SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q


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

                  For the quarterly period ended June 30, 2001

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 ____




    As of August 13,  2001,  1,500  shares of Class A Common  stock and  185,798
shares of Class B Common  stock  (including  options to acquire  8,261 shares of
Class B Common stock exercisable within 60 days of such date) were outstanding.


<PAGE>


                       CINEMARK USA, INC. AND SUBSIDIARIES

                                      Index

                                                                            Page
                                                                            ----
PART I       FINANCIAL INFORMATION

      Item 1.      Financial Statements

                   Condensed Consolidated Balance Sheets
                     as of June 30, 2001 (unaudited)
                     and December 31, 2000                                    3

                   Condensed Consolidated Statements of Operations
                     (unaudited) for the three and six month periods
                     ended June 30, 2001 and 2000                             4

                   Condensed Consolidated Statements of Cash
                     Flows (unaudited) for the six month
                     periods ended June 30, 2001 and 2000                     5

                   Notes to Condensed Consolidated Financial
                     Statements (unaudited)                                   6

      Item 2.      Management's Discussion and Analysis of
                     Financial Condition and Results of
                     Operations                                               9

      Item 3.      Quantitative and Qualitative Disclosures
                     About Market Risk                                       19


PART II      OTHER INFORMATION

      Item 1.      Legal Proceedings                                         20

      Item 2.      Changes in Securities and Use of Proceeds                 20

      Item 3.      Defaults Upon Senior Securities                           20

      Item 4.      Submission of Matters to a Vote of Security Holders       20

      Item 5.      Other Information                                         20

      Item 6.      Exhibits and Reports on Form 8-K                          20


SIGNATURES                                                                   24










                                        2


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

                       CINEMARK USA, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                                                             June 30,           December 31,
                                                                               2001                 2000
                                                                           (Unaudited)
                                                                        -------------------------------------
<S>                                                                     <C>                  <C>
                                     ASSETS

CURRENT ASSETS

    Cash and cash equivalents                                            $   27,853,527       $   19,839,994
    Inventories                                                               3,552,328            3,734,955
    Co-op advertising and other receivables                                   9,995,467            8,246,024
    Income tax receivable                                                     3,021,653            1,462,721
    Prepaid expenses and other                                                3,771,255            3,591,666
                                                                        -------------------------------------
      Total current assets                                                   48,194,230           36,875,360

THEATRE PROPERTIES AND EQUIPMENT                                          1,196,650,224        1,193,507,019
    Less accumulated depreciation and amortization                         (272,949,971)        (243,372,299)
                                                                        -------------------------------------
      Theatre properties and equipment - net                                923,700,253          950,134,720

OTHER ASSETS
    Goodwill - net                                                           16,108,649           16,826,740
    Investments in and advances to affiliates                                 5,990,108            6,932,208
    Deferred charges and other - net                                         46,899,117           49,807,442
                                                                        -------------------------------------
      Total other assets                                                     68,997,874           73,566,390
                                                                        -------------------------------------
TOTAL                                                                    $1,040,892,357       $1,060,576,470
                                                                        =====================================

                   LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
    Current portion of long-term debt                                    $   37,686,395       $   32,767,581
    Accounts payable and accrued expenses                                   102,991,295          116,488,863
                                                                        -------------------------------------
      Total current liabilities                                             140,677,690          149,256,444

LONG-TERM LIABILITIES
    Senior credit agreements                                                405,236,561          397,338,980
    Senior subordinated notes                                               380,201,928          380,216,182
    Deferred lease expenses                                                  21,583,809           20,475,247
    Deferred gain on sale leasebacks                                          4,921,500            5,104,461
    Deferred income taxes                                                    11,628,099           14,831,678
    Deferred revenues and other long-term liabilits                          10,538,434           16,752,114
                                                                        -------------------------------------
      Total long-term liabilities                                           834,110,331          834,718,662

MINORITY INTERESTS IN SUBSIDIARIES                                           23,760,126           27,691,527

SHAREHOLDERS' 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, 234,782 shares issued and outstanding                      49,538,316           49,538,316
    Additional paid-in-capital                                               13,145,365           13,198,615
    Unearned compensation - stock options                                    (1,518,639)          (1,956,944)
    Retained earnings                                                        43,728,524           48,717,567
    Treasury stock, 57,245 Class B shares at cost                           (24,232,890)         (24,232,890)
    Accumulated other comprehensive loss                                    (38,316,481)         (36,354,842)
                                                                        -------------------------------------
      Total shareholders' equity                                             42,344,210           48,909,837
                                                                        -------------------------------------
TOTAL                                                                    $1,040,892,357       $1,060,576,470
                                                                        =====================================
</TABLE>


     See accompanying Notes to Condensed Consolidated Financial Statements.


                                       3


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

                                                             THREE MONTHS ENDED JUNE 30,               SIX MONTHS ENDED JUNE 30,
                                                              2001                2000                 2001                2000
                                                        ------------------------------------     -----------------------------------
<S>                                                     <C>                 <C>                  <C>                 <C>
REVENUES
    Admissions                                           $ 130,004,407       $ 123,413,502        $ 257,843,145       $ 235,900,347
    Concessions                                             61,702,235          56,756,317          119,545,982         108,880,374
    Other                                                   10,652,217           7,808,884           21,039,804          18,063,560
                                                        ------------------------------------     -----------------------------------
         Total                                             202,358,859         187,978,703          398,428,931         362,844,281

COSTS AND EXPENSES
    Cost of operations:
       Film rentals and advertising                         68,490,322          65,630,832          133,798,745         123,078,771
       Concession supplies                                  10,230,831           9,947,499           20,503,711          19,660,737
       Salaries and wages                                   22,377,694          20,928,104           43,856,298          42,577,590
       Facility leases                                      28,132,827          26,058,247           56,924,233          52,692,232
       Utilities and other                                  27,205,026          25,639,123           53,892,744          50,597,257
                                                        ------------------------------------     -----------------------------------
         Total                                             156,436,700         148,203,805          308,975,731         288,606,587

    General and administrative expenses                     10,347,268           9,391,395           20,190,208          19,403,288
    Depreciation and amortization                           17,076,249          15,726,957           33,684,813          29,942,410
    Asset impairment loss                                          -             1,175,000              450,000           1,615,000
    (Gain) loss on sale of assets                            1,720,172            (136,367)           1,831,086             114,809
                                                        ------------------------------------     -----------------------------------
         Total                                             185,580,389         174,360,790          365,131,838         339,682,094

OPERATING INCOME                                            16,778,470          13,617,913           33,297,093          23,162,187

OTHER INCOME (EXPENSE)
    Interest expense                                       (17,850,288)        (18,455,799)         (37,112,518)        (35,345,751)
    Amortization of debt issue costs and debt discount        (643,129)           (245,494)          (1,286,257)           (490,988)
    Interest income                                            349,546             166,942              719,190             481,594
    Foreign currency exchange loss                          (1,379,241)           (361,384)          (2,531,370)            (21,713)
    Equity in loss of affiliates                            (1,418,886)            (71,250)          (1,456,564)            (12,894)
    Minority interests in (income) loss of subsidiaries        575,879             287,609              695,769            (156,927)
                                                        ------------------------------------     -----------------------------------
         Total                                             (20,366,119)        (18,679,376)         (40,971,750)        (35,546,679)
                                                        ------------------------------------     -----------------------------------
LOSS BEFORE INCOME TAXES                                    (3,587,649)         (5,061,463)          (7,674,657)        (12,384,492)

Income tax benefit                                          (1,261,124)         (1,211,050)          (2,685,614)         (2,972,393)
                                                        ------------------------------------     -----------------------------------

NET LOSS                                                 $  (2,326,525)      $  (3,850,413)       $  (4,989,043)      $  (9,412,099)
                                                        ====================================     ===================================
EARNINGS PER SHARE:
    Basic:
       Net loss                                          $      (12.99)      $      (21.53)       $      (27.87)      $      (52.69)
                                                        ====================================     ===================================
    Diluted:
       Net loss                                          $      (12.99)      $      (21.53)       $      (27.87)      $      (52.69)
                                                        ====================================     ===================================
</TABLE>


     See accompanying Notes to Condensed Consolidated Financial Statements.


                                       4


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

                                                                               SIX MONTHS ENDED JUNE 30,
                                                                               2001                2000
                                                                          -----------------------------------
<S>                                                                       <C>                 <C>

OPERATING ACTIVITIES
    Net loss                                                               $ (4,989,043)       $ (9,412,099)

     Noncash items in net loss:
        Depreciation                                                         32,364,610          28,707,931
        Amortization - goodwill and other assets                              1,320,203           1,234,479
        Loss on impairment of assets                                            450,000           1,615,000
        Amortization of gain on sale leasebacks                                (182,961)           (182,960)
        Deferred lease expenses                                               1,108,562           1,519,833
        Amortization of prepaid leases                                        1,143,028           1,185,253
        Deferred income tax expense                                          (3,203,579)         (7,064,852)
        Amortization of debt discount and premium                               (14,254)            (14,254)
        Amortized compensation - stock options                                  388,742             481,843
        Compensation expense related to repurchase of stock options                 -               103,584
        Loss on sale of assets                                                1,831,086             114,809
        Equity in loss of affiliates                                          1,456,564              12,894
        Minority interests in income (loss) of subsidiaries                    (695,769)            156,927
        Amortization of deferred revenues                                    (6,380,397)                -

     Cash provided by (used for) operating working capital:

        Inventories                                                             182,627             912,917
        Co-op advertising and other receivables                              (1,749,443)          4,087,078
        Prepaid expenses and other                                             (179,589)          5,059,501
        Accounts payable and accrued expenses                               (13,497,568)        (10,897,980)
        Other long-term liabilities                                             166,717             768,503
        Income tax receivable                                                (1,558,932)            980,902
                                                                          -----------------------------------
           Net cash provided by operating activities                          7,960,604          19,369,309

INVESTING ACTIVITIES
     Additions to theatre properties and equipment                          (14,022,555)        (72,592,491)
     Sale of theatre properties and equipment                                 3,942,537           7,819,711
     Increase in investments in and advances to affiliates                     (514,464)         (7,265,592)
     Decrease in deferred charges and other                                   1,159,498           2,784,418
                                                                          -----------------------------------
        Net cash used for investing activities                               (9,434,984)        (69,253,954)

FINANCING ACTIVITIES
     Decrease in long-term debt                                             (27,990,167)        (41,185,274)
     Increase in long-term debt                                              40,806,562          72,279,859
     Increase in deferred revenues                                                  -            22,478,015
     Purchase of treasury stock                                                     -               (34,000)
     Repurchase of stock options                                                    -               (67,452)
     Common stock issued for options exercised                                      -                   425
     Minority investment in subsidiaries, net                                (3,235,632)          1,317,982
                                                                          -----------------------------------
        Net cash provided by financing activities                             9,580,763          54,789,555

EFFECT OF EXCHANGE RATE CHANGES ON CASH                                         (92,850)           (100,477)
                                                                          -----------------------------------
INCREASE IN CASH AND CASH EQUIVALENTS                                         8,013,533           4,804,433

CASH AND CASH EQUIVALENTS
     Beginning of period                                                     19,839,994           8,872,157
                                                                          -----------------------------------
     End of period                                                         $ 27,853,527        $ 13,676,590
                                                                          ===================================
</TABLE>


     See accompanying Notes to Condensed Consolidated Financial Statements.


                                       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 a world leader
in the motion  picture  exhibition  industry  that owns or leases  and  operates
motion picture theatres in 33 states, Canada, Mexico, Argentina,  Brazil, Chile,
Ecuador,  Peru, Honduras, El Salvador,  Nicaragua,  Costa Rica and Colombia. The
Company  operates  2,962  screens in 274  theatres  and manages an  additional 4
theatres (27 screens) at June 30, 2001.

        The accompanying  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 include only normal
recurring  adjustments)  necessary  to state fairly the  financial  position and
results of  operations  as of and for the periods  indicated.  The  consolidated
financial  statements  include  the  accounts  of  Cinemark  USA,  Inc.  and its
subsidiaries.   Majority-owned   subsidiaries  are   consolidated   while  those
subsidiaries  of which the Company owns between 20% and 50% are accounted for as
affiliates  under the  equity  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 the consolidation.  Certain reclassifications
have been made to June 30, 2000 and  December  31, 2000  amounts to conform with
the June 30, 2001 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,  2000,  included  in the Annual  Report  filed on Form 10-K by the
Company under the Securities  Exchange Act of 1934 on March 26, 2001.  Operating
results  for the  three  and six  month  periods  ended  June  30,  2001 are not
necessarily indicative of the results to be achieved for the full year.

2.  Earnings Per Share

        Earnings (loss) 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
(loss) per share.


<TABLE>
<CAPTION>

                                                              Three Months Ended                Six Months Ended
                                                                   June 30,                         June 30,
                                                             2001            2000             2001            2000
                                                         ------------    ------------     ------------    ------------
<S>                                                      <C>             <C>              <C>             <C>
Net loss                                                 $(2,326,525)    $(3,850,413)     $(4,989,043)    $(9,412,099)
                                                         ============    ============     ============    ============
Basic:
    Weighted average Common shares outstanding               179,037         178,863          179,037         178,635
                                                             =======         =======          =======         =======

    Net loss per Common share                               $(12.99)        $(21.53)         $(27.87)        $(52.69)
                                                            ========        ========         ========        ========

Diluted:
    Weighted average Common shares outstanding               179,037         178,863          179,037         178,635
    Common equivalent shares for stock options                   -               -                -               -
                                                             -------         -------          -------         -------
    Weighted average shares outstanding                      179,037         178,863          179,037         178,635
                                                             =======         =======          =======         =======

    Net loss per Common and Common equivalent share         $(12.99)        $(21.53)         $(27.87)        $(52.69)
                                                            ========        ========         ========        ========
</TABLE>


                                       6


<PAGE>


        Basic net loss per share is  computed  by  dividing  the net loss by the
weighted  average  number of shares of Common  stock of all classes  outstanding
during the period.  Diluted  net loss per share is computed by dividing  the net
loss by the  weighted  average  number of shares of Common  stock and  potential
Common stock outstanding and options to purchase Common stock using the treasury
stock method.  The dilutive  effect of the options to purchase  Common stock are
excluded from the  computation  of diluted net loss per share if their effect is
antidilutive.  Options to purchase 11,752 and 12,341 shares of Common stock have
been  excluded  from the  diluted net loss per share  calculation  for the three
month periods ended June 30, 2001 and 2000, respectively,  as their effect would
have been  antidilutive.  Options to purchase 11,752 and 12,742 shares of Common
stock have been excluded from the diluted net loss per share calculation for the
six month  periods ended June 30, 2001 and 2000,  respectively,  as their effect
would have been antidilutive.

3.  Other 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 loss:

<TABLE>
<CAPTION>

                                                              Three Months Ended                Six Months Ended
                                                                   June 30,                         June 30,
                                                             2001            2000             2001             2000
                                                         ------------    ------------     ------------    -------------
<S>                                                      <C>             <C>              <C>             <C>

Net loss                                                 $(2,326,525)    $(3,850,413)     $(4,989,043)    $ (9,412,099)
Foreign currency translation adjustment                    1,101,744      (5,474,174)      (1,961,639)      (2,695,747)
                                                         ------------    ------------     ------------    -------------
Comprehensive loss                                       $(1,224,781)    $(9,324,587)     $(6,950,682)    $(12,107,846)
                                                         ============    ============     ============    =============
</TABLE>


4.  Foreign Currency Translation

        The  accumulated  other  comprehensive  loss  in  shareholders'  equity
of $38,316,481 and  $36,354,842   at  June  30,  2001  and  December  31,  2000,
respectively,  primarily relates to the unrealized  adjustments from translating
the financial  statements of Cinemark Brasil,  S.A., Cinemark de Mexico, S.A. de
C.V. and Cinemark Chile, S.A. into U.S. dollars.

        In 2000,  the  Company was  required  to utilize the U.S.  dollar as the
functional  currency of Cinemark del Ecuador,  S.A. for U.S.  reporting purposes
due to the highly  inflationary  economy of Ecuador.  Thus,  devaluations in the
sucre during 2000 that affected the Company's investment were charged to foreign
currency exchange gain (loss) rather than to the accumulated other comprehensive
loss account as a reduction to  shareholders'  equity.  In September  2000,  the
country of Ecuador  officially  switched  to the U.S.  dollar as the  functional
currency  effectively  eliminating  any  exchange  gain (loss) in the sucre on a
going forward basis. At June 30, 2001, the total assets of Cinemark del Ecuador,
S.A. were approximately $4 million.

5.  Supplemental Cash Flow Information

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


                                            Six Months Ended June 30,
                                            2001                 2000
                                        -----------          -----------
        Cash paid for interest          $38,602,949          $34,307,247
        Cash paid for income taxes        1,903,256            2,592,445


                                        7

<PAGE>


6.  Financial Information About Geographic Areas

        The Company operates in a single industry as a motion picture exhibitor.
The Company is a multinational  corporation with consolidated  operations in the
United  States,  Canada,  Mexico,  Argentina,   Brazil,  Chile,  Ecuador,  Peru,
Honduras,  El  Salvador,  Nicaragua,  Costa Rica and  Colombia.  Revenues in the
United States and Canada, Mexico, Brazil and other foreign countries for the six
months ended June 30 are as follows:


                                                Six Months Ended
                                                    June 30,
        Revenues                           2001                 2000
        --------                       -------------        -------------
        U.S. and Canada                $302,520,015         $273,635,486
        Mexico                           34,858,256           29,419,087
        Brazil                           31,310,175           28,653,102
        Other Foreign Countries          34,127,007           31,573,627
        Eliminations                     (4,386,522)            (437,021)
                                       -------------        -------------
        Total                          $398,428,931         $362,844,281
                                       =============        =============


        Long-lived  assets in the United States and Canada,  Mexico,  Brazil and
other foreign countries as of June 30 are as follows:


                                                    June 30,
        Long-Lived Assets                  2001                 2000
        -----------------              -------------        -------------
        U.S. and Canada                $715,195,578         $762,523,941
        Mexico                           76,282,484           64,878,980
        Brazil                           58,682,074           68,492,330
        Other Foreign Countries          73,540,117           69,803,578
                                       -------------        -------------
        Total                          $923,700,253         $965,698,829
                                       =============        =============


7.  Accounting for Derivative Instruments and Hedging Activities

        On  January  1,  2001,  the  Company  adopted   Statement  of  Financial
Accounting Standards (SFAS) No. 133, "Accounting for Derivative  Instruments and
Hedging Activities", as extended by SFAS No. 137 (June 1999) and amended by SFAS
No. 138 (June 2000).

        Based  upon  the  transition  provisions  of  SFAS  133,  no  transition
adjustment was necessary as of January 1, 2001.  The Company's  balance sheet as
of June 30, 2001  includes an  interest  rate cap  recorded at its fair value of
$1.1 million. This derivative asset is recorded as deferred charges and other on
the  Company's  balance  sheet.  For the six month period ended June 30, 2001, a
loss of $0.6 million has been recorded as a component of interest expense on the
Company's statement of operations to recognize the decrease in the fair value of
the derivative asset.

8.  New Accounting Pronouncements

        In July 2001, the Financial  Accounting Standards Board issued Statement
of Financial Accounting Standards (SFAS) No. 142, "Goodwill and Other Intangible
Assets".  This statement requires that goodwill and other intangible assets with
indefinite  useful  lives no longer be  amortized,  but  instead  be tested  for
impairment at least  annually.  This statement is effective for all fiscal years
beginning  after December 15, 2001. The statement will become  effective for the
Company on January 1, 2002. Management is currently assessing the impact of this
statement on the consolidated financial statements.

9.  Subsequent Event

        In July 2001, the Company's Brazilian partners contributed an additional
$5 million of capital to Cinemark Brasil, S.A. and are expected to contribute an
additional $6 million of capital by the end of the year,  which will effectively
dilute the  Company's  ownership of Cinemark  Brasil,  S.A. from 60% at June 30,
2001 to 53% at December 31, 2001.


                                        8


<PAGE>


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



Overview

        The following is an analysis of the  financial  condition and results of
operations of the Company.  This analysis should be read in conjunction with the
Company's  condensed  consolidated  financial  statements,  including  the notes
thereto, appearing elsewhere in this report.

Results of Operations

        The Company's revenues are generated  primarily from box office receipts
and  concession  sales.  The  Company's  revenues  are  affected  by  changes in
attendance and average admission and concession revenues per patron.  Attendance
is primarily  affected by the commercial appeal of the films released during the
period or year  reported.  Since the Company's  formation,  attendance has grown
principally  from the development  and acquisition of theatres.  The Company has
generally  experienced  increases in average admission  revenues per patron from
ticket price  increases as well as the  development  of theatres in markets that
can  support  higher  ticket  prices.  Additional  revenues  related  to theatre
operations  are  generated by screen  advertising,  pay phones,  ATM charges and
electronic  video  games  installed  in  video  arcades  located  in some of the
Company's theatres.

        Film rentals and advertising, concession supplies and salaries and wages
vary  directly  with  changes in  revenues.  These  expenses  have  historically
represented   approximately   65%  of  all  theatre   operating   expenses   and
approximately  50% of revenues.  Film rental costs are based on a percentage  of
admissions  revenues as determined by film license  agreements.  To some extent,
advertising cost is 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 the size of the  directory.  However,  advertising
costs  have been  decreasing  recently  as the  Company  has been  strategically
reducing the size of directory  advertisements  in favor of alternative forms of
advertising (i.e. internet web-site  advertising) which has further helped drive
revenues.  The Company expenses  concession supplies purchased as they are 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.

        Conversely,  facility  lease  expense is  primarily  a fixed cost at the
theatre level as the Company's 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.


                                        9


<PAGE>


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


<TABLE>
<CAPTION>

                                                              % of Revenues             % of Revenues
                                                              -------------             -------------
                                                            Three Months Ended         Six Months Ended
                                                                 June 30,                  June 30,
                                                            2001         2000         2001         2000
                                                           --------------------      -------------------
<S>                                                        <C>          <C>          <C>          <C>
                Revenues
                 Admissions                                 64.2         65.7         64.7         65.0
                 Concessions                                30.5         30.2         30.0         30.0
                 Other                                       5.3          4.1          5.3          5.0
                                                           ------       ------       ------       ------
                Total revenues                             100.0        100.0        100.0        100.0

                Cost of operations                          77.3         78.8         77.5         79.5
                General and administrative expenses          5.1          5.0          5.1          5.3
                Depreciation and amortization                8.4          8.4          8.4          8.3
                Asset impairment loss                          -          0.6          0.1          0.5
                Loss on sale of assets                       0.9            -          0.5            -
                                                           ------       ------       ------       ------
                Total operating expenses                    91.7         92.8         91.6         93.6
                                                           ------       ------       ------       ------

                Operating income                             8.3          7.2          8.4          6.4

                Interest expense                            (8.8)        (9.8)        (9.3)        (9.7)
                Other expense                               (1.3)        (0.1)        (1.0)        (0.1)
                                                           ------       ------       ------       ------
                Loss before income taxes                    (1.8)        (2.7)        (1.9)        (3.4)
                Income tax benefit                          (0.7)        (0.6)        (0.7)        (0.8)
                                                           ------       ------       ------       ------
                Net loss                                    (1.1)        (2.1)        (1.2)        (2.6)
                                                           ======       ======       ======       ======
</TABLE>


Second quarter ended June 30, 2001 and 2000

Revenues

        Revenues for the second  quarter ended June 30, 2001 increased to $202.4
million from $188.0  million for the second  quarter ended June 30, 2000, a 7.7%
increase.  The  increase  in  revenues  for  the  second  quarter  is  primarily
attributable  to an 8.7%  increase in attendance as a result of the net addition
of 107 screens since the second  quarter of 2000 and a 1.9% increase in revenues
per screen.  Revenues per screen  increased to $68,596 in the second  quarter of
2001 from $67,340 in the second quarter of 2000.

Cost of Operations

        Cost of operations,  as a percentage of revenues,  decreased to 77.3% in
the  second  quarter  of 2001 from  78.8% in the  second  quarter  of 2000.  The
decrease as a  percentage  of  revenues  primarily  resulted  from a decrease in
concession  supplies as a  percentage  of  concessions  revenues to 16.6% in the
second  quarter of 2001 from 17.5% in the second  quarter of 2000 resulting from
lower concession  procurement costs and increased  concession volume rebates,  a
decrease in film rentals and  advertising  costs as a percentage  of  admissions
revenues to 52.7% in the second quarter of 2001 from 53.2% in the second quarter
of 2000 resulting from reduced advertising and promotion costs and a decrease in
utilities and other  expenses as a percentage of revenues to 13.4% in the second
quarter of 2001 from 13.6% in the second quarter of 2000.


                                       10


<PAGE>


General and Administrative Expenses

        General and administrative  expenses as a percentage of revenues of 5.1%
for the  second  quarter  of 2001 were  relatively  consistent  with the  second
quarter of 2000.

        The absolute level of general and  administrative  expenses increased to
$10.3  million  in the second  quarter  of 2001 from $9.4  million in the second
quarter of 2000  primarily as a result of increased  costs  associated  with the
Company's international growth and increased accrued bonus expenses.

Depreciation and Amortization

        Depreciation  and  amortization  increased  8.9% to $17.1 million in the
second  quarter of 2001 from $15.7  million in the second  quarter of 2000.  The
increase is a result of the net  addition of $26.9  million in theatre  property
and equipment since the second quarter of 2000, a 2.3% increase.  The difference
in the percentage  increase in  depreciation  and  amortization  compared to the
increase in theatre property and equipment is a result of the timing of when the
additions  were  placed  in  service  during  the  period  and the  scaled  back
construction   program   which  has   significantly   reduced   the   amount  of
non-depreciable construction-in-progress assets.

Asset Impairment Loss

        The Company  wrote down the assets of certain  properties  to their fair
value which resulted in asset  impairment  charges of $1.2 million in the second
quarter of 2000 pursuant to Statement of Financial  Accounting  Standards (SFAS)
No. 121.

Interest Expense

        Interest costs incurred,  including amortization of debt issue costs and
debt  discount  and the  mark-to-market  adjustment  to the  interest  rate cap,
decreased  1.1% during the second  quarter of 2001 to $18.6  million  (including
capitalized  interest  to  properties  under  construction)  from $18.8  million
(including  capitalized interest) in the second quarter of 2000. The decrease in
interest costs incurred for the second quarter of 2001 was due  principally to a
decrease in the average  interest rate  outstanding  under the Company's  Credit
Facility,  partially  offset  by an  increase  in  the  Company's  average  debt
outstanding.

Income Taxes

        An income  tax  benefit  of $1.3  million  was  recorded  for the second
quarter  of 2001 as  compared  to an income tax  benefit of $1.2  million in the
second quarter of 2000. The Company's  effective tax rate for the second quarter
of 2001 was 35.2% as  compared  to 23.9% for the  second  quarter  of 2000.  The
change in the  effective  tax rate is  primarily  due to an  increase in foreign
permanent differences.

Net Loss

        The Company  realized a net loss of $2.3 million for the second  quarter
of 2001 in comparison  with a net loss of $3.9 million for the second quarter of
2000.


                                       11


<PAGE>


Six month periods ended June 30, 2001 and 2000


Revenues

        Revenues  for the six  month  period  ended  June 30,  2001  (the  "2001
period")  increased  to $398.4  million  from  $362.8  million for the six month
period ended June 30, 2000 (the "2000 period"), a 9.8% increase. The increase in
revenues for the 2001 period is primarily  attributable  to an 11.4% increase in
attendance  as a result of the net  addition  of 107  screens  since the  second
quarter of 2000 and a 3.0% increase in revenues per screen.  Revenues per screen
increased to $135,546 in the 2001 period from $131,554 in the 2000 period.

Cost of Operations

        Cost of operations,  as a percentage of revenues,  decreased to 77.5% in
the 2001 period from 79.5% in the 2000 period.  The decrease as a percentage  of
revenues  primarily  resulted  from  a  decrease  in  concession  supplies  as a
percentage of concessions revenues to 17.2% in the 2001 period from 18.1% in the
2000 period  resulting  from lower  concession  procurement  costs and increased
concession volume rebates, a decrease in film rentals and advertising costs as a
percentage of admissions  revenues to 51.9% in the 2001 period from 52.2% in the
2000 period,  a decrease in salaries  and wages as a  percentage  of revenues to
11.0% in the 2001 period from 11.7% in the 2000 period,  a decrease in utilities
and other  expenses as a percentage of revenues to 13.5% in the 2001 period from
13.9%  in the  2000  period  and a  decrease  in  facility  lease  expense  as a
percentage  of  revenues  to  14.3% in the 2001  period  from  14.5% in the 2000
period.

General and Administrative Expenses

        General  and  administrative   expenses  as  a  percentage  of  revenues
decreased  to 5.1% for the 2001 period from 5.3% for the 2000 period as a result
of the economies of scale realized with the Company's growth over the last year.

        The absolute level of general and  administrative  expenses increased to
$20.2  million in the 2001 period  from $19.4  million in the 2000  period.  The
increase  in  general  and  administrative   expenses  is  attributed  to  costs
associated with the Company's  international  growth and increased accrued bonus
expenses.

Depreciation and Amortization

        For the 2001 period,  depreciation and  amortization  increased 12.7% to
$33.7 million from $29.9 million in the 2000 period. The increase is a result of
the net addition of $26.9 million in theatre  property and  equipment  since the
second  quarter of 2000,  a 2.3%  increase.  The  difference  in the  percentage
increase in depreciation  and  amortization  compared to the increase in theatre
property  and  equipment  is a result of the timing of when the  additions  were
placed in service  during the period and the scaled  back  construction  program
which   has    significantly    reduced    the    amount   of    non-depreciable
construction-in-progress assets.

Asset Impairment Loss

        The Company  wrote down the assets of certain  properties  to their fair
value  which  resulted  in asset  impairment  charges of $0.5  million  and $1.6
million in the 2001 and 2000  periods,  respectively,  pursuant to  Statement of
Financial Accounting Standards (SFAS) No. 121.


                                       12


<PAGE>


Interest Expense

        Interest costs incurred in the 2001 period,  including  amortization  of
debt issue costs and debt  discount  and the  mark-to-market  adjustment  to the
interest  rate  cap,  increased  5.8% to $38.5  million  (including  capitalized
interest  to  properties  under  construction)  from  $36.4  million  (including
capitalized  interest)  in the 2000  period.  The  increase  in  interest  costs
incurred for the 2001 period was due principally to an increase in the Company's
average  debt  outstanding,  partially  offset  by lower  interest  rates on the
Company's variable rate debt.

Income Taxes

        An income tax benefit of $2.7  million was  recorded for the 2001 period
as  compared to an income tax benefit of $3.0  million in the 2000  period.  The
Company's  effective tax rate for the 2001 period was 35.0% as compared to 24.0%
for the 2000 period. The change in the effective tax rate is primarily due to an
increase in foreign permanent differences.

Net Loss

        The Company  realized a net loss of $5.0  million for the 2001 period in
comparison with a net loss of $9.4 million for the 2000 period.

Liquidity and Capital Resources

        The  Company's  revenues are  collected in cash,  primarily  through box
office receipts and concession sales.  Because its revenues are received in cash
prior to the payment of related  expenses,  the Company has an operating "float"
and, as a result,  historically  has not required  traditional  working  capital
financing.

        The Company's theatres are typically equipped with modern projection and
sound equipment,  with  approximately 88% of the screens operated by the Company
having been built since  1990.  The  Company's  investing  activities  have been
principally in connection with the  development and acquisition of theatres.  As
of June 30, 2001, the Company has opened one theatre (12 screens),  acquired one
theatre (6 screens) and closed two theatres (10 screens) in the United States in
2001  and  has  only  one  additional   theatre  commitment  (4  screens)  under
construction  and scheduled to open in the United States by the end of 2001. The
Company presently has only one future theatre commitment (12 screens) along with
a five-screen  expansion  commitment in the United States after 2001. As of June
30, 2001, the Company estimates that the remaining capital  expenditures for the
development of its remaining  theatre and expansion  commitments (21 screens) in
the United States will be less than $5 million.  Actual expenditures for theatre
development  and  acquisitions  during 2001 and thereafter are subject to change
based upon the  availability  of attractive  opportunities  for expansion of the
Company's  theatre circuit.  The Company plans to fund capital  expenditures for
its continued  development from cash flow from operations,  borrowings under the
Credit  Facility,  proceeds  from sale  leaseback  transactions  and/or sales of
excess real estate.  As of June 30, 2001, the Company owned  approximately  $270
million of real  estate  and  improvements  resulting  from the  development  of
multiplex  facilities  over the last several  years.  Additionally,  the Company
and/or its  affiliates,  may from time to time,  subject to compliance  with the
Company's  debt  instruments,  purchase  on the open market the  Company's  debt
securities depending upon the availability and prices of such securities.

        In August  1996,  the Company  issued $200 million  principal  amount of
9-5/8%  Series A Senior  Subordinated  Notes (the "Series A Notes") to qualified
institutional  buyers in reliance on Rule 144A of the Securities Act of 1933, as
amended (the "Securities Act"). The Series A Notes were issued at 99.553% of the
principal face amount (a discount of $4.47 per $1,000 principal amount). The net
proceeds  to the  Company  from  the  issuance  of the  Series  A Notes  (net of
discount,  fees and expenses) were  approximately  $193.2  million.  In November
1996, the


                                       13


<PAGE>


Company  completed an offer to exchange $200 million  principal amount of 9-5/8%
Series B Senior  Subordinated  Notes (the  "Series B Notes") due 2008 which were
registered  under the Securities Act for a like principal amount of the Series A
Notes. Interest on the Series B Notes is payable semi-annually on February 1 and
August 1 of each year.

        In June 1997, the Company issued $75 million  principal amount of 9-5/8%
Series  C  Senior  Subordinated  Notes  (the  "Series  C  Notes")  to  qualified
institutional  buyers in reliance on Rule 144A of the Securities Act. The Series
C Notes were issued at 103% of the  principal  face amount.  The net proceeds to
the Company from the  issuance of the Series C Notes (net of fees and  expenses)
were  approximately  $77.1 million.  In October 1997,  the Company  completed an
offer to  exchange  $75  million  principal  amount  of  9-5/8%  Series D Senior
Subordinated  Notes (the "Series D Notes") due 2008, which were registered under
the Securities Act for a like principal  amount of the Series C Notes.  Interest
on the Series D Notes is  payable  semi-annually  on  February 1 and August 1 of
each year.

        In January 1998,  the Company  issued $105 million  principal  amount of
8-1/2%  Series A Senior  Subordinated  Notes (the "Series A Notes") to qualified
institutional  buyers in reliance on Rule 144A of the Securities Act. The Series
A Notes were issued at 99.0% of the principal  face amount.  The net proceeds to
the Company from the  issuance of the Series A Notes (net of discount,  fees and
expenses)  were  approximately  $103.8  million.  In  March  1998,  the  Company
completed an offer to exchange $105 million  principal amount of 8-1/2% Series B
Senior  Subordinated Notes (the "Series B Notes") due 2008 which were registered
under the  Securities  Act for a like  principal  amount of the  Series A Notes.
Interest on the Series B Notes is payable semi-annually on February 1 and August
1 of each year.

        In February 1998, the Company replaced its existing credit facility with
a reducing,  revolving credit agreement (the "Credit  Facility") through a group
of banks for which Bank of America  National Trust and Savings  Association acts
as  Administrative  Agent. The Credit Facility provides for loans to the Company
of up to $350  million in the  aggregate.  The Credit  Facility  is a  reducing,
revolving credit facility with commitments  automatically  reduced each calendar
quarter by 2.5%,  3.75%,  5.0%, 6.25% and 6.25% of the aggregate $350 million in
calendar year 2001,  2002, 2003, 2004 and 2005,  respectively.  As of August 13,
2001, the aggregate  commitment  available to the Company is $332.5 million. The
Company is required to prepay all loans  outstanding  in excess of the aggregate
commitment as reduced pursuant to the terms of the Credit  Facility.  Borrowings
under the Credit  Facility  are  secured by a pledge of a majority of the issued
and  outstanding  Capital  stock of the  Company.  Pursuant  to the terms of the
Credit  Facility,  funds  borrowed  currently  bear interest at a rate per annum
equal to the Offshore Rate (as defined in the Credit  Facility) or the Base Rate
(as defined in the Credit  Facility),  as the case may be,  plus the  Applicable
Margin (as defined in the Credit  Facility).  As of August 13, 2001, the Company
had borrowed $267 million under the Credit Facility with the effective  interest
rate on such borrowings being 5.7% per annum.

        In February  1998, the Company  completed a sale  leaseback  transaction
(the "Sale  Leaseback")  pursuant to which the Company sold the land,  buildings
and site  improvements of twelve theatre  properties to special purpose entities
for  an  aggregate  purchase  price  equal  to  approximately   $131.5  million.
Simultaneously with the sale, the Company entered into operating leases for such
properties for a base term equal to  approximately 20 years at a fixed aggregate
monthly rental payment of $1.1 million or $13.4 million annually.

        In  October  1998,  the  Company   completed  a  second  sale  leaseback
transaction (the "Second Sale Leaseback") pursuant to which the Company sold the
land,  buildings  and site  improvements  of one  theatre  property to a special
purpose  entity for an aggregate  purchase  price equal to  approximately  $13.9
million.  Simultaneously  with the sale,  the Company  entered into an operating
lease for the  property  for a base term  equal to  approximately  20 years at a
fixed monthly rental payment of $119,000 or $1.4 million annually.


                                       14


<PAGE>


        In  December  1999,  the  Company   completed  a  third  sale  leaseback
transaction (the "Third Sale Leaseback")  pursuant to which the Company sold the
land,  building and site  improvements  of its  corporate  office  property to a
special  purpose entity for an aggregate  purchase price equal to  approximately
$20.3  million.  Simultaneously  with the  sale,  the  Company  entered  into an
operating lease for  approximately  60% of the property for a base term equal to
10 years at a fixed monthly rental payment of $114,000 or $1.4 million  annually
for the first seven years and a fixed monthly rental payment of $123,000 or $1.5
million annually for the final three years.

        In December 2000, Cinema Properties,  Inc., a wholly-owned  Unrestricted
Subsidiary  (as those  terms are defined in the Credit  Facility  and the Senior
Subordinated  Note  Indentures),  completed a $77 million loan  transaction with
Lehman  Brothers  Bank,  FSB (the  "Cinema  Properties  Facility").  The  Cinema
Properties  Facility  is a term loan with a December  31,  2003  maturity  date.
Cinema  Properties,  Inc. has the ability to extend the maturity  date two times
for one year each. At the lender's  discretion,  Cinema Properties,  Inc. may be
required  to make  principal  payments  of $1.5  million in the third and fourth
quarters of 2002 with the remaining principal  outstanding due in 2003. 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 the applicable  margin.  Borrowings  are secured by, among other things,  a
mortgage  placed  on six of  Cinema  Properties,  Inc.'s  theatres  and  certain
equipment  leases.  Cinema  Properties,  Inc.  has a separate  legal  existence,
separate  assets,  separate  creditors and separate  financial  statements.  The
assets of Cinema Properties,  Inc. are not available to satisfy the debts of any
of the other entities included in these consolidated  financial statements.  The
Cinema Properties Facility also requires Cinema Properties,  Inc. to comply with
an interest coverage ratio requirement.  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 three month  LIBOR as of the date of  closing.  Three month LIBOR as of
the date of closing was 6.58%.  The net proceeds  from the loan (net of fees and
expenses) were $70.9 million.  The proceeds were distributed to the Company, and
the Company  used such funds to complete  the  Company's  domestic  construction
program for 2000 and to reduce  outstanding  debt under the  Company's  existing
Credit Facility. As of August 13, 2001, Cinema Properties,  Inc. has outstanding
$77 million under the Cinema  Properties  Facility,  and the effective  interest
rate on such borrowing was 9.6% per annum.

        In 1992,  the  Company  formed  Cinemark  International  to develop  and
acquire  theatres  in  international  markets.  As of June  30,  2001,  Cinemark
International,  through its  affiliates,  has opened four  theatres (42 screens)
internationally  in 2001 and  currently  operates  84  theatres  (737  screens),
principally in Latin America.  Cinemark  International,  through its affiliates,
has six  additional  theatres (62 screens) under  construction  and scheduled to
open by the end of 2001 and presently has three theatres (28 screens)  committed
to being built after 2001.  The  following  table  summarizes  the Company's and
Cinemark  International's  holdings in each international  market, the number of
theatres  and  screens  in such  market  as of June 30,  2001 and the  number of
theatres and screens in such market scheduled to open the remainder of 2001.


<TABLE>
<CAPTION>

                                                                               Planned openings
                    Year of                      Operating                     through 2001
Country             Formation     Ownership%     Theatres/Screens              Theatres/Screens
-------             ---------     ----------     ----------------              ----------------

<S>                 <C>            <C>           <C>                           <C>
Mexico              1992           95%           25 theatres (244 screens)     1 theatre (12 screens)
Chile               1992           98%           12 theatres (88 screens)      (5 screen expansion)
Argentina           1995          100%            9 theatres (79 screens)
Brazil              1996           60%           25 theatres (228 screens)     3 theatres (29 screens)
Ecuador             1996           60%            2 theatres (16 screens)
Peru                1996          100%            2 theatres (21 screens)
Central America     1997           50.1%          7 theatres (45 screens)
Colombia            1998           51%            2 theatres (16 screens)      1 theatre (6 screens)
United Kingdom      1998          100%              N/A                        1 theatre (10 screens)

    Total                                        84 theatres (737 screens)     6 theatres (62 screens)
</TABLE>


                                       15


<PAGE>


        The Company  estimates that the remaining  capital  expenditures for the
development of its remaining  theatre  commitments (90 screens)  internationally
will be approximately $25 million.  The Company  anticipates that investments in
excess of Cinemark International's  available cash will be funded by the Company
or by debt or equity  financing  to be  provided  by third  parties  directly to
Cinemark International or its subsidiaries.

        In August 1998, the Company formed Cinemark Investments  Corporation for
the purpose of financing a portion of its  Brazilian  operations by investing in
foreign fixed rate notes issued by Cinemark Brasil,  S.A., an indirect Brazilian
subsidiary of the Company. In September 1998, Cinemark  Investments  Corporation
executed  a  credit  agreement  with  Bank of  America  that  provides  Cinemark
Investments  Corporation  up to $20 million in the  aggregate  under a revolving
line of credit  facility  (the  "Cinemark  Investments  Credit  Agreement")  due
September  2001.  The  Cinemark  Investments  Credit  Agreement is secured by an
assignment  of certain  fixed rate notes  issued by  Cinemark  Brasil,  S.A.  to
Cinemark Investments  Corporation and an unconditional  guaranty by the Company.
Pursuant  to the  terms of the  Cinemark  Investments  Credit  Agreement,  funds
borrowed  bear  interest at a rate per annum equal to the  Offshore  Rate or the
Base Rate (both as defined in the Cinemark  Investments Credit Agreement) as the
case may be.  As of  August  13,  2001,  Cinemark  Investments  Corporation  had
borrowed  $20 million  under the  Cinemark  Investments  Credit  Agreement,  the
proceeds  of which were used to  purchase  fixed rate notes  issued by  Cinemark
Brasil, S.A. which currently bear interest at 14.0%. The effective interest rate
on the Cinemark Investment  Corporation borrowings as of August 13, 2001 is 5.7%
per annum.

        In November 1998,  Cinemark Mexico 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 an unconditional  guaranty by
the Company.  Pursuant to the terms of the  Cinemark  Mexico  Credit  Agreement,
funds  borrowed bear interest at a rate per annum equal to the Offshore Rate (as
defined in the Cinemark Mexico Credit Agreement) or the Base Rate (as defined in
the Cinemark Mexico Credit  Agreement),  as the case may be, plus the Applicable
Margin (as defined in the Cinemark  Mexico Credit  Agreement).  Cinemark  Mexico
borrowed $30 million under the Cinemark Mexico Credit Agreement, the proceeds of
which were used to repay an  intercompany  loan of Cinemark Mexico from Cinemark
International.  Cinemark  International  used the proceeds of such  repayment to
repay all outstanding  indebtedness under its then existing credit facility with
Bank of America National Trust and Savings.  In September 2000,  Cinemark Mexico
and the  banks  party  to the  Cinemark  Mexico  Credit  Agreement  executed  an
amendment which, among other things,  extended the maturity date of the Cinemark
Mexico  Credit  Agreement  and increased the rate of interest paid on borrowings
thereunder.  Pursuant to the  amendment,  Cinemark  Mexico is to make  principal
payments of $500,000 in the third and fourth  quarters of 2001,  $1,500,000  per
quarter in 2002 with the remaining principal outstanding due in January 2003. As
of August 13,  2001,  Cinemark  Mexico has  outstanding  $30  million  under the
Cinemark Mexico Credit Agreement. The effective interest rate on such borrowings
as of August 13, 2001 is 6.7% per annum.

        Cinemark  Chile,  S.A.  became a consolidated  subsidiary of the company
effective January 1, 1999. Prior to that date, Cinemark Chile, S.A. had executed
four  senior  note  payable  agreements  with a local  bank for the U.S.  dollar
equivalent  of $6.0  million,  $3.0  million,  $4.5  million and $3.5 million in
December 1997, July 1998, November 1998 and December 1998,  respectively.  These
notes were each in Chilean  pesos,  adjusted for  inflation,  at the  respective
borrowing  dates.  Interest is  assessed  for three notes at the 90-day TAB rate
(Chile's  Central  Bank  interbank  rate)  plus  1.5% per  annum,  adjusted  for
inflation,  and for the other note (December  1998) at the 180-day TAB rate plus
1.5% per annum,  adjusted for inflation,  and is paid quarterly for three of the
notes and  semi-annually  for the December 1998 note. The term on all four notes
is five  years  with a two year grace  period on  principal.  All four notes are
directly or  indirectly  guaranteed  by Cinemark  International.  The  effective
interest rates on the four notes at August 13, 2001 are  approximately  6.2% per
annum.


                                       16


<PAGE>


        In September 1999, Cinemark  International acquired all of the shares of
its Argentine joint venture  partner,  Prodecine S.A.,  which held the remaining
50% of the shares of Cinemark Argentina,  S.A. Cinemark  International paid $2.8
million in cash and delivered four  promissory  notes  amounting to $11 million,
which were  subsequently  paid. The 100% interests in Prodecine  S.A.,  Cinemark
Investments  Argentina,  S.A.  and  Cinemark  Argentina,  S.A.  held by Cinemark
International were transferred to one of the Company's  subsidiaries in December
1999.

        Cinemark Brasil,  S.A.  currently has four main types of funding sources
executed through nine separate local and international  banks. These include: a)
BNDES automatic in the amount of US$5.4 million  executed October 1999 at a term
of 5 years with nine  months  grace  period at a BNDES  basket  rate (which is a
multiple  currency rate based on the rate at which the bank borrows) plus spread
amounting to 14.5%,  b)  FINAME/BNDES  facility  executed  December  1999 in the
amount of  R$450,000  (equivalent  to  US$225,000)  for a term of 3 years with 6
months  grace  period at a BNDES  basket rate plus spread  totalling  14.4%,  c)
Import financing executed between April 2000 through December 2000 in the amount
of US$6.3 million at a term of 120 to 365 days at a rate of LIBOR +2.8-5.15%, d)
Project  developer  financing  executed between  September 2000 through December
2000 in the amount of US$1.8  million for a term of 5 years with a 6 month grace
period at a rate of  TJLP+5%.  Each of these  sources  have  varying  guarantees
including comfort letters from Cinemark  International,  promissory notes for up
to 130% of the value, a revenue  reserve account and equipment  collateral.  The
effective  interest  rates on these notes at August 13,  2001 are  approximately
10.5% per annum.

        In July 2001, the Company's Brazilian partners contributed an additional
$5 million of capital to Cinemark Brasil, S.A. and are expected to contribute an
additional $6 million of capital by the end of the year,  which will effectively
dilute the  Company's  ownership of Cinemark  Brasil,  S.A. from 60% at June 30,
2001 to 53% at December 31, 2001.


                                       17


<PAGE>


New Accounting Pronouncements

        In July 2001, the Financial  Accounting Standards Board issued Statement
of Financial Accounting Standards (SFAS) No. 142, "Goodwill and Other Intangible
Assets".  This statement requires that goodwill and other intangible assets with
indefinite  useful  lives no longer be  amortized,  but  instead  be tested  for
impairment at least  annually.  This statement is effective for all fiscal years
beginning  after December 15, 2001. The statement will become  effective for the
Company on January 1, 2002. Management is currently assessing the impact of this
statement on the 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

        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.


                                       18


<PAGE>


Item 3. Quantitative and Qualitative Disclosures About Market Risk

        The Company has limited  exposure to financial  market risks,  including
changes in interest rates and other relevant market prices.

        An increase or decrease in interest  rates would affect  interest  costs
relating to the Company's  variable rate credit  facilities.  The Company and/or
its subsidiaries are currently parties to such variable rate credit  facilities.
At June 30,  2001,  there was an  aggregate  of  approximately  $443  million of
variable  rate  debt  outstanding  under  these  facilities.   These  facilities
represent approximately 54% of the Company's outstanding long-term debt. 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>
                                     June 30, 2001          June 30, 2001       December 31, 2000      December 31, 2000
         (in millions)              Carrying Amount       Fair Market Value      Carrying Amount       Fair Market Value
                                    ---------------       -----------------     -----------------      -----------------
<S>                                 <C>                   <C>                   <C>                    <C>
Long-term debt:
    Fixed rate                           $380                   $387                   $380                  $404
                                         ====                   ====                   ====                  ====
    Average interest rate                9.3%                                          9.3%
                                         ====                                          ====

    Variable rate                        $443                   $419                   $430                  $435
                                         ====                   ====                   ====                  ====
    Average interest rate                6.8%                                          9.2%
                                         ====                                          ====

    Long-term debt                       $823                   $806                   $810                  $839
                                         ====                   ====                   ====                  ====
</TABLE>


        The Company does not have any derivative financial  instruments in place
as of June 30, 2001 that would have a material effect on the Company's financial
position,  results of operations and cash flows.  However, 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 three month LIBOR as of the date of
closing.  The three month  LIBOR as of the date of closing  was 6.58%.  The fair
value and carrying value of the interest rate cap is approximately  $1.1 million
at June 30, 2001.

        The  Company is also  exposed to market  risk  arising  from  changes in
foreign  currency  exchange rates as a result of its  international  operations.
Currency  fluctuations result in the Company's reporting exchange gains (losses)
or  foreign  currency  translation  adjustments  relating  to its  international
subsidiaries  depending on the inflationary  environment of the country in which
the Company operates.


                                       19


<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, 2000.

Item 2. Change 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 six  months of 2001  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) Supplemental schedules specified by the Senior Notes indenture:

                           Condensed Consolidating Balance Sheets
                           (unaudited) as of June 30, 2001

                           Condensed Consolidating Statements of
                           Operations (unaudited) for the six months
                           ended June 30, 2001

                           Condensed Consolidating Statements of
                           Cash Flows (unaudited) for the six months
                           ended June 30, 2001


              b) Reports on Form 8-K

                           No reports have been filed by  Registrant  during the
                           quarter for which this report is filed.


                                       20


<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATING BALANCE SHEETS
                               AS OF JUNE 30, 2001
                                   (Unaudited)

                                                                 Restricted       Unrestricted
                                                                    Group             Group         Eliminations          TOTAL
                                                               ---------------   ---------------   ---------------   ---------------
<S>                                                            <C>               <C>               <C>               <C>
                                     ASSETS
CURRENT ASSETS
    Cash and cash equivalents                                   $   5,152,716     $  22,700,811     $         -      $   27,853,527
    Inventories                                                     2,820,907           731,421               -           3,552,328
    Co-op advertising and other receivables                         6,528,979         4,110,179          (643,691)        9,995,467
    Income tax receivable                                           2,517,215           504,438               -           3,021,653
    Prepaid expenses and other                                      2,733,020         1,038,235               -           3,771,255
                                                               ---------------------------------------------------------------------
       Total current assets                                        19,752,837        29,085,084          (643,691)       48,194,230

THEATRE PROPERTIES AND EQUIPMENT                                  952,957,845       243,692,379               -       1,196,650,224
    Less accumulated depreciation and amortization               (229,254,487)      (43,695,484)              -        (272,949,971)
                                                               ---------------------------------------------------------------------
       Theatre properties and equipment - net                     723,703,358       199,996,895               -         923,700,253

OTHER ASSETS

    Goodwill - net                                                  8,614,223         7,494,426               -          16,108,649
    Investments in and advances to affiliates                     161,838,096         1,281,790      (157,129,778)        5,990,108
    Deferred charges and other - net                               36,897,601        10,001,516               -          46,899,117
                                                               ---------------------------------------------------------------------
       Total other assets                                         207,349,920        18,777,732      (157,129,778)       68,997,874
                                                               ---------------------------------------------------------------------

TOTAL                                                           $ 950,806,115     $ 247,859,711     $(157,773,469)   $ 1,040,892,357
                                                               =====================================================================

                      LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
    Current portion of long-term debt                           $   4,240,871     $  33,445,524     $         -      $   37,686,395
    Current income taxes payable                                      (44,261)           44,261               -                 -
    Accounts payable and accrued expenses                          86,532,104        17,102,882          (643,691)      102,991,295
                                                               ---------------------------------------------------------------------
       Total current liabilities                                   90,728,714        50,592,667          (643,691)      140,677,690

LONG-TERM LIABILITIES
    Senior credit agreements                                      310,378,758        94,857,803               -         405,236,561
    Senior subordinated notes                                     380,201,928               -                 -         380,201,928
    Deferred lease expenses                                        21,127,779           456,030               -          21,583,809
    Deferred gain on sale leasebacks                                4,921,500               -                 -           4,921,500
    Deferred income taxes                                          11,673,712           (45,613)              -          11,628,099
    Deferred revenues and other long-term liabilities              10,431,151           107,283               -          10,538,434
                                                               ---------------------------------------------------------------------
       Total long-term liabilities                                738,734,828        95,375,503               -         834,110,331

MINORITY INTERESTS IN SUBSIDIARIES                                  6,616,504        17,143,622               -          23,760,126

SHAREHOLDERS' 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, 234,782 shares issued                           49,538,316        14,062,000       (14,062,000)       49,538,316
    Additional paid-in-capital                                     13,145,365       143,067,778      (143,067,778)       13,145,365
    Unearned compensation - stock options                          (1,518,639)              -                 -          (1,518,639)
    Retained earnings                                              87,719,744       (43,991,220)              -          43,728,524
    Treasury stock, 57,245 Class B shares at cost                 (24,232,890)              -                 -         (24,232,890)
    Accumulated other comprehensive loss                           (9,925,842)      (28,390,639)              -         (38,316,481)
                                                               ---------------------------------------------------------------------
       Total shareholders' equity                                 114,726,069        84,747,919      (157,129,778)       42,344,210
                                                               ---------------------------------------------------------------------

TOTAL                                                           $ 950,806,115     $ 247,859,711     $(157,773,469)   $1,040,892,357
                                                               =====================================================================
</TABLE>

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


                                       21


<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
                     FOR THE SIX MONTHS ENDED JUNE 30, 2001
                                   (Unaudited)

                                                                 Restricted       Unrestricted
                                                                    Group             Group         Eliminations          TOTAL
                                                               ---------------   ---------------   ---------------   ---------------
<S>                                                            <C>               <C>               <C>               <C>
REVENUES
    Admissions                                                  $ 203,391,825     $  54,451,320     $        -        $ 257,843,145
    Concessions                                                    99,828,973        19,717,009              -          119,545,982
    Other                                                          21,597,271         3,829,055       (4,386,522)        21,039,804
                                                               ---------------------------------------------------------------------
                  Total                                           324,818,069        77,997,384       (4,386,522)       398,428,931

COSTS AND EXPENSES
    Cost of operations:
        Film rentals and advertising                              106,201,872        27,596,873              -          133,798,745
        Concession supplies                                        15,901,108         4,602,603              -           20,503,711
        Salaries and wages                                         37,038,732         6,817,566              -           43,856,298
        Facility leases                                            48,618,793         8,305,440              -           56,924,233
        Utilities and other                                        44,917,656        13,361,610       (4,386,522)        53,892,744
                                                               ---------------------------------------------------------------------
                  Total                                           252,678,161        60,684,092       (4,386,522)       308,975,731

    General and administrative expenses                            16,390,261         3,799,947              -           20,190,208
    Depreciation and amortization                                  24,707,607         8,977,206              -           33,684,813
    Asset impairment loss                                             450,000               -                -              450,000
    (Gain) loss on sale of assets                                  (1,433,798)        3,264,884              -            1,831,086
                                                               ---------------------------------------------------------------------
                  Total                                           292,792,231        76,726,129       (4,386,522)       365,131,838

OPERATING INCOME                                                   32,025,838         1,271,255              -           33,297,093

OTHER INCOME (EXPENSE)
    Interest expense                                              (29,582,608)       (7,529,910)             -          (37,112,518)
    Amortization of debt issue costs and debt discount               (512,238)         (774,019)             -           (1,286,257)
    Interest income                                                   247,770           471,420              -              719,190
    Foreign currency exchange loss                                    (37,317)       (2,494,053)             -           (2,531,370)
    Equity in loss of affiliates                                   (1,370,803)          (85,761)             -           (1,456,564)
    Minority interests in (income) loss of subsidiaries              (521,766)        1,217,535              -              695,769
                                                               ---------------------------------------------------------------------
                  Total                                           (31,776,962)       (9,194,788)             -          (40,971,750)
                                                               ---------------------------------------------------------------------

INCOME (LOSS) BEFORE INCOME TAXES                                     248,876        (7,923,533)             -           (7,674,657)

Income taxes (benefit)                                             (2,785,010)           99,396              -           (2,685,614)
                                                               ---------------------------------------------------------------------

NET INCOME (LOSS)                                               $   3,033,886     $  (8,022,929)    $        -        $  (4,989,043)
                                                               =====================================================================
</TABLE>


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


                                       22


<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
                     FOR THE SIX MONTHS ENDED JUNE 30, 2001
                                   (Unaudited)

                                                                 Restricted       Unrestricted
                                                                    Group             Group         Eliminations          TOTAL
                                                               ---------------   ---------------   ---------------   ---------------
<S>                                                            <C>               <C>               <C>               <C>
OPERATING ACTIVITIES
    Net income (loss)                                           $   3,033,886     $  (8,022,929)    $        -        $  (4,989,043)

    Noncash items in net income (loss):

       Depreciation                                                24,068,488         8,296,122              -           32,364,610
       Amortization - goodwill and other assets                       639,119           681,084              -            1,320,203
       Loss on impairment of assets                                   450,000               -                -              450,000
       Amortization of gain on sale leasebacks                       (182,961)              -                -             (182,961)
       Deferred lease expenses                                      1,118,629           (10,067)             -            1,108,562
       Amortization of prepaid leases                                 692,874           450,154              -            1,143,028
       Deferred income tax expense                                 (3,203,579)              -                -           (3,203,579)
       Amortization of debt discount and premium                      (14,254)              -                -              (14,254)
       Amortized compensation - stock options                         388,742               -                -              388,742
       (Gain) loss on sale of assets                               (1,433,798)        3,264,884              -            1,831,086
       Equity in loss of affiliates                                 1,370,803            85,761              -            1,456,564
       Minority interests in income (loss) of subsidiaries            521,766        (1,217,535)             -             (695,769)
       Amortization of deferred revenues                           (6,380,397)              -                -           (6,380,397)

    Cash provided by (used for) operating working capital:

       Inventories                                                    102,838            79,789              -              182,627
       Co-op advertising and other receivables                     (6,790,877)        5,041,434              -           (1,749,443)
       Prepaid expenses and other                                     (84,267)          (95,322)             -             (179,589)
       Accounts payable and accrued expenses                      (14,116,883)          619,315              -          (13,497,568)
       Other long-term liabilities                                     49,632           117,085              -              166,717
       Income tax receivable                                       (1,622,200)           63,268              -           (1,558,932)
                                                               ---------------------------------------------------------------------

           Net cash provided by (used for) operating activities    (1,392,439)        9,353,043              -            7,960,604

INVESTING ACTIVITIES
    Additions to theatre properties and equipment                 (13,800,414)         (222,141)             -          (14,022,555)
    Sale of theatre properties and equipment                        3,848,379            94,158              -            3,942,537
    Decrease (increase) in other assets, investments in
       and advances to affiliates                                  (2,608,976)        3,254,010              -              645,034
                                                               ---------------------------------------------------------------------

       Net cash provided by (used for) investing activities       (12,561,011)        3,126,027              -           (9,434,984)

FINANCING ACTIVITIES
    Decrease in long-term debt                                    (20,690,351)       (7,299,816)             -          (27,990,167)
    Increase in long-term debt                                     38,011,413         2,795,149              -           40,806,562
    Minority investment in subsidiaries, net                            4,164        (3,239,796)             -           (3,235,632)
                                                               ---------------------------------------------------------------------

       Net cash provided by (used for) financing activities        17,325,226        (7,744,463)             -            9,580,763

EFFECT OF EXCHANGE RATE CHANGES ON CASH                               144,592          (237,442)             -              (92,850)
                                                               ---------------------------------------------------------------------

INCREASE IN CASH AND CASH EQUIVALENTS                               3,516,368         4,497,165              -            8,013,533

CASH AND CASH EQUIVALENTS:
    Beginning of period                                             1,636,348        18,203,646              -           19,839,994
                                                               ---------------------------------------------------------------------

    End of period                                               $   5,152,716     $  22,700,811     $        -        $  27,853,527
                                                               =====================================================================
</TABLE>


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


                                       23


<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 thereunder duly authorized.

                                                         CINEMARK USA, INC.
                                                         Registrant

DATE:             August 14, 2001


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

                                                         /s/Robert Copple
                                                         Robert Copple
                                                         Chief Financial Officer




















                                       24