UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   FORM 10-Q

(Mark One)
[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 1998

                                       OR

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

For the transition period from __________ to __________.
Commission file number 33-77444 and 333-11895

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

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


           7502Greenville Ave., Suite 800, LB-9,  Dallas,  Texas 75231 
              (Address of principal executive offices) (Zip Code)

                                 (214) 696-1644
               (Registrant's telephone number including area code)

             -------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

         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:

           1,500  shares of Class A Common  Stock as of August 12, 1998 
         183,814 shares of Class B Common Stock (including options to
            acquire 7,012 shares of Class B Common Stock exercisable  
              within 60 days of such date) as of August 12, 1998




<PAGE>


                      CINEMARK USA, INC. AND SUBSIDIARIES


                                     Index



                                                                           Page

PART I            FINANCIAL INFORMATION

         Item 1.  Financial Statements

                           Condensed Consolidated Balance Sheets
                              as of June 30, 1998 (unaudited)
                              and December 31, 1997                          3

                           Condensed Consolidated Statements of Income
                              (unaudited) for the three and six month
                              periods ended June 30, 1998 and 1997           4

                           Condensed Consolidated Statements of Cash
                              Flows (unaudited) for the six month
                              periods ended June 30, 1998 and 1997           5

                           Notes to Condensed Consolidated Financial
                              Statements                                     6

         Item 2.  Management's Discussion and Analysis of
                              Financial Condition and Results of
                              Operations                                     8


PART II                    OTHER INFORMATION


         Item 5.  Other Information                                          13


         Item 6(b).  Reports on Form 8-K                                     13

SIGNATURES                                                                   17




































                                        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,
                                                                                   1998                     1997
                                                                               (Unaudited)
                                                                         ---------------------------------------------------
                                     ASSETS
<S>                                                                             <C>                      <C>

CURRENT ASSETS:
   Cash and cash equivalents                                                          $28,431,492               $31,788,380
   Temporary cash investments                                                             341,156                   331,156
   Inventories                                                                          3,210,440                 2,234,231
   Receivables from affiliates and other                                               22,113,936                31,452,216
                                                                         ---------------------------------------------------
      Total current assets                                                             54,097,024                65,805,983

THEATER PROPERTIES AND EQUIPMENT                                                      700,328,808               644,192,945
   Less accumulated depreciation and amortization                                    (110,421,568)              (95,251,013)
                                                                         ---------------------------------------------------
      Theater properties and equipment - net                                          589,907,240               548,941,932
OTHER ASSETS:
   Certificates of deposit                                                              2,361,520                 1,525,852
   Investments in and advances to affiliates                                           21,204,344                23,931,120
   Intangible assets - net                                                              6,066,525                 4,413,301
   Deferred charges and other - net                                                    27,838,740                16,978,652
                                                                         ---------------------------------------------------
      Total other assets                                                               57,471,129                46,848,925
                                                                         ---------------------------------------------------
      TOTAL                                                                          $701,475,393              $661,596,840
                                                                         ===================================================

                      LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
   Current portion of long-term debt                                                     $670,797                  $380,730
   Accounts payable and accrued expenses                                               72,673,431                76,656,443
                                                                         ---------------------------------------------------
      Total current liabilities                                                        73,344,229                77,037,173
LONG-TERM LIABILITIES:
   Senior credit agreements                                                           107,980,073               185,000,000
   Senior subordinated notes                                                          380,287,451               276,360,038
   Deferred lease expenses                                                             13,824,615                13,064,630
   Deferred gain and other                                                              8,338,511                 2,483,533
   Deferred income taxes                                                               11,990,520                10,937,029
                                                                         ---------------------------------------------------
      Total long-term liabilities                                                     522,421,170               487,845,230

MINORITY INTERESTS IN SUBSIDIARIES                                                     33,779,332                26,732,561
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, 234,013 shares issued                                                  49,537,547                49,537,547
   Additional paid-in capital                                                          11,047,882                10,201,882
   Unearned compensation - stock options                                               (1,938,747)               (1,534,791)
   Retained earnings                                                                   56,526,364                47,096,688
   Treasury stock, 57,211 Class B shares at cost                                      (24,198,890)              (24,198,890)
   Cumulative foreign currency translation adjustment                                 (19,043,508)              (11,120,575)
                                                                         ---------------------------------------------------
      Total shareholders' equity                                                       71,930,663                69,981,876
                                                                         ---------------------------------------------------
      TOTAL                                                                          $701,475,393              $661,596,840
                                                                         ===================================================
</TABLE>

     See accompanying Notes to Condensed Consolidated Financial Statements.

                                       3
<PAGE>
<TABLE>
<CAPTION>

                      CINEMARK USA, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                  (Unaudited)

                                               THREE MONTHS ENDED JUNE 30,                  SIX MONTHS ENDED JUNE 30,
                                                   1998                 1997                     1998                     1997
<S>                                           <C>                 <C>                      <C>                     <C>
REVENUES:
   Admissions                                  $83,146,352          $64,490,037             $161,452,645             $129,483,037
   Concessions                                  44,344,921           35,927,736               86,890,474               71,127,941
   Other                                         3,482,467            2,373,173                6,852,664                5,162,212
                                               -----------------------------------------------------------------------------------
      Total                                    130,973,740          102,790,946              255,195,783              205,773,190

COSTS AND EXPENSES:
   Cost of operations:
     Film rentals                               42,931,055           32,647,469               80,710,089               63,928,263
     Concession supplies                         6,957,726            4,763,868               13,530,350               10,184,728
     Salaries and wages                         16,743,353           13,894,764               31,456,447               26,883,216
     Facility leases                            14,924,409            9,258,389               27,465,559               18,402,135
     Advertising                                 3,547,017            2,237,354                6,244,337                5,163,808
     Utilities and other                        18,173,212           14,638,679               34,386,852               28,833,964
                                               -----------------------------------------------------------------------------------
           Total                               103,276,772           77,440,523              193,793,634              153,396,114
     General and administrative expenses         7,844,461            8,122,813               14,925,398               13,267,302
     Depreciation and amortization               8,162,665            4,965,311               15,861,088               10,281,827
                                               -----------------------------------------------------------------------------------
           Total                               119,283,898           90,528,647              224,580,120              176,945,243
                                               -----------------------------------------------------------------------------------
OPERATING INCOME                                11,689,842           12,262,299               30,615,663               28,827,947

OTHER INCOME (EXPENSE):
   Interest expense                            (10,966,458)          (7,157,227)             (18,692,196)             (14,381,692)
   Amortization of debt issue cost                (196,154)            (174,509)                (361,482)                (349,018)
   Amortization of bond discount                    57,879              (18,625)                  22,587                  (37,250)
   Interest Income                                 963,313              241,842                2,181,790                  504,231
   Other gains and losses                          610,339               (6,757)               1,052,497                   (1,972)
   Foreign currency exchange gain (loss)          (429,101)             (56,547)                (708,835)                 (23,684)
   Minority interests in subsidiaries              214,045               41,928                 (137,198)                  68,167
   Equity in income of affiliates                  779,782              321,708                  994,919                  433,399
                                               -----------------------------------------------------------------------------------
      Total                                     (8,966,355)          (6,808,187)             (15,647,918)             (13,787,819)
                                               -----------------------------------------------------------------------------------

INCOME BEFORE INCOME TAXES                       2,723,487            5,454,112               14,967,745               15,040,128
  AND EXTRAORDINARY ITEMS

INCOME TAXES                                      $434,919            2,378,072                5,538,069                6,850,881
                                               -----------------------------------------------------------------------------------
 INCOME BEFORE EXTRAORDINARY ITEMS               2,288,568            3,076,040                9,429,676                8,189,247
                                               ===================================================================================
EXTRAORDINARY ITEMS
   Loss on early extinguishments of debt,
     net of income tax benefit of $42,054               --              (55,746)                     --                   (55,746)
                                               -----------------------------------------------------------------------------------
NET INCOME                                      $2,288,568           $3,020,294               $9,429,676               $8,133,501
                                               ===================================================================================
EARNINGS PER SHARE
Net Income Before Extraordinary Items
     Basic                                         $12.84               $17.12                   $52.89                   $45.57
     Diluted                                       $12.27               $16.37                   $50.55                   $43.57
Net Income
     Basic                                         $12.84               $16.81                   $52.89                   $45.26
     Diluted                                       $12.27               $16.07                   $50.55                   $43.28

Basic:
   Weighted average common shares outstanding      178,302              179,699                  178,302                  179,699
                                               ===================================================================================
Diluted:
   Weighted average common shares outstanding      178,302             179,699                   178,302                  179,699
   Diluted stock options                             8,235               8,236                     8,235                    8,236
                                               -----------------------------------------------------------------------------------
   Adjusted weighted average common shares         186,537             187,935                   186,537                  187,935
                                               ===================================================================================
</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,
                                                                                           1998                    1997
 <S>                                                                                  <C>                        <C>
OPERATIONS:
Net Income                                                                             $9,429,676                $8,133,501
Noncash items in net income :
   Depreciation                                                                        15,279,171                 9,793,689
   Amortization                                                                           943,399                   837,156
   Deferred lease expenses                                                                759,985                   754,543
   Amortization of prepaid leases                                                         203,918                   234,614
   Deferred income tax expense                                                          1,053,491                 1,200,563
   Debt issued for accrued interest                                                            --                 1,110,400
   Amortization of debt premium and discounts                                             (22,588)                   37,250
   Amortized compensation - stock options                                                 442,044                 1,080,436
   Equity in income of affiliate                                                         (994,919)                 (433,399)
   Minority interests                                                                     137,198                   (68,167)
   Other gains                                                                           (343,662)                       --
Cash from (used for) operating working capital:
   Inventories                                                                           (976,209)                 (576,293)
   Receivables from affiliates and other                                                7,410,245                (3,634,313)
   Accounts payable and accrued expenses                                               (3,918,589)               (5,499,679)
                                                                         ---------------------------------------------------
      Net cash from operations                                                         29,403,160                12,970,301
INVESTING ACTIVITIES:
   Additions to theatre properties                                                   (196,237,101)              (63,199,868)
   Sale of theatre properties                                                         133,802,332                        --
   Increase in deferred issue costs and other assets                                   (9,246,482)               (4,992,305)
   Decrease/(Increase) in advances to affiliates                                        3,721,695                (8,855,740)
                                                                         ---------------------------------------------------
      Net cash used for investing activities                                          (67,959,555)              (77,047,913)
FINANCING ACTIVITIES:
   Issuance of Senior Subordinated Notes                                              103,950,000                77,250,000
   Decrease in long-term debt                                                        (203,446,337)              (78,646,048)
   Increase in long-term debt                                                         127,786,272                65,365,000
   Purchase of Treasury Stock                                                                  --                (4,013,737)
   Minority investment in subsidiaries, net                                             6,909,573                   792,407
                                                                            -------------------------------------------------
      Net cash from financing activities                                               35,199,508                60,747,622

DECREASE IN CASH AND CASH EQUIVALENTS                                                  (3,356,888)               (3,329,990)
CASH AND CASH EQUIVALENTS:
   Beginning of period                                                                 31,788,380                14,081,226
                                                                         ---------------------------------------------------
   End of period                                                                      $28,431,492               $10,751,236
                                                                         ===================================================
SUPPLEMENTAL INFORMATION:
  Cash paid for interest                                                              $17,767,502               $12,945,289
                                                                         ===================================================
  Cash paid for income taxes                                                           $3,495,845                $4,889,984
                                                                         ===================================================
</TABLE>

     See accompanying Notes to Condensed Consolidated Financial Statements.


                                       5
<PAGE>
                      CINEMARK USA, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)





1.       Interim Financial Statements

         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.

         These  financial  statements  should be read in  conjunction  with the
audited  annual  financial  statements and the notes thereto for the year ended
December  31,  1997  included  in the Annual  Report  filed on Form 10-K by the
Company under the Securities Exchange Act of 1934 on March 31, 1998.

         Operating results for the three and six months ended June 30, 1998 are
not necessarily indicative of the results to be achieved for the full year.


2.  FAS 130 - Comprehensive Net Income

         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 and its components in the
financial statements.  The following components are reflected in the Company's
comprehensive income:

<TABLE>
<CAPTION>


                                                         Three Months Ended                       Six Months Ended
                                                               June 30,                               June 30,
                                                         1998             1997                 1998              1997
<S>                                                 <C>              <C>                  <C>                 <C>
Net income                                            $2,288,568       $3,020,294           $9,429,676        $8,133,501
Foreign currency translation adjustment               (6,991,032)         (14,342)          (7,922,933)          (32,695)
                                                    ---------------  ---------------      ---------------  ---------------
Comprehensive income                                 $(4,702,464)      $3,005,952           $1,506,743        $8,100,806
                                                    ===============  ===============      ===============  ===============
</TABLE>


















                                        6
<PAGE>

3.  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,  Mexico,  Brazil and Ecuador.  In prior years,
foreign  operations did not meet the requirements  for disclosure.  Information
about the Company's operations in different geographic areas for the six months
ended June 30, 1998 is as follows:

<TABLE>
<CAPTION>

                                                              Other Foreign
<S>                              <C>                  <C>                    <C>                  <C>

                                        United States           Subsidiaries        Eliminations       Consolidated

Total revenues                           $220,157,261            $35,778,403          ($739,881)       $255,195,783
                                 ==================== ====================== =================== ==================
Operating income                          $29,800,941               $746,338            $ 68,384        $30,615,663
                                 ==================== ====================== =================== ==================
Total assets                             $649,193,941           $140,614,254      ($ 88,332,802)       $701,475,393
                                 ==================== ====================== =================== ==================
</TABLE>


4.  Year 2000 Compliance

         The  Company  recognizes  that the  arrival  of the Year 2000  poses a
unique  worlwide  challenge to the ability of all systems to recognize the date
change from December 31, 1999 to January 1, 2000 and, like other companies, has
assessed and is updating its computer  applications  and business  processes to
provide for their  continued  functionality.  An assessment of the readiness of
external  entities which it interfaces  with, such as vendors,  counterparties,
customers, payment systems, and others, is ongoing.

         The Company expects that the principal costs will be those  associated
with the remediation and testing of its computer  applications.  This effort is
under way across the Company, and is following a process of inventory,  scoping
and analysis, modification,  testing and certification, and implementation. The
Company does not anticipate that the related overall costs will be material and
will be funded through operating cash flow. The Company anticipates  completing
the Year 2000  project  by no later than June 30,  1999,  which is prior to any
anticipated impact on its operating systems.





                                        7
<PAGE>

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


Results of Operations

         The following  table  presents  certain  income  statement  items as a
percentage of revenues.

<TABLE>
<CAPTION>

                                                      % of Revenues                   % of Revenues
                                                    Three Months Ended              Three Months Ended
                                                         June 30,                        June 30,
                                                    1998           1997              1998          1997
                                                 ----------     ----------        ----------    ----------
<S>                                              <C>           <C>                <C>           <C>
Revenues:
  Admissions                                        63.5           62.7              63.3          62.9
  Concessions                                       33.9           35.0              34.0          34.6
  Other                                              2.7            2.3               2.7           2.5
                                                   ------         ------            ------        ------
Total revenues                                     100.0           100.0            100.0         100.0
Cost of operations                                  78.9            75.3             75.9          74.5
General and administrative expenses                  6.0             7.9              5.8           6.4
Depreciation and amortization                        6.2             4.8              6.2           5.0
Operating income                                     8.9            11.9             12.0          14.0
Interest expense                                     8.5             7.2              7.4           7.2
Income before income taxes                           2.1             5.3              5.9           7.3
Net income                                           1.7             2.9              3.7           4.0

</TABLE>

Revenues

    Revenues for the quarter  ended June 30, 1998  increased to $131.0  million
from $102.8 million for the quarter ended June 30, 1997, a 27.4% increase.  The
company  generated  revenues  for the six month period ended June 30, 1998 (the
"1998 period") of $255.2 million  compared to $205.8 million for the six months
ended  June 30,  1997 (the  "1997  period").  The  increases  in  revenues  are
primarily attributable to an 18.8% increase in attendance in the second quarter
of 1998 versus 1997,  and a 19.2%  increase in  attendance  for the 1998 period
versus the 1997  period.  The  attendance  increases  are the result of the net
addition  of 371  screens  since the second  quarter of 1997.  The  increase in
revenues are also due to a 7.0% increase in admission and  concession  revenues
per patron in the second  quarter of 1998 as compared to the second  quarter of
1997,  and a 5.3% increase in admission and  concession  revenues per patron in
the 1998 period as compared to the 1997  period.  Revenues  per average  screen
increased  1.3% to  $135,454  for the 1998 period  from  $133,706  for the 1997
period.


Cost of Operations

    Cost of operations, as a percentage of revenues,  increased to 78.9% in the
second  quarter of 1998 from 75.3% in the second  quarter of 1997. The increase
as a percentage of revenues  resulted from an increases in film rental  expense
as a percentage  of admission  revenues to 51.6% in the second  quarter of 1998
from 50.6% in the second quarter of 1997, an increase in concession  expense as
a percentage of concession  revenue to 15.7% in the second quarter of 1998 from
13.3% in the second  quarter of 1997,  and an increase  in facility  costs as a
percentage of total revenues to 11.4% in the second quarter of 1998



                                        8
<PAGE>

from 9.0% in the second quarter of 1997.  These increases were partially offset
by a decrease in payroll  expense as a  percentage  of revenues to 12.8% in the
second quarter of 1998 from 13.5% in the second quarter of 1997.

    Cost of operations, as a percentage of revenues,  increased to 75.9% in the
1998  period  from  74.5%  for the same  period  in  1997.  The  increase  as a
percentage of revenues  resulted  from an increase in film rental  expense as a
percentage of admission  revenues to 50.0% in the 1998 period from 49.4% in the
1997 period,  an increase in  concession  expense as a percentage of concession
revenue  to 15.6% in the 1998  period  from  14.3% in the 1997  period,  and an
increase in facility  costs as a percentage  of total  revenues to 10.8% in the
1998 period from 8.9% in the 1997 period. These increases were partially offset
by a decrease in payroll costs as a percentage of revenues to 12.3% in the 1998
period from 13.1% in the 1997 period, and a decrease in utility and other costs
as a percentage  of revenues to 13.5% in the 1998 period from 14.0% in the 1997
period.


General and Administrative Expenses

    General and administrative expenses, as a percentage of revenues, decreased
to 6.0% in the second  quarter of 1998 from 7.9% in the second quarter of 1997.
General and administrative  expenses as a percentage of revenues also decreased
in the six  month  period  ended  June 30,  1998 to 5.8% from 6.5% for the same
period in 1997.  The  decrease  in general  and  administrative  expenses  as a
percentage  of  revenues  is  reflective  of the  Company's  expanding  base of
revenues due to  continuing  growth in the number of screens owned and operated
by the Company.  The high  percentage  of general and  administrative  expenses
relative to revenues in the second quarter of 1997 was also due to compensation
costs associated with the repurchase of non-qualified stock options.


Depreciation and Amortization

    Depreciation and amortization increased 64.0% to $8.2 million in the second
quarter of 1998 from $5.0 million in the second  quarter of 1997.  For the 1998
period,  depreciation  and  amortization  increased 54.3% to $15.9 million from
$10.3 million in the 1997 period.  The increase is a result of the net addition
of $186.4 million in theater property and equipment since the second quarter of
1997,  a  36.3%  increase.   The  difference  in  the  percentage  increase  in
depreciation and amortization  compared to the increase in theater property and
equipment  is a result  of the  timing  of when the  additions  were  placed in
service during the period.


Interest Expense

    Interest  costs  incurred,  including  amortization  of debt  discount  and
premium, and capitalized interest, increased 64.1% during the second quarter of
1998 to $12.8 million from $7.8 million in the second quarter of 1997. Interest
costs incurred in the 1998 period,  including amortization of debt discount and
premium, and capitalized interest,  increased 39.1% to $21.7 million from $15.6
million in the 1997  period.  The increase in interest  costs  incurred for the
second  quarter  and the 1998  period was due  principally  to an  increase  in
average debt  outstanding  resulting from borrowings under the Company's credit
facility, and the issuance of $105 million of Senior Subordinated Notes.







                                       9
<PAGE>

Income Taxes

    Income taxes decreased to $435,000 for the second quarter of 1998 from $2.4
million in the second  quarter of 1997.  Income  taxes also  decreased  to $5.6
million for the 1998 period from $6.9 million for the same period in 1997.  The
Company's  effective  tax rate  for the  first  six  months  of 1998 was  37.0%
compared  to 45.6% for the first six  months of 1997.  The  effective  rate has
decreased due to certain  foreign  subsidiaries  reporting  income for the 1998
period  which have been  offset by losses for which  deferred  tax assets  were
fully reserved for in prior periods.  Other  permanent  differences,  primarily
goodwill, have also decreased.


Net Income

    Net income of $2.3  million  for the second  quarter of 1998  included  the
consolidated net losses of Cinemark International (net of minority interest) of
$400,000.  Net income of $3.0 million for the second  quarter of 1997  included
the  consolidated  net  losses  of  Cinemark  International  (net  of  minority
interest) of $500,000.  Net income of $9.4 million for the 1998 period included
the  consolidated  net  income  of  Cinemark  International  (net  of  minority
interest) of $600,000.  Net income of $8.1 million for the 1997 period included
the  consolidated  net  losses  of  Cinemark  International  (net  of  minority
interest) of $1.2 million.



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  historically  has  not  required   traditional   working  capital
financing.

    The Company's  theaters are typically  equipped with modern  projection and
sound equipment,  with approximately 78% of the screens operated by the Company
having been built in the 1990's. The Company's  investing  activities have been
principally  in  connection  with new  theater  openings  and  acquisitions  of
existing  theaters and theater  circuits.  As of August 12,  1998,  the Company
opened in the U.S.  fifteen  theaters (233  screens) and has thirteen  theaters
(211 screens) under  construction or scheduled to begin construction by the end
of 1998.  Certain of these theaters will be megaplexes which may cost in excess
of $15 million per theater.  The Company also plans to open  approximately  400
screens in the U.S. in 1999. The Company  currently  estimates that its capital
expenditures for the development of these approximately 750 screens in the U.S.
in 1998 and 1999 will be approximately $425 million. As of August 12, 1998, the
Company had expended  approximately  $153.7 million  toward the  development of
these  screens.  The  Company  plans  to  fund  capital  expenditures  for  its
development  from cash  flow  from  operations,  borrowings  under  the  Credit
Facility and the sale and leaseback of theater properties.  Actual expenditures
for theatre  development and  acquisitions  during 1998 and 1999 are subject to
change based upon the availability of attractive opportunities for expansion of
the Company's theatre circuit.

    On August 15, 1996, the Company issued $200 million of Senior  Subordinated
Notes due 2008 (the "Subordinated Notes"). The Subordinated Notes bear interest
at the rate of 9-5/8% per annum, payable semi-annually on February 1 and August
1 of each year. The Subordinated  Notes were issued at 99.553% of the principal
face amount (a discount of $4.47 per $1,000 principal amount). The net proceeds
to the Company  from the issuance of the  Subordinated  Notes (net of discount,
fees and expenses) were approximately $193.2



                                       10
<PAGE>

million.  The proceeds from the Subordinated  Notes were used to repurchase the
Company's $125 million 12% Senior Notes due 2002 ("Senior Notes") pursuant to a
tender offer, to reduce  borrowings under the Company's Credit Facility and for
general corporate purposes.

    In January  1997,  the Company  repurchased  an  aggregate of 267 shares of
Class B common stock from a retiring employee for approximately $.5 million. In
April 1997, the Company  repurchased an aggregate of 1,242 additional shares of
Class B Common Stock  issued to option  holders upon the exercise of options in
April 1996. The aggregate  purchase price for such shares was $2.2 million.  In
May and June 1997,  options to  acquire an  aggregate  of 737 shares of Class B
Common Stock were repurchased by the Company for an aggregate purchase price of
$1.3 million.

    On June 26, 1997,  the Company issued the Series D Notes due 2008 which bea
interest at a rate of 9-5/8% per annum, payable semi-annually on February 1 and
August 1 of each  year.  The  Series  D Notes  were  issued  at  103.0%  of the
principal face amount. The net proceeds to the Company from the issuance of the
Series D Notes (net of fees and expenses) was approximately $77.1 million.  The
proceeds  of  the  Series  D  Notes  were  applied  to  reduce  the   Company's
indebtedness under the Credit Facility.

    On January 14, 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 net  proceeds  of the
Offering  were used by the Company to reduce the Company's  indebtedness  under
the then existing credit facility.  The Company exchanged the Series A Notes on
March 17, 1998 for 8-1/2% Series B Senior Subordinated Notes.

    On February 12, 1998,  the Company  replaced its existing  credit  facility
with a reducing, revolving credit agreement ("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 $350.0  million in the  aggregate.  The Credit  Facility is a reducing
revolving  credit  facility;  therefore,  at the end of each quarter during the
calendar year 2001,  2002,  2003,  2004 and 2005,  the aggregate  commitment is
reduced in the amount of $8,750,000, $11,812,500,  $13,125,000, $12,031,000 and
$6,562,500,   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 under the Credit Facility are secured
by a pledge of a majority of the issued and  outstanding  capital  stock of the
Company. Pursuant to the terms of the Credit Facility, funds borrowed currently
bear interest at a rate per annum equal to the Offshore Rate (as defined in the
Credit  Facility) or the Base Rate (as defined in the Credit  Facility,  as the
case may be), plus the Applicable  Margin (as defined in the Credit  Facility).
As of August 12, 1998,  the Company had  borrowed $87 million  under the Credit
Facility and the effective interest rate on such borrowings is 6.9% per annum.

    On February 24, 1998, the Company  completed a sale  leaseback  transaction
with affiliates of Primus Capital L.L.C.  (the "Sale  Leaseback").  Pursuant to
the Sale Leaseback,  the Company sold the land, buildings and site improvements
of twelve  theatre  properties  to special  purpose  entities  formed by Primus
Capital L.L.C. for an aggregate  purchase price equal to  approximately  $131.5
million.  Simultaneously  with the sale,  the Company  entered  into  operating
leases for such properties for a base term equal to approximately 20 at a fixed
aggregate monthly rental payment of $1.1 million or $13.4 million annually.

    In 1992, the Company formed Cinemark International, Inc.  To develop and
acquire theatres in international markets.  As of August 12, 1998, Cinemark




                                       11
<PAGE>

International  operated 38 theaters (364 screens) principally in Latin America.
The  following  table  summarizes  Cinemark  International's  holdings  in each
international  market, the number of theaters and screens in such markets as of
August 12, 1998,  and the number of theaters and screens which are either under
construction or scheduled to be under construction in 1998.


<TABLE>
<CAPTION>

                                Year of      Ownership       Operating                      1998 Construction
Country                         Formation        %           Theaters/Screens               Theaters/Screens
<S>                             <C>          <C>             <C>                            <C>


Mexico                            1992          95%           15 theaters(153 screens)       7 theaters(70 screens
Chile                             1992          50%           5 theaters (43 screens)        6 theaters(46 screens)
Argentina                         1995          25%           4 theaters (34 screens)        2 theaters(24 screens)
Argentina                         1997          100%          --                             3 theaters(20 screens)
Brazil                            1996          60%           8 theaters (86 screens)        7 theaters(61 screens)
Ecuador                           1996          60%           2 theaters (16 screens)        --
Peru                              1996          50%           1 theater (12 screens)         2 theaters(15 screens)
Central America                   1997          50%           3 theaters (20 screens)        4 theaters (25 screens)
                     Total                                    38 theaters(364 screens)       31 theaters(261 screens)

</TABLE>

    Cinemark  International  plans to invest up to an additional $75 million in
international  ventures,  principally  in Latin  America,  over the next two to
three years.  The Company  anticipates  that  investments in excess of Cinemark
International's  available  cash will be funded  by the  Company  or be debt or
equity  financing  to  be  provided  by  third  parties  directly  to  Cinemark
International or its subsidiaries.

    On November 18, 1997,  Cinemark  International  executed a credit agreement
with Bank of America  National Trust and Savings  Association for itself and as
Administrative  Agent as amended in December 1997 (the "Cinemark  International
Credit Agreement").  The Cinemark International Credit Agreement is a revolving
credit facility and provides for a loan to Cinemark  International of up to $30
million in the  aggregate.  The  Cinemark  International  Credit  Agreement  is
secured by a pledge of substantially all of the stock of Cinemark Mexico and an
unconditional  guaranty  of  Cinemark  Mexico.  Pursuant  to the  terms  of the
Cinemark International Credit Agreement, funds borrowed bear interest at a rate
per annum equal to the Offshore Rate (as defined in the Cinemark  International
Credit  Agreement)  or the Base Rate (as defined in the Cinemark  International
Credit Agreement) as the case may be, plus the Applicable Margin (as defined in
the Cinemark  International  Credit Agreement).  As of August 12, 1998 Cinemark
International had borrowed $30 million under the Cinemark  International Credit
Agreement, the proceeds of which were used to repurchase all of the outstanding
12% Senior  Subordinated PIK Notes of Cinemark Mexico.  The effective  interest
rate on such borrowings as of August 12, 1998 is 6.9% annum.


                                       12
<PAGE>

PART II.       Other Information

Item 5.        Other Information

               Supplemental schedules specified by the Senior Notes indenture:

                    Condensed Consolidating Balance Sheet
                    (unaudited) as of June 30, 1998

                    Condensed Consolidating Statement of
                    Income (unaudited) for the six months
                    ended June 30, 1998

                    Condensed Consolidating Statement of
                    Cash Flow (unaudited) for the six months
                    ended June 30, 1998


Item 6(b)      Reports on Form 8-K

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



                                       13
<PAGE>
<TABLE>
<CAPTION>
                      CINEMARK USA, INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATING BALANCE SHEET
                              AS OF JUNE 30, 1998
                                  (Unaudited)




                                                                 Restricted     Unrestricted
                                                                Subsidiaries    Subsidiaries    Eliminations       TOTAL
                                     ASSETS
<S>                                                              <C>             <C>            <C>             <C>
CURRENT ASSETS:
   Cash and cash equivalents                                       $22,736,881      $5,694,611             --     $28,431,492
   Temporary cash investments                                               --         341,156             --         341,156
   Inventories                                                       1,996,274       1,214,166             --       3,210,440
   Receivables from affiliates and other                             7,216,384      21,668,646     (6,771,094)     22,113,936
                                                               ---------------------------------------------------------------
      Total current assets                                          31,949,539      28,918,579     (6,771,094)     54,097,024

THEATER PROPERTIES AND EQUIPMENT                                   601,721,025      98,607,783             --     700,328,808
   Less accumulated depreciation and amortization                 (103,624,359)     (6,797,209)            --    (110,421,568)
                                                               ---------------------------------------------------------------
      Theater properties and equipment - net                       498,096,666      91,810,574             --     589,907,240
OTHER ASSETS:
   Certificates of deposit                                           2,361,520              --             --       2,361,520
   Investments in and advances to affiliates                        85,204,949      15,451,055    (79,451,660)     21,204,244
   Intangible assets - net                                           8,176,573              --     (2,110,048)      6,066,525
   Deferred charges and other - net                                 23,404,694       4,434,046             --      27,838,740
                                                               ---------------------------------------------------------------
      Total other assets                                           119,147,736      19,885,101    (81,561,708)     57,471,129
                                                               ---------------------------------------------------------------
      TOTAL                                                       $649,193,941    $140,614,254   ($88,332,802)   $701,475,393
                                                               ===============================================================

                      LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
   Current portion of long-term debt                                  $333,006        $337,791             --        $670,797
   Accounts payable and accrued expenses                            63,734,643      13,288,075     (4,349,286)     72,673,432
      Total current liabilities                                     64,067,649      13,625,866     (4,349,286)     73,344,229
LONG-TERM LIABILITIES:
   Senior credit agreement                                          77,980,073      30,000,000             --     107,980,073
   Senior subordinated notes - Cinemark USA, Inc.                  380,287,451              --             --     380,287,451
   Deferred lease expenses                                          13,061,488         763,127             --      13,824,615
   Deferred gain and other                                           6,786,952       1,551,559             --       8,338,511
   Deferred income taxes                                            11,781,634         208,886             --      11,990,520
                                                               ---------------------------------------------------------------
      Total long-term liabilities                                  489,897,598      32,523,572             --     522,421,170

MINORITY INTERESTS IN SUBSIDIARIES                                   4,739,118      29,040,214             --      33,779,332
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, 233,176 shares issued                               49,537,547           1,000         (1,000)     49,537,547
   Additional paid-in capital                                       11,047,882      91,973,880    (91,973,880)     11,047,882
   Unearned compensation - stock options                            (1,938,747)             --             --      (1,938,747)
   Retained earnings (deficit)                                      56,526,363      (7,965,140)     7,965,140      56,526,363
   Treasury stock, 57,211 Class B shares                           (24,198,890)             --             --     (24,198,890)
   Cumulative foreign currency translation adjustment                 (484,594)    (18,585,138)        26,224     (19,043,508)
                                                               ---------------------------------------------------------------
      Total shareholders' equity                                    90,489,577      65,424,602    (83,983,516)     71,930,663
                                                               ---------------------------------------------------------------
      TOTAL                                                       $649,193,941    $140,614,254   ($88,332,802)   $701,475,393
                                                               ===============================================================
</TABLE>

 Note: "Restricted Subsidiaries" and "Unrestricted Subsidiaries" are defined in
     the Indenture for the Senior Subordinated Notes dated August 15, 1996.

                                      14
<PAGE>
<TABLE>
<CAPTION>
                      CINEMARK USA, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATING STATEMENT OF INCOME
                     FOR THE SIX MONTHS ENDED JUNE 30, 1998
                                  (Unaudited)




                                                 Restricted           Unrestricted
                                                Subsidiaries          Subsidiaries        Eliminations          TOTAL
<S>                                             <C>                     <C>              <C>                <C>
REVENUES:
   Admissions                                    $137,035,754            $24,416,891               --         $161,452,645
   Concessions                                     75,854,538             11,035,936               --          $86,890,474
   Other                                            7,600,527                325,576       (1,073,439)          $6,852,664
                                                ---------------------------------------------------------------------------------
      Total                                       220,490,819             35,778,403       (1,073,439)        $255,195,783

COSTS AND EXPENSES:
   Cost of operations:
     Film rentals                                  69,622,787             11,087,302               --           80,710,089
     Concession supplies                            9,903,879              3,626,471               --           13,530,350
     Salaries and wages                            28,019,803              3,436,644               --           31,456,447
     Facility leases                               23,548,704              3,916,855               --           27,465,559
     Advertising                                    5,024,944              1,219,393               --            6,244,337
     Utilities and other                           29,403,761              4,983,091               --           34,386,852
                                                ---------------------------------------------------------------------------------
      Total                                       165,523,878             28,269,756               --          193,793,634
   General and administrative expenses             11,823,892              4,174,895       (1,073,389)          14,925,398
   Depreciation and amortization                   13,342,108              2,587,414          (68,434)          15,861,088
                                                ---------------------------------------------------------------------------------
      Total                                       190,689,878             35,032,065       (1,141,823)         224,580,120
                                                ---------------------------------------------------------------------------------
OPERATING INCOME                                   29,800,941                746,338           68,384           30,615,663

OTHER INCOME (EXPENSE):
   Interest expense                               (17,463,785)            (1,228,411)              --          (18,692,196)
   Amortization of debt issue costs                  (330,232)               (31,250)              --             (361,482)
   Amortization of debt discount/premium               22,587                     --               --               22,587
   Interest Income                                    676,149              1,505,641               --            2,181,790
   Other gains (losses)                             1,052,457                     40               --            1,052,497
   Foreign currency exchange loss                          --               (708,835)              --             (708,835)
   Minority interests                                 (54,863)               (82,335)              --             (137,198)
   Equity in income of affiliates                   1,215,230                343,471         (563,782)             994,919
                                                ---------------------------------------------------------------------------------
      Total                                       (14,882,457)              (201,679)        (563,782)         (15,647,918)
                                                ---------------------------------------------------------------------------------

INCOME BEFORE INCOME TAXES                         14,918,484                544,659         (495,398)          14,967,745

INCOME TAXES                                        5,546,945                 (8,876)              --            5,538,069
                                                ---------------------------------------------------------------------------------

NET INCOME                                         $9,371,539               $553,535        ($495,398)          $9,429,676
                                                =================================================================================
</TABLE>


 Note: "Restricted Subsidiaries" and "Unrestricted Subsidiaries" are defined in
     the Indenture for the Senior Subordinated Notes dated August 15, 1996.

                                      15
<PAGE>
<TABLE>
<CAPTION>
                      CINEMARK USA, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOW
                     FOR THE SIX MONTHS ENDED JUNE 30, 1998
                                  (Unaudited)


                                                       Restricted             Unrestricted
                                                      Subsidiaries            Subsidiaries       Eliminations          TOTAL
<S>                                                  <C>                     <C>               <C>                <C>
OPERATIONS:
Net income                                              $9,429,676               $553,535        ($553,535)          $9,429,676
Noncash items in net income (loss):
   Depreciation                                         12,760,046              2,519,125               --           15,279,171
   Amortization                                            943,544                 68,289          (68,434)             943,399
   Deferred lease expenses                                 485,476                274,509               --              759,985
   Amortization of prepaid leases                               --                203,918               --              203,918
   Deferred income tax (expense) benefit                 1,053,491                     --               --            1,053,491
   Amortization of debt discount and premiums              (22,588)                    --               --              (22,588)
   Amortized compensation - stock option                   442,044                     --               --              442,044
   Equity in income (loss) of affiliate                 (1,204,983)              (343,471)         553,535             (994,919)
   Minority interests                                       54,863                 82,335               --              137,198
   Gain on sale of assets                                 (343,622)                   (40)              --             (343,662)
Cash from (used for) operating working capital          (1,765,703)             4,281,150               --            2,515,447
                                                     -----------------------------------------------------------------------------
      Net cash from (used for) operations               21,832,244              7,639,350          (68,434)          29,403,160

INVESTING ACTIVITIES:
   Additions to theatre properties                    (155,946,729)           (40,290,372)              --         (196,237,101)
   Sale of theatre properties                          133,802,332                     --               --          133,802,332
   Decrease (increase) in deferred issue costs
     and other assets                                  (10,671,371)             1,356,455           68,434           (9,246,482)
   Decrease in advances to affiliates                     (991,550)             3,748,209          893,036            3,721,695
                                                     -----------------------------------------------------------------------------
      Net cash used for investing activities           (33,735,317)           (35,185,708)         961,470          (67,959,555)

FINANCING ACTIVITIES:
   Issuance of Senior Subordinated Notes               103,950,000                     --               --          103,950,000
   Decrease in long-term debt                         (203,446,337)                    --               --         (203,446,337)
   Increase in long-term debt                          126,716,478              1,069,794               --          127,786,272
   Minority investment in subsidiaries, net              4,076,594              2,832,979               --            6,909,573
   Decrease in theatre development advance
   Cinemark USA investment in Cinemark International            --                893,036         (893,036)                  --
                                                     -----------------------------------------------------------------------------
      Net cash from financing activities                31,296,735              4,795,809         (893,036)          35,199,508

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS        19,393,661            (22,750,549)              --           (3,356,888)
CASH AND CASH EQUIVALENTS:
   Beginning of period                                   3,343,220             28,445,160               --           31,788,380
                                                     -----------------------------------------------------------------------------
   End of period                                        22,736,881             $5,694,611               --          $28,431,492
                                                     =============================================================================
SUPPLEMENTAL INFORMATION:
  Cash paid for interest                               $16,674,520             $1,092,982               --          $17,767,502
                                                     =============================================================================
  Cash paid for income taxes                            $3,495,845                     --               --           $3,495,845
                                                     =============================================================================

</TABLE>

 Note: "Restricted Subsidiaries" and "Unrestricted Subsidiaries" are defined in
     the Indenture for the Senior Subordinated Notes dated August 15, 1996.

                                       16

<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 12, 1998


                                             /Jeffrey J. Stedman/
                                             Jeffrey J. Stedman
                                             Senior Vice President and
                                             Chief Financial Officer























                                       17