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 September 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.)


           7502 Greenville 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 November 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 November 12, 1998











<PAGE>

                       CINEMARK USA, INC. AND SUBSIDIARIES


                                      Index



                                                                           Page

PART I            FINANCIAL INFORMATION

         Item 1.  Financial Statements

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

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

                    Condensed Consolidated Statements of Cash
                    Flows (unaudited) for the nine month
                    periods ended September 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                                               7


PART II                    OTHER INFORMATION


         Item 5.  Other Information                                          13


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

SIGNATURES                                                                   17


















                                        2
<PAGE>
<TABLE>
<CAPTION>
                       CINEMARK USA, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                                                               SEPTEMBER 30             DECEMBER 31,
                                                                                   1998                     1997
                                                                               (Unaudited)
                                                                         --------------------------------------------------
                                     ASSETS
<S>                                                                                 <C>                       <C>
CURRENT ASSETS:
   Cash and cash equivalents                                                          $20,610,114              $31,788,380
   Temporary cash investments                                                             341,156                  331,156
   Inventories                                                                          3,205,407                2,234,231
   Receivables from affiliates and other                                               35,840,695               31,452,216
                                                                         --------------------------------------------------
      Total current assets                                                             59,997,372               65,805,983

THEATER PROPERTIES AND EQUIPMENT                                                      786,292,472              644,192,945
   Less accumulated depreciation and amortization                                    (118,102,804)             (95,251,013)
                                                                         --------------------------------------------------
      Theater properties and equipment - net                                          668,189,668              548,941,932
OTHER ASSETS:
   Certificates of deposit                                                              3,305,708                1,525,852
   Investments in and advances to affiliates                                           21,109,486               23,931,120
   Intangible assets - net                                                              5,935,597                4,413,301
   Deferred charges and other - net                                                    22,302,686               16,978,652
                                                                         --------------------------------------------------
      Total other assets                                                               52,653,477               46,848,925
                                                                         --------------------------------------------------
      TOTAL                                                                          $780,840,517             $661,596,840
                                                                         ==================================================

                      LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
   Current portion of long-term debt                                                   $1,076,342                 $380,730
   Accounts payable and accrued expenses                                               67,486,060               76,656,443
                                                                         --------------------------------------------------
      Total current liabilities                                                        68,562,402               77,037,173
LONG-TERM LIABILITIES:
   Senior credit agreements                                                           173,936,357              185,000,000
   Senior subordinated notes                                                          380,280,324              276,360,038
   Deferred lease expenses                                                             14,230,959               13,064,630
   Deferred gain and other                                                              8,152,122                2,483,533
   Deferred income taxes                                                               19,798,378               10,937,029
                                                                         --------------------------------------------------
      Total long-term liabilities                                                     596,398,140              487,845,230

MINORITY INTERESTS IN SUBSIDIARIES                                                     34,155,998               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                                               (1,717,725)              (1,534,791)
   Retained earnings                                                                   65,998,410               47,096,688
   Treasury stock, 57,211 Class B shares at cost                                      (24,198,890)             (24,198,890)
   Cumulative foreign currency translation adjustment                                 (18,943,262)             (11,120,575)
                                                                         --------------------------------------------------
      Total shareholders' equity                                                       81,723,977               69,981,876
                                                                         --------------------------------------------------
      TOTAL                                                                          $780,840,517             $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 MONTH ENDED SEPTEMBER 30,    NINE MONTHS ENDED SEPTEMBER 30,
                                                               1998              1997              1998             1997
<S>                                                          <C>               <C>               <C>              <C>

REVENUES:
   Admissions                                                  $103,913,412      $76,284,636       $265,366,057     $205,767,673
   Concessions                                                   54,972,765       41,615,188        141,863,239      112,743,129
   Other                                                          5,738,849        3,307,938         12,591,513        8,470,150
                                                               ------------------------------------------------------------------
      Total                                                     164,625,026      121,207,762        419,820,809      326,980,952

COSTS AND EXPENSES:
   Cost of operations:
     Film rentals                                                51,194,951       39,697,328        131,905,040      103,625,591
     Concession supplies                                          9,392,262        7,055,929         22,922,612       17,240,657
     Salaries and wages                                          18,716,250       15,224,185         50,172,697       42,107,401
     Facility leases                                             16,814,790        9,900,498         44,280,349       28,302,633
     Advertising                                                  4,317,834        2,523,824         10,562,171        7,687,632
     Utilities and other                                         20,353,739       13,796,365         54,740,591       42,630,329
                                                               ------------------------------------------------------------------
           Total                                                120,789,826       88,198,129        314,583,460      241,594,243
     General and administrative expenses                          8,472,756        7,209,213         23,398,154       20,476,515
     Depreciation and amortization                                9,634,104       10,189,447         25,495,192       20,471,274
                                                               ------------------------------------------------------------------
           Total                                                138,896,686      105,596,789        363,476,806      282,542,032
                                                               ------------------------------------------------------------------
OPERATING INCOME                                                 25,728,340       15,610,973         56,344,003       44,438,920

OTHER INCOME (EXPENSE):
   Interest expense                                             (10,788,040)      (8,690,205)       (29,480,236)     (23,071,897)
   Amortization of debt issue cost                                 (168,429)        (178,469)          (529,911)        (527,487)
   Amortization of bond discount                                   (145,129)         (18,625)          (122,542)         (55,875)
   Interest Income                                                  345,721           43,525          2,527,511          547,756
   Other gains and losses                                             7,681          410,040          1,060,178          408,068
   Foreign currency exchange gain (loss)                           (389,956)         (47,411)        (1,098,791)         (71,095)
   Minority interests in subsidiaries                               552,832           45,065            415,634          113,232
   Equity in income of affiliates                                   205,837          524,507          1,200,756          957,906
                                                               ------------------------------------------------------------------
      Total                                                     (10,379,483)      (7,911,573)       (26,027,401)     (21,699,392)
                                                               ------------------------------------------------------------------

INCOME BEFORE INCOME TAXES                                       15,348,857        7,699,400         30,316,602       22,739,528
  AND EXTRAORDINARY ITEMS

INCOME TAXES                                                      5,876,811        3,406,449         11,414,880       10,257,330
                                                               ------------------------------------------------------------------

NET INCOME BEFORE EXTRAORDINARY ITEMS                             9,472,046        4,292,951         18,901,722       12,482,198

EXTRAORDINARY ITEMS
   Loss on early extinguishments of debt, net of
     income tax benefit of $42,054                                       --               --                 --          (55,746)
                                                               ------------------------------------------------------------------

NET INCOME                                                       $9,472,046       $4,292,951        $18,901,722       12,426,452
                                                               ==================================================================

EARNINGS PER SHARE

Net Income
     Basic                                                          $53.12           $23.92            $106.01           $69.23
     Diluted                                                        $50.78           $22.87            $101.33           $66.19
Basic:
   Weighted average common shares outstanding                       178,302          179,493            178,302          179,493
                                                               ===================================================================
Diluted:
   Weighted average common shares outstanding                       178,302          179,493            178,302          179,493
   Dilutive stock options                                             8,235            8,236              8,235            8,236
                                                               ------------------------------------------------------------------
   Adjusted weighted average common shares                          186,537          187,729            186,537          187,729
                                                               ==================================================================
</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)

                                                                                     NINE MONTHS ENDED SEPTEMBER 30,
                                                                                     1998                      1997
<S>                                                                                  <C>                      <C>
OPERATIONS:
Net Income                                                                            $18,901,722              $12,426,452
Noncash items in net income :
   Depreciation                                                                        24,385,578               19,656,382
   Amortization                                                                         1,109,614                1,347,502
   Deferred lease expenses                                                              1,166,329                1,719,885
   Deferred income tax expense                                                          8,861,349                  540,567
   Debt issued for accrued interest                                                                              2,850,100
   Amortization of debt premium and discounts                                             652,453
   Amortized compensation - stock options                                                 663,066                1,669,404
   Equity in income of affiliate                                                       (1,200,756)                (957,906)
   Minority interests                                                                    (415,634)                (113,232)
   Other gains                                                                             38,613                 (408,068)
Cash from (used for) operating working capital:
   Inventories                                                                           (971,176)                (623,428)
   Tax and other receivables                                                           (4,504,814)              (7,005,000)
   Accounts payable and accrued expenses                                               (9,627,967)              (6,896,839)
                                                                         --------------------------------------------------
      Net cash from operations                                                         39,058,377               24,205,819
INVESTING ACTIVITIES:
   Additions to theatre properties                                                   (284,656,008)            (125,842,263)
   Sale of theatre properties                                                         133,802,332
   Increase in deferred issue costs and other assets                                   (4,077,211)              (9,573,494)
   Decrease/(Increase) in advances to affiliates                                        4,022,390              (10,241,913)
                                                                         --------------------------------------------------
      Net cash (used for) investing activities                                       (150,908,497)            (145,657,670)
FINANCING ACTIVITIES:
   Issuance of Senior Subordinated Notes                                              103,950,000               77,250,000
   Decrease in long-term debt                                                        (203,446,337)             (79,148,172)
   Increase in long-term debt                                                         192,396,139              127,365,000
   Purchase of Treasury Stock                                                                                   (4,013,737)
   Minority investment in subsidiaries, net                                             7,839,071                1,075,131
                                                                         --------------------------------------------------
      Net cash from financing activities                                              100,738,873              122,528,222

EFFECT OF EXCHANGE RATE CHANGES ON CASH                                                   (67,019)                      --

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                      (11,178,266)               1,076,371
CASH AND CASH EQUIVALENTS:
   Beginning of period                                                                 31,788,380               14,081,226
                                                                         --------------------------------------------------
   End of period                                                                      $20,610,114              $15,157,597
                                                                         ==================================================
SUPPLEMENTAL INFORMATION:
  Cash paid for interest                                                              $37,797,868              $24,644,847
                                                                         ==================================================
  Cash paid for income taxes                                                           $3,750,500               $6,935,511
                                                                         ==================================================
</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 norma
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 nine months ended  September  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                       Nine Months Ended
                                                       September 30,                            September 30,
                                                 1998                1997              1998               1997
<S>                                              <C>                 <C>               <C>                <C>

Net income                                          $9,472,046         $4,292,951      $18,901,722       $12,426,452
Foreign currency                                       100,246            (1,320)       (7,822,687)          (34,015)
                                        ----------------------  ----------------- ------------------ ----------------
Comprehensive income                                $9,572,292         $4,291,631      $11,079,035       $12,392,437

                                        ======================  ================= ================== ================
</TABLE>

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 nine
months ended September 30, 1998 is as follows:

<TABLE>
<CAPTION>

                                                             Other Foreign
                                       United States         Subsidiaries          Eliminations     Consolidated
<S>                                    <C>                   <C>                   <C>              <C>
Total revenues                           $360,481,548            $60,649,099        ($1,309,838)         $419,820,809
                                 ==================== ====================== ========================================
Operating income                          $52,767,659             $3,576,344                              $56,344,003
                                 ==================== ====================== ========================================
Total assets                             $707,952,481           $165,464,487       ($92,576,451)         $780,840,517
                                 ==================== ====================== ========================================
</TABLE>





                                        6
<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                   Nine Months Ended
                                                       September 30,                       September 30,
                                                      1998             1997             1998               1997
                                                --------------- --------------  -----------------  -----------------
<S>                                             <C>             <C>             <C>                <C>
Revenues:
  Admissions                                               63.1           63.0               63.2               62.9
  Concessions                                              33.4           34.3               33.8               34.5
  Other                                                     3.5            2.7                3.0                2.6
                                                            ---            ---                ---                ---
Total revenues                                            100.0          100.0              100.0              100.0
Cost of operations                                         73.4           72.8               74.9               73.8
General and administrative expenses                         5.2            5.9                5.6                6.3
Depreciation and amortization                               5.8            8.4                6.1                6.3
Operating income                                           15.6           12.9               13.4               13.6
Interest expense                                            6.6            7.2                7.0                7.1
Income before income taxes                                  9.3            6.4                7.2                7.0
Net income                                                  5.8            3.5                4.5                3.8
</TABLE>

Revenues

    Revenues  for the quarter  ended  September  30, 1998  increased  to $164.6
million from $121.2  million for the quarter ended  September 30, 1997, a 35.8%
increase.  The  company  generated  revenues  for the nine month  period  ended
September  30, 1998 (the "1998  period") of $419.8  million  compared to $327.0
million for the nine months ended September 30, 1997 (the "1997  period").  The
increases  in  revenues  are  primarily  attributable  to an 31.5%  increase in
attendance  in the third quarter of 1998 versus 1997,  and a 27.6%  increase in
attendance for the 1998 period versus the 1997 period. The attendance increases
are the result of the net  addition of 446 screens  since the third  quarter of
1997. The increase in revenues are also due to a 7.0% increase in admission and
concession  revenues per patron in the third quarter of 1998 as compared to the
third quarter of 1997, and a 5.0% increase in admission and concession revenues
per patron in the 1998  period as  compared to the 1997  period.  Revenues  per
average screen increased 1.4% to $198,028 for the 1998 period from $195,329 for
the 1997 period.

Cost of Operations

    Cost of operations, as a percentage of revenues,  increased to 73.4% in the
third quarter of 1998 from 72.8% in the third quarter of 1997.  The increase as
a percentage of revenues resulted from an increase in facility lease expense as
a percentage of total  revenues to 10.2% in the third quarter of 1998 from 8.2%
in the  third  quarter  of  1997  partially  as a  result  of a sale  leaseback
transaction  which  occurred  in the first  quarter  of 1998,  an  increase  in
advertising  expense as a  percentage  of total  revenues  to 2.6% in the third
quarter of 1998 from 2.0% in the third  quarter  of 1997,  and an  increase  in
utility and other operating costs as a percentage of total revenues to 12.4% in
the third  quarter  of 1998  from  11.4% in the third  quarter  of 1997.  These
increases  were  partially  offset by a decrease  in film  rental  expense as a
percentage of admission revenues to 49.3 in the third quarter of 1998 from

                                        7
<PAGE>

52.0% in third quarter of 1997, and a decrease in salaries and wages as a
percentage of total revenues to 11.4% in the third quarter of 1998 from 12.6%
in the third quarter of 1997.

        Cost of operations, as a percentage of revenues,  increased to 74.9% in
the 1998  period  from 73.8% for the same  period in 1997.  The  increase  as a
percentage of revenues  resulted  from an increase in  concession  expense as a
percentage of concession revenues to 16.2% in the 1998 period from 15.3% in the
1997 period and an increase in facility costs as a percentage of total revenues
to 10.6% in the 1998 period from 8.7% in the 1997 period  partially as a result
of the sale leaseback  transaction which occurred in the first quarter of 1998.
These increases were partially offset by a decrease in film rental expense as a
percentage of admission  revenues to 49.7% in the 1998 period from 50.4% in the
1997 period,  and a decrease in payroll costs as a percentage of total revenues
to 12.0% in the 1998 period from 12.9% in the 1997 period.

General and Administrative Expenses

    General and administrative expenses, as a percentage of revenues, decreased
to 5.2% in the third  quarter  of 1998 from 5.9% in the third  quarter of 1997.
General and administrative  expenses as a percentage of revenues also decreased
in the nine month  period  ended  September  30, 1998 to 5.5% from 6.3% 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.

Depreciation and Amortization

    Depreciation and amortization  increased 18.5% to $9.6 million in the third
quarter of 1998 from $8.1 million in the second  quarter of 1998.  For the 1998
period,  depreciation  and  amortization  increased 24.4% to $25.5 million from
$20.5  million  in the 1997  period.  The  increase  is the  result  of the net
addition (net of the sale  leaseback  transaction  which  occurred in the first
quarter of 1998) of $184.2 million in theater  property and equipment since the
third  quarter  of 1997,  a 38%  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 25.0% during the third quarter of
1998 to $12.0 million from $9.6 million in the third quarter of 1997.  Interest
costs incurred in the 1998 period,  including amortization of debt discount and
premium, and capitalized interest,  increased 33.2% to $34.1 million from $25.6
million in the 1997  period.  The increase in interest  costs  incurred for the
third 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.

Income Taxes

    Income taxes  increased to $5.9 million for the third  quarter of 1998 from
$3.4 million in the third quarter of 1997. Income taxes also increased to $11.4
million for the 1998 period from $10.3 million for the same period in 1997. The
Company's  effective  tax rate for the  first  nine  months  of 1998 was  37.7%
compared to 45.1% for the first nine  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  in  prior  periods.  Other  permanent  differences,  primarily
goodwill, have also decreased.


                                        8

<PAGE>

Net Income

    Net  income of $9.5  million  for the third  quarter of 1998  included  the
consolidated net income of Cinemark International (net of minority interest) of
$2.1 million. Net income of $4.3 million for the third quarter of 1997 included
the  consolidated  net  losses  of  Cinemark  International  (net  of  minority
interest) of $500,000. Net income of $18.9 million for the 1998 period included
the  consolidated  net  income  of  Cinemark  International  (net  of  minority
interest)  of $3.4  million.  Net income of $12.4  million  for the 1997 period
included the consolidated net losses of Cinemark International (net of minority
 interest) of $1.7 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 80% 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 November 12, 1998, the Company
has opened  eighteen  theaters (334  screens)in the U.S. and has six additional
theaters (89 screens)  under  construction  and scheduled to open 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  350
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  $450 million.  As of November 12, 1998,
the Company had expended  approximately  $240 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 theater 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  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 bear
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.


                                        9

<PAGE>

    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 November 12, 1998, the Company had borrowed $135 million under the Credit
Facility  with the  average  interest  rate on such  borrowings  being 6.5% 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 November 12, 1998,  Cinemark
International  operated 39 theaters (370 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
November  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)       4 theaters(34 screens)
Chile                         1992          50%         6 theaters (49 screens)       4 theaters(30 screens)
Argentina                     1995          25%         4 theaters (34 screens)       1 theater (10 screens)
Argentina                     1997          100%        -                             2 theaters(15 screens)
Brazil                        1996          60%         8 theaters (86 screens)       5 theaters(40 screens)
Ecuador                       1996          60%         2 theaters (16 screens)       -
Peru                          1996          50%         1 theater (12 screens)        -
Central America               1997          50%         3 theaters (20 screens)       4 theaters (25 screens)

Total                                                   39 theaters(370 screens)      20 theaters(154 screens)
</TABLE>


                                       10

<PAGE>

    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 by 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 November 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 November 12, 1998 is 6.7% per annum.

    On August 26, 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  LTDA,  an indirect  Brazilian  subsidiary of the
Company. On September 11, 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  Corporation Credit Agreement is secured by
an  assignment  of certain fixed rate notes issued by Cinemark LTDA to Cinemark
Investments  Corporation  and  an  unconditional  guarantee  by  Cinemark  USA.
Pursuant to the terms of the Cinemark Investments Corporation 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  Corporation  Credit
Agreement)  as the case may be. As of November  12, 1998  Cinemark  Investments
Corporation had borrowed $15 million under the Cinemark Investments Corporation
Credit Agreement,  the proceeds of which were used to purchase fixed rate notes
bearing interest at 13.25%.  The effective  interest rate on such borrowings as
of November 12, 1998 is 7.1% per annum.

Year 2000 Compliance

    The  Company  recognizes  that the  arrival of the Year 2000 poses a unique
worldwide  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 been
assessing  and  updating its computer  applications  and business  processes to
ensure their continued functionality.

    The Year 2000  compliance  effort is underway  across the  Company,  and is
following a process of  assessment,  modification  and testing.  At the present
time, the necessary  modifications  to the  day-to-day  operating and reporting
systems  for  all  theaters  (both  those  in  the  US and  abroad)  have  been
successfully  completed  to ensure Year 2000  compliance.  With  respect to the
financial reporting and operational  databases associated with the US Corporate
office  and  the  various   International   Corporate  offices,  the  necessary
modifications  to ensure Year 2000  compliance  are expected to be completed by
December  31,  1998 and June 30,  1999,  respectively.  The costs to modify the
existing  systems to ensure Year 2000  compliance  are expected to be less than
$.1 million at the completion of the project.

    Since the core  business of the Company  centers  around the  collection of
cash at the theater box office,  an  unanticipated  Year 2000 computer  failure
should not have an adverse  impact on the  Company's  ability to continue  with
day-to-day  operations.  The  impact  from a system  failure  from a  practical
standpoint should only affect the financial reporting and operational  analysis
that is presently  performed at the Corporate  office.  In the most  reasonably
likely worst case  scenario,  the Company  could  return to a manual  system of
recording daily admissions revenues from a day-to-day operating standpoint.


                                       11
<PAGE>

    The Company operates a large number of  geographically  dispersed  theaters
and has a large  supplier base and believes that this will mitigate any adverse
impact.  The Company has initiated formal  communications  with its significant
suppliers, customers, and critical business partners to determine the extent to
which the Company may be  vulnerable  in the event that those  parties  fail to
properly  remediate their own Year 2000 issues.  The Company has taken steps to
monitor the progress made by those parties, and intends to test critical system
interfaces,  as the Year 2000 approaches.  The Company will develop appropriate
contingency  plans in the  event  that a  significant  exposure  is  identified
relative to the dependencies on third-party  systems.  While the company is not
presently  aware of any such  significant  exposure,  there can be no guarantee
that the systems of third-parties on which the Company relies will be converted
in a timely  manner,  or that  failure to properly  convert by another  Company
would not have a material adverse effect on the Company.

    The Company is in process of formulating its contingency  plan for the Year
2000 compliance issue and anticipates a completion date of 1999.

    The Company simultaneously purchased a new Year  2000  compliant  financial
reporting  and  distribution  system that it expect to go live with sometime in
1999.  The  decision  to  purchase  this new  system  at a cost of more than $1
million was made by management in order to  effectively  handle the  increasing
financial  reporting and analysis  needs of the Company in the years to come as
the Company continues at its rapid growth rate.

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 theater
strategy.  Actual results could differ  materially from those indicated by such
forward-looking statements due to a number of factors.




                                       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 September 30, 1998

                    Condensed Consolidating Statement of
                    Income (unaudited) for the nine months
                    ended September 30, 1998

                    Condensed  Consolidating Statement of Cash Flow (unaudited)
                    for the nine months ended September 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 SEPTEMBER 30, 1998
                                   (Unaudited)


                                                           Restricted           Unrestricted
                                                          Subsidiaries          Subsidiaries        Eliminations        TOTAL
                                     ASSETS
<S>                                                          <C>              <C>                <C>                <C>
CURRENT ASSETS:
   Cash and cash equivalents                                    $15,393,861      $5,216,253                --        $20,610,114
   Temporary cash investments                                            --         341,156                --            341,156
   Inventories                                                    1,820,942       1,384,465                --          3,205,407
   Receivables from affiliates and other                         24,541,172      31,344,406       (20,044,883)        35,840,695
                                                      ---------------------------------------------------------------------------
      Total current assets                                       41,755,975      38,286,280       (20,044,883)        59,997,372

THEATER PROPERTIES AND EQUIPMENT                                673,719,546     112,572,926                --        786,292,472
   Less accumulated depreciation and amortization              (109,666,120)     (8,436,684)               --       (118,102,804)
                                                      ---------------------------------------------------------------------------
      Theater properties and equipment - net                    564,053,426     104,136,242                --        668,189,668
OTHER ASSETS:
   Certificates of deposit                                        2,365,537         940,171                --          3,305,708
   Investments in and advances to affiliates                     76,440,688      17,200,366       (72,531,568)        21,109,486
   Intangible assets - net                                        5,935,597              --                --          5,935,597
   Deferred charges and other - net                              17,401,258       4,901,428                --         22,302,686
                                                      ---------------------------------------------------------------------------
      Total other assets                                        102,143,080      23,041,965       (72,531,568)        52,653,477
                                                      ---------------------------------------------------------------------------
      TOTAL                                                    $707,952,481    $165,464,487      ($92,576,451)      $780,840,517
                                                      ===========================================================================

                      LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
   Current portion of long-term debt                               $333,006        $743,336                --         $1,076,342
   Accounts payable and accrued expenses                         56,530,836      33,464,297       (22,509,073)        67,486,060
                                                      ---------------------------------------------------------------------------
      Total current liabilities                                  56,863,842      34,207,633       (22,509,073)        68,562,402
LONG-TERM LIABILITIES:
   Senior credit agreement                                      143,936,357      30,000,000                --        173,936,357
   Senior subordinated notes - Cinemark USA, Inc.               380,280,324              --                --        380,280,324
   Deferred lease expenses                                       13,357,168         873,791                --         14,230,959
   Deferred gain and other                                        6,600,563       1,551,559                --          8,152,122
   Deferred income taxes                                         19,180,172         618,206                --         19,798,378
                                                      ----------------------------------------------------------------------------
      Total long-term liabilities                               563,354,584      33,043,556                --        596,398,140

MINORITY INTERESTS IN SUBSIDIARIES                                6,010,078      28,145,920                --         34,155,998
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                         (1,717,725)          2,520            (2,520)        (1,717,725)
   Retained earnings (deficit)                                   65,998,410      (3,739,116)        3,739,116         65,998,410
   Treasury stock, 57,211 Class B shares                        (24,198,890)             --                --        (24,198,890)
   Cumulative foreign currency translation adjustment           (18,943,262)    (18,170,906)       18,170,906        (18,943,262)
                                                      ----------------------------------------------------------------------------
      Total shareholders' equity                                 81,723,977      70,067,378       (70,067,378)        81,723,977
                                                      ----------------------------------------------------------------------------
      TOTAL                                                    $707,952,481    $165,464,487      ($92,576,451)      $780,840,517
                                                      ============================================================================
</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 NINE MONTHS ENDED SEPTEMBER 30, 1998
                                   (Unaudited)




                                                      Restricted           Unrestricted
                                                     Subsidiaries          Subsidiaries        Eliminations           TOTAL
<S>                                                 <C>                    <C>                <C>                <C>

REVENUES:
   Admissions                                         $225,017,193           $40,348,864                --         $265,366,057
   Concessions                                         123,755,428            18,107,811                --         $141,863,239
   Other                                                11,708,927             2,192,424        (1,309,838)         $12,591,513
                                                    ----------------------------------------------------------------------------
      Total                                            360,481,548            60,649,099        (1,309,838)        $419,820,809

COSTS AND EXPENSES:
   Cost of operations:
     Film rentals                                      113,263,603            18,641,437                --          131,905,040
     Concession supplies                                17,003,036             5,919,576                --           22,922,612
     Salaries and wages                                 44,649,354             5,523,343                --           50,172,697
     Facility leases                                    38,297,969             5,982,380                --           44,280,349
     Advertising                                         8,332,369             2,229,802                --           10,562,171
     Utilities and other                                46,117,294             8,623,297                --           54,740,591
                                                    ----------------------------------------------------------------------------
      Total                                            267,663,625            46,919,835                --          314,583,460
   General and administrative expenses                  18,908,048             5,799,944        (1,309,838)          23,398,154
   Depreciation and amortization                        21,142,216             4,352,976                --           25,495,192
                                                    ----------------------------------------------------------------------------
      Total                                            307,713,889            57,072,755        (1,309,838)         363,476,806
                                                    ----------------------------------------------------------------------------
OPERATING INCOME                                        52,767,659             3,576,344                --           56,344,003

OTHER INCOME (EXPENSE):
   Interest expense                                    (27,025,595)           (2,454,641)               --          (29,480,236)
   Amortization of debt issue costs                       (483,036)              (46,875)               --             (529,911)
   Amortization of debt discount/premium                  (122,542)                   --                --             (122,542)
   Interest Income                                         940,501             1,587,010                --            2,527,511
   Other gains (losses)                                  1,017,403                42,775                --            1,060,178
   Foreign currency exchange loss                               --            (1,098,791)               --           (1,098,791)
   Minority interests                                     (267,887)              683,521                --              415,634
   Equity in income of affiliates                        3,323,150             1,305,940        (3,428,334)           1,200,756
                                                   ------------------------------------------------------------------------------
      Total                                            (22,618,006)               18,939        (3,428,334)         (26,027,401)
                                                   ------------------------------------------------------------------------------

INCOME BEFORE INCOME TAXES                              30,149,653             3,595,283        (3,428,334)          30,316,602

INCOME TAXES                                            11,247,931               166,949                --           11,414,880
                                                   ------------------------------------------------------------------------------

NET INCOME                                             $18,901,722            $3,428,334       ($3,428,334)         $18,901,722
                                                   ==============================================================================
</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 NINE MONTHS ENDED SEPTEMBER 30, 1998
                                   (UNAUDITED)




                                                                  Restricted        Unrestricted
                                                                  Subsidiaries      Subsidiaries     Eliminations      TOTAL
<S>                                                               <C>               <C>            <C>             <C>
OPERATIONS:
Net income                                                           $18,901,722       $3,428,334    ($3,428,334)    $18,901,722
Noncash items in net income:
   Depreciation                                                       20,032,602        4,352,976             --      24,385,578
   Amortization                                                          736,102          373,512             --       1,109,614
   Deferred lease expenses                                               887,038          279,291             --       1,166,329
   Deferred income tax benefit                                         8,243,144          618,205             --       8,861,349
   Amortization of debt discount and premiums                            605,578           46,875             --         652,453
   Amortized compensation - stock option                                 663,066               --             --         663,066
   Equity in income (loss) of affiliate                               (3,323,150)      (1,305,940)     3,428,334      (1,200,756)
   Minority interests                                                    267,887         (683,521)            --        (415,634)
   Other gains                                                        (1,017,403)       1,056,016             --          38,613
Cash from(used for) operating working capital:                                --               --             --              --
   Inventories                                                          (178,087)        (793,089)            --        (971,176)
   Tax and other receivables                                         (15,381,030)      10,876,216             --      (4,504,814)
   Accounts payable and accrued expenses                             (13,346,322)       3,718,355             --      (9,627,967)
                                                           -----------------------------------------------------------------------

      Net cash from (used for) operations                             17,091,147       21,967,230             --      39,058,377

INVESTING ACTIVITIES:
   Additions to theatre properties                                  (238,016,177)     (46,639,831)            --    (284,656,008)
   Sale of theatre properties                                        133,802,332               --             --     133,802,332
   Decrease (increase) in deferred issue costs and other assets        1,925,262       (6,002,473)            --      (4,077,211)
   Decrease (increase) in advances to affiliates                         512,598        3,509,792             --       4,022,390
                                                           -----------------------------------------------------------------------

      Net cash used for investing activities                        (101,775,985)     (49,132,512)            --    (150,908,497)

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                                        190,963,576        1,432,563             --     192,396,139
   Minority investment in subsidiaries, net                            5,335,259        2,503,812             --       7,839,071
   Decrease in theatre development advance                                    --               --             --              --
   Cinemark USA investment in Cinemark International                          --               --             --              --
      Net cash from financing activities                              96,802,498        3,936,375             --     100,738,873

Effect of exchange rate changes on cash                                  (67,019)              --             --         (67,019)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                      12,050,641      (23,228,907)            --     (11,178,266)
CASH AND CASH EQUIVALENTS:                                                    --               --             --              --
   Beginning of period                                                 3,343,220       28,445,160             --      31,788,380
                                                           ----------------------------------------------------------------------

   End of period                                                      15,393,861       $5,216,253             --     $20,610,114
                                                           ======================================================================
SUPPLEMENTAL INFORMATION:
  Cash paid for interest                                             $36,172,819       $1,625,049             --     $37,797,868
                                                           =====================================================================
  Cash paid for income taxes                                          $3,750,500               --             --      $3,750,500
                                                           ======================================================================
</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:     November 12, 1998


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





































                                       17