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, 2000



                               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

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



    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 ____

    The Registrant  became subject to the filing  requirements of the Securities
Exchange Act of 1934 on June 10, 1992.

    Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:

    As of August 8,  2000,  1,500  shares  of Class A Common  Stock and  184,957
shares of Class B Common  Stock  (including  options to acquire  7,580 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, 2000 (unaudited)
                      and December 31, 1999                                  3

                   Condensed Consolidated Statements of Operations
                      (unaudited) for the three and six month
                      periods ended June 30, 2000 and 1999                   4

                   Condensed Consolidated Statements of Cash
                      Flows (unaudited) for the six month
                      periods ended June 30, 2000 and 1999                   5

                   Notes to Condensed Consolidated Financial
                      Statements                                             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                                      18


PART II                    OTHER INFORMATION

     Item 1.       Legal Proceedings                                         19

     Item 2.       Changes in Securities and Use of Proceeds                 19

     Item 3.       Defaults Upon Senior Securities                           19

     Item 4.       Submission of Matters to a Vote of Security Holders       19

     Item 5.       Other Information                                         19

     Item 6.       Exhibits and Reports on Form 8-K                          19

SIGNATURES                                                                   23





                                        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,
                                                                                2000               1999
                                                                            (Unaudited)
<S>                                                                        <C>                <C>
                                                                         ------------------------------------
    ASSETS
CURRENT ASSETS:
    Cash and cash equivalents                                                $ 13,676,590        $ 8,872,157
    Inventories                                                                 3,821,603          4,734,520
    Co-op advertising and other receivables                                     7,980,393         12,067,471
    Income tax receivable                                                       1,055,244          2,036,146
    Prepaid expenses and other                                                  2,449,221          7,508,722
                                                                         ------------------------------------
      Total current assets                                                     28,983,051         35,219,016

THEATRE PROPERTIES AND EQUIPMENT                                            1,169,703,535      1,107,786,308
    Less accumulated depreciation and amortization                           (204,004,706)      (173,827,249)
                                                                         ------------------------------------
      Theatre properties and equipment - net                                  965,698,829        933,959,059

OTHER ASSETS:
    Investments in and advances to affiliates                                   9,542,251          2,289,553
    Goodwill - net                                                             17,881,260         18,619,715
    Deferred charges and other - net                                           47,308,201         51,773,896
                                                                         ------------------------------------
      Total other assets                                                       74,731,712         72,683,164
                                                                         ------------------------------------
TOTAL                                                                      $1,069,413,592     $1,041,861,239
                                                                         ====================================

                   LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
    Current portion of long-term debt                                        $ 13,497,825       $ 21,420,579
    Accounts payable and accrued expenses                                     117,713,635        128,611,615
                                                                         ------------------------------------
      Total current liabilities                                               131,211,460        150,032,194

LONG-TERM LIABILITIES:
    Senior credit agreements                                                  415,765,149        376,747,810
    Senior subordinated notes                                                 380,230,435        380,244,689
    Deferred lease expenses                                                    17,708,633         16,188,800
    Deferred gain on sale leaseback                                             5,287,421          5,470,381
    Deferred income taxes                                                      11,023,152         18,088,004
    Deferred revenues                                                          24,672,990          1,426,472
                                                                         ------------------------------------
      Total long-term liabilities                                             854,687,780        798,166,156

MINORITY INTERESTS IN SUBSIDIARIES                                             31,287,252         29,812,343

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, 234,622 and 234,073 shares issued, respectively              49,538,156         49,537,607
    Additional paid-in-capital                                                 13,641,431         13,733,221
    Unearned compensation - stock options                                      (2,522,039)        (3,131,680)
    Retained earnings                                                          49,728,553         59,140,652
    Treasury stock, 57,245 and 57,211 Class B shares at cost, respectively    (24,232,890)       (24,198,890)
    Accumulated other comprehensive loss                                      (33,926,126)       (31,230,379)
                                                                         ------------------------------------
      Total shareholders' equity                                               52,227,100         63,850,546
                                                                         ------------------------------------

TOTAL                                                                      $1,069,413,592     $1,041,861,239
                                                                         ====================================
</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,
                                                               2000              1999              2000              1999
                                                          ---------------------------------   ---------------------------------
<S>                                                       <C>               <C>               <C>               <C>
REVENUES:
    Admissions                                             $ 123,413,502     $ 111,821,123     $ 235,900,347     $ 207,037,547
    Concessions                                               56,756,317        54,676,548       108,880,374       101,453,845
    Other                                                      7,808,884         7,368,359        18,063,560        14,642,665
                                                          ---------------------------------   ----------------------------------
        Total                                                187,978,703       173,866,030       362,844,281       323,134,057
                                                          ---------------------------------   ----------------------------------

COSTS AND EXPENSES:
    Cost of operations:
      Film rentals and advertising                            65,630,832        61,158,899       123,078,771       110,360,016
      Concession supplies                                      9,947,499         9,513,044        19,660,737        17,007,078
      Salaries and wages                                      20,928,104        21,272,565        42,577,590        40,610,548
      Facility leases                                         26,058,247        22,172,484        52,692,232        42,745,400
      Utilities and other                                     25,639,123        25,271,261        50,597,257        46,931,796
                                                          ---------------------------------   ---------------------------------
        Total                                                148,203,805       139,388,253       288,606,587       257,654,838

    General and administrative expenses                        9,391,395         8,507,388        19,403,288        16,500,888
    Depreciation and amortization                             15,726,957        12,627,818        29,942,410        23,960,603
    Asset impairment loss                                      1,175,000                 -         1,615,000                 -
    (Gain) loss on sale of assets                               (136,367)           66,669           114,809              (237)
                                                          ---------------------------------   ---------------------------------
        Total                                                174,360,790       160,590,128       339,682,094       298,116,092

OPERATING INCOME                                              13,617,913        13,275,902        23,162,187        25,017,965

OTHER INCOME (EXPENSE):
    Interest expense                                         (18,455,799)      (13,352,959)      (35,345,751)      (26,474,222)
    Amortization of debt issue cost                             (201,869)         (208,116)         (403,738)         (407,670)
    Amortization of bond discount                                (43,625)          (43,625)          (87,250)          (87,250)
    Interest income                                              166,942           704,306           481,594         1,283,869
    Foreign currency exchange gain (loss)                       (361,384)          (76,614)          (21,713)             (380)
    Equity in income (loss) of affiliates                        (71,250)           57,267           (12,894)          113,126
    Minority interests in subsidiaries                           287,609           260,408          (156,927)          990,810
                                                          ---------------------------------   ---------------------------------
        Total                                                (18,679,376)      (12,659,333)      (35,546,679)      (24,581,717)
                                                          ---------------------------------   ---------------------------------
INCOME (LOSS) BEFORE INCOME TAXES AND CUMULATIVE
    EFFECT OF AN ACCOUNTING CHANGE                            (5,061,463)          616,569       (12,384,492)          436,248

Income taxes (benefit)                                        (1,211,050)          936,329        (2,972,393)          926,304
                                                          ---------------------------------   ---------------------------------
INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF
    AN ACCOUNTING CHANGE                                      (3,850,413)         (319,760)       (9,412,099)         (490,056)

Cumulative effect of a change in an accounting principle
    - net of tax benefit of $417,570                                   -                 -                 -        (2,968,637)
                                                          ---------------------------------   ---------------------------------
NET INCOME (LOSS)                                           $ (3,850,413)       $ (319,760)     $ (9,412,099)     $ (3,458,693)
                                                          =================================   =================================

EARNINGS PER SHARE:
    Basic:
      Income (loss) before cumulative effect of an
             accounting change                                  $ (21.53)          $ (1.79)         $ (52.69)          $ (2.75)
      Cumulative effect of an accounting change                        -                 -                 -            (16.64)
                                                          ---------------------------------   ---------------------------------
      Net Income (loss)                                         $ (21.53)          $ (1.79)         $ (52.69)         $ (19.39)
                                                          =================================   =================================

    Diluted:
      Income (loss) before cumulative effect of an
             accounting change                                  $ (21.53)          $ (1.79)         $ (52.69)          $ (2.75)
      Cumulative effect of an accounting change                        -                 -                 -            (16.64)
                                                          ---------------------------------   ---------------------------------
      Net Income (loss)                                         $ (21.53)          $ (1.79)         $ (52.69)         $ (19.39)
                                                          =================================   =================================
</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,
                                                                              2000               1999
                                                                        ------------------------------------
<S>                                                                     <C>                   <C>
OPERATING ACTIVITIES:
     Net income (loss)                                                      $ (9,412,099)      $ (3,458,693)

     Noncash items in net income:
        Depreciation                                                          28,707,931         23,972,025
        Amortization - goodwill and other assets                               1,234,479            396,248
        Loss on impairment of assets                                           1,615,000                  -
        Amortization of gain on sale leaseback                                  (182,960)          (176,875)
        Deferred lease expenses                                                1,519,833            964,421
        Amortization of prepaid leases                                         1,185,253            394,774
        Deferred income tax expense                                           (7,064,852)         5,033,258
        Amortization of debt discount and premium                                (14,254)           (14,255)
        Amortized compensation - stock options                                   481,843            712,275
        Compensation expense related to repurchase of stock options              103,584                  -
        (Gain) loss on sale of assets                                            114,809               (237)
        Equity in (income) loss of affiliates                                     12,894           (113,126)
        Minority interests in income (loss) of subsidiaries                      156,927           (990,810)
        Cumulative effect of an accounting change                                      -          3,386,207

     Cash provided by (used for) operating working capital:
        Inventories                                                              912,917           (471,323)
        Co-op advertising and other receivables                                4,087,078         (8,023,752)
        Prepaid expenses and other                                             5,059,501           (353,631)
        Accounts payable and accrued expenses                                (10,897,980)        (9,994,232)
        Income tax receivable/payable                                            980,902         (2,456,204)
                                                                        -------------------------------------
           Net cash provided by (used for) operating activities               18,600,806          8,806,070

INVESTING ACTIVITIES:
     Additions to Theatre properties and equipment                           (72,592,491)      (105,697,779)
     Sale of Theatre properties and equipment                                  7,819,711            647,728
     Decrease in certificates of deposit                                               -          3,846,821
     Decrease (increase) in investments in and advances to affiliates         (7,265,592)         8,578,136
     Decrease (increase) in deferred charges and other                         2,784,418        (13,488,129)
                                                                        ------------------------------------
        Net cash provided by (used for) investing activities                 (69,253,954)      (106,113,223)

FINANCING ACTIVITIES:
     Decrease in long-term debt                                              (41,185,274)       (14,922,673)
     Increase in long-term debt                                               72,279,859         98,405,184
     Increase in deferred revenues                                            23,246,518          4,753,344
     Purchase of treasury stock                                                  (34,000)                 -
     Repurchase of stock options                                                 (67,452)                 -
     Common stock issued for options exercised                                       425                  -
     Minority investment in subsidiaries, net                                  1,317,982         (8,235,955)
                                                                        ------------------------------------

        Net cash provided by (used for) financing activities                  55,558,058         79,999,900

EFFECT OF EXCHANGE RATE CHANGES ON CASH                                         (100,477)          (409,715)
                                                                        ------------------------------------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                               4,804,433        (17,716,968)

CASH AND CASH EQUIVALENTS:
     Beginning of period                                                       8,872,157         25,645,868

                                                                        ------------------------------------
     End of period                                                          $ 13,676,590        $ 7,928,900
                                                                        ====================================
</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 32 states, Canada, Mexico, Argentina,  Brazil, Chile,
Ecuador,  Peru, Honduras, El Salvador,  Nicaragua,  Costa Rica and Colombia. The
Company  operates 2,855 screens in 266 theatres and manages an additional  three
theatres (23 screens) at June 30, 2000.

        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, 1999 and  December  31, 1999  amounts to conform with
the June 30, 2000 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, 1999  included in the Annual  Report filed on Form 10-K by the Company under
the Securities Exchange Act of 1934 on March 30, 2000. Operating results for the
six months ended June 30, 2000 are not necessarily  indicative of the results to
be achieved for the full year.


2.  Earnings Per Share

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

<TABLE>
<CAPTION>

                                                                 Three Months Ended             Six Months Ended
                                                                      June 30,                      June 30,
                                                                2000          1999            2000          1999
                                                              -----------------------      ------------------------
<S>                                                            <C>             <C>          <C>           <C>
Net income (loss) (in thousands)                               $(3,850)        $(320)       $ (9,412)     $ (3,459)
                                                               ========        ======       =========     =========
Basic:
    Weighted average common shares outstanding                  178,863       178,362         178,635       178,362
                                                               ========       =======        ========     =========
    Earnings (loss) per common share                           $(21.53)       $(1.79)        $(52.69)      $(19.39)
                                                               ========       =======        ========     =========
Diluted:
    Weighted average common shares outstanding                  178,863       178,362         178,635       178,362
    Common equivalent shares for stock options                        -             -               -             -
                                                               --------       -------         -------      --------
    Weighted average shares outstanding                         178,635       178,362         178,635       178,362
                                                               ========       =======        ========      ========
Earnings (loss) per common and common equivalent share         $(21.53)       $(1.79)        $(52.69)      $(19.39)
                                                               ========       =======        ========      ========
</TABLE>

                                        6


<PAGE>
      Basic net income  (loss) per share is computed by dividing  the net income
(loss) by the weighted  average  number of shares of Common stock of all classes
outstanding  during the period.  Diluted net income (loss) per share is computed
by dividing the net income  (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 income
(loss) per share if their effect is antidilutive.


3. FAS 130 - Comprehensive Income (Loss)

        Beginning in 1998, the Company adopted SFAS 130 "Reporting Comprehensive
Income" ("SFAS No. 130").  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,
                                                2000                1999               2000               1999
                                              ---------------------------------     ---------------------------------
<S>                                            <C>                   <C>              <C>                <C>
Net loss                                       $(3,850,413)          $(319,760)       $(9,412,099)       $(3,458,693)
Foreign currency translation adjustment         (5,474,174)         (2,975,771)        (2,695,747)       (13,409,715)
                                              ---------------------------------     ---------------------------------
Comprehensive loss                             $(9,324,587)        $(3,295,531)      $(12,107,846)      $(16,868,408)
                                              =================================     =================================
</TABLE>

4.  Foreign Currency Translation

        The accumulated other  comprehensive loss in shareholders'  equity of
$33,926,126 and $31,230,379 at June 30, 2000 and December 31, 1999,
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 1999 and 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 1999 and 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. At June 30,
2000,  the total  assets of Cinemark  del Ecuador  S.A.  were  approximately  $4
million.

5.   (Gain) Loss on Sale of Assets

         In 1999, the Company adopted Staff  Accounting  Bulletin (SAB) No. 101,
"Revenue Recognition in Financial  Statements,"  requiring that gains and losses
on sale of assets be recorded as a component of operating income.  The Company's
practice  had been to  classify  these  gains  and  losses as other  income  and
expense.  As a result  of the new  accounting  pronouncement,  the  Company  has
reclassified  the (gain) loss on sale of assets of $66,669 and $(237) from other
income and expense to be included as a  component  of  operating  income for the
three and six month periods ended June 30, 1999,  respectively.  The  comparable
amount in the three and six month periods ended June 30, 2000 is $(136,367)  and
$114,809, respectively.






                                        7
<PAGE>

6.   Accounting for Start-up Activities and Organization Costs

        On January 1, 1999, the Company adopted Statement of Position (SOP) 98-5
requiring start-up activities and organization costs to be expensed as incurred.
The Company's practice had been to capitalize organization costs associated with
the  organization  of new  entities  as well as costs  associated  with  forming
international  joint ventures as deferred  charges and to amortize them over the
anticipated life of the respective  entity or venture.  The adoption of this new
accounting  pronouncement resulted in the aggregate write-off of the unamortized
organization costs of $3,386,207 on January 1, 1999. This charge was recorded as
a cumulative  effect of a change in accounting  principle as a one-time non cash
charge to  income of  $2,968,637  (net of tax) in the first  quarter  of 1999 as
follows:


                    United States                     $152,966
                    Mexico                                   -
                    Brazil                             552,488
                    Other Foreign Countries          2,263,183
                                                    ----------
                                                    $2,968,637
                                                    ==========

7.  Supplemental Cash Flow Information

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


                            Six Months Ended June 30,
                                    2000 1999
                                                     ----                 ----
                    Cash paid for interest     $34,307,247          $29,048,419
                    Cash paid for income taxes   2,592,445            1,456,793


8.  Reporting Segments

        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  and
long-lived  assets in the United  States and other  countries for the six months
ended June 30 are as follows:

<TABLE>
<CAPTION>

                                                                       Other Foreign
                      United States       Mexico          Brazil         Countries     Eliminations     Consolidated
2000
----
<S>                     <C>              <C>             <C>              <C>             <C>              <C>
Total revenues          $272,150,333     $29,419,087     $28,653,102      $33,058,780     $(437,021)       $362,844,281
                      =============== =============== =============== ================ ============== ==================
Long-lived assets,
net                      752,499,356      64,878,980      68,492,330       79,828,163              -        965,698,829
                      =============== =============== =============== ================ ============== ==================

1999
----
Total revenues          $253,843,091     $25,049,632     $18,326,554      $26,183,296     $(268,516)       $323,134,057
                      =============== =============== =============== ================ ============== ==================
Long-lived assets,
net                      665,480,668      56,659,155      50,227,815       76,059,624              -        848,427,262
                      =============== =============== =============== ================ ============== ==================
</TABLE>

                                        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.  Advertising cost
is primarily  fixed at the theatre  level as daily movie  directories  placed in
newspapers  represent the largest  component of advertising  costs.  The monthly
cost of these ads is based on the size of the  directory.  However,  advertising
costs have  remained  relatively  constant  when  expressed as a  percentage  of
revenues as screen growth results in the addition of new or larger directory ads
which help 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. As a result of two
sale  leaseback  transactions  which  occurred in 1998, the addition of a larger
proportion of leased theatre  properties has resulted in an increase in facility
lease  expense as a  percentage  of  revenues  in 1999 and 2000 as  compared  to
earlier years.

       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,
                                                               2000         1999         2000        1999
<S>                                                          <C>          <C>          <C>          <C>
      Revenues:
        Admissions                                             65.7         64.3         65.0        64.1
        Concessions                                            30.2         31.5         30.0        31.4
        Other                                                   4.1          4.2          5.0         4.5
                                                              -----        -----        -----       -----
      Total revenues                                          100.0        100.0        100.0       100.0

      Cost of operations                                       78.8         80.1         79.5        79.8
      General and administrative expenses                       5.0          4.9          5.3         5.1
      Depreciation and amortization                             8.4          7.3          8.3         7.4
      Asset impairment loss                                     0.6          0.0          0.5         0.0
                                                               ----         ----         ----        ----
      Total operating expenses                                 92.8         92.3         93.6        92.3
                                                              -----        -----        -----       -----

      Operating income                                          7.2          7.7          6.4         7.7

      Interest expense                                        (9.8)        (7.8)        (9.7)       (8.3)
      Other income (expense)                                  (0.1)          0.5        (0.1)         0.7
                                                              -----        ------       -----        ----
      Income (loss) before income taxes and
         cumulative effect of an accounting change            (2.7)          0.4        (3.4)         0.1
      Income taxes (benefit)                                  (0.6)          0.6        (0.8)         0.3
                                                              -----        -----        -----        -----
      Income (loss) before cumulative effect
         of an accounting change                              (2.1)        (0.2)        (2.6)       (0.2)
      Cumulative effect of an accounting change                  -            -            -        (0.9)
                                                              -----        -----        -----       -----
      Net income (loss)                                       (2.1)        (0.2)        (2.6)       (1.1)
                                                              =====        =====        =====       =====
</TABLE>

Second quarter ended June 30, 2000 and 1999.

Revenues

        Revenues for the second  quarter ended June 30, 2000 increased to $188.0
million from $173.9  million for the second  quarter ended June 30, 1999, a 8.1%
increase.  The  increase  in  revenues  for  the  second  quarter  is  primarily
attributable  to a 5.5% increase in attendance in the second  quarter of 2000 as
compared  to the second  quarter of 1999 as a result of the net  addition of 381
screens since the second  quarter of 1999.  The increase in revenues is also due
to a 2.6%  increase in  admissions  and  concession  revenues  per patron in the
second quarter of 2000 as compared to the second quarter of 1999.


Cost of Operations

       Cost of  operations,  as a percentage of revenues,  decreased to 78.8% in
the  second  quarter  of 2000 from  80.1% in the  second  quarter  of 1999.  The
decrease as a percentage  of revenues  resulted  from a decrease in film rentals
and advertising  expense as a percentage of admission  revenues to 53.2% in 2000
from 54.7% in 1999 as a result of lower film terms,  a decrease in salaries  and
wages as a  percentage  of  revenues  to 11.1% in 2000 from  12.2% in 1999 and a
decrease in utilities and other expenses as a percentage of revenues to 13.6% in
2000 from 14.5% in 1999,  offset by an increase in facility  lease  expense as a
percentage of revenues to 13.9% in 2000 from 12.8% in 1999.


                                       10
<PAGE>
General and Administrative Expenses

        General and administrative  expenses as a percentage of revenues for the
second quarter ended June 30, 2000 of 5.0% were  relatively  consistent with the
second quarter ended June 30, 1999.

        The absolute level of general and  administrative  expenses increased to
$9.4  million  in the  second  quarter  of 2000 from $8.5  million in the second
quarter  of 1999.  The  increase  in  general  and  administrative  expenses  is
attributed to costs  associated  with the worldwide  growth (net addition of 381
screens) of the  Company  since the second  quarter  ended June 30, 1999 and the
additional rent expense related to the Company's  corporate office that was sold
and leased back in December 1999.


Depreciation and Amortization

        Depreciation  and  amortization  increased 24.6% to $15.7 million in the
second  quarter of 2000 from $12.6  million in the second  quarter of 1999.  The
increase is a result of the net addition of $157 million in theatre property and
equipment since the second quarter of 1999, a 15.5% 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.


Asset Impairment Loss

        The Company  recorded  asset  impairment  charges of $1.2 million in the
second  quarter of 2000  pursuant to Statement of  Financial  Standards  No. 121
(FASB 121).  In  accordance  with FASB 121, the Company wrote down the assets of
certain theatres to their fair value.


Interest Expense

        Interest costs incurred,  including  amortization of debt issue cost and
bond  discount,  increased  26.2%  during  the  second  quarter of 2000 to $18.8
million (including  capitalized  interest to properties under construction) from
$14.9 million  (including  capitalized  interest) in the second quarter of 1999.
The increase in interest  costs  incurred for the second quarter of 2000 was due
principally to an increase in average debt outstanding resulting from borrowings
under  the  Company's  Credit  Facility  and  increased  interest  rates  on the
Company's variable rate debt.


Income Taxes

        An income  tax  benefit  of $1.2  million  was  recorded  for the second
quarter of 2000 as compared to income tax expense of $0.9  million in the second
quarter of 1999. The Company's effective rate for the second quarter of 2000 was
23.9%.







                                       11


<PAGE>

Six month period ended June 30, 2000 and 1999.

Revenues

The Company generated revenues for the six month period ended June 30, 2000 (the
"2000 period") of $362.8  million  compared to $323.1 million for the six months
ended June 30,  1999 (the "1999  period"),  a 12.3%  increase.  The  increase in
revenues for the 2000 period is  primarily  attributable  to a 7.8%  increase in
attendance  for the 2000 period  versus the 1999 period as the result of the net
addition  of 381  screens  since the second  quarter of 1999.  The  increase  in
revenues is also due to a 3.7% increase in admissions  and  concession  revenues
per patron in the 2000 period as compared to the 1999 period.


Cost of Operations

       Cost of  operations,  as a percentage of revenues,  decreased to 79.5% in
the 2000  period  from  79.8% for the same  period in 1999.  The  decrease  as a
percentage of revenues  resulted from a decrease in film rental and  advertising
costs as a percentage  of  admissions  revenues to 52.2% in the 2000 period from
53.3% in the 1999 period as a result of lower film terms, a decrease in salaries
and wages as a percentage  of revenues to 11.7% in 2000 from 12.6% in 1999 and a
decrease in utilities and other expenses as a percentage of revenues to 13.9% in
2000 from 14.5% in 1999,  offset by an increase in facility  lease  expense as a
percentage of revenues to 14.5% in the 2000 period from 13.2% in the 1999 period
and an increase in concession expense as a percentage of concession  revenues to
18.1% in the 2000  period  from  16.8% in the  1999  period  as a result  of the
greater number of international theatres in operation.


General and Administrative Expenses

        General and administrative  expenses as a percentage of revenues for the
six month period ended June 30, 2000 of 5.3% were relatively consistent with the
same period in 1999.

        The absolute level of general and  administrative  expenses increased to
$19.4  million in the 2000 period  from $16.5  million in the 1999  period.  The
increase  in  general  and  administrative   expenses  is  attributed  to  costs
associated  with the  worldwide  growth  (net  addition  of 381  screens) of the
Company  between the 1999 period end and the 2000 period end and the  additional
rent expense related to the Company's  corporate office that was sold and leased
back in December 1999.


Depreciation and Amortization

        For the 2000 period,  depreciation and  amortization  increased 24.6% to
$29.9 million from $24.0 million in the 1999 period. The increase is a result of
the net addition of $157 million in theatre  property  and  equipment  since the
second  quarter of 1999, a 15.5%  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.


Asset Impairment Loss

        The Company has recorded  asset  impairment  charges of $1.6 in the 2000
period  pursuant to  Statement  of Financial  Standards  No. 121 (FASB 121).  In
accordance with FASB 121, the Company wrote down the assets of certain  theatres
to their fair value.


                                       12


<PAGE>

Interest Expense

        Interest costs incurred in the 2000 period,  including  amortization  of
debt issue cost and bond discount,  increased 23.0% to $36.4 million  (including
capitalized  interest  to  properties  under  construction)  from $29.6  million
(including  capitalized  interest) in the 1999 period.  The increase in interest
costs incurred for the 2000 period was due principally to an increase in average
debt  outstanding  resulting from borrowings under the Company's Credit Facility
and increased interest rates on the Company's variable rate debt.


Income Taxes

        An income tax benefit of $3.0  million was  recorded for the 2000 period
as  compared  to income tax  expense of $0.9  million  in the 1999  period.  The
Company's effective tax rate for the 2000 period was 24.0%.


Cumulative Effect of a Change in an Accounting Principle

        The  Company  recorded  a  cumulative  effect of a change in  accounting
principle of $3.0 million  (net of tax) in the first  quarter of 1999  resulting
from the write off of the unamortized start-up activities and organization costs
due to the adoption of Statement of Position (SOP) 98-5.


Liquidity and Capital Resources

        The  Company's  revenues are  collected in cash,  primarily  through box
office  receipts  and the sale of  concession  items.  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 87% of the screens operated by the Company
having been built since January 1, 1990. The Company's investing activities have
been  principally in connection  with new theatre  openings and  acquisitions of
existing  theatres and theatre  circuits.  As of August 8, 2000, the Company has
opened 5 theatres (84 screens) during 2000 and has 3 theatres (47 screens) under
construction  or scheduled to open in the United States by the end of 2000.  The
Company is  presently  committed  to opening 41 screens in the U.S.  in 2001 and
2002 combined.  As of August 8, 2000,  the Company  estimates that its remaining
capital  expenditures  for the  development  of these 172 screens in the U.S. in
2000, 2001 and 2002 will be approximately $40 million.  Actual  expenditures for
theatre  development and acquisitions  during 2000, 2001 and 2002 are subject to
change based upon the availability of attractive  opportunities for expansion of
the Company's theatre circuit.  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.  The Company plans to fund
capital  expenditures for its continued  development and/or the purchase of debt
securities, if any, from cash flow from operations,  borrowings under the Credit
Facility,  proceeds from sale leaseback transactions and/or sales of excess real
estate.  As of August 8, 2000, the Company owned  approximately  $300 million of
real  estate  and  improvements  resulting  from  the  development  of  megaplex
facilities over the last several years.




                                       13


<PAGE>

       In August  1996,  the Company  issued $200  million  principal  amount of
Series B Senior  Subordinated  Notes due 2008 which bear  interest  at a rate of
9-5/8% per annum (the "Series B Notes"), payable semi-annually on February 1 and
August 1 of each  year.  The  Series  B Notes  were  issued  at  99.553%  of the
principal face amount.  The net proceeds to the Company from the issuance of the
Series B Notes (net of discount,  fees and expenses) were  approximately  $193.2
million.

        In June 1997, the Company issued $75 million  principal amount of Series
D Senior Subordinated Notes due 2008 which bear interest at a rate of 9-5/8% per
annum (the "Series D Notes"),  payable  semi-annually on February 1 and August 1
of each  year.  The  Series D Notes were  issued at 103% of the  principal  face
amount.  The net proceeds to the Company from the issuance of the Series D Notes
(net of fees and expenses) were approximately $77.1 million.

        In January 1998,  the Company  issued $105 million  aggregate  principal
amount  of 8-1/2%  Series A Senior  Subordinated  Notes due 2008 (the  "Series A
Notes") pursuant to Rule 144A (the  "Offering").  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. The Company exchanged the Series A Notes on March
17, 1998 for Series B Senior  Subordinated Notes due 2008 which bear interest at
a rate of 8-1/2% per annum (the "8-1/2% Series B Notes"),  payable semi-annually
on February 1 and August 1 of each year,  which have been  registered  under the
Securities Act of 1933, as amended.

       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  $8,750,000,
$11,812,500,  $13,125,000,  $12,031,000  and  $6,562,500  in calendar year 2001,
2002, 2003, 2004 and 2005,  respectively.  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  are  secured  by a pledge of a
majority of the issued and  outstanding  capital  stock of the Company,  and the
credit agreement  requires that the Company maintain certain  financial  ratios;
restricts  the  payment  of  dividends,  payment of  subordinated  debt prior to
maturity and issuance of preferred  stock and other  indebtedness;  and contains
other restrictive covenants typical for agreements of this type. Pursuant to the
terms of the Credit  Facility,  funds borrowed 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 8, 2000,  the Company
has outstanding $332.5 million under the Credit Facility. The effective interest
rate on such borrowings as of August 8, 2000 is 8.8% per annum.

        In December  1999, the Company  completed a sale  leaseback  transaction
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 abase 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 $123,000 or $1.5
million annually for the final three years.











                                       14


<PAGE>

        In 1992,  the  Company  formed  Cinemark  International  to develop  and
acquire theatres in international markets. As of August 8, 2000, the Company and
Cinemark  International,  through its  affiliates,  operated  77  theatres  (672
screens)  principally  in Latin  America.  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 August 8, 2000 and the
number of theatres and screens under construction in 2000.

<TABLE>
<CAPTION>


                           Year of                               Operating              Planned Openings Through 2000
Country                   Formation      Ownership %         Theatres/Screens                 Theatres/Screens
                          ---------      -----------         ----------------                 ----------------
<S>                       <C>            <C>             <C>                               <C>
Mexico                      1992             95%         23 theatres (219 screens)         2 theatres (17 screens)
Chile                       1992             98%         12 theatres (88 screens)                     -
Argentina                   1995            100%          8 theatres (69 screens)          1 theatre (10 screens)
Brazil                      1996             60%         22 theatres (204 screens)         3 theatres (26 screens)
Ecuador                     1996             60%          2 theatres (16 screens)                     -
Peru                        1996            100%          2 theatres (21 screens)                     -
Central America             1997             50%          7 theatres (45 screens)                     -
Colombia                    1998             51%          1 theatre (10 screens)            1 theatre (6 screens)
United Kingdom              1998            100%                    N/A                               -
Taiwan                      1998             51%                    N/A                               -
Germany                     1999            100%                    N/A                               -

    Total                                                77 theatres (672 screens)         7 theatres (59 screens)
</TABLE>


        The Company and Cinemark International, through its affiliates, plans to
invest up to an additional $80 million in international ventures, principally in
Latin  America,  over  the  next  three  years.  The  Company  anticipates  that
investments in excess of Cinemark  International  and its  affiliates  available
cash  will be  funded  by the  Company,  its  joint  venture  partners  or other
debt/equity  financing  to be  provided  by third  parties  directly to Cinemark
International or its affiliates.

        In August 1998, the Company formed Cinemark Investments  Corporation for
the purpose of financing 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) the proceeds of which were
used to  purchase  fixed rate  notes  issued by  Cinemark  Brasil  S.A.  bearing
interest at 13.25%.  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  defined in the Cinemark  Investments  Credit  Agreement) as the
case  may be.  As of  August  8,  2000,  Cinemark  Investments  Corporation  has
outstanding $20 million under the Cinemark  Investments  Credit  Agreement.  The
effective  interest  rate on such  borrowings  as of  August 8, 2000 is 9.2% per
annum.

        In September  1998, the Company  incorporated  Cinemark  Theatres U.K.
Ltd., an English  company,  to develop  state-of-the-art multiplex  theatres in
the United Kingdom.  Cinemark  Theatres U.K. Ltd. is a wholly owned  subsidiary
of the Company.  Construction on the initial theatre has begun and Cinemark
Theatres U.K. Ltd. anticipates opening the theatre (10 screens) in 2001.

        In September 1998, Cinemark  International  entered into a joint venture
agreement with Core Pacific Ltd. to develop state-of-the-art  multiplex theatres
in Taiwan,  Republic of China.  The joint  venture  will  conduct  its  business
through   Cinemark-Core   Pacific   Ltd.   which  is  50.1%  owned  by  Cinemark
International  and 49.9% owned by Core Pacific Ltd.  Construction on the initial
theatre has begun and Cinemark-Core Pacific Ltd.
anticipates opening the theatre (13 screens) in 2001.

                                       15

<PAGE>

       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.  As
of August 8,  2000,  Cinemark  Mexico  has  outstanding  $30  million  under the
Cinemark Mexico Credit Agreement. The effective interest rate on such borrowings
as of August 8, 2000 is 8.0% 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 bank for the U.S. dollar  equivalent
of U.S. $6.0 million, U.S. $3.0 million, U.S. $4.5 million and U.S. $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.  At June 30, 2000,
$16.9  million had been  borrowed and remained  outstanding  on these four notes
payable plus accrued interest of $0.2 million.  The effective  interest rates on
the four notes are approximately 8.0% per annum.

        In  September  1999,  Cinemark  International,  through its wholly owned
subsidiary Cinemark Germany GmbH, executed a lease agreement for a movie theatre
in Herne,  Germany. The landlord for the project in Herne, Germany has initiated
insolvency  proceedings  in Berlin.  The Company is unable to  determine at this
time whether the project will be completed. The Company has filed claims against
the landlord in the bankruptcy proceedings.

       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 the following promissory notes bearing interest at
the rate of 10% per annum:  (a) totaling  US$2.5  million due January 2000,  (b)
totaling  US$2.5  million due April 2000,  (c) totaling  A$2.5 million pesos due
July 2000, (d) totaling A$3.5 million pesos due October 2000. 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. At June 30, 2000 the promissory  notes for A$2.5
million  pesos due July 20,  2000 and A$3.5  million  pesos due October 20, 2000
plus accrued interest of $0.5 million remained outstanding.


                                       16
<PAGE>


New Accounting Pronouncements

       During  fiscal 1999,  the  Financial  Accounting  Standards  Board issued
Statement of Financial Accounting Standards No. 133 ("SFAS 133"), Accounting for
Derivative Instruments and Hedging Activities.  The statement requires companies
to  recognize  all  derivatives  as  either  assets  or  liabilities,  with  the
instruments  measured at fair value. The accounting for changes in fair value of
a derivative  depends on the intended use of the  derivative  and the  resulting
designation.  The  statement is effective for all fiscal years  beginning  after
June 15, 2000.  The  statement  will become  effective for the Company in fiscal
year 2001. 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.





























                                       17


<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. The Company does not
have any derivative financial instruments in place as of June 30, 2000.

        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,  2000,  there was an  aggregate  of  approximately  $422  million of
variable  rate debt  outstanding  under  these  facilities.  The  Company has no
interest  rate  swaps or  other  hedging  facilities  relating  to these  credit
facilities.  These  facilities  represent  approximately  52% 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, 2000        June 30, 2000      December 31, 1999      December 31, 1999
         (in millions)             Carrying Amount     Fair Market Value     Carrying Amount       Fair Market Value
                                   ---------------     -----------------    -----------------      -----------------
<S>                                <C>                 <C>                  <C>                    <C>

Long-term debt:
    Fixed rate                          $387                 $411                  $392                  $439
    Average interest rate               9.3%                                       9.3%

    Variable rate                       $422                 $433                  $386                  $394
    Average interest rate               8.8%                                       8.2%

    Long-term debt                      $809                 $844                  $778                  $833

</TABLE>

        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 or losses
or  foreign  currency  translation  adjustments  relating  to its  international
subsidiaries  depending on the inflationary  environment of the country in which
the Company operates.



















                                       18

<PAGE>

PART II.          Other Information

Item 1. Legal Proceedings

        The Company currently is a defendant in certain  litigation  proceedings
alleging certain  violations of the Americans with Disabilities Act of 1990 (the
"ADA") relating to the accessibility of certain theatre seating to patrons using
wheelchairs. In August 1998, the federal district judge presiding over a case in
El Paso (Lara,  et al versus Cinemark USA, Inc.) granted  plaintiffs  motion for
summary judgement ruling the Company's stadium theatre design is in violation of
the ADA. The Company appealed this ruling to the Fifth Circuit Court of Appeals.
In April 2000,  the Fifth  Circuit  Court of Appeals  reversed the ruling of the
federal  district judge and rendered  judgement in favor of the Company  holding
that the Company's  theatre  subject to the Lara lawsuit  complied with the ADA.
The  Company  is now  seeking  dismissals  of  similar  cases  pending in Texas.
Although the Company  cannot  predict the final  resolution  of this case or the
outcome of the other cases,  management  believes that the  Company's  potential
liability  with respect to such  proceedings is not material in the aggregate to
the Company's financial position, results of operations and cash flows.

        Reference is also made to Item 3 of the Company's  Annual Report on Form
10-K for the fiscal year ended December 31, 1999.

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 2000  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 theater
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 Sheet
                      (unaudited) as of June 30, 2000

                      Condensed Consolidating Statement of
                      Operations (unaudited) for the six months
                      ended June 30, 2000

                      Condensed Consolidating Statement of
                      Cash Flow (unaudited) for the six months
                      ended June 30, 2000

          b) Reports on Form 8-K

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

                                       19


<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                               AS OF JUNE 30, 2000
                                   (Unaudited)

                                                      Restricted       Unrestricted
                                                         Group           Group        Eliminations        TOTAL
                                                     -----------       ------------   ------------       ----------
<S>                                                  <C>               <C>            <C>                <C>
    ASSETS
CURRENT ASSETS:
    Cash and cash equivalents                          $ 6,066,219     $ 7,610,371              $ -     $ 13,676,590
    Inventories                                          3,223,502         598,101                -        3,821,603
    Co-op advertising and other receivables            (10,757,133)     19,051,239         (313,713)       7,980,393
    Tax receivable                                         852,926         202,318                -        1,055,244
    Prepaid expenses and other                           2,164,722         284,499                -        2,449,221
                                                     ----------------------------------------------------------------
       Total current assets                              1,550,236      27,746,528         (313,713)      28,983,051

THEATRE PROPERTIES AND EQUIPMENT                     1,039,390,659     130,312,876                -    1,169,703,535
    Less accumulated depreciation and amortization    (182,159,212)    (21,845,494)               -     (204,004,706)
                                                     ----------------------------------------------------------------
       Theatre properties and equipment - net          857,231,447     108,467,382                -      965,698,829

OTHER ASSETS:
    Investments in and advances to affiliates          117,311,725       5,242,070     (113,011,544)       9,542,251
    Goodwill - net                                       9,798,414       8,082,846                -       17,881,260
    Deferred charges and other - net                    39,441,468       7,866,733                -       47,308,201
                                                     ----------------------------------------------------------------
       Total other assets                              166,551,607      21,191,649     (113,011,544)      74,731,712
                                                     ----------------------------------------------------------------
TOTAL                                                $1,025,333,290   $ 157,405,559   $(113,325,257)  $ 1,069,413,592
                                                     ================================================================

        LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
    Current portion of long-term debt                    $ 642,331     $12,855,494              $ -     $ 13,497,825
    Current income taxes payable                           (33,139)         33,139                -                -
    Accounts payable and accrued expenses              105,581,867      12,445,481         (313,713)     117,713,635
                                                     ----------------------------------------------------------------
       Total current liabilities                       106,191,059      25,334,114         (313,713)     131,211,460

LONG-TERM LIABILITIES:
    Senior credit agreements                           367,112,852      48,652,297                -      415,765,149
    Senior subordinated debt                           380,230,435               -                -      380,230,435
    Deferred lease expenses                             17,329,666         378,967                -       17,708,633
    Deferred gain on sale leaseback                      5,287,421               -                -        5,287,421
    Deferred income taxes                               11,068,765         (45,613)               -       11,023,152
    Deferred revenues                                   24,433,182         239,808                -       24,672,990
                                                     ----------------------------------------------------------------
       Total long-term liabilities                     805,462,321      49,225,459                -      854,687,780

MINORITY INTERESTS IN SUBSIDIARIES                       6,039,870      25,247,382                -       31,287,252

SHAREHOLDERS' EQUITY:
    Class A common stock, $.01 par value: 10,000,000 shares
       authorized, 1,500 shares issued and outstanding          15      10,901,000      (10,901,000)              15
    Class B common stock, no par value: 1,000,000 shares
       authorized, 234,622 shares issued                49,538,156               -                -       49,538,156
    Additional paid-in-capital                          16,111,431      99,640,544     (102,110,544)      13,641,431
    Unearned compensation - stock options               (2,522,039)              -                -       (2,522,039)
    Retained earnings                                   83,423,281     (33,194,728)        (500,000)      49,728,553
    Treasury stock, 57,245 Class B shares at cost      (24,232,890)              -                -      (24,232,890)
    Distributions                                                -        (500,000)         500,000                -
    Other accumulated comprehensive loss               (14,677,914)    (19,248,212)               -      (33,926,126)
                                                     ----------------------------------------------------------------
       Total shareholders' equity                      107,640,040      57,598,604     (113,011,544)      52,227,100
                                                     ----------------------------------------------------------------

TOTAL                                                $1,025,333,290   $ 157,405,559   $(113,325,257)  $ 1,069,413,592
                                                     ================================================================
</TABLE>

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


                                       20
<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                     FOR THE SIX MONTHS ENDED JUNE 30, 2000
                                   (Unaudited)

                                                             Restricted       Unrestricted
                                                               Group             Group        Eliminations       TOTAL
                                                           -------------      ------------    ------------    -------------
<S>                                                         <C>               <C>             <C>             <C>
REVENUES:
    Admissions                                              $ 201,617,014      $34,283,333             $ -     $235,900,347
    Concessions                                                98,233,652       10,646,722               -      108,880,374
    Other                                                      16,464,501        2,036,080        (437,021)      18,063,560
                                                           ----------------------------------------------------------------
                  Total                                       316,315,167       46,966,135        (437,021)     362,844,281

COSTS AND EXPENSES:
    Cost of operations:
       Film rentals and advertising                           106,288,370       16,790,401               -      123,078,771
       Concession supplies                                     16,180,787        3,479,950               -       19,660,737
       Salaries and wages                                      38,544,874        4,032,716               -       42,577,590
       Facility leases                                         44,581,342        8,110,890               -       52,692,232
       Utilities and other                                     45,847,499        5,186,779        (437,021)      50,597,257
                                                           -----------------------------------------------------------------
                  Total                                       251,442,872       37,600,736        (437,021)     288,606,587

    General and administrative expenses                        15,599,438        3,803,850               -       19,403,288
    Depreciation and amortization                              23,290,085        6,652,325               -       29,942,410
    Asset impairment loss                                       1,615,000                -               -        1,615,000
    (Gain) loss on sale of assets                                 148,698          (33,889)              -          114,809
                                                           -----------------------------------------------------------------
                  Total                                       292,096,093       48,023,022        (437,021)     339,682,094

OPERATING INCOME                                               24,219,074       (1,056,887)              -       23,162,187

OTHER INCOME (EXPENSE)
    Interest expense                                          (32,435,818)      (2,909,933)              -      (35,345,751)
    Amortization of debt issue cost                              (387,071)         (16,667)              -         (403,738)
    Amortization of bond discount                                 (87,250)               -               -          (87,250)
    Dividend income                                               500,000                -        (500,000)               -
    Interest income                                               280,933          200,661               -          481,594
    Foreign currency exchange gain (loss)                          94,678         (116,391)              -          (21,713)
    Equity in income (loss) of affiliates                         (12,886)              (8)              -          (12,894)
    Minority interests in subsidiaries                           (860,819)         703,892               -         (156,927)
                                                           -----------------------------------------------------------------
                  Total                                       (32,908,233)      (2,138,446)       (500,000)     (35,546,679)
                                                           -----------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES AND
    CUMULATIVE EFFECT OF AN ACCOUNTING CHANGE                  (8,689,159)      (3,195,333)       (500,000)     (12,384,492)

Income taxes (benefit)                                         (2,849,922)        (122,471)              -       (2,972,393)
                                                           -----------------------------------------------------------------
INCOME (LOSS) BEFORE CUMULATIVE EFFECT
    OF AN ACCOUNTING CHANGE                                    (5,839,237)      (3,072,862)       (500,000)      (9,412,099)

Cumulative effect of a change in accounting principle
     - net of tax benefit                                               -                -               -                -

                                                           -----------------------------------------------------------------
NET INCOME (LOSS)                                            $ (5,839,237)    $ (3,072,862)     $ (500,000)    $ (9,412,099)
                                                           =================================================================
</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 CONSOLIDATED STATEMENTS OF CASH FLOWS
                     FOR THE SIX MONTHS ENDED JUNE 30, 2000
                                   (Unaudited)

                                                            Restricted       Unrestricted
                                                               Group           Group         Eliminations      TOTAL
                                                           ------------      ------------    ------------    ------------
<S>                                                        <C>              <C>              <C>            <C>
OPERATING ACTIVITIES:
    Net income (loss)                                       $ (5,839,237)   $ (3,072,862)     $ (500,000)   $ (9,412,099)

    Noncash items in net income:
       Depreciation                                           22,653,852       6,054,079               -      28,707,931
       Amortization - goodwill and other assets                  636,233         598,246               -       1,234,479
       Loss on impairment of assets                            1,615,000               -               -       1,615,000
       Amortization of gain on sale leaseback                   (182,960)              -               -        (182,960)
       Deferred lease expenses                                 1,432,703          87,130               -       1,519,833
       Amortization of prepaid leases                            737,134         448,119               -       1,185,253
       Deferred income tax expense                            (7,012,488)        (52,364)              -      (7,064,852)
       Amortization of debt discount and premium                 (14,254)              -               -         (14,254)
       Amortized compensation - stock options                    481,843               -               -         481,843
       Compensation expense related to repurchase of
          stock options                                          103,584               -               -         103,584
       Gain on sale of assets                                    148,698         (33,889)              -         114,809
       Equity in (income) loss of affiliates                      12,886               8               -          12,894
       Minority interests in income (loss) of subsidiaries       860,819        (703,892)              -         156,927

    Cash provided by (used for) operating working capital:
       Inventories                                               208,604         704,313               -         912,917
       Co-op advertising and other receivables               (11,543,356)     15,630,434               -       4,087,078
       Prepaid expenses and other                              5,195,418        (135,917)              -       5,059,501
       Accounts payable and accrued expenses                 (12,016,557)      1,118,577               -     (10,897,980)
       Income tax receivable/payable                           1,150,081        (169,179)              -         980,902
                                                           --------------------------------------------------------------
           Net cash provided by (used for) operating          (1,371,997)     20,472,803        (500,000)     18,600,806
                    activities

INVESTING ACTIVITIES:
    Additions to Theatre properties and equipment            (57,049,273)    (15,543,218)              -     (72,592,491)
    Sale of Theatre properties and equipment                   7,501,817         317,894               -       7,819,711
    Decrease (increase) in other assets, investments in
       and advances to affiliates                                805,847      (5,787,021)        500,000      (4,481,174)
                                                           ---------------------------------------------------------------

       Net cash provided by (used for) investing activities  (48,741,609)    (21,012,345)        500,000     (69,253,954)

FINANCING ACTIVITIES:
    Decrease in long-term debt                               (33,784,597)     (7,400,677)              -     (41,185,274)
    Increase in long-term debt                                65,612,751       6,667,108               -      72,279,859
    Increase in deferred revenues                             23,039,855         206,663               -      23,246,518
    Purchase of treasury stock                                   (34,000)              -               -         (34,000)
    Repurchase of stock options                                  (67,452)              -               -         (67,452)
    Common stock issued for options exercised                        425               -               -             425
    Minority investment in subsidiaries, net                    (996,999)      2,314,981               -       1,317,982
                                                           --------------------------------------------------------------
       Net cash provided by (used for) financing activities   53,769,983       1,788,075               -      55,558,058

EFFECT OF EXCHANGE RATE CHANGES ON CASH                         (100,524)             47               -        (100,477)
                                                           --------------------------------------------------------------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS               3,555,853       1,248,580               -       4,804,433

CASH AND CASH EQUIVALENTS:
    Beginning of period                                        2,510,366       6,361,791               -       8,872,157
                                                           --------------------------------------------------------------
    End of period                                            $ 6,066,219     $ 7,610,371             $ -     $13,676,590
                                                           ==============================================================
</TABLE>

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

                                       22
<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 8, 2000


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


                                                    /s/Robert Copple
                                                    Robert Copple
                                                    Chief Financial Officer


































                                       23