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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit files). Yes☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of April ~~30, 2021, 119,541,047~~29, 2022, 120,449,483 shares of common stock were issued and outstanding.

Certain matters within this Quarterly Report on Form 10Q include “forward–looking statements” within the meaning of ~~Section 27A~~the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of ~~1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.~~1995. The “forward-looking statements” may include our current expectations, assumptions, estimates and projections about our business and our industry. They may include statements relating to to:

Forward-looking statements can be identified by the use of words such as “may,” “should,” “could,” “estimates,” “predicts,” “potential,” “continue,” “anticipates,” “believes,” “plans,” “expects,” “future” and “intends” and similar expressions. Forward-looking statements may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statements. These statements are ~~not~~neither historical facts nor guarantees of future ~~performance~~performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions and are, therefore, subject to risks, inherent uncertainties and other factors, some of which are beyond our control and difficult to predict, including, among others, the impacts of ~~COVID-19.~~the COVID-19 pandemic. Such risks and uncertainties could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. For a description of the risk factors, please review the “Risk Factors” section or other sections of, or incorporated by reference to, ~~the Company’s~~ Cinemark Holdings, Inc.'s Annual Report on Form 10-K filed February ~~26, 2021~~ ~~and the Current Report on Form 8-K filed March 4, 2021~~.25, 2022. All forward-looking statements are expressly qualified in their entirety by such risk factors. We undertake no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Unless the context otherwise requires, all references to “we,” “our,” “us,” “the issuer”, “the Company” or “Cinemark” relate to Cinemark Holdings, Inc. and its consolidated subsidiaries. All references to Latin America are to Brazil, Argentina, Chile, Colombia, Peru, Ecuador, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, Guatemala, Bolivia, Curacao and Paraguay.

The accompanying notes are an integral part of the condensed consolidated financial statements.

The Company and its subsidiaries operate in the motion picture exhibition industry, with theatres in the United States (“U.S.”), Brazil, Argentina, Chile, Colombia, Peru, Ecuador, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, Guatemala, Bolivia, Curacao and Paraguay.

The accompanying condensed consolidated balance sheet as of December 31, ~~2020,~~2021, which was derived from audited financial statements, and the unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete consolidated financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from these estimates. Majority-owned subsidiaries of which the Company has control are consolidated while those affiliates of which the Company owns between ~~20%~~20% and ~~50%~~50% and does not control are accounted for under the equity method. Those affiliates of which the Company owns less than ~~20%~~20% are generally accounted for under the cost method, unless the Company is deemed to have the ability to exercise significant influence over the affiliate, in which case the Company would account for its investment under the equity method. TheThe results of these subsidiaries and affiliates are included in the condensed consolidated financial statements effective with their formation or from their dates of acquisition. Intercompany balances and transactions are eliminated in consolidation.

These condensed consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and the notes thereto for the year ended December 31, ~~2020,~~2021, included in the Annual Report on Form 10-K filed February ~~26, 2021~~25, 2022 by the Company under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Operating results for the three months ended March 31, ~~2021~~2022 are not necessarily indicative of the results to be achieved for the full year.

Amounts included in the condensed consolidated financial statements of this Quarterly Report on Form 10-Q are rounded in millions. The amounts reported in the consolidated financial statements, and the notes thereto, of the Annual Report on Form 10-K for the year ended December 31, 2021 filed February 25, 2022 are rounded in thousands.

During June 2020, Company management approved and announced a restructuring plan to realign its operations to create a more efficient cost structure (referred to herein as the “Restructuring Plan”). in response to the COVID-19 pandemic. The Restructuring Plan primarily included a ~~permanent~~ headcount reduction at its domestic corporate office and the permanent closure of certain domestic and international theatres. The ~~following table summarizes activity recorded~~Company paid approximately $0.5 related to previously accrued restructuring costs during the three months ended March 31, ~~2021:~~

2022. The remaining accrued restructuring costs of ~~$6,183~~$1.0, which are primarily related to facility closure costs, are reflected in accounts payable and accrued expenses on the condensed consolidated balance sheet as of March 31, ~~2021.~~ 2022.

Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, (“ASU 2020-04”) and ASU 2021-01, Reference Rate Reform (Topic 848): Scope, (“ASU 2021-01”). The purpose of ASU 2020-04 is to provide optional guidance for a limited period of time to ease the potential burden in accounting for ~~(or~~

(or recognizing the effects of) reference rate reform on financial reporting. More specifically, the amendments in ASU 2020-04 provide optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in ASU 2021-01 clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The amendments in ASU 2020-04 and ASU 2021-01 are effective as of March 12, 2020 through December 31, 2022. The Company ~~is evaluating the impact of~~does not expect ASU 2020-04 and ASU 2021-01 ~~and their~~to have a material impact on its condensed consolidated financial statements.

ASU ~~2020-06,~~ 2021-10, ~~Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity~~Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance, (“ASU ~~2020-06”~~2021-10”). ~~In August 2020,~~The purpose of ASU 2021-10 is to provide annual disclosure guidance about transactions with a government for which the ~~FASB issued~~entity is applying a grant or contribution accounting model by analogy. More specifically, the amendments in ASU ~~2020-06, which simplifies~~2021-10 require disclosure of a) the ~~guidance~~nature of the transactions and the related accounting policy used to account for the transactions, b) the line items on the ~~issuer’s accounting~~balance sheet and income statement, including the amounts applicable to each line item, that are affected by the transactions and c) significant terms and conditions of the transactions, including commitments and contingencies. The amendments in ASU 2021-10 are effective for ~~convertible debt. The provisions of ASU 2020-06 are applicable for fiscal years~~annual periods beginning after December 15, ~~2021, with early adoption permitted no earlier than fiscal years beginning~~2021. The amendments in ASU 2021-10 should be applied either a) prospectively to all transactions at the date of initial application and new transactions that are entered into after ~~December 15, 2020.~~the date of initial application or b) retrospectively to those transactions. The Company ~~elected to adopt~~will provide the disclosures required by ASU ~~2020-06 effective January 1, 2021. See discussion of~~2021-10 in its Form 10-K for the ~~impact of adoption at Note 7.~~year ended December 31, 2022.

Upon the temporary closure of theatres in March 2020, the Company ~~initiated discussions with landlords to negotiate~~began negotiating the deferral of rent and other lease-related payments with ~~certain of~~ its ~~landlords. The~~landlords while theatres remained closed. These discussions and negotiations have remained ongoing as the Company continues to be impacted by the COVID-19 pandemic. These negotiations resulted in amendments ~~signed with~~to the ~~landlords~~leases that involve varying concessions, including the abatement of rent payments during closure, deferral of all or a portion of rent payments to later periods and deferrals of rent payments ~~to later periods~~ combined with an early exercise of an existing renewal option or extension of the lease term. ~~In some cases, the Company is entitled to rent-free periods while theatres remain closed in certain locations due to local regulations.~~ Total remaining deferred payments ~~deferred~~ as of March 31, 2022 and December 31, 2021 were ~~$65,203, of which $48,287 is~~$22.1 and $31.9, respectively, and are included in accounts payable and accrued expenses ~~and $16,915 is included in other long-term liabilities~~ in the condensed consolidated balance ~~sheet.~~sheets.

In April 2020, the FASB staff released guidance indicating that in response to the COVID-19 crisis, an entity would not have to analyze each contract to determine whether enforceable rights and obligations for concessions exist in the contract and can elect to apply or not apply the lease modification guidance in Topic 842 to those contracts. The election is available for concessions related to the effects of the COVID-19 pandemic that do not result in a substantial increase in the rights of the lessor or the obligations of the lessee. For example, this election is available for concessions that result in the total payments required by the modified contract being substantially the same as or less than total payments required by the original contract.

The following table represents the minimum cash lease payments ~~recorded as lease expense, interest expense and a reduction~~included in the measurement of lease liabilities ~~as well as~~and the non-cash addition of lease right-of-use assets for the periods ~~indicated.~~presented.

As of March 31, ~~2021,~~2022, the Company had signed lease agreements with total noncancelable lease payments of approximately ~~$183,689~~$90.8 related to theatre leases that had not yet commenced. The timing of lease commencement is dependent on the completion of construction of the related theatre facility. Additionally, these amounts are based on estimated square footage and costs to construct each facility and may be subject to adjustment upon final completion of each construction project. In accordance with ASC Topic 842, fixed minimum lease payments related to these theatres are not included in the right-of-use assets and lease liabilities as of March 31, ~~2021.~~2022.

The Company’s patrons have the option to purchase movie tickets well in advance of a movie showtime or right before the movie showtime, or at any point in between those two timeframes depending on seat availability. The Company recognizes such admissions ~~revenues~~revenue when the showtime for a purchased movie ticket has passed. Concession ~~revenues are~~revenue is recognized when products are sold to the consumer. Other revenues primarily consist of screen advertising and screen rental revenues, promotional income,

studio trailer placements and transactional fees. Except for National CineMedia, LLC. ("NCM") screen advertising advances discussed below in Note 9, these revenues are generally recognized when the Company has performed the related services. The Company sells gift cards and discount ticket vouchers, the proceeds from which are recorded as deferred ~~revenues.~~revenue. Deferred ~~revenues~~revenue for gift cards and discount ticket vouchers ~~are~~is recognized when they are redeemed for concession items or, if redeemed for movie tickets, when the showtime has passed. The Company generally records breakage revenue on gift cards and discount ticket vouchers based on redemption activity and historical experience with unused balances. The Company offers a subscription program in the U.S. whereby patrons can pay a monthly or annual fee to receive a monthly credit for use towards a future movie ticket purchase. The Company records the ~~monthly~~ subscription program fees as deferred ~~revenues~~revenue and records admissions ~~revenues~~revenue when the showtime for a movie ticket purchased with a credit has passed. The Company has loyalty programs in the U.S. and many of its international locations that either have a prepaid annual ~~membership~~ fee or award points to customers as purchases are made. For those loyalty programs that have ana prepaid annual ~~membership~~ fee, the Company recognizes the fee collected as other ~~revenues~~revenue on a straight-line ~~basis over the term of the membership.~~basis. For those loyalty programs that award points to customers based on their purchases, the Company records a portion of the original transaction proceeds as deferred ~~revenues~~revenue based on the number of reward points issued to customers and recognizes the deferred ~~revenues~~revenue when the customer redeems such points. The value of loyalty points issued is based on the estimated fair value of the rewards offered. The Company ~~generally~~ records breakage revenue on ~~gift cards~~its loyalty and ~~discount ticket vouchers based on redemption activity and historical experience with unused balances. The Company also records breakage revenue~~subscription programs generally upon the expiration of loyalty points ~~and~~or subscription credits. Advances collected on ~~concession and~~ other contracts are deferred and recognized during the period in which the Company satisfies the related performance obligations, which may differ from the period in which the advances are collected.

Accounts receivable as of March 31, ~~2021~~2022 and December 31, ~~2020~~2021 included approximately ~~$6,484~~$22.6 and ~~$6,232~~$23.5 respectively, of receivables ~~respectively,~~ related to contracts with customers. The Company did 0t0t record any assets related to the costs to obtain or fulfill a contract with customers during the three months ended March 31, ~~2021 or March 31, 2020.~~2022.

Long Term Debt

Long-term debt consisted of the following for the periods presented:


	March 31,		December 31,
	2022		2021
Cinemark Holdings, Inc. 4.500% convertible senior notes due 2025	$	460.0	$	460.0
Cinemark USA, Inc. term loan due 2025		631.5		633.1
Cinemark USA, Inc. 8.750% senior secured notes due 2025		250.0		250.0
Cinemark USA, Inc. 5.875% senior notes due 2026		405.0		405.0
Cinemark USA, Inc. 5.250% senior notes due 2028		765.0		765.0
Other		32.4		30.2
Total carrying value of long-term debt	$	2,543.9	$	2,543.3
Less: Current portion		27.2		24.3
Less: Debt issuance costs, net of accumulated amortization		40.1		42.7
Long-term debt, less current portion, net of unamortized debt issuance costs	$	2,476.6	$	2,476.3

~~Long Term Debt Activity~~

Senior Secured Credit Facility

Cinemark USA, Inc. has a senior secured credit facility that includes a ~~$700,000~~$700.0 term loan and a ~~$100,000~~$100.0 revolving credit line (the “Credit Agreement”). As of March 31, ~~2021,~~2022, there was ~~$638,083~~$631.5 outstanding under the term loan and 0 borrowings were outstanding under the revolving credit line. As of March 31, ~~2021, $100,000~~2022, $100.0 was available for borrowing under the revolving credit line. Quarterly principal payments of ~~$1,649~~$1.6 are due on the term loan through December 31, 2024, with a final principal payment of ~~$613,351~~$613.4 due on March 29, ~~2025.~~2025. The revolving credit line matures on November 28, ~~2022.~~2024. The average interest rate applicable to outstanding term loan borrowings under the Credit Agreement atas of March 31, ~~2021~~2022 was approximately ~~3.4%~~3.4% per annum, after giving effect to the interest rate swap agreements discussed below.

On April 17, 2020, in conjunction with the issuance of the 8.750% Secured Notes discussed below, the Company obtained a waiver of the leverage covenant. The leverage covenant applies when amounts are outstanding under the revolving line of credit under the Credit Agreement for the fiscal quarters ending September 30, 2020 and December 31, 2020.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~In thousands,~~(in millions, except ~~share and~~ per share ~~data~~

data)

On August 21, 2020, the Company further amended the waiver of the leverage covenant to extend through the fiscal quarter ending September 30, 2021. The amendment also (i) modifies the leverage covenant calculation beginning with the calculation for the trailing twelve-month period ended December 31, 2021, (ii) for purposes of testing the consolidated net senior secured leverage ratio for the fiscal quarters ending on December 31, 2021, March 31, 2022 and June 30, 2022, permits the Company to substitute Consolidated EBITDA for the first three fiscal quarters of 2019 in lieu of Consolidated EBITDA for the corresponding fiscal quarters of 2021, (iii) modifies the restrictions imposed by the covenant waiver, and (iv) makes such other changes to permit the issuance of the 4.50% Convertible Senior Notes discussed below.

~~5.875% Senior Notes~~

On March 16, 2021, Cinemark USA, Inc. issued $405,000 aggregate principal amount of 5.875% senior notes due 2026, at par value (the “5.875% Senior Notes”). Proceeds, after payment of fees, were used to fund a cash tender offer to purchase any and all of Cinemark USA’s 5.125% Senior Notes (the “5.125% Senior Notes”) and to redeem any of the 5.125% Senior Notes that remained outstanding after the tender offer. See further discussion of the tender offer below. Interest on the 5.875% Senior Notes is payable on March 15 and September 15 of each year, beginning September 15, 2021. The 5.875% Senior Notes mature on March 15, 2026. The Company incurred debt issue costs of approximately $5,980 in connection with the issuance, which are recorded as a reduction of long-term debt, less current on the consolidated balance sheet.

The 5.875% Senior Notes are fully and unconditionally guaranteed on a joint and several senior unsecured basis by certain of Cinemark USA, Inc.’s subsidiaries that guarantee, assume or become liable with respect to any of Cinemark USA, Inc.’s or a guarantor’s debt. The 5.875% Senior Notes and the guarantees are senior unsecured obligations and rank equally in right of payment with all of Cinemark USA, Inc.’s and its guarantor’s existing and future senior debt and are senior in right of payment to all of Cinemark USA, Inc.’s and its guarantors’ existing and future senior subordinated debt. The 5.875% Senior Notes and the guarantees are effectively subordinated to all of Cinemark USA, Inc.’s and its guarantor’s existing and future secured debt to the extent of the value of the collateral securing such debt, including all borrowings under Cinemark USA, Inc.’s amended senior secured credit facility. The 5.875% Senior Notes and the guarantees are structurally subordinated to all existing and future debt and other liabilities of Cinemark USA, Inc.’s subsidiaries that do not guarantee the 5.875% Senior Notes.

The indenture to the 5.875% Senior Notes contains covenants that limit, among other things, the ability of Cinemark USA, Inc. and certain of its subsidiaries to (1) make investments or other restricted payments, including paying dividends, making other distributions or repurchasing subordinated debt or equity, (2) incur additional indebtedness and issue preferred stock, (3) enter into transactions with affiliates, (4) enter new lines of business, (5) merge or consolidate with, or sell all or substantially all of its assets to, another person and (6) create liens. Upon a change of control, as defined in the indenture, the Company would be required to make an offer to repurchase the 5.875% Senior Notes at a price equal to 101% of the aggregate principal amount outstanding plus accrued and unpaid interest, if any, through the date of repurchase. The indenture governing the 5.875% Senior Notes allows Cinemark USA, Inc. to incur additional indebtedness if we satisfy the coverage ratio specified in the indenture, after giving effect to the incurrence of the additional indebtedness, and in certain other circumstances.

Prior to March 15, 2023, Cinemark USA, Inc. may redeem all or any part of the 5.875% Senior Notes at its option at 100% of the principal amount plus a make-whole premium plus accrued and unpaid interest on the 5.875% Senior Notes to the date of redemption. After March 15, 2023, Cinemark USA, Inc. may redeem the 5.875% Senior Notes in whole or in part at redemption prices specified in the indenture. In addition, prior to March 15, 2023, Cinemark USA, Inc. may redeem up to 40% of the aggregate principal amount of the 5.875% Senior Notes from the net proceeds of certain equity offerings at the redemption price set forth in the indenture.

~~5.125% Senior Notes~~

On March 16, 2021, Cinemark USA, Inc. completed a tender offer to purchase its previously outstanding 5.125% Senior Notes, of which $333,990 was tendered at the expiration of the offer. On March 16, 2021, Cinemark USA, Inc. also issued a notice of optional redemption to redeem the remaining $66,010 principal amount of the 5.125% Senior Notes. In connection therewith, Cinemark USA deposited with Wells Fargo Bank, N.A., as Trustee for the 5.125% Senior Notes (the “Trustee”), funds sufficient to redeem all 5.125% Notes remaining outstanding on April 15, 2021 (the “Redemption Date”). The redemption payment (the “Redemption Payment”) included $66,010 of outstanding principal at the redemption price equal to 100.000% of the principal amount plus accrued and unpaid interest thereon to the Redemption Date. Upon deposit of the Redemption Payment with the Trustee on March 16, 2021, the indenture governing the 5.125% Senior Notes was fully satisfied and discharged.

The Company recorded a loss on extinguishment of debt of $2,603 during the three months ended March 31, 2021, which included the write-off of $1,168 unamortized debt issuance costs and the payment of $1,435 in fees.

~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In thousands, except share and per share data~~

~~Additional Borrowings of International Subsidiaries~~

~~During the three months ended March 31, 2021, certain of the Company’s international subsidiaries borrowed an aggregate of $9,012 under various local bank loans. Below is a summary of these loans:~~

Loan Amounts

Loan Description

(in USD)

Interest Rates

Covenants

Maturity
Peru bank loan

$
3,277

4.8%

Negative covenants

January 2024
Brazil bank loan

$
5,735

4.0%

Negative covenants

January 2029

Additionally, the Company deposited cash into a collateral account to support the issuance of bank letters of credit to the lenders for the international loans noted above. The total amount deposited during the three months ended March 31, 2021 was $7,300. Total deposits made to support bank letters of credit for the Company’s outstanding international loans is $21,147 and is considered restricted cash as of March 31, 2021.

Interest Rate Swap Agreements

Below is a summary of the Company’s interest rate swap agreements, which are designated as cash flow hedges, as of March 31, ~~2021:~~2022:


						Estimated
						Fair Value at
Notional						March 31,
Amount		Effective Date	Pay Rate	Receive Rate	Expiration Date	2022 (1)
$	137.5	December 31, 2018	2.12%	1-Month LIBOR	December 31, 2024	$	1.3
$	175.0	December 31, 2018	2.12%	1-Month LIBOR	December 31, 2024		1.6
$	137.5	December 31, 2018	2.19%	1-Month LIBOR	December 31, 2024		1.0
					Total	$	3.9

Estimated

Fair Value at

Notional

March 31,

Amount

Effective Date

Pay Rate

Receive Rate

Expiration Date

2021 ⁽¹⁾

$
137,500

December 31, 2018

2.12%

1-Month LIBOR

December 31, 2024

$
7,567

$
175,000

December 31, 2018

2.12%

1-Month LIBOR

December 31, 2024

9,687

$
137,500

December 31, 2018

2.19%

1-Month LIBOR

December 31, 2024

8,003

$
150,000

March 31, 2020

0.57%

1-Month LIBOR

March 31, 2022

642

Total

$
25,899

(1)

Approximately $(1.7) of the total is included in accounts payable and accrued expenses and $5.6 is included in deferred charges and other assets, net on the condensed consolidated balance sheet as of March 31, 2022.

~~(1)~~

Approximately $9,786 of the total is included in accounts payable and accrued expenses and $16,113 is included in other long-term liabilities on the condensed consolidated balance sheet as of March 31, 2021.

Effective March 31, 2020, the Company amended and extended its 3 then existing interest rate swap agreements and entered into a fourth interest rate swap agreement, all of which are used to hedge a portion of the interest rate risk associated with the variable interest rates on the Company’s term loan debt and qualify for cash flow hedge accounting. Upon amending the interest rate swap agreements effective March ~~31,2020,~~31, 2020, the Company determined that the interest payments hedged with the agreements are still probable to occur, therefore the loss that accumulated on the swaps prior to the amendments of ~~$29,359~~$29.4 is being amortized to interest expense through December 31, 2022, the original maturity dates of the swaps. Approximately ~~$1,124~~$1.1 was recorded in ~~amortization of accumulated losses for amended swaps~~interest expense in the condensed consolidated income statement for the three months ended March 31, ~~2021, respectively.~~2022 and the three months ended March 31, 2021.

The fair values of the ~~amended~~ interest rate swaps ~~and the new interest rate swap~~ are recorded on the Company’s condensed consolidated balance ~~sheet~~sheets as an asset or liability with the related gains or losses reported as a component of accumulated other comprehensive loss. The changes in fair value are reclassified from accumulated other comprehensive loss into earnings in the same period that the hedged items affect earnings. The valuation technique used to determine fair value is the income ~~approach. Under~~approach and, under this approach, the Company uses projected future interest rates ~~which fall in Level 2 of the U.S. GAAP hierarchy as defined by FASB ASC Topic 820-10-35,~~ as provided by counterparties to the interest rate swap agreements and the fixed rates that the Company is obligated to pay under the ~~agreements.~~

~~Adoption~~agreement. Therefore, the Company’s measurements use significant unobservable inputs, which fall in Level 2 of the U.S. GAAP hierarchy as defined by FASB ASC Topic 820-10-35. The Company is assessing the impact of reference rate reform, as well as the impact of ASU ~~2020-06~~

2020-04 and ASU ~~2020-06 simplifies~~2021-01, on the guidance on an issuer’s accounting for convertible debt instruments by removing the separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature. As a result, entities will not separately present in equity an embedded conversion feature of such debt. Instead, they will account for a convertible debt instrument wholly as debt, unless certain other conditions are met. The elimination of these models reduces reportedCompany's interest expense and increases reported net income for entities that have issued a convertible instrument within the scope of those models before the adoption of ASU 2020-06. Also, ASU 2020-06 requires the application of the if-converted method for calculating diluted earnings per share and the treasury stock method is no longer available. The provisions of ASU 2020-06 are applicable for fiscal years beginning after December 15, 2021, with early adoption permitted no earlier than fiscal years beginning after December 15, 2020.

~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In thousands, except share and per share data~~

rate swaps. See further discussion at Note 3.

The Company adopted ASU 2020-06 under the modified retrospective method effective January 1, 2021. As a result of the adoption, the entire $460,000 principal balance of the 4.50% Convertible Senior Notes are recorded in long-term debt and is no longer bifurcated between long-term debt and equity. The impact of the adoption is as follows:

•

~~Reclassified $101,123 previously allocated to the cash conversion feature and recorded in equity, from equity to long term debt on the condensed consolidated balance sheet.~~

•

~~Reversed the accretion of interest of $5,714 on the 4.50% Convertible Senior Notes recorded during the year ended December 31, 2020 with a credit to retained earnings.~~

•

~~Reclassified $3,764 of debt issue costs previously allocated to equity to long-term debt on the condensed consolidated balance sheet.~~

•

~~Recorded offsetting amortization of debt issue costs of $274 as an adjustment to retained earnings on the condensed consolidated balance sheet.~~

Fair Value of Long-Term Debt

The Company estimates the fair value of its long-term debt primarily using ~~the market approach, which utilizes~~ quoted market prices, ~~that~~which fall under Level 2 of the U.S. GAAP fair value hierarchy as defined by ASC 820, Fair Value Measurement (“ASC Topic 820”).The table below presents the carrying value and fair value of the Company's long-term debt as of the periods presented:


	As of
	March 31, 2022		December 31, 2021
Carrying value (1)	$	2,543.9	$	2,543.3
Fair value (2)	$	2,678.3	$	2,749.8

(1)

The carrying value excludes unamortized debt issuance costs.

(2)

Includes the fair value of the ~~Company’s long-term debt, excluding unamortized debt discounts~~4.500% convertible senior notes of $684.5 and ~~debt issue costs, was $2,538,135 and $2,527,900~~$691.9 as of March 31, ~~2021~~2022 and December 31, ~~2020,~~2021, respectively. ~~The fair value of the Company’s long-term debt was $2,846,837 and $2,652,635 as of March 31, 2021 and December 31, 2020, respectively.~~

8. ~~Equity~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

Equity

Below is a summary of changes in stockholders’ equity attributable to Cinemark Holdings, Inc., noncontrolling interests and total equity for the three months ended March 31, ~~2021~~2022 and ~~2020:~~2021:

Common Stock

Treasury Stock

Additional Paid-In-Capital

Retained Earnings (Deficit)

Accumulated Other Comprehensive Loss

Total Cinemark Holdings, Inc. Stockholders’ Equity

Noncontrolling Interests

Total Equity

Balance at January 1, 2021

$
124

$
(87,004
)
$
1,245,569

$
27,937

$
(398,653
)
$
787,973

$
10,996

$
798,969

Impact of adoption of ASU 2020-06, net of deferred taxes of $23,756 (See Note 7)

—

—

(73,604
)

5,440

—

(68,164
)

—

(68,164
)
Issuance of share based awards and share based awards compensation expense

—

—

4,668

—

—

4,668

—

4,668

Stock withholdings related to share based awards that vested during the three months ended March 31, 2021

—

(8
)

—

—

—

(8
)

—

(8
)
Dividends accrued on unvested restricted stock unit awards

—

—

—

(2
)

—

(2
)

—

(2
)
Net loss

—

—

—

(208,241
)

—

(208,241
)

(602
)

(208,843
)
Unrealized gain due to fair value adjustments on interest rate swap agreements, net of taxes, net of settlements

—

—

—

—

5,704

5,704

—

5,704

Amortization of accumulated losses for amended swap agreements

—

—

—

—

1,124

1,124

—

1,124

Foreign currency translation adjustments

—

—

—

—

(9,465
)

(9,465
)

—

(9,465
)
Balance at March 31, 2021

$
124

$
(87,012
)
$
1,176,633

$
(174,866
)
$
(401,290
)
$
513,589

$
10,394

$
523,983


	Common Stock		Treasury Stock			Additional Paid-In-Capital		Retained Earnings (Deficit)			Accumulated Other Comprehensive Loss			Total Cinemark Holdings, Inc. Stockholders’ Equity			Noncontrolling Interests		Total Equity
Balance at January 1, 2022	$	0.1	$	(91.1	)	$	1,197.8	$	(389.4	)	$	(394.5	)	$	322.9		$	11.6	$	334.5
Issuance of share based awards and share based awards compensation expense	—		—				5.1		—			—			5.1			—		5.1
Stock withholdings related to share based awards that vested during the three months ended March 31, 2022	—			(1.6	)		—		—			—			(1.6	)		—		(1.6	)
Net loss	—		—				—		(74.0	)		—			(74.0	)		1.5		(72.5	)
Unrealized gain due to fair value adjustments on interest rate swap agreements, net of taxes and settlements	—		—				—		—			18.4			18.4			—		18.4
Amortization of accumulated losses for amended swap agreements	—		—				—		—			1.1			1.1			—		1.1
Foreign currency translation adjustments	—		—				—		—			14.4			14.4			—		14.4
Balance at March 31, 2022	$	0.1	$	(92.7	)	$	1,202.9	$	(463.4	)	$	(360.6	)	$	286.3		$	13.1	$	299.4


	Common Stock		Treasury Stock			Additional Paid-In-Capital			Retained Earnings (Deficit)			Accumulated Other Comprehensive Loss			Total Cinemark Holdings, Inc. Stockholders’ Equity			Noncontrolling Interests			Total Equity
Balance at January 1, 2021	$	0.1	$	(87.0	)	$	1,245.6		$	27.9		$	(398.7	)	$	787.9		$	11.0		$	798.9
Impact of adoption of ASU 2020-06, net of deferred taxes of $23.8	—		—				(73.6	)		5.4		—				(68.2	)		—			(68.2	)
Issuance of share based awards and share based awards compensation expense	—		—				4.7		—			—				4.7			—			4.7
Net loss	—		—			—				(208.3	)		—			(208.3	)		(0.6	)		(208.9	)
Unrealized gain due to fair value adjustments on interest rate swap agreements, net of taxes and settlements	—		—			—			—				5.7			5.7			—			5.7
Amortization of accumulated losses for amended swap agreements	—		—			—			—				1.1			1.1			—			1.1
Foreign currency translation adjustments	—		—			—			—				(9.5	)		(9.5	)		—			(9.5	)
Balance at March 31, 2021	$	0.1	$	(87.0	)	$	1,176.7		$	(175.0	)	$	(401.4	)	$	513.4		$	10.4		$	523.8

1615

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~In thousands,~~(in millions, except ~~share and~~ per share ~~data~~data)

Common Stock

Treasury Stock

Additional Paid-In-Capital

Retained Earnings

Accumulated Other Comprehensive Loss

Total Cinemark Holdings, Inc. Stockholders’ Equity

Noncontrolling Interests

Total Equity

Balance at January 1, 2020

$
122

$
(81,567
)
$
1,170,039

$
687,332

$
(340,112
)
$
1,435,814

$
12,508

$
1,448,322

Issuance of share based awards and share based awards compensation expense

—

—

4,111

—

—

4,111

—

4,111

Stock withholdings related to share based awards that vested during the three months ended March 31, 2020

—

(2,691
)

—

—

—

(2,691
)

—

(2,691
)
Dividends paid to stockholders, $0.36 per common share ⁽¹⁾

—

—

—

(42,311
)

—

(42,311
)

—

(42,311
)
Dividends paid to noncontrolling interests

—

—

—

—

—

—

(392
)

(392
)
Dividends accrued on unvested restricted stock unit awards ⁽¹⁾

—

—

—

(256
)

—

(256
)

—

(256
)
Net income (loss)

—

—

—

(59,591
)

—

(59,591
)

169

(59,422
)
Unrealized loss due to fair value adjustments on interest rate swap agreements, net of taxes, net of settlements

—

—

—

—

(24,171
)

(24,171
)

—

(24,171
)
Foreign currency translation adjustments

—

—

—

—

(57,625
)

(57,625
)

—

(57,625
)
Balance at March 31, 2020

$
122

$
(84,258
)
$
1,174,150

$
585,174

$
(421,908
)
$
1,253,280

$
12,285

$
1,265,565

Investment in National CineMedia LLC

~~(1)~~

On March 20, 2020 the Company paid a $0.36 dividend per common share to stockholders of record on March 6, 2020. Additionally, the Company accrued dividends on outstanding unvested restricted stock units.

9.	~~Investment in National CineMedia LLC~~

Below is a summary of activity with NCM included in the Company’s condensed consolidated financial statements:


	Investment in NCM			NCM Screen Advertising Advances			Equity in Loss		Other Revenue			Interest Expense - NCM		Cash Received (2)
Balance as of January 1, 2022	$	135.4		$	(346.0	)
Screen rental revenues earned under ESA (1)		—			—		$	—	$	(4.2	)	$	—	$	4.2
Interest accrued related to significant financing component		—			(5.8	)		—		—			5.8		—
Equity in loss		(3.5	)		—			3.5		—			—		—
Amortization of screen advertising advances		—			8.0			—		(8.0	)		—		—
Balance as of and for the three months ended March 31, 2022	$	131.9		$	(343.8	)	$	3.5	$	(12.2	)	$	5.8	$	4.2

Investment
in NCM

NCM Screen Advertising Advances

Distributions
from NCM

Equity in
Loss

Other
Revenue

Interest
Expense - NCM

Cash Received

Balance as of January 1, 2021

$
151,962

$
(344,255
)

Screen rental revenues earned under ESA ⁽¹⁾

—

—

—

—

(855
)

—

855

Interest accrued related to significant financing component

—

(5,835
)

—

—

—

5,835

—

Receipt under tax receivable agreement

(156
)

—

(77
)

—

—

—

233

Equity in loss

(6,348
)

—

—

6,348

—

—

—

Amortization of screen advertising advances

—

7,850

—

—

(7,850
)

—

—

Balance as of and for the three months ended March 31, 2021

$
145,458

$
(342,240
)
$
(77
)
$
6,348

$
(8,705
)
$
5,835

$
1,088

(1)

Amounts include the per patron and per digital screen theatre access fees due to the Company, net of amounts due to NCM for on-screen advertising time provided to the Company’s beverage concessionaire of approximately $1.5.

(2)

The Company had a receivable from NCM of $6.2 as of March 31, 2022.

~~(1)~~

Investment in National CineMedia

NCM operates a digital in-theatre network in the U.S. for providing cinema advertising. The Company entered into an Exhibitor Services Agreement with NCM (“ESA”), pursuant to which NCM primarily provides advertising to our theatres. T~~he Company does not recognize undistributed equity~~ See Note 8 to the Company's Annual Report on Form 10-K filed February 25, 2022 for additional discussion of the Company's investment in NCM as well as the ~~earnings on~~accounting for its original NCM membership units (referred to herein as the Company’s Tranche 1 Investment) until NCM’s future net earnings, less distributions received, surpass the amount of the excess distribution. The Company recognizes equity in earnings on its Tranche 1 Investment only to the extent it receives cash distributions from NCM. The Company ~~recognizes cash distributions it receives from NCM on its Tranche 1 Investment as a component of earnings as Distributions from NCM.~~ ~~The Company believes that the accounting model provided by ASC Topic 323-10-35-22 for recognition of equity~~

~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In thousands, except share~~ and ~~per share data~~

subsequent common unit adjustments.

~~investee losses in excess of an investor’s basis is analogous to the accounting for equity income subsequent to recognizing an excess distribution.~~

Common Unit Adjustments

The Company also periodically receives consideration in the form of common units from NCM. Annual adjustments to the common membership units are made primarily based on increases or decreases in the number of theatre screens operated and theatre attendance generated. The common units received are recorded at estimated fair value as an increase in the Company’s investment in NCM with an offset to NCM screen advertising advances.

As of March 31, 2022, the Company owned a total of 43.2 common units of NCM representing an ownership interest of approximately 26%. Each of the Company’s common units in NCM is convertible into 1 share of National Cinemedia, Inc. ("NCM, Inc.") common stock. As of March 31, 2022, the estimated fair value of the Company’s investment in NCM was approximately $109.6 based on NCM, Inc.’s stock price as of March 31, 2022 of $2.54 per share (Level 1 input as defined in FASB ASC Topic 820). The estimated fair value was below the Company’s carrying value of $131.9. The Company believes the recent decline in NCMI’s stock price is a result of the continued impacts of the COVID-19 pandemic along with the market’s reaction to inflation and interest rate developments as well as global events. The Company continues to recover from the impacts of the COVID-19 pandemic, and the Company believes NCM will continue to recover as well, as new film content continues to be released on a consistent basis. Additionally, NCM, Inc.’s stock price was only below the Company's carrying value of NCM for less than two consecutive months as of March 31, 2022.

During March ~~2021,~~2022, NCM performed its annual common unit adjustment calculation under the Common Unit Adjustment Agreement. As a result of the calculation, the Company will receive an additional ~~2,311,482~~0.5 common units of NCM ~~each~~during the second quarter of ~~which is convertible into 1 share of NCMI common stock.~~2022. The Company will record the additional common units received in April 2022 at their estimated fair value with a corresponding adjustment to NCM screen advertising ~~advances when they are received in April 2021.~~advances.

As of March 31, 2021, the Company owned a total of 40,850,068 common units of NCM (excluding the common units to be received in April 2021 noted above), representing an ownership interest of approximately 25%. Each of the Company’s common units in NCM is convertible into 1 share of NCM, Inc. common stock. As of March 31, 2021, the estimated fair value of the Company’s investment in NCM was approximately $188,727 based on NCM, Inc.’s stock price as of March 31, 2021 of $4.62 per share (Level 1 input as defined in FASB ASC Topic 820).

Exhibitor Services Agreement

As discussed above, the Company’s domestic theatres are part of the in-theatre digital network operated by NCM, ~~under~~the terms of which are defined in the ESA. NCM provides advertising to ~~the Company’s~~its theatres through its branded “Noovie” pre-show entertainment program and also handles lobby promotions and displays for our theatres. The Company receives a monthly theatre access fee for participation in the NCM network and also earns screen advertising or screen rental revenue on a per patron basis. ~~The screen advertising~~See Note 8 to the Company's Annual Report on Form 10-K filed February 25, 2022 for further discussion of the accounting for revenues earned under the ESA ~~are reflected in other revenue on~~as well as the ~~condensed consolidated income statement.~~

Prior to September 17, 2019, the ESA was accounted for under ASC Topic 606, Revenue from Contracts with Customers. Effective September 17, 2019, the Company signed an amendment to the ESA, under which the Company will provide incremental advertising timeaccounting related to NCM and has extended the term through February 2041. Since the agreement was amended, the Company was required to evaluate the revised contract under ASC Topic 842, Leases, and as a result, determined that the ESA met the definition of a lease. screen advertising advances.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

The Company leases nonconsecutive periods of use of its domestic theatre screens to NCM for purposes of showing third party advertising content. The lease, which is classified as an operating lease, generally requires variable lease payments based on the number of patrons attending the showtimes during which such advertising is shown. The lease agreement is considered short-term due to the fact that the nonconsecutive periods of use, or advertising time slots, are set on a weekly basis. The revenues earned under the ESA, both before and after the amendment, are reflected in other revenue on the consolidated income statement.

~~The recognition of revenue related to the~~deferred NCM screen advertising advances are recorded ~~through February 2041.~~

Twelve Months Ended March 31,

Remaining Maturity

2022

2023

2024

2025

2026

Thereafter

Total

NCM screen advertising advances ⁽¹⁾

$
8,407

$
8,989

$
9,612

$
10,279

$
10,994

$
293,959

$
342,240

~~(1)~~

~~Amounts are net of the estimated interest to be accrued for the periods presented. See discussion of significant financing component below.~~

~~Significant Financing Component~~

In connection with the completion of the NCMI initial public offering, the Company amended and restated its ESA with NCM and received approximately $174,000 in cash consideration from NCM. The proceeds were recorded as deferred revenue and are being amortizedon a straight-line basis over the term of the ~~modified~~amended ESA or through February 2041. ~~In addition~~The table below summarizes when the Company expects to recognize these revenues:


	Twelve Months Ended March 31,
Remaining Maturity	2023		2024		2025		2026		2027		Thereafter		Total
NCM screen advertising advances (1)	$	9.3	$	9.9	$	10.6	$	11.3	$	12.1	$	290.6	$	343.8

(1)

Amounts are net of the estimated interest to be accrued for the periods presented. See discussion of significant financing component below.

Significant Financing Component

As discussed in Note 8 to the ~~consideration received upon~~Company's Annual Report on Form 10-K filed February 25, 2022, the Company's ESA ~~modification during 2007, the Company also receives consideration in the form of common units from~~with NCM at each annual common unit adjustment settlement, in exchange for exclusive access to the Company’s newly opened domestic screens under the ESA. Due to the significant length of time between receiving the consideration from NCM and fulfillment of the related performance obligation, the ESA includes an implied significant financing component, as per the guidance in ASC Topic 606. As a result of the significant financing component, the Company recognized incremental screen rental revenue and ~~an offsetting~~ interest expense of ~~$7,851~~$8.0 and ~~$5,835,~~$5.8, respectively, during the three months ended March 31, 2022 and incremental screen rental revenue and interest expense of $7.9 and $5.8, respectively, during the three months ended March 31, 2021. The interest expense was calculated using the Company’s incremental borrowing rates at the time when the cash was received from the ~~NCMI~~NCM, Inc. IPO and each tranche of common units was received from NCM, which ranged from ~~4.4%~~4.4% to ~~8.3%~~8.3%.

~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In thousands, except share and per share data~~

Effective September 17, 2019, upon the Company’s evaluation and determination that ASC Topic 842 applies to the amended ESA, the Company determined it acceptable to apply the significant financing component guidance from ASC Topic 606 by analogy as the economic substance of the agreement represents a financing arrangement.

NCM Financial Information

Below is summary financial information for NCM for the periods indicated:


	Three Months Ended			Three Months ended
	March 31, 2022			April 1, 2021
Gross revenues	$	35.9		$	5.4
Operating loss	$	(22.5	)	$	(28.3	)
Net loss	$	(39.5	)	$	(43.5	)


	As of			As of
	March 31, 2022			December 30, 2021
Current assets	$	125.9		$	115.4
Noncurrent assets	$	656.8		$	658.0
Current liabilities	$	56.7		$	67.2
Noncurrent liabilities	$	1,163.1		$	1,114.7
Members equity	$	(437.1	)	$	(408.5	)

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

Three Months Ended

Three Months ended

April 1, 2021

March 26, 2020

Gross revenues

$
5,445

$
64,700

Operating income (loss)

$
(28,239
)

$
4,900

Net loss

$
(43,497
)

$
(8,600
)

10.

Other Investments

As of

As of

April 1, 2021

December 31, 2020

Current assets

$
151,292

$
142,566

Noncurrent assets

$
681,560

$
685,643

Current liabilities

$
37,569

$
46,872

Noncurrent liabilities

$
1,116,244

$
1,072,207

Members deficit

$
(320,961
)

$
(290,870
)

~~10.~~

~~Other Investments~~

Digital Cinema Implementation Partners LLC (“DCIP”)

On February 12, 2007, the Company, AMC and Regal (the “Exhibitors”) entered into a joint venture known as DCIP to facilitate the implementation of digital cinema in the Company’s theatres and to establish agreements with major motion picture studios for the financing of digital cinema. OnAs of March ~~10, 2010,~~31, 2022, the Company had a 33% voting interest in DCIP and its subsidiaries completed an initial financing transaction to enable the purchase, deployment and leasing of digital projection systems to the Exhibitors under equipment lease and installation agreements. On March 31, 2011, DCIP obtained incremental financing necessary to complete the deployment of digital projection systems.a 24.3% economic interest in DCIP. DCIP also entered into long-term Digital Cinema Deployment Agreements (“DCDAs”) with 6 major motion picture studios pursuant to which Kasima LLC, one of DCIP’s subsidiaries, ~~receives~~received a virtual print fee ("VPF") each time the studio ~~books~~booked a film or certain other content on the leased digital projection systems. Other content distributors entered into similar DCDAs that ~~provide~~provided for the payment of VPFs for bookings of the distributor's content on a leased digital projection system. The DCDAs end on the earlier to occur of (i) the tenth anniversary of the "mean deployment date" for all digital projection systems scheduled to be deployed over a period of up to five years, or (ii) the date DCIP achieves "cost recoupment", each as definedexpired in the DCDAs. Cost recoupment occurs when revenues attributable to the digital projection systems exceed the financing, deployment, administration and other costs associated with the purchase of the digital projection systems. DCIP expects cost recoupment to occur during lateOctober 2021. ~~The timing of cost recoupment is dependent on VPF payments from studios.~~ Pursuant to the operating agreement between the Exhibitors and DCIP, DCIP began to distribute excess cash generated from their operations to the Exhibitors ~~upon~~during 2019. As the ~~payoff of~~DCDAs have expired and the MELA between the Company and Kasima has been terminated, as discussed below, DCIP and its ~~outstanding debt, which occurred~~subsidiaries no longer have regular operations, and final distributions are expected to be made to the Company during ~~the year ended December 31, 2019.~~ 2022.

Effective November 1, 2020, the Company amended the master equipment lease agreement (“MELA”) with Kasima LLC, which is an indirect subsidiary of DCIP, resulting in the termination of the MELA. Upon termination of the MELA, the Company received a distribution of the digital projection equipment that it previously leased. As the fair value of the distributed projectors was greater than the Company’s investment in DCIP at the time of the distribution, the investment in DCIP was reduced to zero at the time of the distribution. The Company does not recognize undistributed equity in the earnings or loss of its investment in DCIP until such time that future net earnings, less distributions received, surpass the amount of the excess distribution.

~~As of March 31, 2021, the Company had a 33% voting interest in DCIP and a 24.3% economic interest in DCIP.~~ The ~~Company accounts for its~~ investment in DCIP on the condensed consolidated balance sheets as of December 31, 2021 and ~~its subsidiaries under the equity method of accounting.~~March 31, 2022 was $0.

~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In thousands, except share and per share data~~

Below is summary financial information for DCIP for the periods indicated:


	Three Months Ended
	March 31, 2022			March 31, 2021
Gross revenues	$	0.5		$	5.6
Operating income (loss)	$	(0.5	)	$	4.0
Net income (loss)	$	(0.6	)	$	3.9

Three Months Ended

March 31, 2021

March 31, 2020

Gross revenues

$
5,624

$
32,510

Operating income (loss)

$
3,980

$
(5,239
)
Net income (loss)

$
3,901

$
(11,140
)


	As of
	March 31, 2022		December 31, 2021
Current assets	$	22.1	$	22.9
Current liabilities	$	11.4	$	11.6
Members' equity	$	10.7	$	11.3

As of

March 31, 2021

December 31, 2020

Current assets

$
29,987

$
36,372

Noncurrent assets

$
172

$
205

Current liabilities

$
23,125

$
39,844

Noncurrent liabilities

$
940

$
687

Members' equity

$
6,094

$
(3,954
)

~~The Company had the following transactions with DCIP, reflected in utilities and other costs on the condensed consolidated statements of income, during the three months ended March 31, 2021 and 2020:~~

Three Months Ended

March 31, 2021

March 31, 2020

Equipment lease payments ⁽¹⁾

$
1,045

$
1,038

Warranty reimbursements from DCIP

$
(266
)

$
(3,123
)
Management service fees

$
11

$
84

~~(1)~~

As a result of the MELA amendment noted above, the Company recorded a lease termination liability during 2020. The lease termination payments made during the three months ended March 31, 2021 reduced the liability outstanding. The remaining termination liability of $2,084 as of March 31, 2021 is reflected in accrued other current liabilities on the condensed consolidated balance sheet.

Other Investment Activity

Below is a summary of activity for each of the Company’s other ~~investments~~investees and corresponding changes to the Company's investment balances during the three months ended March 31, 2022:


	AC JV, LLC			DCDC		FE Concepts		Other			Total
Balance at January 1, 2022	$	3.7		$	1.8	$	19.3	$	0.4		$	25.2
Cash distributions received		(0.6	)		—		—		—			(0.6	)
Equity income		1.0			0.1		0.2		—			1.3
Other		—			—		—		(0.1	)		(0.1	)
Balance at March 31, 2022	$	4.1		$	1.9	$	19.5	$	0.3		$	25.8

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

Transactions with Other Investees

Below is a summary of transactions with each of the Company’s other investees for the three months ended March 31, 2022 and 2021:


		Three Months Ended
Investee	Transactions	March 31, 2022		March 31, 2021
DCIP	Equipment lease payments (1)	$	—	$	1.0
DCIP	Warranty reimbursements (2)	$	—	$	(0.3	)
AC JV, LLC	Event fees paid (3)	$	1.8	$	0.2
DCDC	Content delivery fees paid (3)	$	0.2	$	0.1

AC JV,
LLC

DCDC

FE Concepts

Other

Total

Balance at January 1, 2021

$
3,745

$
1,255

$
18,273

$
453

$
23,726

Equity loss

(453
)

16

(21
)

—

(458
)
Other

—

—

—

664

664

Balance at March 31, 2021

$
3,292

$
1,271

$
18,252

$
1,117

$
23,932

~~AC JV, LLC~~

~~During December 2013,~~(1)

As a result of the MELA amendment noted above, the Company ~~Regal, AMC (the “AC Founding Members”) and NCM entered into~~recorded a ~~series~~lease termination liability during 2020. Lease termination payments of agreements that resulted in the formation of AC JV, LLC (“AC”), a joint venture that owns “Fathom Events” formerly operated by NCM. The Fathom Events business focuses on the marketing and distribution of live and pre-recorded entertainment programming$1.0 made to various theatre operators, including concerts, opera and symphony, DVD product releases and marketing events, theatrical premieres, Broadway plays, live sporting events and other special events. The Company paid event fees to AC of $230 and $1,673 forDCIP during the three months ended March 31, 2021 reduced the liability outstanding, which was fully paid by October 2021.

(2)

Included in utilities and ~~2020, respectively, which are included~~other costs on the condensed consolidated statements of loss.

(3)

Included in film rentals and advertising costs on the condensed consolidated statements of ~~income. The Company accounts for its investment in AC under the equity method of accounting.~~

~~Digital Cinema Distribution Coalition~~

Digital Cinema Distribution Coalition (“DCDC”) is a joint venture among the Company, Universal, Warner Bros., AMC and Regal. DCDC operates a satellite distribution network that distributes all digital content to U.S. theatres via satellite. The Company has an approximate 14.6% ownership in DCDC. The Company paid approximately $64 and $105 to DCDC during the three months ended March 31, 2021 and 2020, respectively, related to content delivery services provided by DCDC. These fees are included in film rentals and advertising costs on the condensed consolidated statements of income. The Company accounts for its investment in DCDC

~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In thousands, except share and per share data~~

loss.

~~under the equity method of accounting.~~11.

~~FE Concepts, LLC~~

The Company has a 50% voting interest in a joint venture, FE Concepts, LLC (“FE Concepts”) with AWSR Investments, LLC, an entity owned by Lee Roy Mitchell and Tandy Mitchell. FE Concepts operates a family entertainment center that offers bowling, gaming, movies and other amenities. The Company accounts for its investment in FE Concepts under the equity method of accounting. The Company has a theatre services agreement with FE Concepts under which it provides film booking and equipment monitoring services. The Company recorded $16 and $10 of theatre services revenue under the agreement during the three months ended March 31, 2021 and 2020, respectively.

~~11.~~

~~Treasury Stock and Share Based Awards~~

Treasury Stock — and Share Based Awards

Treasury Stock

Treasury stock represents shares of common stock repurchased or withheld by the Company and not yet retired. The Company has applied the cost method in recording its treasury shares. Below is a summary of the Company’s treasury stock activity for the three months ended March 31, ~~2021:~~2022:

	Number of
	Treasury				Number of
	Shares		Cost		Treasury
Balance at January 1, 2021		5,050,981	$	87,004
					Shares		Cost
Balance at January 1, 2022						5.35	$	91.1
Restricted stock withholdings ⁽¹⁾		220		8		0.09		1.6
Restricted stock forfeitures		9,185		0		0.03		—
Balance at March 31, 2021		5,060,386	$	87,012
Balance at March 31, 2022						5.47	$	92.7

(1)

The Company withheld restricted shares as a result of the election by certain employees to satisfy their tax liabilities upon vesting in restricted stock and restricted stock units with shares. The Company determined the number of shares to be withheld based upon market values on the vest dates, which ranged from $16.37 to $17.51 per share.

~~(1)~~

The Company withheld restricted shares as a result of the election by certain employees to satisfy their tax liabilities upon vesting in restricted stock and restricted stock units. The Company determined the number of shares to be withheld based upon market values ranging from $17.41 to $24.14 per share.

As of March 31, ~~2021,~~2022, the Company had no plans to retire any shares of treasury stock.

Restricted Stock

Below is a summary of restricted stock activity for the three months ended March 31, 2022:


	Shares of			Weighted Average
	Restricted			Grant Date
	Stock			Fair Value
Outstanding at January 1, 2022		2.00		$	21.73
Granted		0.74		$	16.64
Vested		(0.33	)	$	30.59
Forfeited		(0.03	)	$	19.99
Outstanding at March 31, 2022		2.38		$	18.96
Unvested restricted stock at March 31, 2022		2.38


	Three Months Ended March 31,
	2022		2021
Compensation expense recognized during the period	$	4.2	$	4.2
Fair value of restricted shares that vested during the period	$	5.6	$	1.2
Income tax benefit (cost) related to restricted stock awards	$	0.8	$	(0.1	)

–

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

During the three months ended March 31, ~~2021,~~2022, the Company granted ~~968,474~~0.74 shares of its restricted stock to its employees. The fair value of the restricted stock granted was determined based on the closing price of the Company’s common stock, ~~on the day preceding the grant date,~~ which ranged from ~~$21.01~~$15.10 to ~~$23.98~~$16.65 per share. The Company assumed forfeiture rates for the restricted stock awards that ranged from 0%0% to ~~10%~~10%. ~~Certain of the~~The restricted stock ~~awards vested immediately on~~granted during the ~~grant date while others~~three months ended March 31, 2022 vest over periods ranging from one to four ~~years.~~years. The recipients of restricted stock are entitled to receive non-forfeitable dividends and to vote their respective shares, however, the sale and transfer of the restricted shares is prohibited during the restriction period.

~~Below is a summary of restricted stock activity for the three months ended March 31, 2021:~~

Shares of

Weighted
Average

Restricted

Grant Date

Stock

Fair Value

Outstanding at January 1, 2021

1,431,975

$
21.11

Granted

968,474

$
21.34

Vested

(55,064
)

$
33.05

Forfeited

(9,185
)

$
15.25

Outstanding at March 31, 2021

2,336,200

$
20.94

Unvested restricted stock at March 31, 2021

2,336,200

$
20.94

~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In thousands, except share and per share data~~

Three Months Ended
March 31,

2021

2020

Compensation expense recognized during the period

$
4,230

$
2,691

Fair value of restricted shares that vested during the period

$
1,148

$
8,029

Income tax benefit (cost) related to restricted stock awards

$
(110
)

$
2,418

As of March 31, ~~2021,~~2022, the estimated remaining unrecognized compensation expense related to unvested restricted stock awards was ~~$35,924~~$30.0 and the weighted average period over which this remaining compensation expense will be recognized is approximately two ~~years.~~years.

Restricted Stock Units

~~– The Company did not grant any~~Below is a summary of restricted stock ~~units during~~unit activity for the ~~three months ended March 31, 2021.~~ periods presented:


	Three Months Ended March 31,
	2022		2021
Number of restricted stock unit awards that vested during the period		0.10		0.01
Fair value of restricted stock unit awards that vested during the period	$	1.7	$	0.3
Accumulated dividends paid upon vesting of restricted stock unit awards	$	0.3	$	0.1
Compensation expense recognized during the period	$	0.9	$	0.5
Income tax benefit (cost) related to stock unit awards	$	0.3	$	(0.1	)

During the three months ended March 31, ~~2021~~,2022, the Company ~~evaluated~~granted performance awards in the ~~impact~~form of restricted stock units. The maximum number of shares issuable under the performance awards is 0.80 shares of common stock. The performance metrics for these awards are based upon the achievement of pre-established criteria that consists of revenue and consolidated cash flows as defined in the award agreement. The performance measurement period for these performance awards is one year with an additional service requirement to the third anniversary of the ~~COVID-19 pandemic~~date of grant. Each performance target underlying the performance award has a threshold, target and maximum level, with the maximum level equal to 175% of the target award. If the performance metrics meet the threshold level, approximately 29% of the maximum restricted stock units vest. If the performance metrics for the one-year period are at target, approximately 57% of the maximum restricted stock units vest. If the performance metrics are at the maximum, 100% of the maximum restricted stock units vest. Grantees are eligible to receive a ratable portion of the common stock issuable if the achievement of the performance goals is within the targets previously noted.All restricted stock units granted during 2022 will be paid in the form of common stock if the participant continues to provide services through the third anniversary of the grant date. Restricted stock unit award participants are eligible to receive dividend equivalent payments from the grant date to the extent declared by the Company if, and at the time that, the restricted stock unit awards vest.

Company estimated that the most likely outcome is the achievement of the target level. The fair value of the restricted stock unit awards was determined based on the ~~performance metric used~~closing price of the Company’s common stock on the date of grant, which was $16.65 per share. The Company assumed a forfeiture rate of 5% for the restricted stock unit ~~awards granted~~awards. If during ~~February 2019~~the service period, additional information becomes available to lead the Company to believe a different achievement level will be reached for the one-year performance period, the Company will reassess the number of units that are expected to vest for the grant and ~~February 2020. The Compensation Committee of~~adjust its compensation expense accordingly over the Company’s Board of Directors made a discretionary decision to certify the vest of the 2019 and 2020 restricted stock unit awards at target based upon the projected macroeconomic conditions through 2021 and beyond and the uncertain timing as to the recovery of the Company’s industry.remaining service period.

Three Months Ended March 31,

2021

2020

Number of restricted stock unit awards that vested during the period

14,744

112,070

Fair value of restricted stock unit awards that vested during the period

$
303

$
3,554

Accumulated dividends paid upon vesting of restricted stock unit awards

$
63

$
544

Compensation expense recognized during the period

$
438

$
1,420

Income tax benefit (cost) related to restricted stock unit awards

$
(129
)

$
821

As of March 31, ~~2021,~~2022, the estimated remaining unrecognized compensation expense related to outstanding restricted stock unit awards was ~~$9,578.~~$10.3. The weighted average period over which this remaining compensation expense will be recognized is approximately ~~2 years.~~two years. As of March 31, ~~2021,~~2022, the Company had restricted stock units outstanding that represented a total of ~~564,890~~1.1 hypothetical shares of common stock, net of forfeitures, reflecting actual certified performance levels for ~~all grants outstanding.~~restricted stock units granted during 2019 and 2020 and the maximum performance level for the 2022 grant discussed above.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

12.

Goodwill and Other Intangible Assets

~~12.~~

~~Goodwill and Other Intangible Assets~~

A summary of the Company’s goodwill is as follows:


	U.S. Operating Segment		International Operating Segment		Total
Balance at January 1, 2022 (1)	$	1,182.9	$	65.9	$	1,248.8
Foreign currency translation adjustments		0		8.1		8.1
Balance at March 31, 2022 (1)	$	1,182.9	$	74.0	$	1,256.9

U.S.
Operating
Segment

International
Operating
Segment

Total

Balance at January 1, 2021 ⁽¹⁾

$
1,182,853

$
70,987

$
1,253,840

Foreign currency translation adjustments

—

(4,645
)

(4,645
)
Balance at March 31, 2021 ⁽¹⁾

$
1,182,853

$
66,342

$
1,249,195

(1)

Balances are presented net of accumulated impairment losses of $214.0 for the U.S. operating segment and $43.8 for the international operating segment. See discussion of the qualitative impairment analysis performed by the Company as of March 31, 2022 at Note 13.

~~(1)~~

Balances are presented net of accumulated impairment losses of $214,031 for the U.S. operating segment and $43,750 for the international operating segment. See discussion of the qualitative impairment analysis performed by the Company as of March 31, 2021 at Note 13.

A summary of the Company’s intangible assets is as follows:

~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In thousands, except share and per share data~~


	Balance at January 1, 2022			Amortization			Foreign Currency Translation Adjustments		Balance at March 31, 2022
Intangible assets with finite lives:
Gross carrying amount	$	81.8		$	—		$	0.3	$	82.1
Accumulated amortization		(71.1	)		(0.6	)		—		(71.7	)
Total net intangible assets with finite lives	$	10.7		$	(0.6	)	$	0.3	$	10.4

Intangible assets with indefinite lives:
Tradename and other		300.1			—			0.3		300.4
Total intangible assets, net	$	310.8		$	(0.6	)	$	0.6	$	310.8

The estimated aggregate future amortization expense for intangible assets is as follows:

As noted above, beginning July 1, 2018, Argentina was deemed highly inflationary. A foreign currency exchange gain of $0.5 and $0.2 was recorded for the three months ended March 31, 2022 and 2021, respectively, as a result of translating Argentina's financial results to U.S. dollars.

Three Months Ended

March 31,

2021

2020

Cash paid for interest

$
22,285

$
8,774

Cash paid (refunds received) for income taxes, net

$
(1,946
)

$
2,110

Cash deposited in restricted accounts ⁽¹⁾

$
7,300

$
—

Noncash investing and financing activities:

Change in accounts payable and accrued expenses for the acquisition of theatre properties and equipment ⁽²⁾

$
(6,955
)

$
2,269

Interest expense - NCM (see Note 9)

$
(5,835
)

$
(5,891
)
Investment in NCM – receipt of common units

$
—

$
3,620

Dividends accrued on unvested restricted stock unit awards

$
(2
)

$
(256
)

17.

Segments

~~(1)~~

~~Represents cash deposited in a collateral account during the period to support the issuance of letters of credit to lenders. See further discussion at Note 7.~~

~~(2)~~

~~Additions to theatre properties and equipment included in accounts payable as of March 31, 2021 and December 31, 2020 were $21,295 and $28,250, respectively.~~

~~17.~~

~~Segments~~

The Company manages its international market and its U.S. market as separate reportable operating segments, with the international segment consisting of operations in Brazil, Argentina, Chile, Colombia, Peru, Ecuador, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, Guatemala, Bolivia, Curacao and Paraguay. Each segment’s revenue is derived from admissions and concession sales and other ancillary revenues. The Company uses Adjusted EBITDA, as shown in the reconciliation table below, as the primary measure of segment profit and loss to evaluate performance and allocate its resources. The Company does not report total assets by segment because that information is not used to evaluate the performance of or allocate resources between segments.

Below is a breakdown of selected financial information by reportable operating segment:


	Three Months Ended
	March 31,
	2022			2021
Revenues
U.S.	$	373.7		$	97.3
International		88.5			17.3
Eliminations		(1.7	)		(0.2	)
Total revenues	$	460.5		$	114.4

Adjusted EBITDA
U.S.	$	14.4		$	(77.0	)
International		10.8			(15.0	)
Total Adjusted EBITDA	$	25.2		$	(92.0	)

Capital expenditures
U.S.	$	14.0		$	13.7
International		4.7			4.0
Total capital expenditures	$	18.7		$	17.7

Three Months Ended

March 31,

2021

2020

Revenues

U.S.

$
97,267

$
429,302

International

17,272

116,173

Eliminations

(178
)

(1,859
)
Total revenues

$
114,361

$
543,616

Adjusted EBITDA

U.S.

$
(76,997
)

$
56,072

International

(14,953
)

10,139

Total Adjusted EBITDA

$
(91,950
)

$
66,211

Capital expenditures

U.S.

$
13,641

$
25,673

International

4,039

8,470

Total capital expenditures

$
17,680

$
34,143

~~CINEMARK HOLDINGS, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In thousands, except share and per share data~~

The following table sets forth a reconciliation of net loss to Adjusted EBITDA:


	Three Months Ended
	March 31,
	2022			2021
Net loss	$	(72.5	)	$	(208.9	)
Add (deduct):
Income taxes		(1.8	)		(14.7	)
Interest expense (1)		38.1			36.6
Other expense, net (2)		3.2			15.0
Cash distributions from other equity investees (3)		0.6			0.1
Depreciation and amortization		61.7			68.2
Restructuring costs		0			(0.2	)
(Gain) loss on disposal of assets and other		(6.9	)		4.5
Loss on extinguishment of debt		0			2.6
Non-cash rent expense		(2.3	)		0.1
Share based awards compensation expense		5.1			4.7
Adjusted EBITDA	$	25.2		$	(92.0	)

Three Months Ended

March 31,

2021

2020

Net loss

$
(208,843
)

$
(59,422
)
Add (deduct):

Income taxes

(14,643
)

(3,108
)
Interest expense ⁽¹⁾

36,553

24,666

Other expense, net ⁽²⁾

14,971

169

Cash distributions from DCIP ⁽³⁾

—

5,161

Cash distributions from other equity investees ⁽⁴⁾

156

11,445

Depreciation and amortization

68,160

65,256

Impairment of long-lived assets

—

16,619

Restructuring costs

(208
)

—

Loss on disposal of assets and other

4,505

1,905

Loss on extinguishment of debt

2,603

—

Non-cash rent expense

128

(591
)
Share based awards compensation expense

4,668

4,111

Adjusted EBITDA

$
(91,950
)

$
66,211

(1)

Includes amortization of debt issue costs and amortization of accumulated losses for amended swap agreements.

(2)

Includes interest income, foreign currency exchange (gain) loss, equity in loss of affiliates and interest expense - NCM and excludes distributions from NCM.

(3)

Reflects cash distributions received from equity investees that were recorded as a reduction of the respective investment balances (see Note 10). These distributions are reported entirely within the U.S. operating segment.

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in millions, except per share data)

~~(1)~~

~~Includes amortization of debt issue costs and amortization of accumulated losses for amended swap agreements.~~

~~(2)~~

~~Includes interest income, foreign currency exchange loss, equity in income (loss) of affiliates and interest expense - NCM and excludes distributions from NCM.~~

~~(3)~~

~~Includes cash distributions from DCIP, which were recorded as a reduction of the Company’s investment in DCIP. These distributions are reported entirely within the U.S. operating segment.~~

~~(4)~~

Includes cash distributions received from equity investees, other than those from DCIP noted above, that were recorded as a reduction of the respective investment balances (see Notes 9 and 10). These distributions are reported entirely within the U.S. operating segment.

Financial Information About Geographic Areas

Below is a breakdown of selected financial information by geographic area:


	Three Months Ended
	March 31,
Revenues	2022			2021
U.S.	$	373.7		$	97.3
Brazil		33.1		$	4.4
Other international countries		55.4		$	12.9
Eliminations		(1.7	)	$	(0.2	)
Total	$	460.5		$	114.4


	As of		As of
Theatre Properties and Equipment-net	March 31, 2022		December 31, 2021
U.S.	$	1,166.8	$	1,208.7
Brazil		62.9		56.8
Other international countries		119.3		117.4
Total	$	1,349.0	$	1,382.9

From time to time, the Company is involved in various legal proceedings arising from the ordinary course of its business operations, such as personal injury claims, employment matters, patent claims, landlord-tenant disputes, contractual disputes with landlords over certain termination rights or the right to discontinue rent payments due to the COVID-19 pandemic and other contractual disputes, some of which are covered by insurance. The Company believes its potential liability with respect to proceedings currently pending is not material, individually or in the aggregate, to the Company’s financial position, results of operations and cash flows.

Cinemark Holdings, Inc., et al vs Factory Mutual Insurance Company. The Company filed suit on November 18, 2020, in the District Court, ~~471~~^st471st Judicial District, Collin County, Texas. On December 22, 2020, the case was moved to the US District Court for the Eastern District of Texas, Sherman Division. The Company submitted a claim under its property insurance policy issued by Factory Mutual Insurance Company (the “FM Policy”) for losses sustained as a result of the ~~COVID-19 pandemic and the forced~~ closure of the Company’s theatres ~~pursuant~~due to ~~orders issued by various government agencies.~~the COVID-19 pandemic. Factory Mutual Insurance Company (“FM”) denied the Company’s claim. The Company is seeking damages resulting from FM’s breach of contract, FM’s bad faith conduct and a declaration of the parties’ rights under the FM Policy. ~~While the~~The Company cannot predict the outcome of this ~~litigation, management believes~~litigation.

Lakeenya Neal, et al v. Cinemark Holdings, Inc., et al. This class action lawsuit was filed against the Company on December 10, 2021, in the Central District of Los Angeles County Superior Court of the State of California alleging certain violations of the Fair and Accurate Credit Transactions Act. We firmly maintain that the allegations are without merit and will vigorously defend this ~~lawsuit will not have a material adverse effect on~~lawsuit. The Company cannot predict the ~~company’s financial position or results~~outcome of ~~operations~~this litigation..

Intertrust Technologies Corporation (“Intertrust”) v. Cinemark Holdings, Inc., Regal, AMC, et al. This case was filed against the Company on August 7, 2019 in the Eastern District of Texas – Marshall Division alleging patent infringement. The Company firmly maintains that the contentions of the Plaintiff are without ~~merit~~merit. In December 2021, the parties reached a settlement and ~~will vigorously defend itself against~~announced the ~~lawsuit. Although~~settlement to the ~~Company does not believe that it~~court. The settlement was recorded in (gain) loss on disposal of assets and other on the consolidated statement of income (loss) for the year ended December 31, 2021. The parties entered into definitive settlement agreements, and the court has ~~infringed on any of Intertrust’s patents, it cannot predict~~dismissed the ~~outcome of this litigation.~~lawsuit with prejudice.

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

The following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and related notes and schedules included elsewhere in this report.

As we have previously disclosed, the COVID-19 pandemic has had an unprecedented impact on our industry. The social and economic effects are widespread, and the situation continues to evolve. As a movie exhibitor that operates spaces where patrons gather in close proximity, we have been, and continue to be, significantly impacted by protective actions taken by governmental authorities to control the spread of the pandemic. We temporarily closed all of our theatres Amounts included in the ~~U.S.~~following discussion, except for screens, average screens, average ticket price and ~~Latin America effective March 17, 2020 and March 18, 2020, respectively, to comply with government mandates at the initial outbreak.~~concessions per patron, are rounded in millions.

As of March 31, 2021, we had reopened 301 of our domestic theatres and 78 of our international theatres and continued to show a limited volume of new releases along with library content during reduced operating hours. Our theatre staffing levels remain reduced as compared to pre-COVID levels due to limited operating hours as well as our focus on initiatives to enhance productivity. We also continue to limit operating expenses and capital expenditures to essential activities and projects as volumes remain reduced. We are continuing to work with landlords and other vendors to extend payment terms while we reopen theatres and recover from the impacts of the COVID-19 pandemic.

Our focus on maintaining a strong balance sheet and low leverage allowed us to enter the global COVID-19 pandemic in a solid financial position. Based on our current estimates of recovery, we believe we have, and will generate, sufficient cash to sustain operations. Nonetheless, the COVID-19 pandemic has had, and continues to have, adverse effects on our business, results of operations, cash flows and financial condition.

The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act enacted on March 27, 2020 allows corporate taxpayers to carryback net operating losses generated in 2018, 2019 and 2020 to the previous five years. As a result of the impact of the COVID-19 pandemic on the Company’s business, it generated significant net operating losses during the year ended December 31, 2020. The Company carried back these losses to prior years and, as of March 31, 2021, the Company has a federal income tax receivable of $171 million.

We are a leader in the motion picture exhibition industry, with theatres in the U.S., Brazil, Argentina, Chile, Colombia, Ecuador, Peru, Honduras, El Salvador, Nicaragua, Costa Rica, Panama, Guatemala, Bolivia, Curacao and Paraguay. As of March 31, ~~2021,~~2022, we managed our business under two reportable operating segments – U.S. markets and international markets. See Note 17 to our condensed consolidated financial statements.

The COVID-19 pandemic has had an unprecedented impact on the world and the movie exhibition industry with widespread social and economic effects. We temporarily closed our theatres in the U.S. and Latin America during March of 2020 at the onset of the COVID-19 outbreak. During that time, we implemented various cash preservation strategies, including, but not limited to, temporary personnel and salary reductions, halting non-essential operating and capital expenditures, negotiating modified timing and/or abatement of contractual payments with landlords and other major suppliers, and the suspension of our quarterly dividend.

Throughout 2020 and 2021 we reopened theatres as local restrictions and the status of the COVID-19 pandemic would allow. All of our domestic and international theatres were reopened by the end of the fourth quarter of 2021. The industry’s recovery from the COVID-19 pandemic is still underway and is contingent upon the volume of new film content available, as well as the box office performance of new film content released, consumer sentiment in returning to move theaters and government restrictions. The industry is also adjusting to the evolution of the exclusive theatrical window, competition from streaming platforms, supply chain constraints, inflationary impacts pressures and other economic factors.

We generate ~~revenues~~revenue primarily from filmed entertainment box office receipts and concession sales with additional ~~revenues~~revenue from screen advertising, ~~sales~~screen rental and other revenue streams, such as transactional fees, vendor marketing promotions, studio trailer placements, meeting rentals and electronic video games located in some of our theatres. We also offer alternative entertainment, such as the Metropolitan Opera, concert events, in-theatre gaming, live and pre-recorded sports programs ~~concert events, the Metropolitan Opera, in-theatre gaming~~ and other special events in our ~~theatres. In-theatre advertising for~~theatres through Fathom Entertainment (operated by AC JV, LLC). NCM provides our domestic theatres ~~is provided by National CineMedia. In our international locations, our~~with various forms of in-theatre advertising. Our Flix Media subsidiaries provide screen advertising and alternative content for our international circuit and to other international exhibitors.

Films leading the box office during the three months ended March 31, ~~2021~~2022 included the carryover ~~from~~ of ~~The Croods: A New Age~~Spider-Man: No Way Home ~~and~~ ~~Wonder Woman 1984, and~~as well as new releases including ~~Tom & Jerry~~The Batman, Uncharted, The Lost City and~~Godzilla vs. Kong~~ Scream.Films currently scheduled for release during the remainder of ~~2021~~ 2022 include ~~Mortal Kombat, Demon Slayer: Kimetsu no Yaiba~~Sonic the Hedgehog 2, ,Doctor Strange in the Multiverse of Madness, Top Gun: Maverick, Jurassic World: Dominion, Lightyear, Minions: The Rise of Gru, Thor: Love and Thunder, Black Adam, Black Panther: Wakanda Forever ~~Cruella, A Quiet Place Part II, F9, Black Widow,~~and the highly anticipated sequel, Avatar: The ~~Suicide Squad, Venom: Let There Be Carnage, Top Gun Maverick and~~Way of Water, ~~the sequel to Marvel’s~~ ~~Spider-man Far From Home,~~ among other films. ~~Films currently scheduled for release during~~There are several key factors impacting the ~~remainder~~industry box office's recovery from the COVID-19 pandemic, including the availability and quality of ~~2021 may still shift as a result~~new films released, the duration of the ~~COVID-19 pandemic.~~exclusive theatrical windows and evolving consumer behavior with competition from streaming and other forms of entertainment.

Film rental ~~and advertising~~ costs are variable in nature and fluctuate with our admissions ~~revenues.~~revenue. Film rental costs as a percentage of ~~revenues~~revenue are generally higher for periods in which more blockbuster films are released. The Company ~~also receives~~received virtual print fees from studios for certain of its international locations, which are included as a contra-expense in film ~~rentals~~rental and advertising ~~costs. Promotional expenses are generally variable~~costs on the condensed consolidated statements of income. However, these costs were fully recovered during 2021 and virtual print fees will not be received in ~~nature and primarily include the placement of film-specific social and digital media spots promoting film content currently playing in our theatres.~~future periods. Advertising costs, which are expensed as incurred, are primarily related to our loyalty and subscription programs, brand advertising, reengaging our audiences as our theatres reopened and new film content was released as well as campaigns for new and ~~renovated theatres, loyalty and membership programs and brand advertising that~~remodeled theatres. These expenses vary depending on the timing and length of such campaigns.

Concession supplies ~~expenses are~~expense is variable in nature and ~~fluctuate~~fluctuates with our concession ~~revenues~~revenue and product mix. Supply chain interruptions and inflationary pressures have impacted, and may continue to impact, product costs and product availability in the near term. We ~~negotiate prices for concession supplies directly with concession vendors~~source products from a variety of partners around the world to minimize supply chain interruptions and ~~manufacturers to obtain volume rates.~~price increases, wherever possible.

~~Salaries~~Although salaries and wages ~~for our theatres generally~~include a fixed cost component (i.e., the minimum staffing costs to operate a theatre facility during non-peak periods), salaries and wages tend to move in relation to ~~revenues~~revenue as theatre staffing is adjusted to respond to changes in ~~attendance~~attendance. Staffing levels may vary based on the amenities offered at a location, such as full-service restaurants, bars or expanded food and ~~also include a fixed cost component (i.e. the minimum staffing costs to operate a theatre during non-peak periods).~~beverage options. In ~~some~~certain international locations, staffing levels are also subject to local regulations. Labor market conditions and inflationary pressures have driven increases in wages across our labor base and increases may continue in the future.

Facility lease ~~expenses are~~expense is primarily a fixed ~~costs~~cost at the theatre level as most of our facility leases require a fixed monthly minimum rent ~~payments.~~payment. Certain leases are subject to percentage rent only, while others are subject to percentage rent in addition to their fixed monthly rent if a target annual performance level is achieved. Facility lease ~~expenses~~expense as a percentage of ~~revenues are~~revenue is also affected by the number of theatres under operating leases, the number of theatres under finance leases and the number of owned theatres.

Utilities and other costs include both fixed and variable costs and primarily consist of utilities, ~~expenses for projection and sound equipment maintenance and monitoring,~~property taxes, janitorial costs, credit card fees, third party ticket sales commissions, ~~property taxes, janitorial costs,~~ repairs and maintenance expenses, security services and expenses for the maintenance and ~~security services.~~monitoring of projection and sound equipment.

General and administrative expenses ~~are primarily fixed in nature and consist of the costs~~ to support the overall management of the Company ~~including base, incentive compensation~~are primarily fixed in nature with certain variable expenses. Fixed expenses include salaries and wages and benefits costs for our corporate office personnel, facility expenses for our corporate and other offices, software maintenance costs and audit fees. Some variable expenses may include incentive compensation, consulting and legal fees, ~~professional fees, cloud-based software licensing fees, travel expenses,~~ supplies and other costs that are not specifically associated with the operations of our theatres.

The following table sets forth, for the periods indicated, ~~certain operating data and~~ the ~~percentage of revenues represented by~~amounts for certain items reflected in our condensed consolidated statements of ~~income.~~income along with each of those items as a percentage of revenues.

Three Months Ended

March 31,

2021

2020

Operating data (in millions):

Revenues

Admissions

$
56.1

$
292.5

Concession

39.5

190.4

Other

18.8

60.7

Total revenues

$
114.4

$
543.6

Cost of operations

Film rentals and advertising

23.2

156.6

Concession supplies

7.2

34.8

Salaries and wages

31.2

87.6

Facility lease expense

64.8

82.2

Utilities and other

49.1

100.5

General and administrative expenses

35.9

41.0

Depreciation and amortization

68.2

65.3

Impairment of long-lived assets

—

16.6

Restructuring costs

(0.2
)

—

Loss on disposal of assets and other

4.5

1.9

Total cost of operations

283.9

586.5

Operating loss

$
(169.5
)

$
(42.9
)

Operating data as a percentage of total revenues:

Revenues

Admissions

49.0
%

53.8
%

Concession

34.5
%

35.0
%

Other

16.5
%

11.2
%

Total revenues

100.0
%

100.0
%

Cost of operations ⁽¹⁾

Film rentals and advertising

41.4
%

53.5
%

Concession supplies

18.2
%

18.3
%

Salaries and wages

NM

NM

Facility lease expense

NM

NM

Utilities and other

NM

NM

General and administrative expenses

NM

NM

Total cost of operations

NM

NM

Operating income (loss)

NM

NM

Average screen count (month end average)

5,916

6,139

(1)

All costs are expressed as a percentage of total revenues, except film rentals and advertising, which are expressed as a percentage of admissions revenue and concession supplies, which are expressed as a percentage of concession revenue. Certain values for the 2021 period are considered not applicable (“N/A”) as they are not comparable due to limited film content and certain ongoing theatre closures as a result of the COVID-19 pandemic.

~~(1)~~

All costs are expressed as a percentage of total revenues, except film rentals and advertising, which are expressed as a percentage of admissions revenues and concession supplies, which are expressed as a percentage of concession revenues. Certain values are considered not meaningful (“NM”) as they are not comparable due to the temporary theatre closures effective March 18, 2020.

Three months ended March 31, ~~2021~~2022 (the “2022 period”) versus ~~March 31, 2020~~

We had reopened 301 of our domestic theatres and 78 of our international theatres as of March 31, 2021. Certain of our international theatres had to temporarily close again during the first quarter of 2021 due to the COVID-19 pandemic. We continue to monitor the status of the COVID-19 pandemic and local government regulations as we plan the reopening of our remaining theatres.

U.S. Operating Segment

International Operating Segment

Consolidated

Constant
Currency ⁽³⁾

2021

2020

%
Change

2021

2020

%
Change

2021

%
Change

2021

2020

%
Change

Admissions revenues ⁽¹⁾

$
48.5

$
232.3

(79.1
)%

$
7.6

$
60.2

(87.4
)%

$
8.6

(85.7
)%

$
56.1

$
292.5

(80.8
)%
Concession revenues ⁽¹⁾

$
33.0

$
152.8

(78.4
)%

$
6.5

$
37.6

(82.7
)%

$
7.1

(81.1
)%

$
39.5

$
190.4

(79.3
)%
Other revenues ⁽¹⁾⁽²⁾

$
15.6

$
42.3

(63.1
)%

$
3.2

$
18.4

(82.6
)%

$
3.7

(79.9
)%

$
18.8

$
60.7

(69.0
)%
Total revenues ⁽¹⁾⁽²⁾

$
97.1

$
427.4

(77.3
)%

$
17.3

$
116.2

(85.1
)%

$
19.4

(83.3
)%

$
114.4

$
543.6

(79.0
)%
Attendance ⁽¹⁾

5.2

27.9

(81.4
)%

2.5

17.9

(86.0
)%

7.7

45.8

(83.2
)%
Average ticket price ⁽¹⁾

$
9.25

$
8.33

11.0
%

$
3.05

$
3.36

(9.2
)%

$
3.45

2.7
%

$
7.25

$
6.39

13.5
%
Concession revenues per patron ⁽¹⁾

$
6.30

$
5.48

15.0
%

$
2.58

$
2.10

22.9
%

$
2.82

34.3
%

$
5.10

$
4.16

22.6
%

~~(1)~~

Revenues and attendance amounts in millions. Average ticket price is calculated as admissions revenues divided by attendance. Concession revenues per patron is calculated as concession revenues divided by attendance.

~~(2)~~

~~U.S. operating segment revenues include eliminations of intercompany transactions with the international operating segment. See Note 17 to our condensed consolidated financial statements.~~

~~(3)~~

Constant currency revenue amounts, which are non-GAAP measurements, were calculated using the average exchange rate for the corresponding month for 2020. We translate the results of our international operating segment from local currencies into U.S. dollars using currency rates in effect at different points in time in accordance with U.S. GAAP. Significant changes in foreign currency exchange rates from one period to the next can result in meaningful variations in reported results. We are providing constant currency amounts for our international operating segment to present a period-to-period comparison of business performance that excludes the impact of foreign currency fluctuations.

•

~~U.S.We showed limited new releases, including~~ ~~Tom and Jerry~~ ~~and~~ ~~Godzilla vs. Kong,~~ as well as library content during the first quarter of 2021. Additionally, we continued to offer Private Watch Parties to our patrons. Average ticket price increased 11.0% to $9.25, primarily as a result of the mix of fewer matinee and weekday showtimes, the impact of Private Watch Parties and recognition of previously deferred loyalty revenues. Concession revenues per patron increased 15.0% to $6.30 driven by an increase in overall purchase incidence across core concession items and the recognition of previously deferred loyalty revenues, that were partially offset by the impact of continued welcome back pricing in certain locations. Other revenues for the first quarter of 2021 primarily included the amortization of NCM screen advertising advances and promotional income related to the recent new film releases.

•

~~International.~~We offered library content and limited new releases in our international theatres during the first quarter of 2021, resulting in 2.5 million in attendance and $7.6 million of admissions revenue. Our average ticket price was $3.05 as reported and $3.45 in constant currency, representing a 2.7% increase. The increase in constant currency average ticket price was due to the impact of inflation in certain countries, partially offset by a lower premium ticket mix. Concession revenues per patron increased 22.9% as reported and 34.3% in constant currency. The increase was a result of increased purchase incidence of our core concession items, the impact of inflation, new premium combo offerings, and increased retail concession sales. Other revenues primarily included screen advertising and loyalty membership revenues and were impacted by reduced attendance.

~~Cost of Operations.~~ ~~The table below summarizes our theatre operating costs (in millions) by reportable operating segment for~~ the three months ended March 31, 2021 ~~and 2020.~~(the “2021 period”)

U.S. Operating Segment

International Operating Segment

Consolidated

2021

2020

2021

2020

Constant
Currency ⁽¹⁾
2021

2021

2020

Film rentals and advertising

$
19.3

$
128.0

$
3.9

$
28.6

$
4.4

$
23.2

$
156.6

Concession supplies

$
5.5

$
25.6

$
1.7

$
9.2

$
1.9

$
7.2

$
34.8

Salaries and wages

$
24.9

$
71.2

$
6.3

$
16.4

$
7.2

$
31.2

$
87.6

Facility lease expense

$
59.0

$
65.4

$
5.8

$
16.8

$
6.3

$
64.8

$
82.2

Utilities and other

$
40.0

$
75.0

$
9.1

$
25.5

$
10.5

$
49.1

$
100.5

~~(1)~~

~~Constant currency expense amounts, which are non-GAAP measurements, were calculated using the average exchange rate for the corresponding month for 2020. We translate~~As noted above at Recent Developments, the COVID-19 pandemic has had an ongoing impact on the movie exhibition industry. When comparing the results of our international operating segment from local currencies into U.S. dollars using currency rates in effect at different points in time in accordance with U.S. GAAP. Significant changes in foreign currency exchange rates from one period to the next can result in meaningful variations in

reported results. We are providing constant currency amounts for our international operating segment to present a period-to-period comparison of business performance that excludes the impact of foreign currency fluctuations.

•

~~U.S.~~ Film rentals and advertising costs for first quarter of 2021 were 39.8% of admissions revenue compared to 55.1% for the first quarter of 2020. The decrease in the film rentals and advertising rate was driven by the box office performance of the limited new releases that was lower on the film rental scales that we have with the studios, as well as impact of library content. Film rentals and advertising costs for the first quarter of 2020 reflected a normal volume of new film releases with box office revenues that generally fell higher on the film rental scales. Concession supplies expenses for the first quarter of 2021 was 16.7% of concessions revenue compared to 16.8% of concession revenues for the first quarter of 2020. The concession supplies rate for the first quarter of 2021 reflected the impact of promotional pricing and the disposal of perishable goods for theatres that just recently reopened, offset by a favorable product mix.

~~Salaries and wages decreased $46.3 million~~ for the ~~first quarter~~2022 period with the 2021 period, the following should be noted:

•

All of ~~2021 as many of~~ our domestic and international theatres were open during the 2022 period while certain of our domestic and international theatres were temporarily closed for portions of the 2021 period.

•

The North American Industry box office exceeded $1.3B during the 2022 period, which included blockbuster films such as The Batman and Uncharted, as well as the sustained performance of the 2021 release of Spider-Man: No Way Home.

•

The North American Industry box office totaled less than $0.3B during the 2021 period with a limited number of new releases including Tom and Jerry, Raya and the Last Dragon and Croods: A New Age in addition to library content.

Revenues. The table below, presented by reportable operating segment, summarizes our year-over-year revenue performance and certain key performance indicators that impact our revenues.


	U.S. Operating Segment				International Operating Segment						Consolidated
									Constant Currency (3)
	2022		2021		2022		2021		2022		2022		2021
Admissions revenues (1)	$	191.8	$	48.5	$	44.0	$	7.6	$	46.4	$	235.8	$	56.1
Concession revenues (1)		141.1		33.0		31.9		6.5		33.9		173.0		39.5
Other revenues (1)(2)		39.1		15.6		12.6		3.2		13.1		51.7		18.8
Total revenues (1)(2)	$	372.0	$	97.1	$	88.5	$	17.3	$	93.4	$	460.5	$	114.4
Attendance (1)		20.7		5.2		12.4		2.5				33.1		7.7
Average ticket price (1)	$	9.27	$	9.25	$	3.55	$	3.05	$	3.74	$	7.12	$	7.25
Concession revenues per patron (1)	$	6.82	$	6.30	$	2.57	$	2.58	$	2.73	$	5.23	$	5.10

(1)

Average ticket price is calculated as admissions revenues divided by attendance. Concession revenues per patron is calculated as concession revenues divided by attendance.

(2)

U.S. operating segment revenues include eliminations of intercompany transactions with the international operating segment. See Note 17 to our condensed consolidated financial statements.

(3)

Constant currency revenue amounts, which are non-GAAP measurements, were calculated using the average exchange rate for the corresponding month for 2021. We translate the results of our international operating segment from local currencies into U.S. dollars using currency rates in effect at different points in time in accordance with U.S. GAAP. Significant changes in foreign currency exchange rates from one period to the next can result in meaningful variations in reported results. We are providing constant currency amounts for our international operating segment to present a period-to-period comparison of business performance that excludes the impact of foreign currency fluctuations.

•

U.S.Average ticket price increased to $9.27 during the 2022 period compared with $9.25 during the 2021 period. The 2021 period reflected limited operating hours and therefore fewer matinee showtimes. The 2021 period also benefited from Private Watch Parties, which carried a higher ticket price per patron. The 2022 period benefited from favorable ticket type mix, strategic pricing actions and a higher mix of premium large format box office. Concession revenues per patron increased 8.3% to $6.82 during the 2022 period compared with $6.30 during the 2021 period driven by higher incidence, audience mix and operating hours that are more conducive to concession purchases. Other revenues for the 2022 period increased 150.6% to $39.1 million compared with $15.6 million during the 2021 period primarily as a result of growth in attendance, which drove an increase in transaction fees, screen advertising and promotional revenues.

•

International.Average ticket price was $3.55 as reported, $3.74 in constant currency, compared with the 2021 period of $3.05. The increase in average ticket price in constant currency was primarily the result of the impact of inflation and higher premium ticket mix. Concession revenues per patron was $2.57 as reported, $2.73 in constant currency, for the 2022 period compared with $2.58 in the 2021 period. The increase in concession revenues per patron in constant currency was a result of the impact of inflation coupled with higher purchase incidence. Other revenues for the 2022 period increased 293.8% to $12.6 million compared with $3.2 million during the 2021 period primarily as a result of growth in attendance, which drove an increase in transaction fees, screen advertising and promotional revenues.

Cost of Operations. The table below, presented by reportable operating segment, summarizes our ~~operational teams focused~~year-over-year theatre operating costs.


	U.S. Operating Segment				International Operating Segment						Consolidated
	2022		2021		2022		2021		Constant Currency (1) 2022		2022		2021
Film rentals and advertising	$	106.2	$	19.3	$	21.4	$	3.9	$	22.6	$	127.6	$	23.2
Concession supplies	$	22.9	$	5.5	$	7.1	$	1.7	$	7.6	$	30.0	$	7.2
Salaries and wages	$	67.1	$	24.9	$	12.7	$	6.3	$	13.4	$	79.8	$	31.2
Facility lease expense	$	62.5	$	59.0	$	11.2	$	5.8	$	11.7	$	73.7	$	64.8
Utilities and other	$	68.1	$	40.0	$	18.8	$	9.1	$	19.7	$	86.9	$	49.1

(1)

Constant currency expense amounts, which are non-GAAP measurements, were calculated using the average exchange rate for the corresponding month for 2021. We translate the results of our international operating segment from local currencies into U.S. dollars using currency rates in effect at different points in time in accordance with U.S. GAAP. Significant changes in foreign currency exchange rates from one period to the next can result in meaningful variations in reported results. We are providing constant currency amounts for our international operating segment to present a period-to-period comparison of business performance that excludes the impact of foreign currency fluctuations.

•

U.S. Film rentals and advertising costs for the 2022 period were 55.4% of admissions revenue compared with 39.8% for the 2021 period. The rate for the 2022 period reflected the success of new film releases as discussed above. The rate for the 2021 period reflected the release of limited new films which skewed lower on ~~more efficient staffing levels.~~our negotiated film rental scales, and the impact of library content. Concession supplies expenses for the 2022 period was 16.2% of concessions revenue compared with 16.7% of concession revenues for the 2021 period.

Salaries and wages increased to $67.1 million for the 2022 period expanded operating hours, significantly higher attendance volumes and wage rate pressures with average hourly rates increasing approximately 14% compared with the 2021 period. Facility lease expense, which is primarily fixed in nature, ~~decreased $6.4~~increased to $62.5 million primarily due to ~~a decline~~new theatres and an increase in percentage rent expense and common area maintenance ~~costs, as well as the permanent closure of certain theatres.~~costs. Utilities and other costs ~~decreased $35.0~~increased to $68.1 million, as many of these costs, such as janitorial costs, utilities costs, credit card fees ~~security expenses, janitorial costs~~ and repairs and maintenance, are variable in nature and were impacted by ~~reduced~~the expansion of operating hours ~~of our theatres~~.and significant increase in attendance.

•

International. Film rentals and advertising costs for the 2022 period were 48.6% of admissions revenue compared with 51.3% for the 2021 period. The decrease in the film rentals and advertising rate was a result of decreased promotional and advertising costs as a percentage of revenue. Concession supplies expenses were 22.3% of concessions revenue compared with 26.2% of concession revenues for the 2021 period. The decrease in concessions supplies rate was driven by the disposal of perishable goods during the 2021 period due to temporary theatre closures.

•

~~International.~~ Film rentals and advertising costs for first quarter of 2021 were 51.3% of admissions revenue compared to 47.5% for the first quarter of 2020. The increase in the film rentals and advertising rate was a result of increased promotional and advertising costs as a percentage of revenue as well as a decrease in virtual print fees collected from studios as cost recoupment is attained on the digital equipment. Concession supplies expenses were 26.2% of concessions revenue compared to 24.5% of concession revenues for the first quarter of 2020, driven by a higher mix of retail and premium concession products and the disposal of perishable goods due to temporary theatre closures.

Salaries and wages ~~decreased $10.1~~increased to $12.7 million as reported for the first quarter of ~~2021 as compared~~2022 due to ~~the first quarter of 2020, driven by the ongoing closures of theatres and limited~~expanded operating hours, ~~for those theatres that reopened.~~increased staffing to service the significant increase in attendance volumes and inflationary impacts. Facility lease expense ~~decreased $11.0~~increased to $11.2 million as reported due to ~~our negotiations with certain landlords to shift from a~~increased percentage rent driven by increases in revenue and the return of minimum rent ~~structure to percentage rent~~thresholds that were temporarily adjusted while ~~we recover from~~theatres were reopening during the ~~pandemic, as well as lower percentage rent at other locations.~~2021 period. Utilities and other costs ~~decreased $16.4~~increased to $18.8 million as reported, as many of these costs are variable in nature, such as credit card fees, security expenses, janitorial costs and repairs and maintenance, and were impacted by the ~~temporary closure and limited~~expansion of operating hours and the significant increase in attendance. These expenses, as reported, were also impacted by exchange rates in each of ~~our theatres.~~the countries in which we operate.

General and Administrative Expenses. General and administrative expenses ~~decreased $5.0~~increased to $40.7 million for the ~~first quarter of~~2022 period compared with $35.9 million for the 2021 ~~compared to the first quarter of 2020.~~period. The ~~decrease was~~increase is primarily due to ~~the impact of the 2020 Restructuring Plan (see Note 2) that permanently reduced headcount~~increased consulting fees and ~~related compensation~~salaries to support our strategic initiatives and ~~benefits. Travel expense also declined due to the Company’s continued efforts to limit non-essential operating expenses.~~ increased legal fees.

Depreciation and Amortization. Depreciation and amortization expense ~~increased $2.9~~decreased to $61.7 million ~~during~~for the ~~first quarter of~~2022 period compared with $68.2 million for the 2021 period primarily due to the ~~digital projectors we received in a non-cash distribution from DCIP~~impairment of theatre assets during ~~the fourth quarter of 2020. See Note 10 to the condensed consolidated financial statements for discussion of the non-cash distribution from DCIP.~~2021.

~~Impairment of Long-Lived Assets.~~ No asset impairment charges were recorded during the first quarter of 2021. We recorded asset impairment charges of $16.6 million during the first quarter of 2020. The asset impairment charges recorded during the first quarter of 2020 were primarily a result of the prolonged impact of the COVID pandemic on our operations, as some theatres remained closed and film content continues to shift into future periods, both of which impacted our estimated future cash flows for theatres. Impairment charges for the first quarter of 2020 impacted eight countries. See Note 13 to our condensed consolidated financial statements.

(Gain) Loss on Disposal of Assets and Other. ~~We recorded a loss~~A gain on disposal of assets and other of $6.9 million was recorded during the 2022 period compared with a loss of $4.5 million during the ~~first quarter of~~ 2021 ~~compared to $1.9 million during the first quarter of 2020.~~period. Activity for the ~~first quarter~~2022 period was primarily related to the sales of excess land parcels. Activity for the 2021 period was primarily related to the write-off of certain digital projectors ~~recently~~ received from DCIP in a non-cash distribution during November 2020 that were replaced with laser projectors. See Note 10 for discussion of the distribution of digital projectors from DCIP. ~~Activity for the first quarter of 2020 was primarily due to the retirement of assets related to theatre remodels.~~

Interest Expense. Interest expense, which includes amortization of debt issue costs and amortization of accumulated losses for swap amendments, increased to ~~$36.6~~$38.1 million during the ~~first quarter of~~2022 period compared with $36.6 million for the 2021 ~~compared to $24.7 million the first quarter of 2020.~~period. The increase was primarily due to the issuance of ~~8.750% senior secured~~ notes ~~on April 20, 2020~~(the 5.875% Senior Notes and ~~the issuance of 4.50% convertible~~5.25% Senior Notes) to refinance certain notes ~~on August 21, 2020.~~that had lower interest rates (5.125% Senior Notes and 4.875% Senior Notes) during 2021. See ~~Note 7 to our condensed consolidated financial statements.~~further discussion at Financing Activities below.

Loss on Extinguishment of Debt. We recorded a loss on extinguishment of debt of $2.6 million during the ~~first quarter of~~ 2021 period related to the early retirement of our 5.125% Senior Notes and 4.875% Senior Notes, including athe write-off of unamortized debt issuance costs and ~~cash~~legal and other fees paid. ~~See Note 7 to our condensed consolidated financial statements.~~

~~Distributions from NCM.~~ We recorded distributions from NCM of $0.1 million during the first quarter of 2021 compared to $5.2 million recorded during the first quarter of 2020. These distributions were in excess of the carrying value of our Tranche 1 investment. The decrease in distributions from NCM is primarily due to the impact of theatres being temporarily closed as a result of the COVID-19 pandemic as discussed at Note 2. See Note 9 to our condensed consolidated financial statements for discussion of our investment in NCM.

~~Interest expense – NCM~~. We recorded non-cash interest expense of $5.8 million for the first quarter of 2021 compared to $5.9 million recorded during the first quarter of 2020, related to the significant financing component associated with certain of our agreements with NCM. See Note 9 to our condensed consolidated financial statements for further discussion.

Equity in ~~Income (Loss)~~Loss of Affiliates. ~~We recorded~~An equity in loss of affiliates of ~~$(6.8)~~$2.2 million was recorded during the 2022 period compared with $6.8 million during the ~~first quarter of~~ 2021 ~~compared to equity in income of affiliates of $8.5 million during the first quarter of 2020.~~period. The decrease in equity ~~income~~loss of affiliates is ~~primarily~~ due to the ~~impact~~recovery of ~~theatres being temporarily closed~~our equity investees’ performance as ~~a result of~~ the ~~COVID-19 pandemic as discussed at Note 2~~industry continues to ~~our condensed consolidated financial statements.~~recover. See Notes 9 and 10 to our condensed consolidated financial statements for information about our equity investments.

Income Taxes. An income tax benefit of ~~$(14.6)~~$(1.8) million was recorded for the ~~first quarter of 2021~~2022 period compared towith an income tax benefit of ~~$(3.1)~~$(14.7) million for the ~~first quarter of 2020.~~2021 period. The effective tax rate was approximately ~~6.55%~~2.4% for the ~~first quarter of 2021~~2022 period compared ~~to 5%~~with 6.6% for the ~~first quarter of 2020. As a result of continued projected losses in~~ 2021 ~~the income~~period. The effective tax rate for the 2022 period was ~~negatively~~ impacted by valuation allowances related to ~~certain~~deferred tax assets and foreign tax credits ~~and deferred tax assets~~ for which the ultimate realization is uncertain. For the 2022 period, we utilized the discrete effective tax rate method (“discrete method”), as allowed by ASC Topic 740-270-30-18, Income Taxes — Interim Reporting, to calculate our interim income tax ~~provisions for interim (quarterly) periods are based on~~provision. The discrete method is applied when the application of the estimated annual effective tax rate is impractical because it is not possible to reliably estimate the annual effective tax rate. The discrete method treats the year-to-date period as if it was the annual period and determines the income tax ~~rates and are adjusted for~~expense or benefit on that basis. We believe that, at this time, the ~~effects~~use of this discrete method is more appropriate than the annual effective tax rate method as the estimated annual effective tax rate method is not reliable due to significant ~~infrequent~~variations in income tax expense relative to changes (increases or ~~unusual items (i.e. discrete items) occurring during the interim period. As a result, the interim rate may vary significantly from the normalized annual rate.~~decreases) in estimated pretax earnings.

Liquidity and Capital Resources

Operating Activities

We primarily collect our ~~revenues~~revenue in cash, mainly through box office receipts and the sale of concessions. Our revenues are generally received in cash prior to the payment of related expenses; therefore, we have an operating “float” and historically have not required traditional working capital financing. ~~However, as we reopened~~We temporarily closed all of our theatres ~~that were temporarily closed~~ during March 2020 ~~we have~~and funded operating expenses with cash on hand and ~~recent additional~~new financing discussed below under Financing Activities. while theatres were closed and as we reopened our theatres. During the latter part of 2021, as we began to show a steady stream of new film content and our theatres were returning to more consistent operating hours, we began to generate positive cash flows from operations and transition back to our historical working capital “float” position. However, our working capital position will continue to fluctuate based on seasonality, the level of new film content, the timing of interest payments on our long-term debt as well as timing of payment of other operating expenses that are paid annually or semi-annually, such as property and other taxes and incentive bonuses. We believe our existing cash and expected cash flows from operations will be sufficient to meet our working capital, capital expenditures, and expected cash requirements from known contractual obligations for the next twelve months and beyond.

Cash used for operating activities was ~~$124.1~~$118.8 million for the three months ended March 31, ~~2021~~2022 compared ~~to cash used for operating activities of $15.6~~with $124.1 million for the three months ended March 31, ~~2020.~~2021. The decrease in cash ~~provided by~~used for operating activities was primarily a result of the ~~continued impact~~timing and level of revenues earned during each period and the ~~COVID-19 pandemic.~~ timing of payments to vendors for expenses incurred during each period.

As discussed in Note 4 to our condensed consolidated financial statements, we negotiated the deferral of rent and other lease-related payments in 2020 and early 2021 with ~~many~~some of our ~~landlords, resulting in~~landlords. As of March 31, 2022, approximately ~~$65.2~~$22.1 million in deferred lease payments asremain outstanding, the majority of ~~March 31, 2021. Approximately $48.3 million~~which will be repaid ~~within one year and the remaining $16.9 million will be repaid in subsequent years.~~ during 2022.

~~Subsequent to March 31, 2021, we received approximately $136.8 million in cash tax refunds associated with net operating losses that were carried back, as discussed above.~~

Investing Activities

Our investing activities have been principally related to the development, remodel and acquisition of theatres. New theatre openings, remodels and acquisitions historically have been financed with internally generated cash and by debt financing, including borrowings under our senior secured credit facility. Cash used for investing activities was ~~$17.7~~ $8.1 million for the three months ended March 31, ~~2021~~2022 compared to ~~$34.1~~ with $17.7 million for the three months ended March 31, ~~2020.~~2021. The decrease in cash used for investing activities was primarily due to ~~reduced capital expenditures in response to~~proceeds from the ~~continued impact~~sale of excess land parcels recognized during the ~~COVID-19 pandemic.~~ three months ended March 31, 2022.

Capital expenditures for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 were as follows (in millions):


	Three Months Ended March 31,
	2022		2021
New theatres	$	6.6	$	2.3
Existing theatres	$	12.1	$	15.4
Total capital expenditures	$	18.7	$	17.7

Period

New Theatres

Existing Theatres

Total

Three Months Ended March 31, 2021

$
2.3

$
15.4

$
17.7

Three Months Ended March 31, 2020

$
8.1

$
26.0

$
34.1

We operated ~~523~~520 theatres with ~~5,872~~5,849 screens worldwide as of March 31, ~~2021.~~2022. Theatres and screens acquired, built and closed during the three months ended March 31, ~~2021~~2022 were as follows:


	January 1, 2021		Closed		March 31, 2021		January 1, 2022		Built		Closed			March 31, 2022
U.S (42 states)
Theatres		331		(6)		325		321		—		(1	)		320
Screens		4,507		(71)		4,436		4,408		—		(12	)		4,396

International (15 countries)
Theatres		200		(2)		198		201		—		(1	)		200
Screens		1,451		(15)		1,436		1,460		5		(12	)		1,453

Worldwide
Theatres		531		(8)		523		522		—		(2	)		520
Screens		5,958		(86)		5,872		5,868		5		(24	)		5,849

As of March 31, ~~2021,~~2022, we had the following signed ~~commitments (costs in millions):~~commitments:


	Theatres	Screens	Estimated Cost (1)
Remainder of 2022
U.S.	2	28	$	20.4
International	1	14		4.2
Total	3	42	$	24.6

Subsequent to 2022
U.S.	3	34	$	20.8
International	6	36		16.2
Total	9	70	$	37.0

Total commitments at March 31, 2022	12	112	$	61.6

Theatres

Screens

Estimated Cost ⁽¹⁾

Remainder of 2021

U.S.

3

42

$
32.2

International

3

30

13.3

Total

6

72

$
45.5

Subsequent to 2021

U.S.

6

74

$
46.0

International

7

49

19.1

Total

13

123

$
65.1

Total commitments at March 31, 2021

19

195

$
110.6

(1)

We expect approximately $24.6 million during the remainder of 2022 and $31.1 million and $5.9 million to be paid during 2023 and 2024, respectively. The timing of payments is subject to change as a result of construction or other delays.

~~(1)~~

We expect approximately $45.5 million, $41.0 million and $24.1 million to be paid during the remainder of 2021, during 2022 and 2023, respectively. The timing of payments is subject to change depending on project or other related delays.

Actual expenditures for continued theatre development, remodels and acquisitions are subject to change based upon the availability of attractive opportunities. ~~We may~~During the next twelve months and the foreseeable future, we plan to fund capital expenditures for our continued development with cash flow from operations and, if needed, borrowings under our senior secured credit facility, ~~and~~ proceeds from debt issuances, sale leaseback transactions and/or sales of excess real estate.

Financing Activities

Cash used for financing activities was $8.6 million for the three months ended March 31, 2022 compared with cash provided by financing activities ~~was~~of $0.8 million for the three months ended March 31, ~~2021 compared to cash provided by financing activities of $48.0 million for the three months ended March 31, 2020.~~2021. During the three months ended March 31, ~~2020,~~2021, we ~~borrowed $98.8 million on our revolving line-of-credit,~~issued 5.875% Senior Notes, the proceeds of which ~~was repaid during~~were used to redeem the ~~third quarter of 2020, and we paid dividends to stockholders of $42.3 million.~~5.125% Senior Notes, as discussed further below.

We, at the discretion of the board of directors and subject to applicable law, may pay dividends on our common stock. The amount, if any, of the dividends to be paid in the future will depend upon our then available cash balance, anticipated cash needs, overall financial condition, loan agreement restrictions as discussed below, future prospects for earnings and cash flows, as well as other relevant factors. As a result of the impact of the COVID-19 pandemic, we have suspended our quarterly dividend.

We may from time to time, subject to compliance with our debt instruments, purchase our debt securities on the open market depending upon the availability and prices of such securities. Long-term debt consisted of the following as of March 31, ~~2021~~2022 (in millions):


	March 31,		December 31,
	2022		2021
Cinemark Holdings, Inc. 4.500% convertible senior notes due 2025	$	460.0	$	460.0
Cinemark USA, Inc. term loan due 2025		631.5		633.1
Cinemark USA, Inc. 8.750% senior secured notes due 2025		250.0		250.0
Cinemark USA, Inc. 5.875% senior notes due 2026		405.0		405.0
Cinemark USA, Inc. 5.250% senior notes due 2028		765.0		765.0
Other		32.4		30.2
Total long-term debt	$	2,543.9	$	2,543.3
Less: Current portion		27.2		24.3
Less: Debt issuance costs, net of accumulated amortization		40.1		42.7
Long-term debt, less current portion, net of unamortized debt issuance costs	$	2,476.6	$	2,476.3

Cinemark USA, Inc. term loan

$
638.1

Cinemark USA, Inc. 4.875% senior notes due 2023

755.0

Cinemark USA, Inc. 8.750% senior secured notes due 2025

250.0

Cinemark Holdings, Inc. 4.500% convertible senior notes due 2025

460.0

Cinemark USA, Inc. 5.875% senior notes due 2026

405.0

Other debt

30.1

Total long-term debt

$
2,538.2

Less current portion

18.5

Subtotal long-term debt, less current portion

$
2,519.7

Less: Debt discounts and debt issuance costs, net of accumulated amortization

43.0

Long-term debt, less current portion, net of debt discounts and unamortized debt issuance costs

$
2,476.7

As of March 31, ~~2021,~~ ~~$100~~2022, $100 million was available for borrowing under the revolving line of credit.

Contractual Obligations

On March 16, 2021, Cinemark USA, Inc. issued the 5.875% Senior Notes and retired the 5.125% Senior Notes. Included below is an updated summary of long-term debt obligations and related estimated scheduled interest payment obligations as of March 31, 2021, reflecting these changes.

Payments Due by Period

(in millions)

Less Than

After

Contractual Obligations

Total

One Year

1 - 3 Years

3 - 5 Years

5 Years

Long-term debt ⁽¹⁾

$
2,538.2

$
18.5

$
780.5

$
1,733.7

$
5.5

Scheduled interest payments on long-term debt ⁽²⁾

$
460.0

$
125.5

$
219.3

$
115.0

$
0.2

~~(1)~~

~~Amounts are presented before adjusting for unamortized debt issuance costs and debt discounts.~~

~~(2)~~

Amounts include scheduled interest payments on fixed rate and variable rate debt agreements. Estimates for the variable rate interest payments were based on interest rates in effect on March 31, 2021. The average interest rates in effect on our fixed rate and variable rate debt are 5.0% and 2.4%, respectively, as of March 31, 2021.

There have been no ~~other~~ material changes in our contractual obligations previously disclosed in “Liquidity and Capital Resources” in our Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 filed February ~~26, 2021.~~25, 2022.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

Senior Secured Credit Facility

Cinemark USA, Inc. has a senior secured credit facility that includes a $700.0 million term loan and a $100.0 million revolving credit line (the “Credit Agreement”). Under the amended Credit Agreement, quarterly principal payments of $1.6 million are due on the term loan through December 31, 2024, with a final principal payment of $613.4 million due on March 29, 2025. Cinemark USA, Inc. had $100.0 million available borrowing capacity on the revolving credit line as of March 31, ~~2021.~~2022.

Interest on the term loan accrues at Cinemark USA, Inc.’s option at: (A) the base rate equal to the greater of (1) the US “Prime Rate” as quoted in The Wall Street Journal or, if no such rate is quoted therein, in a Federal Reserve Board statistical release, (2) the federal funds effective rate plus 0.50%, and (3) a one-month Eurodollar-based rate plus 1.0%, plus, in each case, a margin of 0.75% per annum, or (B) a Eurodollar-based rate for a period of 1, 2, 3, 6, 9 or 12 months plus a margin of 1.75% per annum. Interest on the revolving credit line accrues, at our option, at: (A) a base rate equal to the greater of (1) the US “Prime Rate” as quoted in The Wall Street Journal or if no such rate is quoted therein, in a Federal Reserve Board statistical release, (2) the federal funds effective rate plus 0.50%, and (3) a one-month Eurodollar-based rate plus 1.0%, plus, in each case, a margin that ranges from 0.50% to 1.25% per annum, or (B) a Eurodollar-based rate for a period of 1, 2, 3, 6, 9 or 12 months plus a margin that ranges from 1.50% to 2.25% per annum. The margin of the revolving credit line is determined by the consolidated net senior secured leverage ratio as defined in the Credit Agreement.

Cinemark USA, Inc.’s obligations under the Credit Agreement are guaranteed by Cinemark Holdings, Inc. and certain of Cinemark USA, Inc.’s domestic subsidiaries and are secured by mortgages on certain fee and leasehold properties and security interests in substantially all of Cinemark USA, Inc.’s and the guarantors’ personal property, including, without limitation, pledges of all of Cinemark USA, Inc.’s capital stock, all of the capital stock of certain of Cinemark USA, Inc.’s domestic subsidiaries and 65% of the voting stock of certain of its foreign subsidiaries.

The Credit Agreement contains usual and customary negative covenants for agreements of this type, including, but not limited to, restrictions on Cinemark USA, Inc.’s ability, and in certain instances, its subsidiaries’ and our ability, to consolidate or merge or liquidate, wind up or dissolve; substantially change the nature of its business; sell, transfer or dispose of assets; create or incur indebtedness; create liens; pay dividends or repurchase stock; and make capital expenditures and investments. If Cinemark USA, Inc. has borrowings outstanding on the revolving credit line, it is required to satisfy a consolidated net senior secured leverage ratio covenant as defined in the Credit Agreement, not to exceed 4.25 to 1. See below for discussion of recent covenant waivers.

The dividend restriction contained in the Credit Agreement prevents the Company and any of its subsidiaries from paying a dividend or otherwise distributing cash to its stockholders unless (1) the Company is not in default, and the distribution would not cause Cinemark USA, Inc. to be in default, under the Credit Agreement; and (2) the aggregate amount of certain dividends, distributions, investments, redemptions and capital expenditures made since December 18, 2012, including dividends declared by the board of directors, is less than the sum of (a) the aggregate amount of cash and cash equivalents received by Cinemark Holdings, Inc. or Cinemark USA, Inc. as common equity since December 18, 2012, (b) Cinemark USA, Inc.’s consolidated EBITDA minus 1.75 times its consolidated interest expense, each as defined in the Credit Agreement, and (c) certain other defined amounts, ~~(collectively~~or collectively, the ~~“Applicable Amount”).~~Applicable Amount. As of March 31, 2022, Cinemark USA, Inc. could have distributed up to approximately $2.75 billion to its parent company and sole stockholder, Cinemark Holdings, Inc.

On April 17, 2020, in conjunction with the issuance of the 8.750% Secured Notes discussed below, we obtained a waiver of the leverage covenant from the majority of revolving lenders under the Credit Agreement for the fiscal quarters ending September 30, 2020 and December 31, 2020. The waiver is subject to certain liquidity thresholds, restrictions on investments and the use of the Applicable Amount.

On August 21, 2020, in conjunction with the issuance of the 4.50% Convertible Senior Notes discussed below, we further amended the waiver of the leverage covenant through the fiscal quarter ending September 30, 2021. The amendment also i) modifies the leverage covenant calculation beginning with the calculation for the trailing twelve-month period ended December 31, 2021, ii) for purposes of testing the consolidated net senior secured leverage ratio for the fiscal quarters ending on December 31, 2021, March 31, 2022 and June 30, 2022, permits us to substitute Consolidated EBITDA for the first three fiscal quarters of 2019 in lieu of Consolidated EBITDA for the corresponding fiscal quarters of 2021, (iii) modifies the restrictions imposed by the covenant waiver and (iv) makes such other changes to permit the issuance of the 4.50% Convertible Senior Notes discussed below.

On June 15, 2021, in conjunction with the issuance of the 5.25% Senior Notes discussed below, the Credit Agreement was amended to, among other things, extend the maturity of the revolving credit line from November 28, 2022 to November 28, 2024.

We have ~~four~~three interest rate swap agreements that are used to hedge a portion of the interest rate risk associated with the variable interest rates on the term loan outstanding under the Credit Agreement. See Note 7 of our condensed consolidated financial statements for discussion of the interest rate swaps.

AtAs of March 31, ~~2021,~~2022, there was ~~$638.1~~$631.5 million outstanding under the term loan and no borrowings were outstanding under the $100.0 million revolving line of credit. The average interest rate on outstanding term loan borrowings under the Credit Agreement as of March 31, ~~2021~~2022 was approximately 3.4% per annum, after giving effect to the interest rate swap agreements discussed above.

5.875% Senior Notes

On March 16, 2021, Cinemark USA, Inc. issued $405 million aggregate principal amount of 5.875% senior notes due 2026, at par value (the “5.875% Senior Notes”). Proceeds, after payment of fees, were used to fund a cash tender offer to purchase any and all of Cinemark USA’s 5.125% Senior Notes (the “5.125% Senior Notes”) and to redeem any of the 5.125% Notes that remained outstanding after the tender offer. See further discussion of the tender offer below. Interest on the 5.875% Senior Notes is payable on March 15 and September 15 of each year, beginning September 15, 2021. The 5.875% Senior Notes mature on March 15, 2026. The Company incurred debt issue costs of approximately $6.0 million in connection with the issuance, which are recorded as a reduction of long-term debt, less current on the condensed consolidated balance sheet.

The 5.875% Senior Notes are fully and unconditionally guaranteed on a joint and several senior unsecured basis by certain of Cinemark USA, Inc.’s subsidiaries that guarantee, assume or become liable with respect to any of Cinemark USA, Inc.’s or a guarantor’s debt. The 5.875% Senior Notes and the guarantees are senior unsecured obligations and rank equally in right of payment with all of Cinemark USA, Inc.’s and its guarantor’s existing and future senior debt and senior in right of payment to all of Cinemark USA, Inc.’s and its guarantors’ existing and future senior subordinated debt. The 5.875% Senior Notes and the guarantees are effectively subordinated to all of Cinemark USA, Inc.’s and its guarantor’s existing and future secured debt to the extent of the value of the collateral securing such debt, including all borrowings under Cinemark USA, Inc.’s amended senior secured credit facility. The 5.875% Senior Notes and the guarantees are structurally subordinated to all existing and future debt and other liabilities of Cinemark USA, Inc.’s subsidiaries that do not guarantee the 5.875% Senior Notes.

The indenture to the 5.875% Senior Notes contains covenants that limit, among other things, the ability of Cinemark USA, Inc. and certain of its subsidiaries to (1) make investments or other restricted payments, including paying dividends, making other distributions or repurchasing subordinated debt or equity, (2) incur additional indebtedness and issue preferred stock, (3) enter into transactions with affiliates, (4) enter new lines of business, (5) merge or consolidate with, or sell all or substantially all of its assets to, another person and (6) create liens. As of March 31, 2021, Cinemark USA, Inc. could have distributed up to approximately $3.0 billion to its parent company and sole stockholder, Cinemark Holdings, Inc., under the terms of the indenture to the 4.875% Senior Notes, subject to its available cash and other borrowing restrictions outlined in the indenture. Upon a change of control, as defined in the indenture, the Company would be required to make an offer to repurchase the 5.875% Senior Notes at a price equal to 101% of the aggregate principal amount outstanding plus accrued and unpaid interest, if any, through the date of repurchase. The indenture governing the 5.875% Senior Notes allows Cinemark USA, Inc. to incur additional indebtedness if we satisfy the coverage ratio specified in the indenture, after giving effect to the incurrence of the additional indebtedness, and in certain other circumstances. ~~The required minimum coverage ratio is 2 to 1 and our actual ratio as of March 31, 2021 was below zero.~~

~~5.125%~~

5.25% Senior Notes

On ~~March 16,~~June 15, 2021, Cinemark USA, Inc. ~~completed a tender offer~~issued $765 million aggregate principal amount of 5.25% senior notes due 2028, at par value (the “5.25% Senior Notes”). Proceeds, after payment of fees, were used to ~~purchase it’s previously outstanding 5.125%~~redeem all of Cinemark USA’s 4.875% $755 million aggregate principal amount of Senior Notes due 2023 (the “4.875% Senior Notes”). Interest on the 5.25% Senior Notes is payable on January 15 and July 15 of ~~which $334.0 million was tendered at~~each year, beginning January 15, 2022. The 5.25% Senior Notes mature on July 15, 2028.

The 5.25% Senior Notes are fully and unconditionally guaranteed on a joint and several senior unsecured basis by certain of Cinemark USA, Inc.’s subsidiaries that guarantee, assume or become liable with respect to any of Cinemark USA, Inc.’s or a guarantor’s debt. The 5.25% Senior Notes and the ~~expiration~~guarantees will be Cinemark USA’s and the guarantors’ senior unsecured obligations and (i) rank equally in right of payment to Cinemark USA’s and the guarantors’ existing and future senior debt, including borrowings under Cinemark USA’s Credit Agreement (as defined below) and Cinemark USA’s existing senior notes, (ii) rank senior in right of payment to Cinemark USA’s and the guarantors’ future subordinated debt, (iii) are effectively subordinated to all of Cinemark USA’s and the guarantors’ existing and future secured debt, including all obligations under the Credit Agreement and Cinemark USA’s 8.750% senior secured notes due 2025, in each case to the extent of the ~~offer. On March 16, 2021,~~value of the collateral securing such debt, (iv) are structurally subordinated to all existing and future debt and other liabilities of Cinemark USA’s non-guarantor subsidiaries, and (v) are structurally senior to the 4.50% convertible senior notes due 2025 issued by Cinemark Holdings.

Prior to July 15, 2024, Cinemark USA, Inc. ~~also issued a notice of optional redemption to~~may redeem ~~the remaining $66.0 million principal amount~~all or any part of the ~~5.125% Senior Notes. In connection therewith, on March 16, 2021, Cinemark USA deposited with Wells Fargo Bank, N.A., as trustee for the 5.125%~~5.25% Senior Notes (the “Trustee”), funds sufficient to redeem all 5.125% Notes remaining outstanding on April 15, 2021 (the “Redemption Date”). The redemption payment (the “Redemption Payment”) included approximately $66.0 million of outstanding principal at ~~the redemption price equal to~~its option at 100% of the principal amount plus a make-whole premium plus accrued and unpaid interest ~~thereon~~on the 5.25% Senior Notes to the ~~Redemption Date. Upon deposit~~date of ~~the Redemption Payment with the Trustee on March 16, 2021, the indenture governing the 5.125% Senior Notes was fully satisfied and discharged.~~

The Company recorded a loss on extinguishment of debt on the condensed consolidated income statement of $2.6 million for the three months ended March 31, 2021, which included the write-off of $1.2 million of unamortized debt issuance costs and the payment of $1.4 million in fees.

~~4.875% Senior Notes~~

redemption. On ~~May 24, 2013,~~or after July 15, 2024, Cinemark USA, Inc. ~~issued $530.0 million aggregate principal amount of 4.875%~~may redeem the 5.25% Senior Notes ~~due 2023,~~in whole or in part at ~~par value (the “4.875% Senior Notes”).~~redemption prices specified in the indenture. In addition, prior to July 15, 2024, Cinemark USA, Inc. ~~issued an additional $225.0 million~~may redeem up to 40% of the aggregate principal amount of the ~~4.875%~~5.25% Senior Notes from the net proceeds of certain equity offerings at ~~99.0%~~the redemption price set forth in the indenture, so long as at least 60% of the principal amount ~~plus accrued and unpaid interest from December 1, 2015. These additional 4.875%~~of the 5.25% Senior Notes have identical terms, other than the issue date, the issue price and the first interest payment date, and constitute part of the same series as the Company’s existing 4.875% Senior Notes. Interest on the 4.875% Senior Notes is payable on June 1 and December 1 ofremains outstanding immediately after each ~~year. The 4.875% Senior Notes mature on June 1, 2023.~~ such redemption.

The indenture to the 4.875% Senior Notes contains covenants that limit, among other things, the ability of Cinemark USA, Inc. and certain of its subsidiaries to (1) make investments or other restricted payments, including paying dividends, making other distributions or repurchasing subordinated debt or equity, (2) incur additional indebtedness and issue preferred stock, (3) enter into transactions with affiliates, (4) enter new lines of business, (5) merge or consolidate with, or sell all or substantially all of its assets to, another person and (6) create liens. As of March 31, 2021, Cinemark USA, Inc. could have distributed up to approximately $2.7 billion to its parent company and sole stockholder, Cinemark Holdings, Inc., under the terms of the indenture to the 4.875% Senior Notes, subject to its available cash and other borrowing restrictions outlined in the indenture. Upon a change of control, as defined in the indenture governing the 4.875% Senior Notes, Cinemark USA, Inc. would be required to make an offer to repurchase the 4.875% Senior Notes at a price equal to 101% of the aggregate principal amount outstanding plus accrued and unpaid interest, if any, through the date of repurchase. The indenture governing the 4.875% Senior Notes allows Cinemark USA, Inc. to incur additional indebtedness if it satisfies the coverage ratio specified in the indenture, after giving effect to the incurrence of the additional indebtedness, and in certain other circumstances. The required minimum coverage ratio is 2 to 1 and our actual ratio as of March 31, 2021 was below zero.

8.750% Secured Notes

On April 20, 2020, Cinemark USA, Inc. issued ~~$250,000~~$250 million 8.750% senior secured notes (the “8.750% Secured Notes”). The 8.750% ~~Senior~~Secured Notes will mature on May 1, 2025; provided, however, that if (i) on September 13, 2022, the aggregate outstanding principal amount of the 5.125% Senior Notes that shall not have been purchased, repurchased, redeemed, defeased or otherwise acquired, retired, cancelled or discharged exceeds $50,000, the 8.750% Senior Notes will mature on September 14, 2022 and (ii) on February 27, 2023, the aggregate outstanding principal amount of the 4.875% Senior Notes that shall not have been purchased, repurchased, redeemed, defeased or otherwise acquired, retired, cancelled or discharged exceeds $50,000, the 8.750% Senior Notes will mature on February 28, 2023.2025. Interest on the 8.750% ~~Senior~~Secured Notes ~~will be~~is payable on May 1 and November 1 of each ~~year, beginning on November 1, 2020.~~ year. Cinemark USA, Inc. may redeem the 8.750% Secured Notes in whole or in part at redemption prices specified in the indenture.

The 8.750% Secured Notes are fully and unconditionally guaranteed on a joint and several senior basis by certain of the Company’s subsidiaries that guarantee, assume or in any other manner become liable with respect to any of the Company’s or its guarantors’ other debt. If the Company cannot make payments on the 8.750% Secured Notes when they are due, the Company’s guarantors must make them instead. Under certain circumstances, the guarantees may be released without action by, or the consent of, the holders of the 8.750% Secured Notes.

The indenture to the 8.750% Secured Notes contains covenants that limit, among other things, the ability of Cinemark USA, Inc. and certain of its subsidiaries to (1) make investments or other restricted payments, including paying dividends, making other distributions or repurchasing subordinated debt or equity, (2) incur additional indebtedness and issue preferred stock, (3) enter into transactions with affiliates, (4) enter new lines of business, (5) merge or consolidate with, or sell all or substantially all of its assets to, another person and (6) create liens. As of March 31, 2021, Cinemark USA, Inc. could have distributed up to approximately $3.0 billion to its parent company and sole stockholder, Cinemark Holdings, Inc., under the terms of the indenture to the 8.750% Secured Notes, subject to its available cash and other borrowing restrictions outlined in the indenture. Upon a change of control, as defined in the indenture governing the 8.750% Secured Notes, Cinemark USA, Inc. would be required to make an offer to repurchase the 8.750% Secured Notes at a price equal to 101% of the aggregate principal amount outstanding plus accrued and unpaid interest, if any, through the date of repurchase. The indenture governing the 8.750% Secured Notes allows Cinemark USA, Inc. to incur additional indebtedness if it satisfies a coverage ratio specified in the indenture, after giving effect to the incurrence of the additional indebtedness, and in certain other circumstances. The required minimum coverage ratio is 2.0 to 1 and our actual ratio as of March 31, 2021 was below zero.

4.50% Convertible Senior Notes

On August 21, 2020, Cinemark Holdings, Inc. issued $460 million 4.50% convertible senior notes (the “4.50% Convertible Senior Notes”). The notes will mature on August 15, 2025, unless earlier repurchased or converted. Interest on the notes will be payable on February 15 and August 15 of each year, beginning on February 15, 2021.

Holders of the 4.50% Convertible Senior Notes may convert their 4.50% Convertible Senior Notes at their option at any time prior to the close of business on the business day immediately preceding May 15, 2025 only under the following circumstances: (1) during the five business day period after any five consecutive trading day period, or the measurement period, in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; (2) if we distribute to all or substantially all stockholders (i) rights options or warrants entitling them to purchase shares at a discount to the recent average trading price of our common stock (including due to a stockholder rights plan) or (ii) our assets or securities or rights, options or warrants to purchase the same with a per share value exceeding 10% of the trading price of our common stock, (3) upon the occurrence of specified corporate events as described further in the indenture. Beginning May 15, 2025, holders may convert their notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date, or (4) during any calendar quarter commencing after the calendar quarter ending on September 30, 2020 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price (initially $14.35 per share), on each applicable trading day. Upon conversion of the notes, we will pay or deliver cash, shares of our common stock or a combination of cash and shares of our common stock, at our election.

The initial conversion rate ~~will initially be~~is 69.6767 shares of our common stock per one thousand dollars principal amount of the 4.50% Convertible Senior Notes. The conversion rate will be subject to adjustment upon the occurrence of certain events. If a make-whole fundamental change as defined in the indenture occurs prior to the maturity date, we will, in certain circumstances, increase the conversion rate for a holder who elects to convert its notes in connection with such make-whole fundamental change.

The 4.50% Convertible Notes ~~will be~~are effectively subordinated to any of our, or our subsidiaries’, existing and future secured debt to the extent of the value of the assets securing such indebtedness, including obligations under the Credit Agreement. The 4.50% Convertible Notes ~~will be~~are structurally subordinated to all existing and future debt and other liabilities, including trade payables, including Cinemark USA’s ~~5.125% senior notes due 2022, 4.875% senior notes due 2023 and the~~ 8.750% Secured Notes due 2025, 5.25% Senior Notes due 2028 and 5.875% Senior Notes due 2026, or, collectively, Cinemark USA’s senior notes (but excluding all obligations under the Credit Agreement which are guaranteed by Cinemark Holdings, inc.). The 4.50% Convertible Notes rank equally in right of payment with all of our existing and future unsubordinated debt, including all obligations under the Cinemark USA, Inc. Credit Agreement, which such Credit Agreement is guaranteed by Cinemark Holdings, Inc., and senior in right of payment to any future debt that is expressly subordinated in right of payment to the notes. The 4.50% Convertible Notes are not guaranteed by any of Cinemark Holdings, Inc.’s subsidiaries.

~~Additional~~ Borrowings of International Subsidiaries

~~During the three months ended~~As of March 31, ~~2021,~~2022, certain of ~~our~~the Company’s international subsidiaries ~~borrowed~~have an aggregate borrowing of ~~$9.0 million~~$32.4 outstanding under various local bank loans. ~~Below is a summary of these loans:~~

~~Loan Amounts~~

~~Loan Description~~

~~(in USD)~~

~~Interest Rates~~

~~Covenants~~

~~Maturity~~

~~Peru bank loan~~

~~3.3 million~~

~~4.8%~~

~~Negative covenants~~

~~January 2024~~

~~Brazil bank loan~~

~~5.7 million~~

~~4.0%~~

~~Negative covenants~~

~~January 2029~~

~~Additionally, we~~The Company has deposited cash into a collateral account to support the issuance of ~~bank~~ letters of credit to the lenders for ~~the~~certain of these international ~~loans noted above.~~bank loans. The total amount deposited ~~during the three months ended~~as of March 31, ~~2021~~2022 was ~~$7.3 million. Total deposits made to support bank letters of credit for the outstanding loans of our international subsidiaries is $21.1 million~~$25.8 and is considered restricted ~~cash as~~cash.

During the year ended December 31, 2021, we obtained a waiver of the maintenance covenant related to the bank loans in Chile through June 30, 2022.

Covenant Compliance

The indentures governing the 5.875% Senior Notes, the 5.25% Senior Notes and the 8.750% Secured Notes ("the indentures") contain covenants that limit, among other things, the ability of Cinemark USA, Inc. and certain of its subsidiaries to (1) make investments or other restricted payments, including paying dividends, making other distributions or repurchasing subordinated debt or equity, (2) incur additional indebtedness and issue preferred stock, (3) enter into transactions with affiliates, (4) enter new lines of business, (5) merge or consolidate with, or sell all or substantially all of its assets to, another person and (6) create liens. As of March 31, ~~2021. These restricted cash amounts do not impact the Applicable Amount as defined~~2022, Cinemark USA, Inc. could have distributed up to approximately $2.98 billion to its parent company and sole stockholder, Cinemark Holdings, Inc., under the ~~Credit Agreement or~~terms of the ~~restricted payments~~indentures, subject to its available cash and other borrowing restrictions outlined in the indentures. Upon a change of control, as defined in the indentures, Cinemark USA, Inc. would be required to make an offer to repurchase the 5.875% Senior Notes, the 5.25% Senior Notes and the 8.750% Secured Notes at a price equal to 101% of the aggregate principal amount outstanding plus accrued and unpaid interest, if any, through the date of repurchase. The indentures allow Cinemark USA, Inc. to incur additional indebtedness if we satisfy the coverage ratio specified in the indenture, after giving effect to the ~~notes~~incurrence of the additional indebtedness, and in certain other circumstances. The required minimum coverage ratio is 2 to 1 and our actual ratio as ~~described above.~~of March 31, 2022 was 1.5.

~~Covenant Compliance~~

As of March 31, ~~2021,~~2022, we believe we were in full compliance with all agreements, including all related covenants, governing our outstanding debt.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

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

Interest Rate Risk

We ~~are~~ currently ~~party to a~~have variable rate ~~debt facility.~~debt. An increase or decrease in interest rates would affect our interest expense related to this variable rate debt. We have ~~four~~three interest rate swap agreements that are used to hedge a portion of the interest rate risk associated with ~~the variable interest rates on $600~~our term loan, covering $450 million of the ~~term loan~~$631.5 million outstanding ~~under the Credit Agreement. An increase or decrease in interest rates would affect our interest expense relating to our variable rate debt.~~at March 31, 2022. At March 31, ~~2021,~~2022, we had an aggregate of approximately ~~$68.2~~$213.9 million of variable rate debt ~~outstanding. Based on the interest rates in effect on the variable rate debt~~ outstanding, ~~at March 31, 2021,~~and a 100 basis point increase in market interest rates would increase our annual interest expense by ~~approximately $0.7~~$2.1 million.

The table below provides information about our fixed rate and variable rate long-term debt agreements as of March 31, ~~2021:~~2022:


	Expected Maturity for the Twelve-Month Periods Ending March 31,																Average
	(in millions)																Interest
	2023		2024		2025		2026		2027		Thereafter		Total		Fair Value		Rate
Fixed rate	$	—	$	—	$	450.0	$	1,115.0	$	—	$	765.0	$	2,330.0	$	2,468.9		5.3	%
Variable rate		27.2		12.1		169.8		1.4		1.2		2.2		213.9		209.4		3.1	%
Total debt (1)	$	27.2	$	12.1	$	619.8	$	1,116.4	$	1.2	$	767.2	$	2,543.9	$	2,678.3

Expected Maturity for the Twelve-Month Periods Ending March 31,

Average

(in millions)

Interest

2022

2023

2024

2025

2026

Thereafter

Total

Fair Value

Rate

Fixed rate

$
—

$
—

$
755.0

$
600.0

$
1,115.0

$
—

$
2,470.0

$
2,780.3

5.0
%
Variable rate ⁽¹⁾

18.5

14.5

11.0

18.6

0.1

5.5

68.2

66.5

2.4
%
Total debt

$
18.5

$
14.5

$
766.0

$
618.6

$
1,115.1

$
5.5

$
2,538.2

$
2,846.8

(1)

Amounts are presented before adjusting for debt issuance costs.

~~(1)~~

~~Amounts are presented before adjusting for unamortized debt issuance costs and debt discounts.~~

Interest Rate Swap Agreements

All of our interest rate swap agreements qualify for cash flow hedge accounting. The fair values of the interest rate swaps are recorded on our condensed consolidated balance sheet as an asset or liability with the related gains or losses reported as a component of accumulated other comprehensive loss. See Note 7 to the condensed consolidated financial statements for further discussion of the interest rate swap agreements.

Foreign Currency Exchange Rate Risk

There have been no material changes in foreign currency exchange rate risk previously disclosed in “Quantitative and Qualitative Disclosures About Market Risk” in our Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 filed February ~~26, 2021.~~25, 2022.

Item 4. Controls and Procedures

Evaluation of the Effectiveness of Disclosure Controls and Procedures

As of March 31, ~~2021,~~2022, we carried out an evaluation required by the Exchange Act, under the supervision and with the participation of our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13a-15(e) of the Exchange Act. Based on this evaluation, our principal executive officer and principal financial officer concluded that, as of March 31, ~~2021,~~2022, our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and were effective to provide reasonable assurance that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 that occurred during the quarter ended March 31, ~~2021~~2022 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1.Legal Proceedings

Other than the discussion at Note 19, there have been no material changes from legal proceedings previously reported under “Business – Legal Proceedings” in our Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 filed February ~~26, 2021~~25, 2022..

Item 1A. RiRisk Factors~~sk Factors~~

See discussion in “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 filed February ~~26, 2021, as updated by risk factors included in a Form 8-K that was filed on March 4, 2021~~25, 2022..

Item 6. Ex Exhibits~~hibits~~


4.1		Director Nomination Agreement by and among Cinemark Holdings, Inc. and certain stockholders (incorporated by reference to Exhibit 10.1 to Cinemark Holdings, Inc.’s Current Report on Form 8K, File No. 001-33401, filed May 3, 2007).
*31.1
*31.1		Certification of ~~Mark Zoradi,~~Sean Gamble, Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

*31.2		Certification of ~~Sean Gamble,~~Melissa Thomas, Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

*32.1		Certification of ~~Mark Zoradi,~~Sean Gamble, Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as added by Section 906 of the Sarbanes-Oxley Act of 2002.

*32.2		Certification of ~~Sean Gamble,~~Melissa Thomas, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as added by Section 906 of the Sarbanes-Oxley Act of 2002.

* 101		The following material from Cinemark Holdings, Inc.’s Form 10-Q for the quarter ended March 31, ~~2021,~~2022, formatted in iXBRL (Inline eXtensible Business Reporting Language), filed herewith: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of ~~Income (Loss),~~Loss, (iii) the Condensed Consolidated Statements of Comprehensive ~~Income (Loss),~~Loss, (iv) the Condensed Consolidated Statements of Cash Flows and (v) the Notes to Condensed Consolidated Financial Statements.

* 104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

*	~~filed herewith~~.

~~SIGNATURES~~* filed herewith.

SIGNATURES

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


		CINEMARK HOLDINGS, INC.
		Registrant

DATE:	May ~~7, 2021~~6, 2022

		/s/ ~~Mark Zoradi~~Sean Gamble
		~~Mark Zoradi~~Sean Gamble
		Chief Executive Officer

		/s/ ~~Sean Gamble~~Melissa Thomas
		~~Sean Gamble~~Melissa Thomas
		Chief Financial Officer


Delaware		20-5490327
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

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


Title of Each Class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $.001 per share	CNK	New York Stock Exchange


	March 31,			December 31,			March 31,			December 31,
	2021			2020			2022			2021
Assets
Current assets
Cash and cash equivalents	$	512,828		$	655,338		$	568.6		$	707.3
Inventories		12,170			12,593			16.8			15.5
Accounts receivable		23,732			25,265			52.9			68.8
Current income tax receivable		174,658			165,151			46.5			46.6
Prepaid expenses and other		31,419			34,400			35.0			36.2
Total current assets		754,807			892,747			719.8			874.4
Theatre properties and equipment		3,348,813			3,403,103			3,415.8			3,368.8
Less: accumulated depreciation and amortization		1,815,515			1,788,041			2,066.8			1,985.9
Theatre properties and equipment, net		1,533,298			1,615,062			1,349.0			1,382.9
Operating lease right-of-use assets, net		1,246,115			1,278,191			1,201.6			1,230.8
Other assets
Goodwill		1,249,195			1,253,840			1,256.9			1,248.8
Intangible assets, net		313,085			314,195			310.8			310.8
Investment in NCM		145,458			151,962			131.9			135.4
Investments in affiliates		23,932			23,726	��		25.8			25.2
Deferred charges and other assets, net		31,064			33,199			28.5			22.3
Total other assets		1,762,734			1,776,922			1,753.9			1,742.5
Total assets	$	5,296,954		$	5,562,922		$	5,024.3		$	5,230.6

Liabilities and equity
Current liabilities
Current portion of long-term debt	$	18,468		$	18,056		$	27.2		$	24.3
Current portion of operating lease obligations		206,750			208,593			219.4			217.1
Current portion of finance lease obligations		14,486			16,407			14.7			14.6
Current income tax payable		55			5,632
Accounts payable and accrued expenses		354,751			357,753			384.3			513.1
Total current liabilities		594,510			606,441			645.6			769.1
Long-term liabilities
Long-term debt, less current portion		2,476,680			2,377,162			2,476.6			2,476.3
Operating lease obligations, less current portion		1,107,544			1,138,142			1,044.1			1,078.3
Finance lease obligations, less current portion		112,911			124,609			98.8			102.6
Long-term deferred tax liability		39,309			79,525			39.0			39.8
Long-term liability for uncertain tax positions		39,318			19,225			46.4			45.9
NCM screen advertising advances		342,240			344,255			343.8			346.0
Other long-term liabilities		60,459			74,594			30.6			38.1
Total long-term liabilities		4,178,461			4,157,512			4,079.3			4,127.0
Commitments and contingencies (see Note 19)
Equity
Cinemark Holdings, Inc.'s stockholders' equity:
Common stock, $0.001 par value: 300,000,000 shares authorized, 124,610,298 shares issued and 119,549,912 shares outstanding at March 31, 2021 and 123,627,080 shares issued and 118,576,099 shares outstanding at December 31, 2020		124			124
Common stock, $0.001 par value: 300.0 shares authorized, 125.94 shares issued and 120.47 shares outstanding at March 31, 2022 and 125.10 shares issued and 119.75 shares outstanding at December 31, 2021								0.1			0.1
Additional paid-in-capital		1,176,633			1,245,569			1,202.9			1,197.8
Treasury stock, 5,060,386 and 5,050,981 shares, at cost, at March 31, 2021 and December 31, 2020, respectively		(87,012	)		(87,004	)
Treasury stock, 5.47 and 5.35 shares, at cost, at March 31, 2022 and December 31, 2021, respectively								(92.7	)		(91.1	)
Retained earnings (deficit)		(174,866	)		27,937			(463.4	)		(389.4	)
Accumulated other comprehensive loss		(401,290	)		(398,653	)		(360.6	)		(394.5	)
Total Cinemark Holdings, Inc.'s stockholders' equity		513,589			787,973			286.3			322.9
Noncontrolling interests		10,394			10,996			13.1			11.6
Total equity		523,983			798,969			299.4			334.5
Total liabilities and equity	$	5,296,954		$	5,562,922		$	5,024.3		$	5,230.6

	Three Months Ended March 31,
	2021			2020
Revenues
Admissions	$	56,121		$	292,462
Concession		39,488			190,356
Other		18,752			60,798
Total revenues		114,361			543,616
Cost of operations
Film rentals and advertising		23,205			156,617
Concession supplies		7,140			34,812
Salaries and wages		31,166			87,544
Facility lease expense		64,829			82,241
Utilities and other		49,144			100,523
General and administrative expenses		35,858			41,018
Depreciation and amortization		68,160			65,256
Impairment of long-lived assets		—			16,619
Restructuring costs		(208	)		—
Loss on disposal of assets and other		4,505			1,905
Total cost of operations		283,799			586,535
Operating loss		(169,438	)		(42,919	)
Other income (expense)
Interest expense		(36,553	)		(24,666	)
Interest income		646			2,084
Loss on extinguishment of debt		(2,603	)		—
Foreign currency exchange loss		(2,974	)		(4,848	)
Distributions from NCM		77			5,224
Interest expense - NCM		(5,835	)		(5,891	)
Equity in income (loss) of affiliates		(6,806	)		8,486
Total other expense		(54,048	)		(19,611	)
Loss before income taxes		(223,486	)		(62,530	)
Income taxes		(14,643	)		(3,108	)
Net loss	$	(208,843	)	$	(59,422	)
Less: Net income (loss) attributable to noncontrolling interests		(602	)		169
Net loss attributable to Cinemark Holdings, Inc.	$	(208,241	)	$	(59,591	)

Weighted average shares outstanding
Basic		117,177			116,496
Diluted		117,177			116,496
Loss per share attributable to Cinemark Holdings, Inc.'s common stockholders
Basic	$	(1.75	)	$	(0.51	)
Diluted	$	(1.75	)	$	(0.51	)


	Three Months Ended March 31,						Three Months Ended March 31,
	2021			2020			2022			2021
Operating activities
Net loss	$	(208,843	)	$	(59,422	)	$	(72.5	)	$	(208.9	)
Adjustments to reconcile net loss to cash used for operating activities:
Depreciation		67,495			64,005			61.1			67.5
Amortization of intangible and other assets		665			1,251			0.6			0.7
Amortization of debt issue costs		2,590			1,328			2.7			2.6
Interest accrued on NCM screen advertising advances		5,835			5,891			5.8			5.8
Amortization of NCM screen advertising advances and deferred revenues		(7,934	)		(7,852	)
Amortization of NCM screen advertising advances and other deferred revenues								(8.2	)		(7.9	)
Amortization of accumulated losses for amended swap agreements		1,124			—			1.1			1.1
Impairment of long-lived assets		—			16,619
Share based awards compensation expense		4,668			4,111			5.1			4.7
Loss on disposal of assets and other		4,505			1,905
(Gain) loss on disposal of assets and other								(6.9	)		4.5
Loss on extinguishment of debt		2,603			—			0			2.6
Non-cash rent expense		128			(591	)		(2.3	)		0.1
Equity in (income) loss of affiliates		6,806			(8,486	)
Deferred income tax expenses		(18,070	)		15,364
Equity in loss of affiliates								2.2			6.8
Deferred income tax benefit								(3.2	)		(18.1	)
Distributions from equity investees		156			16,606			0.6			0.2
Changes in assets and liabilities and other		14,193			(66,290	)		(104.9	)		14.2
Net cash used for operating activities		(124,079	)		(15,561	)		(118.8	)		(124.1	)

Investing activities
Additions to theatre properties and equipment		(17,680	)		(34,143	)		(18.7	)		(17.7	)
Proceeds from sale of theatre properties and equipment and other		21			55			10.6			—
Investment in joint ventures and other, net		—			(50	)
Net cash used for investing activities		(17,659	)		(34,138	)		(8.1	)		(17.7	)

Financing activities
Dividends paid to stockholders		—			(42,311	)
Payroll taxes paid as a result of stock withholdings		(8	)		(2,691	)
Proceeds from revolving line of credit		—			98,800
Restricted stock withholdings for payroll taxes								(1.6	)		—
Proceeds from issuance of senior notes		405,000			—			—			405.0
Proceeds from other borrowings		9,012			—			—			9.0
Redemption of senior notes		(400,000	)		—			—			(400.0	)
Repayments of long-term debt		(1,999	)		(1,649	)		(3.4	)		(2.0	)
Payment of debt issue costs		(5,980	)		—			—			(6.0	)
Fees paid related to debt refinancing		(1,435	)		—			—			(1.5	)
Payments on finance leases		(3,742	)		(3,789	)		(3.6	)		(3.7	)
Other		—			(392	)
Net cash provided by financing activities		848			47,968
Net cash provided by (used for) financing activities								(8.6	)		0.8

Effect of exchange rate changes on cash and cash equivalents		(1,620	)		(7,183	)		(3.2	)		(1.6	)

Decrease in cash and cash equivalents		(142,510	)		(8,914	)		(138.7	)		(142.6	)

Cash and cash equivalents:
Beginning of period		655,338			488,313			707.3			655.3
End of period	$	512,828		$	479,399		$	568.6		$	512.7


			Page
PART I. FINANCIAL INFORMATION

	Item 1.	Financial Statements	4

		Condensed Consolidated Balance Sheets as of March 31, ~~2021~~2022 and December 31, ~~2020~~2021 (unaudited)	4

		Condensed Consolidated Statements of Loss for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 (unaudited)	5

		Condensed Consolidated Statements of Comprehensive Loss for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 (unaudited)	6

		Condensed Consolidated Statements of Cash Flows for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 (unaudited)	7

		Notes to Condensed Consolidated Financial Statements (unaudited)	8

	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	2827

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	4037

	Item 4.	Controls and Procedures	4037

PART II. OTHER INFORMATION

	Item 1.	Legal Proceedings	4138

	Item 1A.	Risk Factors	4138

	Item 6.	Exhibits	4239

SIGNATURES			4340


		Three Months Ended
		March 31,
Lease Cost	Classification	2022		2021
Operating lease costs
Equipment (1)	Utilities and other	$	0.6	$	0.4
Real Estate (2)(3)	Facility lease expense		75.0		63.8
Total operating lease costs		$	75.6	$	64.2

Finance lease costs
Amortization of leased assets	Depreciation and amortization	$	3.1	$	3.2
Interest on lease liabilities	Interest expense		1.4		1.6
Total finance lease costs		$	4.5	$	4.8

		Three Months Ended
		March 31
Lease Cost	Classification	2021		2020
Operating lease costs
Equipment ⁽¹⁾	Utilities and other	$	445	$	1,541
Real Estate ⁽²⁾⁽³⁾	Facility lease expense		63,759		81,658
Total operating lease costs		$	64,204	$	83,199

Finance lease costs
Amortization of leased assets	Depreciation and amortization	$	3,250	$	3,707
Interest on lease liabilities	Interest expense		1,570		1,851
Total finance lease costs		$	4,820	$	5,558

	Three Months Ended
	March 31, 2020
	U.S.		International
	Operating		Operating
Major Goods/Services	Segment ⁽¹⁾		Segment		Consolidated
Admissions revenues	$	232,326	$	60,136	$	292,462
Concession revenues		152,758		37,598		190,356
Screen advertising, screen rental and promotional revenues		18,209		12,446		30,655
Other revenues		24,150		5,993		30,143
Total revenues	$	427,443	$	116,173	$	543,616


	NCM screen advertising advances (1)			Other Deferred Revenues (2)
Balance at January 1, 2022	$	346.0		$	160.3
Amounts recognized as accounts receivable		0			0.5
Cash received from customers in advance		0			49.6
Interest accrued related to significant financing component		5.8			0
Revenue recognized during period		(8.0	)		(40.2	)
Foreign currency translation adjustments		0			1.5
Balance at March 31, 2022	$	343.8		$	171.7

	NCM screen advertising advances⁽¹⁾			Other Deferred Revenues ⁽²⁾			Total
Balance at January 1, 2021	$	344,255		$	138,830		$	483,085
Amounts recognized as accounts receivable		—			93			93
Cash received from customers in advance		—			8,024			8,024
Interest accrued related to significant financing component		5,835			—			5,835
Revenue recognized during period		(7,850	)		(13,258	)		(21,108	)
Foreign currency translation adjustments		—			(1,071	)		(1,071	)
Balance at March 31, 2021	$	342,240		$	132,618		$	474,858


	Twelve Months Ended March 31,
Remaining Performance Obligations	2023		2024		Thereafter		Total
Other deferred revenues	$	152.1	$	19.6	$	—	$	171.7

	Investment in NCM			NCM Screen Advertising Advances			Distributions from NCM			Equity in Loss		Other Revenue			Interest Expense - NCM		Cash Received
Balance as of January 1, 2021	$	151,962		$	(344,255	)
Screen rental revenues earned under ESA ⁽¹⁾		—			—			—			—		(855	)		—		855
Interest accrued related to significant financing component		—			(5,835	)		—			—		—			5,835		—
Receipt under tax receivable agreement		(156	)		—			(77	)		—		—			—		233
Equity in loss		(6,348	)		—			—			6,348		—			—		—
Amortization of screen advertising advances		—			7,850			—			—		(7,850	)		—		—
Balance as of and for the three months ended March 31, 2021	$	145,458		$	(342,240	)	$	(77	)	$	6,348	$	(8,705	)	$	5,835	$	1,088

	As of
	March 31, 2021		December 31, 2020
Current assets	$	29,987	$	36,372
Noncurrent assets	$	172	$	205
Current liabilities	$	23,125	$	39,844
Noncurrent liabilities	$	940	$	687
Members' equity	$	6,094	$	(3,954	)

	Balance at January 1, 2021			Amortization			Other ⁽¹⁾			Balance at March 31, 2021
Intangible assets with finite lives:
Gross carrying amount	$	82,432		$	—		$	(297	)	$	82,135
Accumulated amortization		(68,416	)		(655	)		0			(69,071	)
Total net intangible assets with finite lives	$	14,016		$	(655	)	$	(297	)	$	13,064

Intangible assets with indefinite lives:
Tradename and other		300,179			—			(158	)		300,021
Total intangible assets, net	$	314,195		$	(655	)	$	(455	)	$	313,085


	Estimated
	Amortization
For the nine months ended December 31, 2022	$	2.0
For the twelve months ended December 31, 2023		2.5
For the twelve months ended December 31, 2024		2.5
For the twelve months ended December 31, 2025		1.9
For the twelve months ended December 31, 2026		1.5
Thereafter		0
Total	$	10.4

For the nine months ended December 31, 2021	$	1,972
For the twelve months ended December 31, 2022		2,487
For the twelve months ended December 31, 2023		2,399
For the twelve months ended December 31, 2024		2,399
For the twelve months ended December 31, 2025		2,292
Thereafter		1,515
Total	$	13,064


		Carrying		Fair Value Hierarchy
Description	As of,	Value		Level 1		Level 2		Level 3
Interest rate swap assets (1)	March 31, 2022	$	3.9	$	—	$	3.9	$	—

Interest rate swap liabilities (1)	December 31, 2021	$	14.6	$	—	$	14.6	$	—


					Other Comprehensive Income (Loss) for
	Exchange Rate as of				Three Months Ended
Country	March 31, 2022		December 31, 2021		March 31, 2022		March 31, 2021
Brazil		4.8		5.6	$	8.0	$	(6.9	)
Chile		788.6		852.0		4.8		(1.0	)
Peru		3.8		4.0		1.6		(1.2	)
All other						—		(0.4	)
					$	14.4	$	(9.5	)

					Other Comprehensive Loss for
	Exchange Rate as of				Three Months Ended
Country	March 31, 2021		December 31, 2020		March 31, 2021			March 31, 2020
Brazil		5.72		5.20	$	(6,912	)	$	(42,873	)
Chile		725.34		714.14		(1,025	)		(11,126	)
Colombia		3,736.91		3,432.50		(119	)		(3,274	)
Peru		3.79		3.65		(1,172	)		(1,450	)
All other						(237	)		1,098
					$	(9,465	)	$	(57,625	)

Period	New Theatres		Existing Theatres		Total
Three Months Ended March 31, 2021	$	2.3	$	15.4	$	17.7
Three Months Ended March 31, 2020	$	8.1	$	26.0	$	34.1

	Theatres		Screens		Estimated Cost ⁽¹⁾
Remainder of 2021
U.S.		3		42	$	32.2
International		3		30		13.3
Total		6		72	$	45.5

Subsequent to 2021
U.S.		6		74	$	46.0
International		7		49		19.1
Total		13		123	$	65.1

Total commitments at March 31, 2021		19		195	$	110.6

Cinemark USA, Inc. term loan	$	638.1
Cinemark USA, Inc. 4.875% senior notes due 2023		755.0
Cinemark USA, Inc. 8.750% senior secured notes due 2025		250.0
Cinemark Holdings, Inc. 4.500% convertible senior notes due 2025		460.0
Cinemark USA, Inc. 5.875% senior notes due 2026		405.0
Other debt		30.1
Total long-term debt	$	2,538.2
Less current portion		18.5
Subtotal long-term debt, less current portion	$	2,519.7
Less: Debt discounts and debt issuance costs, net of accumulated amortization		43.0
Long-term debt, less current portion, net of debt discounts and unamortized debt issuance costs	$	2,476.7

	Payments Due by Period
	(in millions)
			Less Than						After
Contractual Obligations	Total		One Year		1 - 3 Years		3 - 5 Years		5 Years
Long-term debt ⁽¹⁾	$	2,538.2	$	18.5	$	780.5	$	1,733.7	$	5.5
Scheduled interest payments on long-term debt ⁽²⁾	$	460.0	$	125.5	$	219.3	$	115.0	$	0.2

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company