three month period ended
March 31, 2003. The following  assumptions  were used in the calculation of fair
value:  dividend  yield of 0 percent;  an expected  life of 6.5 years;  expected
volatility  of  approximately  38  percent;  and  risk-free  interest  rates  of
approximately 5% at the time of the last option grant date in 2001.


                                       13


<PAGE>


12. Long-Term Debt Refinancing

        On February 11, 2003, the Company issued $150 million  principal  amount
of 9% Senior Subordinated Notes to qualified institutional buyers in reliance on
Rule 144A of the Securities Act.  Interest is payable on February 1 and August 1
of each year, beginning on August 1, 2003. The notes mature on February 1, 2013.
The net  proceeds of  approximately  $145.9  million from the issuance of the 9%
Senior Subordinated Notes were used to repay a portion of the Company's existing
Credit Facility.

        The Company may redeem all or part of the notes on or after  February 1,
2008.  Prior to  February  1,  2006,  the  Company  may  redeem up to 35% of the
aggregate  principal  amount of the notes from the  proceeds  of certain  equity
offerings. The notes are general, unsecured obligations, are subordinated to the
Company's senior debt and rank pari passu with the Company's  previously  issued
senior  subordinated  debt. The notes are guaranteed by certain of the Company's
domestic subsidiaries. The guarantees are subordinated to the senior debt of the
Company's   guarantor   subsidiaries   and  rank  pari  passu  with  the  senior
subordinated  debt of the  guarantor  subsidiaries.  The notes  are  effectively
subordinated  to the  indebtedness  and other  liabilities of the  non-guarantor
subsidiaries.

        The  Company  and  the  guarantor  subsidiaries  have  agreed  to file a
registration  statement with the Securities and Exchange  Commission relating to
an offer to exchange these new notes due 2013 for publicly tradable notes having
substantially  identical terms. In addition, the Company may be required to file
a shelf  registration  statement covering resales of the new notes by holders of
the new notes.  The new notes are expected to be  designated  for trading in the
Private Offering, Resales and Trading Automatic Linkages (PORTAL SM) Market.

        On February 14,  2003,  the Company  entered  into a new senior  secured
credit  facility  consisting of a $75 million  revolving  credit line and a $125
million  term  loan  with  Lehman  Commercial  Paper,  Inc.  for  itself  and as
administrative  agent  for a  syndicate  of  lenders.  The new  credit  facility
provides for incremental loans of up to $100 million. The new credit facility is
guaranteed by the guarantors of the senior  subordinated notes and is secured by
mortgages on certain fee and  leasehold  properties  and  security  interests on
certain personal and intangible property, including without limitation,  pledges
of all of the  capital  stock of certain  domestic  subsidiaries  and 65% of the
voting stock of certain of the Company's foreign subsidiaries.  The net proceeds
from the new credit  facility  were used to repay,  in full,  the then  existing
Credit Facility and the Cinema  Properties  Facility.  The term of the revolving
credit line is five years.  The term loan matures on March 31, 2008 or March 31,
2009,  if the maturity of the Company's  existing  senior  subordinated  debt is
extended beyond September 30, 2009.

        Borrowings  under  the  revolving  credit  line  bear  interest,  at the
Company's  option,  at: (A) a margin of 2.00% per annum plus a "base rate" equal
to the higher of (i) the prime lending rate as set forth on the British  Banking
Association  Telerate page 5 or (ii) the federal funds  effective rate from time
to time  plus  0.50%,  or (B) a  "eurodollar  rate"  equal  to the rate at which
eurodollar deposits are offered in the interbank  eurodollar market for terms of
one,  two,  three  or  six,  or (if  available  to all  lenders  in  their  sole
discretion) nine or twelve months, as selected by the Company,  plus a margin of
3.00% per annum.  After  September  30, 2003 the margin  applicable to base rate
loans  will  range  from  1.25% per  annum to 2.00%  per  annum  and the  margin
applicable  to  eurodollar  rate loans  ranges from 2.25% per annum to 3.00% per
annum based upon the Company  achieving  certain ratios of debt to  consolidated
EBITDA (as defined in the new Credit Facility).

        The term loan reduces  automatically  each calendar  quarter by $312,500
from June 30,  2003 to March  31,  2007 and then  reduces  by  $30,000,000  each
calendar quarter from June 30, 2007 to maturity at March 31, 2008. $1,250,000 is
due on or before  March 31, 2004 and thus is  classified  as current  portion of
long-term debt. The term loan bears interest,  at the Company's option,  at: (A)
the base rate plus a margin of 1.75% or (B) the eurodollar rate plus a margin of
2.75%.

        The loss on  early  retirement  of debt of  $1,645,759  recorded  in the
condensed  consolidated statement of operations for the three month period ended
March 31,  2003  related  to the  write-off  of  unamortized  debt  issue  costs
associated with the Company's existing Credit Facility and the Cinema Properties
Facility.


                                       14


<PAGE>


13.  Condensed Consolidated Financial Statements of Subsidiary Guarantors

        On February 11, 2003, the Company  completed a private placement of $150
million 9% Senior  Subordinated  Notes due 2013 (the "2003  Senior  Subordinated
Notes") pursuant to rule 144A. The 2003 Senior  Subordinated Notes are fully and
unconditionally  guaranteed,  jointly and  severally,  on a senior  subordinated
unsecured  basis by the  following  wholly-owned  subsidiaries  of Cinemark USA,
Inc.:

        Cinemark,  L.L.C.,  Sunnymeade Cinema Corp.,  Cinema  Properties,  Inc.,
Greeley Holdings, Inc. (formerly known as Cinemark Paradiso,  Inc.), Trans Texas
Cinema,  Inc.,  Missouri  City Central 6, Inc.,  Cinemark  Mexico  (USA),  Inc.,
Cinemark Leasing Company, Cinemark Partners I, Inc., Multiplex Properties, Inc.,
Multiplex Services,  Inc., CNMK Investments,  Inc., CNMK Delaware Investments I,
L.L.C.,  CNMK  Delaware   Investments  II,  L.L.C.,  CNMK  Delaware  Investments
Properties,  L.P., CNMK Texas Properties, Ltd, Laredo Theatre, Ltd. and Cinemark
Investments Corporation.

        The following supplemental condensed  consolidating financial statements
present:

        1.  Condensed  consolidating  balance  sheets as of March  31,  2003 and
                December  31, 2002 and  condensed  consolidating  statements  of
                operations  and cash flows for each of the three  month  periods
                ended March 31, 2003 and 2002.

        2. Cinemark USA, Inc. (the "Parent" and  "Issuer"),  combined  Guarantor
                Subsidiaries and combined Non-Guarantor  Subsidiaries with their
                investments  in  subsidiaries  accounted  for using  the  equity
                method of accounting and therefore,  the Parent column  reflects
                the  equity  income  (loss) of its  Guarantor  Subsidiaries  and
                Non-Guarantor Subsidiaries,  which are also separately reflected
                in the stand  alone  Guarantor  Subsidiaries  and  Non-Guarantor
                Subsidiaries column.  Additionally,  the Guarantor  Subsidiaries
                column  reflects the equity income  (loss) of its  Non-Guarantor
                Subsidiaries,   which  are  also  separately  reflected  in  the
                stand-alone Non-Guarantor Subsidiaries column.

        3.  Elimination  entries  necessary to consolidate the Parent and all of
                its Subsidiaries.


                                       15


<PAGE>
<TABLE>
<CAPTION>
SUBSIDIARY GUARANTORS
CONSOLIDATING BALANCE SHEET INFORMATION
MARCH 31, 2003
------------------------------------------------------------------------------------------------------------------------------------

                                                                Parent      Subsidiary    Subsidiary
ASSETS                                                          Company     Guarantors  Non-Guarantors  Eliminations   Consolidated

<S>                                                          <C>           <C>           <C>           <C>             <C>
CURRENT ASSETS
  Cash and cash equivalents                                  $  8,497,480  $  1,930,859  $ 32,220,235  $         -     $ 42,648,574
  Inventories                                                   1,622,682       955,028     1,111,722            -        3,689,432
  Accounts receivable                                          42,400,821   (13,910,449)    7,119,638    (24,233,094)    11,376,916
  Income tax receivable                                          (371,244)    1,039,408     1,279,900            -        1,948,064
  Prepaid expenses and other                                    5,482,496       444,169     1,598,778     (3,000,000)     4,525,443
                                                             -----------------------------------------------------------------------

    Total current assets                                       57,632,235    (9,540,985)   43,330,273    (27,233,094)    64,188,429

THEATRE PROPERTIES AND EQUIPMENT - net                        313,161,078   293,957,959   177,175,188            -      784,294,225

OTHER ASSETS
  Goodwill                                                      7,897,512       412,327     2,644,347       (198,875)    10,755,311
  Investments in and advances to affiliates                   460,725,816   333,508,476    28,815,409   (820,121,542)     2,928,159
  Deferred charges and other - net                             21,878,773     1,283,775    73,593,395    (59,996,395)    36,759,548
                                                             -----------------------------------------------------------------------

    Total other assets                                        490,502,101   335,204,578   105,053,151   (880,316,812)    50,443,018
                                                             -----------------------------------------------------------------------

TOTAL ASSETS                                                 $861,295,414  $619,621,552  $325,558,612  $(907,549,906)  $898,925,672
                                                             =======================================================================

LIABILITIES AND SHAREHOLDER'S EQUITY

CURRENT LIABILITIES
  Current portion of long-term debt                          $  1,305,629  $        -    $  4,696,375  $         -     $  6,002,004
  Accounts payable and accrued expenses                        46,314,756    32,145,184    29,656,015    (24,148,124)    83,967,831
                                                             -----------------------------------------------------------------------

    Total current liabilities                                  47,620,385    32,145,184    34,352,390    (24,148,124)    89,969,835

LONG-TERM LIABILITIES
  Long-term debt, less current portion                        693,308,840    45,237,910    88,407,819   (128,857,122)   698,097,447
  Deferred income taxes                                        16,109,042     5,519,944    (6,638,841)           -       14,990,145
  Other long-term liabilities and deferrals                    28,870,883    73,183,415     4,367,103    (72,990,000)    33,431,401
                                                             -----------------------------------------------------------------------

    Total long-term liabilities                               738,288,765   123,941,269    86,136,081   (201,847,122)   746,518,993

COMMITMENTS AND CONTINGENCIES                                         -             -             -              -              -

MINORITY INTERESTS IN SUBSIDIARIES                                    -       1,251,307    26,847,360            -       28,098,667

SHAREHOLDER'S EQUITY
  Common stock                                                 49,546,775        25,787   111,543,705   (111,572,825)    49,543,442
  Other shareholder's equity                                   25,839,489   462,258,005    66,679,076   (569,981,835)   (15,205,265)
                                                             -----------------------------------------------------------------------

    Total shareholder's equity                                 75,386,264   462,283,792   178,222,781   (681,554,660)    34,338,177
                                                             -----------------------------------------------------------------------

TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY                   $861,295,414  $619,621,552  $325,558,612  $(907,549,906)  $898,925,672
                                                             =======================================================================
</TABLE>


                                       16


<PAGE>
<TABLE>
<CAPTION>
SUBSIDIARY GUARANTORS
CONSOLIDATING STATEMENT OF OPERATIONS INFORMATION
THREE MONTHS ENDED MARCH 31, 2003
------------------------------------------------------------------------------------------------------------------------------------

                                                                Parent      Subsidiary    Subsidiary
                                                                Company     Guarantors  Non-Guarantors  Eliminations   Consolidated

<S>                                                          <C>           <C>           <C>           <C>             <C>
REVENUES                                                     $ 97,727,633  $ 70,797,068  $ 50,274,733  $ (14,797,675)  $204,001,759

COSTS AND EXPENSES
  Cost of operations                                           87,109,837    44,162,240    37,710,998    (14,917,288)   154,065,787
  General and administrative expenses                             862,824     5,581,358     3,026,019        119,613      9,589,814
  Depreciation and amortization                                 5,345,673     5,443,162     5,348,079            -       16,136,914
  (Gain) loss on sale of assets and other                          49,562      (666,782)          791            -         (616,429)
                                                             -----------------------------------------------------------------------
    Total costs and expenses                                   93,367,896    54,519,978    46,085,887    (14,797,675)   179,176,086
                                                             -----------------------------------------------------------------------

OPERATING INCOME                                                4,359,737    16,277,090     4,188,846            -       24,825,673

OTHER INCOME (EXPENSE)
  Interest expense                                            (12,454,151)   (1,648,630)   (1,921,381)     2,728,554    (13,295,608)
  Amortization of debt issue cost                                (430,657)     (130,329)      (22,634)           -         (583,620)
  Interest income                                               1,270,261     1,528,837       588,085     (2,728,554)       658,629
  Foreign currency exchange gain                                      -             -          16,131            -           16,131
  Loss on early retirement of debt                               (762,137)     (883,622)          -              -       (1,645,759)
  Equity in income (loss) of affiliates                        14,352,675     1,498,941       128,334    (15,783,594)       196,356
  Minority interests in income of subsidiaries                        -         (15,004)     (755,201)           -         (770,205)
                                                             -----------------------------------------------------------------------
    Total other income (expense)                                1,975,991       350,193    (1,966,666)   (15,783,594)   (15,424,076)
                                                             -----------------------------------------------------------------------

INCOME (LOSS) BEFORE INCOME TAXES                               6,335,728    16,627,283     2,222,180    (15,783,594)     9,401,597

Income taxes                                                      864,600     2,562,379       521,692            -        3,948,671
                                                             -----------------------------------------------------------------------

NET INCOME (LOSS)                                            $  5,471,128  $ 14,064,904  $  1,700,488  $ (15,783,594)  $  5,452,926
                                                             =======================================================================
</TABLE>


                                       17


<PAGE>
<TABLE>
<CAPTION>
SUBSIDIARY GUARANTORS
CONSOLIDATING STATEMENT OF CASH FLOWS INFORMATION
THREE MONTHS ENDED MARCH 31, 2003
------------------------------------------------------------------------------------------------------------------------------------

                                                                Parent      Subsidiary    Subsidiary
                                                                Company     Guarantors  Non-Guarantors  Eliminations   Consolidated

<S>                                                          <C>           <C>           <C>           <C>             <C>
OPERATING ACTIVITIES
  Net income (loss)                                          $  5,471,128  $ 14,064,904  $  1,700,488  $ (15,783,594)  $  5,452,926

  Noncash items in net income (loss):
    Depreciation and amortization                               4,783,794     5,573,491     5,794,320            -       16,151,605
    (Gain) loss on sale of assets and other                        49,562      (666,782)          791            -         (616,429)
    Loss on early retirement of debt                            1,645,759           -             -              -        1,645,759
    Deferred lease expenses                                     7,958,915    (7,539,575)      (39,838)           -          379,502
    Deferred income tax expenses                                5,733,619    (2,505,646)      592,044            -        3,820,017
    Equity in (income) loss of affiliates                     (14,352,675)   (1,498,941)     (128,334)    15,783,594       (196,356)
    Minority interests in income of subsidiaries                      -          15,004       755,201            -          770,205
  Cash provided by (used for) operating working capital       (49,580,775)   14,775,869    (3,137,738)    (5,117,261)   (43,059,905)
                                                             -----------------------------------------------------------------------

      Net cash provided by (used for) operating activities    (38,290,673)   22,218,324     5,536,934     (5,117,261)   (15,652,676)

INVESTING ACTIVITIES
  Additions to theatre properties and equipment                (1,919,479)   (1,674,120)   (5,009,675)           -       (8,603,274)
  Sale of theatre properties and equipment                            -       1,484,619         5,955            -        1,490,574
  Net transactions with affiliates                            (40,408,341)    8,762,445     6,235,944     25,406,638         (3,314)
                                                             -----------------------------------------------------------------------

      Net cash provided by (used for) investing activities    (42,327,820)    8,572,944     1,232,224     25,406,638     (7,116,014)

FINANCING ACTIVITIES
  Issuance of senior subordinated notes                       150,000,000           -             -              -      150,000,000
  Increase in long-term debt                                  226,004,596           -             -              -      226,004,596
  Decrease in long-term debt                                 (285,664,100)  (74,335,900)   (4,361,185)           -     (364,361,185)
  Increase in debt issue cost                                 (10,712,267)          -             -              -      (10,712,267)
  Change in intercompany notes                                        -      21,640,000    (1,350,623)   (20,289,377)           -
  Increase in minority investment in subsidiaries                     -             -         894,354            -          894,354
  Decrease in minority investment in subsidiaries                     -             -        (280,821)           -         (280,821)
                                                             -----------------------------------------------------------------------

      Net cash provided by (used for) financing activities     79,628,229   (52,695,900)   (5,098,275)   (20,289,377)     1,544,677

EFFECT OF EXCHANGE RATE CHANGES
  ON CASH AND CASH EQUIVALENTS                                        -             -         154,072            -          154,072
                                                             -----------------------------------------------------------------------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                 (990,264)  (21,904,632)    1,824,955            -      (21,069,941)

CASH AND CASH EQUIVALENTS:
  Beginning of period                                           9,487,744    23,835,491    30,395,280            -       63,718,515
                                                             -----------------------------------------------------------------------

  End of period                                              $  8,497,480  $  1,930,859  $ 32,220,235  $         -     $ 42,648,574
                                                             =======================================================================
</TABLE>


                                       18


<PAGE>
<TABLE>
<CAPTION>
SUBSIDIARY GUARANTORS
CONSOLIDATING BALANCE SHEET INFORMATION
DECEMBER 31, 2002
------------------------------------------------------------------------------------------------------------------------------------

                                                                Parent      Subsidiary    Subsidiary
ASSETS                                                          Company     Guarantors  Non-Guarantors  Eliminations   Consolidated

<S>                                                          <C>           <C>           <C>           <C>             <C>
CURRENT ASSETS
  Cash and cash equivalents                                  $  9,487,744  $ 23,835,491  $ 30,395,280  $         -     $ 63,718,515
  Inventories                                                   1,618,111       924,709     1,146,095            -        3,688,915
  Accounts receivable                                          20,715,100     7,577,935     8,127,358    (23,978,544)    12,441,849
  Income tax receivable                                           (76,969)      745,133        47,767            -          715,931
  Prepaid expenses and other                                    4,948,540     2,459,454     1,281,141     (4,595,000)     4,094,135
                                                             -----------------------------------------------------------------------

    Total current assets                                       36,692,526    35,542,722    40,997,641    (28,573,544)    84,659,345

THEATRE PROPERTIES AND EQUIPMENT - net                        297,727,453   317,354,222   176,648,828            -      791,730,503

OTHER ASSETS
  Goodwill                                                      5,275,538     3,034,301     2,442,005            -       10,751,844
  Investments in and advances to affiliates                   419,075,595   277,255,664    28,970,718   (722,261,037)     3,040,940
  Deferred charges and other - net                              9,002,357     5,347,599    74,064,083    (61,782,743)    26,631,296
                                                             -----------------------------------------------------------------------

    Total other assets                                        433,353,490   285,637,564   105,476,806   (784,043,780)    40,424,080
                                                             -----------------------------------------------------------------------

TOTAL ASSETS                                                 $767,773,469  $638,534,508  $323,123,275  $(812,617,324)  $916,813,928
                                                             =======================================================================

LIABILITIES AND SHAREHOLDER'S EQUITY

CURRENT LIABILITIES
  Current portion of long-term debt                          $     55,629  $ 23,000,000  $  7,134,820  $         -     $ 30,190,449
  Accounts payable and accrued expenses                        72,131,876    43,636,926    32,228,042    (23,759,532)   124,237,312
                                                             -----------------------------------------------------------------------

    Total current liabilities                                  72,187,505    66,636,926    39,362,862    (23,759,532)   154,427,761

LONG-TERM LIABILITIES
  Long-term debt, less current portion                        594,977,372    74,956,909    83,521,345    (91,059,238)   662,396,388
  Deferred income taxes                                        10,375,423     8,025,590    (7,230,885)           -       11,170,128
  Other long-term liabilities and deferrals                    19,858,840    84,630,823     4,434,784    (74,585,000)    34,339,447
                                                             -----------------------------------------------------------------------

    Total long-term liabilities                               625,211,635   167,613,322    80,725,244   (165,644,238)   707,905,963

COMMITMENTS AND CONTINGENCIES                                           -           -             -              -              -

MINORITY INTERESTS IN SUBSIDIARIES                                      -     1,236,303    25,478,626            -       26,714,929

SHAREHOLDER'S EQUITY
  Common stock                                                 49,546,772        25,789   111,543,706   (111,572,825)    49,543,442
  Other shareholder's equity                                   20,827,557   403,022,168    66,012,837   (511,640,729)   (21,778,167)
                                                             -----------------------------------------------------------------------

    Total shareholder's equity                                 70,374,329   403,047,957   177,556,543   (623,213,554)    27,765,275
                                                             -----------------------------------------------------------------------

TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY                   $767,773,469  $638,534,508  $323,123,275  $(812,617,324)  $916,813,928
                                                             =======================================================================
</TABLE>


                                       19


<PAGE>
<TABLE>
<CAPTION>
SUBSIDIARY GUARANTORS
CONSOLIDATING STATEMENT OF OPERATIONS INFORMATION
THREE MONTHS ENDED MARCH 31, 2002
------------------------------------------------------------------------------------------------------------------------------------

                                                                Parent      Subsidiary    Subsidiary
                                                                Company     Guarantors  Non-Guarantors  Eliminations   Consolidated

<S>                                                          <C>           <C>           <C>           <C>             <C>
REVENUES                                                     $105,451,575  $ 72,621,805  $ 61,753,092  $ (13,124,366)  $226,702,106

COSTS AND EXPENSES
  Cost of operations                                           83,964,824    52,101,063    44,310,711    (13,124,366)   167,252,232
  General and administrative expenses                           7,523,481           -       3,119,536            -       10,643,017
  Depreciation and amortization                                 5,396,951     1,998,193     9,771,637            -       17,166,781
  Asset impairment loss                                               -             -         558,398            -          558,398
  Loss on sale of assets and other                                217,002       107,851       214,339            -          539,192
                                                             -----------------------------------------------------------------------
    Total costs and expenses                                   97,102,258    54,207,107    57,974,621    (13,124,366)   196,159,620
                                                             -----------------------------------------------------------------------

OPERATING INCOME                                                8,349,317    18,414,698     3,778,471            -       30,542,486

OTHER INCOME (EXPENSE)
  Interest expense                                            (13,677,509)   (1,014,876)   (2,715,376)     2,623,824    (14,783,937)
  Amortization of debt issue cost                                (563,017)      (24,584)       (3,569)           -         (591,170)
  Interest income                                                 532,582     2,196,741       377,840     (2,623,824)       483,339
  Foreign currency exchange loss                                      -             -        (220,997)           -         (220,997)
  Equity in income (loss) of affiliates                        12,734,509      (715,980)      115,154    (12,016,942)       116,741
  Minority interests in income of subsidiaries                        -         (52,351)     (824,120)           -         (876,471)
                                                             -----------------------------------------------------------------------
    Total other income (expense)                                 (973,435)      388,950    (3,271,068)   (12,016,942)   (15,872,495)
                                                             -----------------------------------------------------------------------

INCOME (LOSS) BEFORE INCOME TAXES AND
  CUMULATIVE EFFECT OF AN ACCOUNTING CHANGE                     7,375,882    18,803,648       507,403    (12,016,942)    14,669,991

Income taxes                                                      458,780     3,061,629       918,860            -        4,439,269
                                                             -----------------------------------------------------------------------

INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF AN
  ACCOUNTING CHANGE                                             6,917,102    15,742,019      (411,457)   (12,016,942)    10,230,722

  Cumulative effect of a change in accounting principle,
   net of tax benefit of $0.                                      (91,394)   (3,298,385)          -              -       (3,389,779)
                                                             -----------------------------------------------------------------------

NET INCOME (LOSS)                                            $  6,825,708  $ 12,443,634  $   (411,457) $ (12,016,942)  $  6,840,943
                                                             =======================================================================
</TABLE>


                                       20


<PAGE>
<TABLE>
<CAPTION>
SUBSIDIARY GUARANTORS
CONSOLIDATING STATEMENT OF CASH FLOWS INFORMATION
THREE MONTHS ENDED MARCH 31, 2002
------------------------------------------------------------------------------------------------------------------------------------

                                                                Parent      Subsidiary    Subsidiary
                                                                Company     Guarantors  Non-Guarantors  Eliminations   Consolidated

<S>                                                          <C>           <C>           <C>           <C>             <C>
OPERATING ACTIVITIES
  Net income (loss)                                          $  6,825,708  $ 12,443,634  $   (411,457) $ (12,016,942)  $  6,840,943

  Noncash items in net income (loss):
    Depreciation and amortization                               4,970,415     5,321,162     6,974,784            -       17,266,361
    Loss on impairment of assets                                      -             -         558,398            -          558,398
    Loss on sale of assets and other                              217,002       107,851       214,339            -          539,192
    Deferred lease expenses                                       515,570       (83,447)       22,079            -          454,202
    Deferred income tax expenses                                4,944,978     5,405,719           -              -       10,350,697
    Equity in (income) loss of affiliates                     (12,734,509)      715,980      (115,154)    12,016,942       (116,741)
    Minority interests in income of subsidiaries                      -          52,351       824,120            -          876,471
    Cumulative effect of an accounting change                      91,394     3,298,385           -              -        3,389,779
  Cash provided by (used for) operating working capital       (19,197,415)   62,785,561   (72,046,737)     1,708,991    (26,749,600)
                                                             -----------------------------------------------------------------------

      Net cash provided by (used for) operating activities    (14,366,857)   90,047,196   (63,979,628)     1,708,991     13,409,702

INVESTING ACTIVITIES
  Additions to theatre properties and equipment                (1,063,465)     (557,766)   (7,035,539)           -       (8,656,770)
  Sale of theatre properties and equipment                      1,504,441           -             -              -        1,504,441
  Net transactions with affiliates                             10,637,456   (84,433,029)    7,628,980     66,666,593        500,000
                                                             -----------------------------------------------------------------------

      Net cash provided by (used for) investing activities     11,078,432   (84,990,795)      593,441     66,666,593     (6,652,329)

FINANCING ACTIVITIES
  Increase in long-term debt                                   17,505,311           -         267,517            -       17,772,828
  Decrease in long-term debt                                  (12,500,000)          -      (2,670,540)           -      (15,170,540)
  Change in intercompany notes                                        -             -      68,375,584    (68,375,584)           -
  Increase in minority investment in subsidiaries                     -             -         421,855            -          421,855
  Decrease in minority investment in subsidiaries                     -         (50,000)     (159,028)           -         (209,028)
                                                             -----------------------------------------------------------------------

      Net cash provided by (used for) financing activities      5,005,311       (50,000)   66,235,388    (68,375,584)     2,815,115

EFFECT OF EXCHANGE RATE CHANGES
  ON CASH AND CASH EQUIVALENTS                                        -             -        (334,209)           -         (334,209)
                                                             -----------------------------------------------------------------------

INCREASE IN CASH AND CASH EQUIVALENTS                           1,716,886     5,006,401     2,514,992            -        9,238,279

CASH AND CASH EQUIVALENTS:
  Beginning of period                                           8,590,808    12,560,326    29,048,089            -       50,199,223
                                                             -----------------------------------------------------------------------

  End of period                                              $ 10,307,694  $ 17,566,727  $ 31,563,081  $         -     $ 59,437,502
                                                             =======================================================================
</TABLE>


                                       21


<PAGE>


14.   Subsequent Event

        On April 18,  2003,  the Company  announced  it was  commencing a tender
offer for up to $240 million aggregate  principal amount of its outstanding $200
million  9 5/8%  Series B  Subordinated  Notes  due 2008 and $75  million 9 5/8%
Series D Subordinated Notes due 2008.

        On May 7, 2003,  the Company  issued an  additional  $210  million of 9%
Senior Subordinated Notes due 2013 at a premium of 107.25% of the face amount to
qualified  institutional  buyers in reliance on Rule 144A of the Securities Act.
The new notes were  offered as  additional  debt  securities  under an indenture
pursuant to which,  on February 11, 2003,  the Company issued $150 million of 9%
Senior  Subordinated  Notes  due 2013  (see note 12).  Interest  is  payable  on
February  1 and August 1 of each year,  beginning  on August 1, 2003.  The notes
mature on  February  1, 2013.  The net  proceeds  of this  add-on  issuance  and
additional  borrowings  under the Company's  senior secured credit facility were
utilized to fund the purchase of approximately  $233.0 million of bonds tendered
as of midnight on May 15, 2003 pursuant to the April 18, 2003 tender offer.

        The  Company  and  the  guarantor  subsidiaries  have  agreed  to file a
registration  statement with the Securities and Exchange  Commission relating to
an offer to exchange these new notes due 2013 for publicly tradable notes having
substantially  identical terms. In addition, the Company may be required to file
a shelf  registration  statement covering resales of the new notes by holders of
the new notes.  The new notes are expected to be  designated  for trading in the
Private Offering, Resales and Trading Automatic Linkages (PORTAL SM) Market.


                                       22


<PAGE>


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

        The following is an analysis of our  financial  condition and results of
operations.  This  analysis  should be read in  conjunction  with our  Condensed
Consolidated  Financial  Statements,  including  the  notes  thereto,  appearing
elsewhere in this report.

Overview

        We generate  revenues  primarily  from box office  receipts,  concession
sales and screen advertising sales.  Revenues are recognized when admissions and
concession sales are received at the box office and screen  advertising is shown
at the theatres.  Our revenues are affected by changes in attendance and average
admissions and concession revenues per patron.  Attendance is primarily affected
by the commercial  appeal of the films released during the period  reported.  We
generate additional revenues related to theatre operations from vendor marketing
programs, pay phones, ATM machines and electronic video games installed in video
arcades located in some of our theatres.

        Film rentals and advertising, concession supplies and salaries and wages
vary directly  with changes in revenues.  Film rental costs are accrued based on
the  applicable  box office  receipts and either the  mutually  agreed upon firm
terms or  estimates  of the final  settlement  depending  on the film  licensing
arrangement.  Advertising costs borne by us, which are expensed as incurred, are
primarily  fixed at the  theatre  level as daily  movie  directories  placed  in
newspapers  represent the largest  component of advertising  costs.  The monthly
cost of these ads is based on, among other things, the size of the directory and
the frequency and size of the newspaper's  circulation.  We purchase  concession
supplies to replace  units sold.  Although  salaries  and wages  include a fixed
component of cost (i.e. the minimum  staffing cost to operate a theatre facility
during  non-peak  periods),  salaries  and wages move in relation to revenues as
theatre staffing is adjusted to handle attendance volume.

        Facility lease expense is primarily a fixed cost at the theatre level as
our facility  leases  generally  require a fixed  monthly  minimum rent payment.
Facility  lease  expense as a  percentage  of revenues  is also  affected by the
number of leased versus fee owned facilities.

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

Critical Accounting Policies

        We prepare our condensed consolidated financial statements in conformity
with accounting  principles  generally accepted in the United States of America.
As such, we are required to make certain  estimates,  judgments and  assumptions
that we believe  are  reasonable  based upon the  information  available.  These
estimates,  judgments and assumptions  affect the reported amounts of assets and
liabilities at the date of the financial  statements and the reported amounts of
revenues and expenses during the periods presented.  The significant  accounting
policies  which we believe are the most  critical to aid in fully  understanding
and evaluating our reported  financial results are included in our Annual Report
filed March 19, 2003 on Form 10-K. No significant  changes have been made to our
critical accounting policies during the period covered by this filing.


                                       23


<PAGE>


Results of Operations

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

<TABLE>
<CAPTION>
                                                                             % of Revenues
                                                                          Three Months Ended
                                                                               March 31,
                                                                               ---------
                                                                           2003         2002
                                                                           ----         ----
<S>                                                                       <C>          <C>
        Revenues
          Admissions                                                       63.1%        64.6%
          Concession                                                       31.6         30.6
          Other                                                             5.3          4.8
                                                                          ------       ------
        Total revenues                                                    100.0        100.0

        Cost of operations                                                 75.5         73.8
        General and administrative expenses                                 4.7          4.7
        Depreciation and amortization                                       7.9          7.6
        Asset impairment loss                                                -           0.2
        (Gain) loss on sale of assets and other                            (0.3)         0.2
                                                                          ------       ------
        Total operating expenses                                           87.8         86.5
                                                                          ------       ------

        Operating income                                                   12.2         13.5

        Interest expense                                                   (6.8)        (6.8)

        Income taxes                                                        1.9          2.0

        Income before cumulative effect of an accounting change             2.7          4.5

        Net income                                                          2.7          3.0
</TABLE>

First quarter ended March 31, 2003 and 2002

Revenues

        Revenues for the first quarter ended March 31, 2003  decreased to $204.0
million from $226.7  million for the first quarter ended March 31, 2002, a 10.0%
decrease.  The decrease in revenues is primarily attributable to a 7.2% decrease
in  attendance  resulting  from the weaker film  product.  Revenues  per average
screen  decreased  10.7% to $67,422 in the first quarter of 2003 from $75,492 in
the first quarter of 2002.


                                       24


<PAGE>


Cost of Operations

        Cost of operations,  as a percentage of revenues,  increased to 75.5% in
the first quarter of 2003 from 73.8% in the first quarter of 2002.  The increase
as a percentage of revenues was primarily due to the 10.0%  decrease in revenues
and the fact that some of our theatre  operating costs are fixed in nature.  The
increase as a percentage  of revenues  resulted from an increase in salaries and
wages as a  percentage  of revenues  to 11.1% in the first  quarter of 2003 from
9.9% in the first  quarter of 2002,  an increase in facility  lease expense as a
percentage  of revenues to 14.1% in the first  quarter of 2003 from 12.9% in the
first  quarter  of 2002  and an  increase  in  utilities  and  other  costs as a
percentage  of revenues to 12.5% in the first  quarter of 2003 from 11.8% in the
first quarter of 2002.  These  increases were partially  offset by a decrease in
concession supplies as a percentage of concession revenues to 15.4% in the first
quarter of 2003 from 17.3% in the first  quarter of 2002 and a decrease  in film
rentals and  advertising as a percentage of admissions  revenues to 52.3% in the
first quarter of 2003 from 52.5% in the first  quarter of 2002.  The decrease in
concession  supplies as a percentage of concession revenues is primarily related
to the successful  implementation of a domestic concession price increase in the
fourth  quarter of 2002.  The  decrease  in film  rentals and  advertising  as a
percentage  of  admissions  revenues  is  primarily  related to the weaker  film
product in the first  quarter of 2003 in  comparison  with the first  quarter of
2002.

General and Administrative Expenses

        General  and  administrative  expenses,  as a  percentage  of  revenues,
remained  consistent at 4.7% for the first quarter of 2003 and the first quarter
of 2002.  General and  administrative  expenses decreased to $9.6 million in the
first  quarter of 2003 from  $10.6  million  in the first  quarter of 2002.  The
decrease is primarily attributed to a decrease in accrued bonus expense.

Depreciation and Amortization

        Depreciation and amortization, as a percentage of revenues, increased to
7.9% for the first  quarter  of 2003 from  7.6% for the first  quarter  of 2002.
Depreciation and amortization decreased to $16.1 million in the first quarter of
2003 from  $17.2  million  in the first  quarter of 2002.  The  decrease  in the
absolute level of  depreciation  and  amortization  is primarily  related to the
reduction in the  depreciable  basis of properties and equipment  resulting from
the devaluation in foreign currencies and a decline in new construction.

Asset Impairment Loss

        The Company  recorded  asset  impairment  charges of $0.6 million in the
first quarter of 2002, pursuant to Statement of Financial  Accounting  Standards
No. 142 related to assets held for use. The asset impairment charges recorded in
the first  quarter of 2002 related to the  write-down  to fair value of goodwill
associated with the Company's Argentina operations.

Interest Expense

        Interest  costs  incurred,  including  amortization  of debt issue cost,
decreased  9.7% in the first quarter of 2003 to $13.9 million from $15.4 million
in the first quarter of 2002. The decrease was due  principally to a decrease in
the average debt outstanding under the Company's long-term debt agreements.

Income Taxes

        Income tax expense of $3.9 million was recorded in the first  quarter of
2003 in comparison  with income tax expense of $4.4 million in the first quarter
of 2002.  The  Company's  effective  tax rate for the first  quarter of 2003 was
42.0% as  compared  to 30.3% for the first  quarter  of 2002.  The change in the
effective  tax  rate  is  primarily  due to an  increase  in  foreign  permanent
differences and the impact on the 2002 rate resulting from the cumulative effect
of an accounting change.


                                       25


<PAGE>


Income Before Cumulative Effect of an Accounting Change

        The Company  realized income before  cumulative  effect of an accounting
change of $5.5 million for the first quarter of 2003 in  comparison  with income
before  cumulative effect of an accounting change of $10.2 million for the first
quarter of 2002.  The  decrease is  primarily  related to the 10.0%  decrease in
revenues.

Liquidity and Capital Resources

Operating Activities

        We  primarily  collect our revenues in cash,  mainly  through box office
receipts and the sale of  concession  supplies.  We are  expanding the number of
theatres  that provide the patron a choice of using a credit  card,  in place of
cash, which we convert to cash in approximately  three to four days. Because our
revenues are received in cash prior to the payment of related expenses,  we have
an operating  "float" and  historically  have not required  traditional  working
capital financing. We typically operate with a negative working capital position
for our ongoing theatre operations throughout the year, primarily because of the
lack of significant inventory and accounts receivable.

Investing Activities

        Our  investing   activities  have  been   principally   related  to  the
development and  acquisition of additional  theatres.  New theatre  openings and
acquisitions  historically have been financed with internally generated cash and
by debt financing, including borrowings under our credit facility.

        We are continuing to expand our U.S.  theatre  circuit which consists of
2,206  screens  at  March  31,  2003.  As of  March  31,  2003,  we have  signed
commitments for eight new theatres with 100 screens and a five screen  expansion
to an existing theatre scheduled to open in the U.S. in 2003 and thereafter.  We
estimate the remaining  capital  expenditures  for the  development of these 105
screens in the U.S. will be approximately $35 million.  Actual  expenditures for
continued theatre  development and acquisitions are subject to change based upon
the  availability  of  attractive   opportunities.   We  plan  to  fund  capital
expenditures  for our  continued  development  from cash  flow from  operations,
borrowings under our credit  facility,  subordinated  note borrowings,  proceeds
from  sale   leaseback   transactions   and/or  sales  of  excess  real  estate.
Additionally,  we may from time to time,  subject  to  compliance  with our debt
instruments,  purchase on the open market our debt securities depending upon the
availability and prices of such securities.

        We are also continuing to expand our international  theatre circuit.  We
added two screens to an existing  theatre in the three month  period ended March
31, 2003  bringing our total  international  screen count to 818 screens.  As of
March 31, 2003, we have five new theatres  with 32 screens  scheduled to open in
international markets in 2003 and thereafter.  We estimate the remaining capital
expenditures  for the development of these 32 screens in  international  markets
will be approximately  $15 million.  Actual  expenditures for continued  theatre
development and  acquisitions  are subject to change based upon the availability
of  attractive  opportunities.  We  anticipate  that  investments  in  excess of
available  cash  will  be  funded  by us or by debt or  equity  financing  to be
provided by third parties directly to our subsidiaries.


                                       26


<PAGE>


Financing Activities

        As of March 31, 2003,  our  long-term  debt  obligations,  capital lease
obligations and future minimum lease obligations under non-cancelable  operating
leases for each period indicated are summarized as follows:

<TABLE>
<CAPTION>

                                              Payments Due by Period
                                                   (In millions)

                                                           Less Than                                  After 5
          Contractual Obligations               Total        1 Year      1-3 Years     4-5 Years       Years
-----------------------------------------     --------     ---------     ---------     ---------     --------
<S>                                           <C>           <C>          <C>           <C>           <C>
Long-term debt...........................     $  704.1     $     6.0     $    12.8      $  155.1      $ 530.2
Capital lease obligations................          0.2           0.2           --            --           --
Operating lease obligations..............      1,461.2         100.7         207.1         206.7        946.7
</TABLE>

        As of March 31, 2003,  we were in full  compliance  with all  agreements
governing our outstanding debt.

New Senior Subordinated Notes Issuance

        On February 11, 2003,  we issued $150 million of 9% Senior  Subordinated
Notes due 2013.  Interest  is payable  on  February 1 and August 1 of each year,
beginning on August 1, 2003.  The notes will mature on February 1, 2013. The net
proceeds of  approximately  $145.9  million  from the  issuance of the 9% Senior
Subordinated  Notes  were used to repay a portion  of our then  existing  credit
facility.

        We may  redeem  all or part of the notes on or after  February  1, 2008.
Prior to February 1, 2006,  we may redeem up to 35% of the  aggregate  principal
amount of the notes from the proceeds of certain equity offerings. The notes are
general,  unsecured  obligations,  are subordinated to our senior debt, and rank
pari passu with our existing senior  subordinated debt. The notes are guaranteed
by certain of our domestic subsidiaries.  The guarantees are subordinated to the
senior  debt of the  subsidiary  guarantors  and rank pari passu with the senior
subordinated  debt of our  guarantor  subsidiaries.  The notes  are  effectively
subordinated  to  the  indebtedness  and  other  liabilities  of  the  Company's
non-guarantor subsidiaries.

        The  Company  and  the  guarantor  subsidiaries  have  agreed  to file a
registration  statement with the Securities and Exchange  Commission relating to
an offer to exchange these new notes due 2013 for publicly tradable notes having
substantially  identical terms. In addition, the Company may be required to file
a shelf  registration  statement covering resales of the new notes by holders of
the new notes.  The new notes are expected to be  designated  for trading in the
Private Offering, Resales and Trading Automatic Linkages (PORTAL SM) Market.

Senior Subordinated Notes

        As of  March  31,  2003,  we have  outstanding  four  issues  of  senior
subordinated  notes:  (1) $200  million in 9 5/8%  Series B Senior  Subordinated
Notes due 2008; (2) $75 million in 9 5/8% Series D Senior Subordinated Notes due
2008;  (3) $105 million in 8 1/2% Series B Senior  Subordinated  Notes due 2008;
and (4) $150 million in 9% Senior  Subordinated Notes due 2013. Interest in each
issue is payable semi-annually on February 1 and August 1 of each year.

        The indentures governing the senior subordinated notes contain covenants
that  limit,  among  other  things,  dividends,  transactions  with  affiliates,
investments,  sale of assets,  mergers,  repurchases of our capital stock, liens
and additional  indebtedness.  Upon a change of control, we would be required to
make an offer to repurchase  the senior  subordinated  notes at a price equal to
101% of the  principal  amount  outstanding  plus  accrued  and unpaid  interest
through the date of repurchase. The indentures governing the senior subordinated
notes allow us to incur additional indebtedness if we satisfy the coverage ratio
specified  in each  indenture,  after  giving  effect to the  incurrence  of the
additional indebtedness, and in certain other circumstances.


                                       27


<PAGE>


        The  senior   subordinated  notes  are  general  unsecured   obligations
subordinated  in  right of  payment  to the  credit  agreement  or other  senior
indebtedness.  Generally,  if we are in default under the senior credit facility
and other senior  indebtedness,  we would not be allowed to make payments on the
senior  subordinated  notes until the defaults have been cured or waived.  If we
fail to make any payments when due or within the  applicable  grace  period,  we
would be in default  under the  indentures  governing  the  senior  subordinated
notes.

        All the  senior  subordinated  notes are  guaranteed  by  certain of our
domestic subsidiaries.

New Senior Secured Credit Facility

        On  February  14,  2003,  we entered  into a new senior  secured  credit
facility  consisting of a $75 million  revolving  credit line and a $125 million
term loan with Lehman  Commercial  Paper,  Inc. for itself and as administrative
agent  for a  syndicate  of  lenders.  The  new  credit  facility  provides  for
incremental  term  loans  of up to $100  million.  The new  credit  facility  is
guaranteed by the guarantors of the new senior subordinated notes and is secured
by mortgages on certain fee and leasehold  properties and security  interests on
certain personal and intangible property, including without limitation,  pledges
of all of the  capital  stock of certain  domestic  subsidiaries  and 65% of the
voting stock of certain of our foreign subsidiaries.

        We used the borrowings under the new credit facility,  together with the
proceeds from the issuance of our 9% Senior Subordinated Notes, to repay in full
the existing credit facility and the existing Cinema Properties Facility.

        Borrowings under the revolving credit line bear interest, at our option,
at:  (A) a margin of 2.00% per annum plus a "base  rate"  equal to the higher of
(i) the prime  lending  rate as set  forth on the  British  Banking  Association
Telerate page 5 or (ii) the federal funds  effective rate from time to time plus
0.50%, or (B) a "eurodollar rate" equal to the rate at which eurodollar deposits
are offered in the interbank  eurodollar  market for terms of one, two, three or
six, or (if  available to all lenders in their sole  discretion)  nine or twelve
months,  as  selected  by us,  plus a margin  of 3.00%  per  annum.  The  margin
applicable to base rate loans ranges from 1.25% per annum to 2.00% per annum and
the margin  applicable to  eurodollar  rate loans ranges from 2.25% per annum to
3.00% per annum based upon our achieving  certain ratios of debt to consolidated
EBITDA (as defined in the new credit facility).

        The term loan bears interest, at our option, at (A) the base rate plus a
margin of 1.75% or (B) the eurodollar rate plus a margin of 2.75%.

        The term of the  revolving  credit  line is five  years.  The term  loan
matures on March 31, 2008,  or March 31,  2009,  if the maturity of our existing
senior  subordinated  debt due on August 2008 is extended  beyond  September 30,
2009.

        Under the new credit  facility,  we are  required to maintain  specified
levels of fixed charge coverage and set limitations on our leverage  ratios.  We
are  limited  in our  ability  to pay  dividends  and in our  ability  to  incur
additional  indebtedness and liens and,  following the issuance of certain types
of indebtedness or the disposition of assets, subject to certain exceptions,  we
would be required to apply certain of the proceeds to repay amounts  outstanding
under the credit  facility.  The new credit facility also contains certain other
covenants and restrictions customary in credit agreements of this kind.

        As of March 31,  2003,  we had $125 million  outstanding  under the term
loan and the effective interest rate on such borrowing was 4.0% per annum. As of
March 31, 2003, we had $30 million  outstanding  under the revolving credit line
and the effective interest rate on such borrowings was 4.3% per annum.


                                       28


<PAGE>


Cinemark USA Revolving Credit Facility

        In February 1998, we entered into a reducing  revolving  credit facility
with a group of banks for which Bank of  America,  N.A.  acts as  administrative
agent.  The credit facility  provided for an initial  commitment of $350 million
which was  automatically  reduced each quarter by 2.5%,  3.75%,  5.0%, 6.25% and
6.25%  of the  aggregate  $350  million  in 2001,  2002,  2003,  2004 and  2005,
respectively,  until  maturity in 2006.  As of December 31, 2002,  the aggregate
commitment  available  to us was  $262.5  million.  Borrowings  under the credit
facility are secured by a pledge of all of the stock of Cinemark  USA,  Inc. and
65% of the stock of our Mexican  subsidiaries  and by  guarantees  from material
subsidiaries.  The credit  facility  required us to maintain  certain  financial
ratios;  restricts the payment of dividends,  payment of subordinated debt prior
to maturity and issuance of preferred stock and other indebtedness; and contains
other restrictive  covenants typical for agreements of this type. Funds borrowed
pursuant to the credit  facility  bear interest at a rate per annum equal to the
Offshore Rate or the Base Rate, as the case may be, plus the  Applicable  Margin
(as defined in the credit  facility).  We prepaid a portion of the  indebtedness
outstanding under the credit facility on February 11, 2003 with the net proceeds
of our new senior subordinated notes issuance. The credit facility was repaid in
full on February 14, 2003 from the net proceeds of our new senior secured credit
facility  entered  into with Lehman  Commercial  Paper,  Inc.  for itself and as
administrative agent for a syndicate of lenders.

Cinemark Mexico Revolving Credit Facility

        In  November  1998,  Cinemark  Mexico  (USA),  Inc.  executed  a  credit
agreement  with Bank of America  National  Trust and  Savings  Association  (the
"Cinemark Mexico Credit  Agreement").  The Cinemark Mexico Credit Agreement is a
revolving  credit  facility and provides for a loan to Cinemark  Mexico of up to
$30 million in the aggregate. The Cinemark Mexico Credit Agreement is secured by
a pledge of 65% of the stock of Cinemark de Mexico,  S.A. de C.V.  and  Cinemark
Holdings  Mexico  S.  de R.L.  de C.V.  and an  unconditional  guarantee  by us.
Pursuant to the terms of the Cinemark  Mexico Credit  Agreement,  funds borrowed
bear  interest at a rate per annum equal to the Offshore  Rate or the Base Rate,
as the case may be,  plus the  Applicable  Margin (as  defined  in the  Cinemark
Mexico  Credit  Agreement).  Cinemark  Mexico  was  required  to make  principal
payments of $0.5 million in each of the third and fourth  quarters of 2001, $1.5
million  per quarter in 2002 with the  remaining  principal  outstanding  of $23
million due in January  2003.  On January 15, 2003,  the Cinemark  Mexico Credit
Agreement was paid in full.


                                       29


<PAGE>


Cinema Properties Term Loan

        In December 2000,  Cinema  Properties,  Inc., a wholly owned  subsidiary
that is not  subject  to  restrictions  imposed by the  credit  facility  or the
indentures  governing  the senior  subordinated  notes,  borrowed a $77  million
3-year  term  loan  from  Lehman  Brothers  Bank,  FSB (the  "Cinema  Properties
Facility"),  which originally  matured on December 31, 2003. In 2002, the Cinema
Properties Facility was amended, which among other things, extended the maturity
date one year to December 31, 2004 and  eliminated  the  lender's  discretionary
right to require Cinema Properties, Inc. to make $1.5 million principal payments
in the third and  fourth  quarters  of 2002.  Cinema  Properties,  Inc.  has the
unilateral  ability to further  extend the maturity  date two times for one year
each by paying  extension  fees of 1.5% and 3.0% of the  outstanding  borrowing,
respectively,  if  certain  interest  coverage  ratios  are met and no  event of
default has occurred and is continuing.  Funds  borrowed  pursuant to the Cinema
Properties Facility bear interest at a rate per annum equal to LIBOR plus 5.75%.
Borrowings  are secured  by,  among other  things,  a mortgage  placed on six of
Cinema  Properties,  Inc.'s theatres and certain  equipment  leases.  The Cinema
Properties  Facility  requires  Cinema  Properties,  Inc. to comply with certain
interest  coverage ratios and contains other  restrictive  covenants typical for
agreements of this type. Cinema Properties, Inc. has a separate legal existence,
separate assets,  separate creditors and separate financial  statements from the
Company's  other  entities.  The  assets  of  Cinema  Properties,  Inc.  are not
available  to  satisfy  the  debts of any of the  Company's  other  consolidated
entities. Cinema Properties, Inc. also purchased from Lehman Brothers Derivative
Products Inc. an Interest Rate Cap Agreement with a notional amount equal to $77
million  with a five year term and a strike  rate  equal to the  excess of three
month LIBOR over the strike price of 6.58%. The Cinema  Properties  Facility was
repaid in full on February  14,  2003,  from the net  proceeds of our new senior
secured credit  facility  entered into with Lehman  Commercial  Paper,  Inc. for
itself and as administrative  agent for a syndicate of lenders.  Simultaneously,
with such repayment Cinema  Properties,  Inc. and its  shareholders  were merged
with and into us.

Cinemark Brasil Notes Payable

        Cinemark  Brasil S.A.  currently has four main types of funding  sources
executed with local and international banks. These include:

        (1) BNDES  (Banco  Nacional de  Desenvolvimento  Economico e Social (the
Brazilian National  Development Bank)) credit line in the U.S. dollar equivalent
in Brazilian  reais of US$3.3 million  executed in October 1999 with a term of 5
years (with a nine month grace  period) and accruing  interest at a BNDES basket
rate,  which is a  multiple  currency  rate  based on the rate at which the bank
borrows, plus a spread amounting to 14.5%;

        (2) BNDES credit line in the U.S.  dollar  equivalent in Brazilian reais
of US$1.6  million  executed in November 2001 with a term of 5 years (with a one
year grace  period) and  accruing  interest at a BNDES basket rate plus a spread
amounting to 13.8%;

        (3)  Import  financing  executed  with  Banco ABC  Brasil in 2002 in the
amount of US$440,000 with a term of 360 days and accruing  interest at a rate of
7.5% per annum; and

        (4) Project developer financing executed with two engineering  companies
in September 2000 in the amount of US$1.8 million with a term of 5 years (with a
nine month grace  period) and  accruing  interest at a rate of TJLP+5%  (Taxa de
Juros de Longo  Prazo (a long term  interest  rate  published  by the  Brazilian
government)).

        These sources are secured by a variety of instruments, including comfort
letters  from  Cinemark  International,  promissory  notes for up to 130% of the
value, a revenue reserve account and equipment collateral. As of March 31, 2003,
an aggregate of $5.3 million was outstanding and the average effective  interest
rate on such borrowings was 13.7% per annum.


                                       30


<PAGE>


Cinemark Chile Notes Payable

        On  March  26,   2002,   Cinemark   Chile  S.A.   entered  into  a  Debt
Acknowledgment,  Rescheduling  and Joint  Guarantee and Co-Debt  Agreement  with
Scotiabank Sud Americano and three local banks.  Under this agreement,  Cinemark
Chile S.A. borrowed the U.S. dollar equivalent of approximately $10.6 million in
Chilean  pesos  (adjusted  for  inflation  pursuant to the Unidades de Fomento).
Cinemark  Chile S.A.  is  required to make 24 equal  quarterly  installments  of
principal  plus accrued and unpaid  interest,  commencing  March 27,  2002.  The
indebtedness is secured by a first priority  commercial  pledge of the shares of
Cinemark Chile S.A., a chattel mortgage over Cinemark Chile's personal  property
and by guarantees issued by Cinemark International, L.L.C. and Chile Films S.A.,
whose owners are  shareholders  of Cinemark  Chile S.A. The  agreement  requires
Cinemark  Chile S.A. to maintain  certain  financial  ratios and contains  other
restrictive  covenants  typical for agreements of this type such as a limitation
on dividends.  Funds  borrowed  under this agreement bear interest at the 90 day
TAB  Banking  rate (360 day TAB  Banking  rate with  respect  to one of the four
banks) as published by the Association of Banks and Financial  Institutions  Act
plus 2%. As of March 31, 2003, $7.8 million was outstanding under this agreement
and the effective interest rate on such borrowing was 6.0% per annum.

Recent Developments

Tender Offer to Repurchase Senior Subordinated Notes

        On April 18, 2003,  Cinemark USA, Inc. announced that it has commenced a
tender offer to purchase for cash up to $240 million aggregate  principal amount
of its outstanding  $200 million 9 5/8% Series B Senior  Subordinated  Notes due
2008 and $75 million 9 5/8% Series D Subordinated Notes due 2008.

Add-on Senior Subordinated Notes Issuance

        On May 7,  2003,  we  issued an  additional  $210  million  of 9% Senior
Subordinated  Notes  due 2013 at a  premium  of  107.25%  of the face  amount to
qualified  institutional  buyers in reliance on Rule 144A of the Securities Act.
The new notes were  offered as  additional  debt  securities  under an indenture
pursuant to which,  on February 11, 2003,  the Company issued $150 million of 9%
Senior  Subordinated Notes 2013.  Interest is payable on February 1 and August 1
of each year, beginning on August 1, 2003. The notes mature on February 1, 2013.
The net proceeds of this add-on  issuance and  additional  borrowings  under our
senior  secured   credit   facility  were  utilized  to  fund  the  purchase  of
approximately  $233.0  million of bonds  tendered as of midnight on May 15, 2003
pursuant to the April 18, 2003 tender offer.

Credit Ratings

        In August 2000, Standard & Poor's lowered the rating on our three series
of  senior  subordinated  notes  due 2008 from B to B-,  and in  December  2000,
Moody's Investor  Services lowered the rating on these notes from B2 to Caa2. In
August 2002,  Standard & Poor's  assigned a stable rating to us. In  conjunction
with this rating,  our  corporate  rating was assigned a B+ rating and our three
series of senior  subordinated  notes due 2008 were  assigned  a B-  rating.  On
January  31,  2003,  Standard & Poor's  revised its outlook on us from stable to
positive and assigned a BB- rating to our new senior secured credit facility and
a B- rating to the senior  subordinated notes due 2013. On the same day, Moody's
Investor  Services  upgraded its rating on our three  existing  series of senior
subordinated notes due 2008 from Caa2 to B3 and assigned a Ba3 rating to our new
senior secured credit facility and a B3 rating to the senior  subordinated notes
due 2013. On April 25, 2003,  Standard & Poor's  assigned a B- rating to the new
9% notes.


                                       31


<PAGE>


New Accounting Pronouncements

        In April 2002, the Financial Accounting Standards Board issued Statement
of  Financial  Accounting  Standards  ("SFAS")  No.  145,  "Rescission  of  FASB
Statements No. 4, 44, and 64,  Amendment of FASB Statement No. 13, and Technical
Corrections". This statement requires, among other things, that gains and losses
on the early  extinguishment of debt be classified as extraordinary only if they
meet the criteria for extraordinary treatment set forth in Accounting Principles
Board Opinion No. 30. The provisions of this statement related to classification
of gains and losses on the early extinguishment of debt are effective for fiscal
years beginning after May 15, 2002.  This statement  became  effective for us on
January 1, 2003. See note 12 for discussion of the debt retired during the three
month period ended March 31, 2003 in conjunction  with Company's  long-term debt
refinancing.

        In November  2002,  the  Financial  Accounting  Standards  Board  issued
Interpretation  Number 45, "Guarantor's  Accounting and Disclosure  Requirements
for Guarantees,  including Indirect  Guarantees of Indebtedness of Others" ("FIN
45").  This  interpretation  elaborates  on  the  disclosures  to be  made  by a
guarantor in its interim and annual  financial  statements about its obligations
under certain  guarantees that it has issued. It also clarifies that a guarantor
is required to recognize,  at the inception of a guarantee,  a liability for the
fair value of the obligation undertaken in issuing the guarantee. The disclosure
requirements  of FIN 45 are  effective  for  interim  and annual  periods  after
December 15, 2002. The initial recognition and initial measurement  requirements
of FIN 45 are effective  prospectively  for guarantees  issued or modified after
December 31, 2002. The adoption of this statement had no impact on the condensed
consolidated financial statements.

Seasonality

        The Company's revenues have historically been seasonal,  coinciding with
the timing of releases of motion pictures by the major distributors.  Generally,
the most  successful  motion  pictures  have been  released  during  the  summer
extending from Memorial Day to Labor Day and during the holiday season extending
from  Thanksgiving  through  year-end.  The  unexpected  emergence of a hit film
during other periods can alter this  seasonality  trend. The timing of such film
releases can have a significant  effect on the Company's  results of operations,
and the results of one quarter are not necessarily indicative of results for the
next quarter or for the same period in the following year.

Other Issues

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

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


                                       32


<PAGE>


        You can identify forward-looking  statements by the use of words such as
"may,"  "should,"  "will,"  "could,"   "estimates,"   "predicts,"   "potential,"
"continue,"   "anticipates,"   "believes,"   "plans,"  "expects,"  "future"  and
"intends" and similar expressions which are intended to identify forward-looking
statements.  These  statements are not guarantees of future  performance and are
subject to risks,  uncertainties and other factors, some of which are beyond our
control  and  difficult  to predict  and could  cause  actual  results to differ
materially from those expressed or forecasted in the forward-looking statements.
In evaluating these  forward-looking  statements,  you should carefully consider
the risks and  uncertainties  described  in this report.  These  forward-looking
statements  reflect our view only as of the date of this report.  Actual results
could differ materially from those indicated by such forward-looking  statements
due to a number of factors. All forward-looking statements attributable to us or
persons  acting on our behalf are expressly  qualified in their entirety by this
cautionary statement. We undertake no current obligation to publicly update such
forward-looking statements to reflect subsequent events or circumstances.


                                       33


<PAGE>


Item 3.  Quantitative and Qualitative Disclosures About Market Risk

        We have  exposure  to  financial  market  risks,  including  changes  in
interest  rates,  foreign  currency  exchange  rates and other  relevant  market
prices.

Interest Rate Risk

        An increase or decrease in interest  rates would affect  interest  costs
relating to our  variable  rate debt  facilities.  We and our  subsidiaries  are
currently  parties to such  variable  rate debt  facilities.  At March 31, 2003,
there was an aggregate of $173.7 million of variable rate debt outstanding under
these  facilities.   These  facilities   represent   approximately  25%  of  our
outstanding  long-term debt.  Based on the interest rate levels in effect on the
variable rate debt  outstanding at March 31, 2003, a 10% increase in these rates
would not increase our annual interest expense by a material amount.  Changes in
interest rates do not have a direct impact on interest  expense  relating to the
remaining fixed rate debt facilities.

        The table below provides  information about the Company's fixed rate and
variable rate long-term debt agreements:

<TABLE>
<CAPTION>
                                                               Expected Maturity Date
                                                                As of March 31, 2003
                                                                --------------------

                          March 31,    March 31,    March 31,    March 31,    March 31,                              Fair
(in millions)                2004         2005         2006         2007         2008       Thereafter     Total     Value
-------------                ----         ----         ----         ----         ----       ----------     -----     -----
<S>                       <C>          <C>          <C>          <C>          <C>           <C>           <C>       <C>
Long-term debt:
Fixed rate                     $0.1          $ -          $ -         $0.1          $ -         $530.2    $530.4    $545.1
Average interest rate                                                                                       9.2%

Variable rate                  $5.9         $5.7         $7.1         $3.6       $151.4            $ -    $173.7    $175.2
Average interest rate                                                                                       4.4%

Total debt                     $6.0         $5.7         $7.1         $3.7       $151.4         $530.2    $704.1    $720.3
</TABLE>


<TABLE>
<CAPTION>

                                                               Expected Maturity Date
                                                               As of December 31, 2002
                                                               -----------------------

                           Dec. 31,     Dec. 31,     Dec. 31,     Dec. 31,     Dec. 31,                              Fair
(in millions)                2003         2004         2005         2006         2007       Thereafter     Total     Value
-------------                ----         ----         ----         ----         ----       ----------     -----     -----
<S>                       <C>          <C>          <C>          <C>          <C>           <C>           <C>       <C>
Long-term debt:
Fixed rate                     $0.1          $ -         $0.1          $ -          $ -         $380.2    $380.4    $393.8
Average interest rate                                                                                       9.3%

Variable rate                 $30.1       $165.6        $94.6        $19.9         $2.0            $ -    $312.2    $324.1
Average interest rate                                                                                       4.4%

Total debt                    $30.2       $165.6        $94.7        $19.9         $2.0         $380.2    $692.6    $717.9
</TABLE>


                                       34


<PAGE>


        In December 2000, Cinema Properties,  Inc., a wholly-owned subsidiary of
the Company, entered into the Cinema Properties Facility.  Pursuant to the terms
of the Cinema  Properties  Facility,  funds borrowed bear interest at a rate per
annum equal to LIBOR (as defined in the Cinema Properties  Facility) plus 5.75%.
As part of the Cinema  Properties  Facility,  in order to hedge  against  future
changes in  interest  rates,  Cinema  Properties,  Inc.  purchased  from  Lehman
Brothers Derivative Products Inc. an Interest Rate Cap Agreement with a notional
amount equal to $77 million with a five year term and a strike rate equal to the
excess of three month LIBOR over the strike price of 6.58%. Three month LIBOR as
of the date of closing was 6.58%.  At March 31, 2003 and December 31, 2002,  the
interest rate cap agreement is recorded at its fair value of $0.1 million. We do
not have any additional  derivative  financial  instruments in place as of March
31, 2003 that would have a material effect on our financial position, results of
operations and cash flows.

Foreign Currency Exchange Rate Risk

        We are also  exposed  to market  risk  arising  from  changes in foreign
currency exchange rates as a result of our international  operations.  Generally
accepted accounting principles in the U.S. require that our subsidiaries use the
currency  of the primary  economic  environment  in which they  operate as their
functional  currency.  If our  subsidiaries  operate  in a  highly  inflationary
economy,  generally accepted accounting  principles in the U.S. require that the
U.S.  dollar be used as the  functional  currency for the  subsidiary.  Currency
fluctuations  result in us reporting exchange gains (losses) or foreign currency
translation adjustments relating to our international  subsidiaries depending on
the inflationary  environment of the country in which we operate. Based upon our
equity ownership in our international subsidiaries as of March 31, 2003, holding
everything  else  constant,  a 10% immediate  unfavorable  change in each of the
foreign  currency  exchange rates to which we are exposed would decrease the net
fair value of our investments in our international subsidiaries by approximately
$5 million.

Item 4.  Controls and Procedures

        We have established a system of controls and other  procedures  designed
to ensure that  information  required to be disclosed  in its  periodic  reports
filed  under the  Securities  Exchange  Act of 1934  (the  "Exchange  Act"),  as
amended, is recorded, processed, summarized and reported within the time periods
specified in the Securities  and Exchange  Commission's  rules and forms.  These
disclosure  controls and procedures  have been evaluated  under the direction of
our Chief Executive Officer and Chief Financial Officer within the last 90 days.
Based on such  evaluations,  the Chief  Executive  Officer  and Chief  Financial
Officer have concluded that the disclosure controls and procedures are effective
in  alerting  them in a timely  basis to  material  information  relating to the
Company and its consolidated subsidiaries required to be included in our reports
filed or submitted under the Exchange Act.

        There  have  been no  significant  changes  in our  system  of  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the evaluation by the Chief Executive  Officer and Chief Financial
Officer.


                                       35


<PAGE>


PART II - OTHER INFORMATION

Item 1. Legal Proceedings

        Reference is made to Item 3 of the Company's  Annual Report on Form 10-K
for the fiscal year ended December 31, 2002.

Item 2. Changes in Securities and Use of Proceeds

        Not Applicable

Item 3. Defaults Upon Senior Securities

        Not Applicable

Item 4. Submission of Matters to a Vote of Security Holders

        There have not been any matters  submitted to a vote of security holders
during the first three  months of 2003  through the  solicitation  of proxies or
otherwise.

Item 5. Other Information

        The Company  intends  that this report be governed by the "safe  harbor"
provision  of the Private  Securities  Litigation  Reform Act of 1995 (the "PSLR
Act")  with  respect  to  statements  that may be deemed  to be  forward-looking
statements under the PSLR Act. Such forward-looking  statements may include, but
are not limited to, the Company and any of its  subsidiaries'  long-term theatre
strategy.  Actual results could differ  materially  from those indicated by such
forward-looking statements due to a number of factors.

Item 6. Exhibits and Reports on Form 8-K

        a) Certifications under Exchange Act Rules 13a-14 or 15d-14

              Certification of the Chief Executive Officer of Cinemark USA, Inc.
              Certification of the Chief Financial Officer of Cinemark USA, Inc.

        b) Supplemental  schedules  specified by the Senior  Subordinated  Notes
Indenture:

              Condensed Consolidating Balance Sheets
              (unaudited) as of March 31, 2003

              Condensed Consolidating Statements of
              Operations (unaudited) for the three months
              ended March 31, 2003

              Condensed Consolidating Statements of
              Cash Flows (unaudited) for the three months
              ended March 31, 2003

        c) Exhibits

              *99.1  Certification  of the Chief  Executive  Officer of Cinemark
                     USA, Inc. pursuant to Section 906 of the Sarbanes-Oxley Act
                     of 2002.

              *99.2  Certification  of the Chief  Financial  Officer of Cinemark
                     USA, Inc. pursuant to Section 906 of the Sarbanes-Oxley Act
                     of 2002.


                                       36


<PAGE>


        d) Reports on Form 8-K

              Reports on Form 8-K were filed by the Company on January 30, 2003,
                     April 18, 2003 and April 24, 2003.


                                       37


<PAGE>


                                   SIGNATURES

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

                                                     CINEMARK USA, INC.
                                                     Registrant

DATE:   May 20, 2003


                                                     /s/Alan W. Stock
                                                     Alan W. Stock
                                                     President


                                                     /s/Robert Copple
                                                     Robert Copple
                                                     Chief Financial Officer


                                       38


<PAGE>


                               CERTIFICATION UNDER
                       EXCHANGE ACT RULES 13a-14 OR 15d-14


        CERTIFICATION

        I, Lee Roy Mitchell, certify that:

        1. I have reviewed this  quarterly  report on Form 10-Q of Cinemark USA,
        Inc.;

        2. Based on my  knowledge,  this  quarterly  report does not contain any
        untrue  statement  of a material  fact or omit to state a material  fact
        necessary to make the  statements  made,  in light of the  circumstances
        under which such  statements  were made, not misleading  with respect to
        the period covered by this quarterly report;

        3. Based on my knowledge, the financial statements,  and other financial
        information  included in this  quarterly  report,  fairly present in all
        material  respects the financial  condition,  results of operations  and
        cash flows of the  registrant  as of, and for, the periods  presented in
        this quarterly report;

        4. The registrant's other certifying  officers and I are responsible for
        establishing  and  maintaining  disclosure  controls and  procedures (as
        defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant, and
        we have:

                a) designed such  disclosure  controls and  procedures to ensure
                that material information relating to the registrant,  including
                its  consolidated  subsidiaries,  is made  known to us by others
                within those entities,  particularly  during the period in which
                this quarterly report is being prepared;

                b) evaluated the  effectiveness of the  registrant's  disclosure
                controls and procedures as of a date within 90 days prior to the
                filing date of this quarterly  report (the  "Evaluation  Date");
                and

                c) presented in this quarterly report our conclusions  about the
                effectiveness of the disclosure controls and procedures based on
                our evaluation as of the Evaluation Date;

        5. The  registrant's  other  certifying  officers and I have  disclosed,
        based on our most recent  evaluation,  to the registrant's  auditors and
        the audit  committee  of  registrant's  board of  directors  (or persons
        performing the equivalent function):

                a) all  significant  deficiencies  in the design or operation of
                internal  controls which could adversely affect the registrant's
                ability to record, process,  summarize and report financial data
                and have identified for the  registrant's  auditors any material
                weaknesses in internal controls; and

                b) any fraud, whether or not material,  that involves management
                or  other   employees  who  have  a  significant   role  in  the
                registrant's internal controls; and


                                       39


<PAGE>


        6. The registrant's  other  certifying  officers and I have indicated in
        this quarterly report whether or not there were  significant  changes in
        internal  controls or in other factors that could  significantly  affect
        internal controls  subsequent to the date of our most recent evaluation,
        including any corrective actions with regard to significant deficiencies
        and material weaknesses.

        Date: May 20, 2003


                                                     CINEMARK USA, INC.


                                                     By: /s/Lee Roy Mitchell
                                                         Lee Roy Mitchell
                                                         Chief Executive Officer


                                       40


<PAGE>


                               CERTIFICATION UNDER
                       EXCHANGE ACT RULES 13a-14 OR 15d-14


        CERTIFICATION

        I, Robert Copple, certify that:

        1. I have reviewed this  quarterly  report on Form 10-Q of Cinemark USA,
        Inc.;

        2. Based on my  knowledge,  this  quarterly  report does not contain any
        untrue  statement  of a material  fact or omit to state a material  fact
        necessary to make the  statements  made,  in light of the  circumstances
        under which such  statements  were made, not misleading  with respect to
        the period covered by this quarterly report;

        3. Based on my knowledge, the financial statements,  and other financial
        information  included in this  quarterly  report,  fairly present in all
        material  respects the financial  condition,  results of operations  and
        cash flows of the  registrant  as of, and for, the periods  presented in
        this quarterly report;

        4. The registrant's other certifying  officers and I are responsible for
        establishing  and  maintaining  disclosure  controls and  procedures (as
        defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant, and
        we have:

                a) designed such  disclosure  controls and  procedures to ensure
                that material information relating to the registrant,  including
                its  consolidated  subsidiaries,  is made  known to us by others
                within those entities,  particularly  during the period in which
                this quarterly report is being prepared;

                b) evaluated the  effectiveness of the  registrant's  disclosure
                controls and procedures as of a date within 90 days prior to the
                filing date of this quarterly  report (the  "Evaluation  Date");
                and

                c) presented in this quarterly report our conclusions  about the
                effectiveness of the disclosure controls and procedures based on
                our evaluation as of the Evaluation Date;

        5. The  registrant's  other  certifying  officers and I have  disclosed,
        based on our most recent  evaluation,  to the registrant's  auditors and
        the audit  committee  of  registrant's  board of  directors  (or persons
        performing the equivalent function):

                a) all  significant  deficiencies  in the design or operation of
                internal  controls which could adversely affect the registrant's
                ability to record, process,  summarize and report financial data
                and have identified for the  registrant's  auditors any material
                weaknesses in internal controls; and

                b) any fraud, whether or not material,  that involves management
                or  other   employees  who  have  a  significant   role  in  the
                registrant's internal controls; and


                                       41


<PAGE>


        6. The registrant's  other  certifying  officers and I have indicated in
        this quarterly report whether or not there were  significant  changes in
        internal  controls or in other factors that could  significantly  affect
        internal controls  subsequent to the date of our most recent evaluation,
        including any corrective actions with regard to significant deficiencies
        and material weaknesses.

        Date: May 20, 2003


                                                     CINEMARK USA, INC.


                                                     By: /s/Robert Copple
                                                         Robert Copple
                                                         Chief Financial Officer


                                       42


<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATING BALANCE SHEETS
                              AS OF MARCH 31, 2003
                                   (Unaudited)

                                                                     Restricted      Unrestricted
                                                                        Group            Group        Eliminations         TOTAL
                                                                   --------------   --------------   --------------   --------------
<S>                                                                <C>              <C>              <C>              <C>
                                     ASSETS

CURRENT ASSETS
    Cash and cash equivalents                                      $  19,969,909    $  22,678,665    $         -      $  42,648,574
    Inventories                                                        3,187,789          501,643              -          3,689,432
    Accounts receivable                                              (19,851,809)      31,447,827         (219,102)      11,376,916
    Income tax receivable                                               (532,379)       2,480,443              -          1,948,064
    Prepaid expenses and other                                         3,928,430          597,013              -          4,525,443
                                                                   -----------------------------------------------------------------
       Total current assets                                            6,701,940       57,705,591         (219,102)      64,188,429

THEATRE PROPERTIES AND EQUIPMENT - net                               718,626,129       65,668,096              -        784,294,225

OTHER ASSETS
    Goodwill                                                           8,110,964        2,644,347              -         10,755,311
    Investments in and advances to affiliates                        167,444,443        1,130,561     (165,646,845)       2,928,159
    Deferred charges and other - net                                  32,776,164        3,983,384              -         36,759,548
                                                                   -----------------------------------------------------------------
       Total other assets                                            208,331,571        7,758,292     (165,646,845)      50,443,018
                                                                   -----------------------------------------------------------------

TOTAL ASSETS                                                       $ 933,659,640    $ 131,131,979    $(165,865,947)   $ 898,925,672
                                                                   =================================================================

                      LIABILITIES AND SHAREHOLDER'S EQUITY

CURRENT LIABILITIES
    Current portion of long-term debt                              $   1,490,872    $   4,511,132    $         -      $   6,002,004
    Current income taxes payable                                        (482,653)         482,653              -                -
    Accounts payable and accrued expenses                             72,059,490       12,116,143         (207,802)      83,967,831
                                                                   -----------------------------------------------------------------
       Total current liabilities                                      73,067,709       17,109,928         (207,802)      89,969,835

LONG TERM LIABILITIES
    Senior credit agreements                                         157,154,372       10,791,035              -        167,945,407
    Senior subordinated notes                                        530,152,040              -                -        530,152,040
    Deferred lease expenses                                           24,809,545          407,414              -         25,216,959
    Deferred gain on sale leasebacks                                   4,281,140              -                -          4,281,140
    Deferred income taxes                                             14,500,396          489,749              -         14,990,145
    Deferred revenues and other long-term liabilities                  1,860,968        2,072,334              -          3,933,302
                                                                   -----------------------------------------------------------------
       Total long term liabilities                                   732,758,461       13,760,532              -        746,518,993

MINORITY INTERESTS IN SUBSIDIARIES                                     8,327,897       19,770,770              -         28,098,667

SHAREHOLDER'S EQUITY
    Class A common stock, $.01 par value: 10,000,000 shares
       authorized, 1,500 shares issued and outstanding                        15              -                -                 15
    Class B common stock, no par value: 1,000,000 shares
       authorized, 239,893 shares issued and outstanding              49,543,427       14,958,000      (14,958,000)      49,543,427
    Additional paid-in-capital                                        12,249,157      150,700,145     (150,700,145)      12,249,157
    Retained earnings                                                131,936,700      (46,210,451)             -         85,726,249
    Treasury stock, 57,245 Class B shares at cost                    (24,232,890)             -                -        (24,232,890)
    Accumulated other comprehensive loss                             (49,990,836)     (38,956,945)             -        (88,947,781)
                                                                   -----------------------------------------------------------------
       Total shareholder's equity                                    119,505,573       80,490,749     (165,658,145)      34,338,177
                                                                   -----------------------------------------------------------------

TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY                         $ 933,659,640    $ 131,131,979    $(165,865,947)   $ 898,925,672
                                                                   =================================================================

Note:  "Restricted Group" and "Unrestricted Group" are defined in the Indentures for the Senior Subordinated Notes.

</TABLE>


                                       43


<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
                    FOR THE THREE MONTHS ENDED MARCH 31, 2003
                                   (Unaudited)

                                                                     Restricted      Unrestricted
                                                                        Group            Group        Eliminations         TOTAL
                                                                   --------------   --------------   --------------   --------------
<S>                                                                <C>              <C>              <C>              <C>
REVENUES                                                           $ 173,087,943    $  32,406,891    $  (1,493,075)   $ 204,001,759


COSTS AND EXPENSES
    Cost of operations                                               130,455,032       25,103,830       (1,493,075)     154,065,787
    General and administrative expenses                                7,700,775        1,889,039              -          9,589,814
    Depreciation and amortization                                     13,311,517        2,825,397              -         16,136,914
    (Gain) loss on sale of assets and other                             (617,056)             627              -           (616,429)
                                                                   -----------------------------------------------------------------
            Total costs and expenses                                 150,850,268       29,818,893       (1,493,075)     179,176,086
                                                                   -----------------------------------------------------------------

OPERATING INCOME                                                      22,237,675        2,587,998              -         24,825,673

OTHER INCOME (EXPENSE)
    Interest expense                                                 (12,232,782)      (1,062,826)             -        (13,295,608)
    Amortization of debt issue cost                                     (375,217)        (208,403)             -           (583,620)
    Interest income                                                      249,354          409,275              -            658,629
    Foreign currency exchange gain (loss)                               (213,886)         230,017              -             16,131
    Loss on early retirement of debt                                    (320,393)      (1,325,366)             -         (1,645,759)
    Equity in income of affiliates                                        68,022          128,334              -            196,356
    Minority interests in income of subsidiaries                        (228,467)        (541,738)             -           (770,205)
                                                                   -----------------------------------------------------------------
            Total other expenses                                     (13,053,369)      (2,370,707)             -        (15,424,076)
                                                                   -----------------------------------------------------------------

INCOME BEFORE INCOME TAXES                                             9,184,306          217,291              -          9,401,597

Income taxes                                                           3,650,657          298,014              -          3,948,671
                                                                   -----------------------------------------------------------------

NET INCOME (LOSS)                                                  $   5,533,649    $     (80,723)   $         -       $  5,452,926
                                                                   =================================================================

Note:  "Restricted Group" and "Unrestricted Group" are defined in the Indentures for the Senior Subordinated Notes.

</TABLE>


                                       44


<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
                    FOR THE THREE MONTHS ENDED MARCH 31, 2003
                                   (Unaudited)

                                                                     Restricted      Unrestricted
                                                                        Group            Group        Eliminations         TOTAL
                                                                   --------------   --------------   --------------   --------------
<S>                                                                <C>              <C>              <C>              <C>
OPERATING ACTIVITIES
    Net income (loss)                                              $   5,533,649    $     (80,723)   $         -      $   5,452,926

    Noncash items in net income (loss):
       Depreciation                                                   13,178,252        2,804,024              -         15,982,276
       Amortization of other assets                                      133,265           21,373              -            154,638
       Amortization of foreign advanced rents                            258,325          165,282              -            423,607
       Amortized compensation - stock options                            274,297              -                -            274,297
       Amortization of debt issue costs                                  375,217          208,403              -            583,620
       Amortization of gain on sale leasebacks                           (91,480)             -                -            (91,480)
       Amortization of debt discount and premium                          (7,127)             -                -             (7,127)
       Amortization of deferred revenues                              (1,168,226)             -                -         (1,168,226)
       (Gain) loss on sale of assets and other                          (617,056)             627              -           (616,429)
       Loss on early retirement of debt                                  320,393        1,325,366              -          1,645,759
       Deferred lease expenses                                           387,211           (7,709)             -            379,502
       Deferred income tax expenses                                    4,007,092         (187,075)             -          3,820,017
       Equity in income of affiliates                                    (68,022)        (128,334)             -           (196,356)
       Minority interests in income of subsidiaries                      228,467          541,738              -            770,205
    Cash used for operating working capital                          (12,864,137)     (30,195,768)             -        (43,059,905)
                                                                   -----------------------------------------------------------------

          Net cash provided by (used for) operating activities         9,880,120      (25,532,796)             -        (15,652,676)

INVESTING ACTIVITIES
    Additions to theatre properties and equipment                     (7,779,385)        (823,889)             -         (8,603,274)
    Sale of theatre properties and equipment                           1,488,175            2,399              -          1,490,574
    Transfer of theatre properties and equipment                     (93,106,945)      93,106,945              -                -
    Investment in affiliates                                              (3,314)             -                -             (3,314)
                                                                   -----------------------------------------------------------------

          Net cash provided by (used for) investing activities       (99,401,469)      92,285,455              -         (7,116,014)

FINANCING ACTIVITIES
    Issuance of senior subordinated notes                            150,000,000              -                -        150,000,000
    Increase in long term debt                                       226,004,596              -                -        226,004,596
    Decrease in long term debt                                      (284,075,520)     (80,285,665)             -       (364,361,185)
    Increase in debt issue cost                                      (10,712,267)             -                -        (10,712,267)
    Increase in minority investment in subsidiaries                       10,603          883,751              -            894,354
    Decrease in minority investment in subsidiaries                     (117,296)        (163,525)             -           (280,821)
                                                                   -----------------------------------------------------------------

          Net cash provided by (used for) financing activities        81,110,116      (79,565,439)             -          1,544,677

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
    CASH EQUIVALENTS                                                    (104,367)         258,439              -            154,072
                                                                   -----------------------------------------------------------------

DECREASE IN CASH AND CASH EQUIVALENTS                                 (8,515,600)     (12,554,341)             -        (21,069,941)

CASH AND CASH EQUIVALENTS:
    Beginning of period                                               28,485,509       35,233,006              -         63,718,515
                                                                   -----------------------------------------------------------------

    End of period                                                  $  19,969,909    $  22,678,665    $         -      $  42,648,574
                                                                   =================================================================

Note:  "Restricted Group" and "Unrestricted Group" are defined in the Indentures for the Senior Subordinated Notes.

</TABLE>


                                       45


<PAGE>
Exhibit 99.1


                                Certification of
                             Chief Executive Officer
                                       of
                               Cinemark USA, Inc.

This certification is provided pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002 and accompanies the quarterly  report on Form 10-Q (the "Form 10-Q") for
the quarter ended March 31, 2003 of Cinemark USA, Inc. (the "Issuer").

I, Lee Roy Mitchell,  the Chief Executive  Officer of Issuer certify that to the
best of my knowledge:

        (i)  the Form 10-Q fully complies with the requirements of section 13(a)
             or section 15(d) of the Securities  Exchange Act of 1934 (15 U.S.C.
             78m(a) or 78o(d)); and

        (ii) the information  contained in the Form 10-Q fairly presents, in all
             material   respects,   the  financial   condition  and  results  of
             operations of the Issuer.

Dated: May 20, 2003.


                                                             /s/Lee Roy Mitchell
                                                       Name: Lee Roy Mitchell


Subscribed and sworn to before me
this 20th day of May 2003.


      /s/Carol Waldman
Name: Carol Waldman
Title: Notary Public


My commission expires: 06/07/04





<PAGE>
Exhibit 99.2


                                Certification of
                             Chief Financial Officer
                                       of
                               Cinemark USA, Inc.

This certification is provided pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002 and accompanies the quarterly  report on Form 10-Q (the "Form 10-Q") for
the quarter ended March 31, 2003 of Cinemark USA, Inc. (the "Issuer").

I, Robert Copple, the Chief Financial Officer of Issuer certify that to the best
of my knowledge:

        (i)  the Form 10-Q fully complies with the requirements of section 13(a)
             or section 15(d) of the Securities  Exchange Act of 1934 (15 U.S.C.
             78m(a) or 78o(d)); and

        (ii) the information  contained in the Form 10-Q fairly presents, in all
             material   respects,   the  financial   condition  and  results  of
             operations of the Issuer.

Dated:  May 20, 2003.


                                                             /s/Robert Copple
                                                       Name: Robert Copple


Subscribed and sworn to before me
this 20th day of May 2003.


      /s/Carol Waldman
Name: Carol Waldman
Title: Notary Public


My commission expires: 06/07/04