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SEC Filings

10-K
CINEMARK HOLDINGS, INC. filed this Form 10-K on 02/27/2015
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Table of Contents

Liquidity and Capital Resources

Operating Activities

We primarily collect our revenues in cash, mainly through box office receipts and the sale of concessions. In addition, a majority of our theatres provide the patron a choice of using a credit card, debit card or advanced-sale type certificates, such as a gift card, in place of cash. Because our revenues are received in cash prior to the payment of related expenses, we have an operating “float” and historically have not required traditional working capital financing. Cash provided by operating activities amounted to $395.2 million, $309.7 million, and $454.6 million for the years ended December 31, 2012, 2013 and 2014, respectively. Cash provided by operating activities was lower in 2013 primarily due to the make-whole premium of $56.6 million paid to redeem the 8.625% Senior Notes, which was included in net income. The increase in cash provided by operating activities in 2014 was a result of the timing of collections of accounts receivable and payments to suppliers.

Investing Activities

Our investing activities have been principally related to the development and acquisition of theatres. New theatre openings and acquisitions historically have been financed with internally generated cash and by debt financing, including borrowings under our amended senior secured credit facility. Cash used for investing activities amounted to $234.3 million, $364.7 million and $253.3 million for the years ended December 31, 2012, 2013 and 2014, respectively. Cash used for investing activities for the year ended December 31, 2013 included the acquisition of theatres in the U.S. for approximately $259.2 million and proceeds of approximately $126.2 million from the sale of our theatres in Mexico.

Cash capital expenditures for the years ended December 31, 2012, 2013 and 2014 were as follows (in millions):

 

Period

   New
Theatres
     Existing
Theatres
     Total  

Year Ended December 31, 2012

   $ 104.9       $ 115.8       $ 220.7   

Year Ended December 31, 2013

   $ 134.7       $ 125.0       $ 259.7   

Year Ended December 31, 2014

   $ 104.7       $ 140.0       $ 244.7   

We continue to invest in our U.S. theatre circuit. We built seven new theatres and 81 screens, acquired one theatre with 14 screens and closed seven theatres with 53 screens during the year ended December 31, 2014, bringing our total domestic screen count to 4,499. At December 31, 2014, we had signed commitments to open eight new theatres with 85 screens in domestic markets during 2015 and open three new theatres with 36 screens subsequent to 2015. We estimate the remaining capital expenditures for the development of these 121 domestic screens will be approximately $73 million. Actual expenditures for continued theatre development and acquisitions are subject to change based upon the availability of attractive opportunities. As of December 31, 2014, we also had a signed commitment to purchase the office building where our worldwide headquarters are located, which will result in a capital expenditure of approximately $24 million during the first quarter of 2015.

We also continue to invest in our international theatre circuit. We built 11 new theatres and 71 screens, acquired one theatre with four screens and closed four screens during the year ended December 31, 2014, bringing our total international screen count to 1,177. At December 31, 2014, we had signed commitments to open ten new theatres and 73 screens in international markets during 2015 and open two new theatres with 17 screens subsequent to 2015. We estimate the remaining capital expenditures for the development of these 90 international screens will be approximately $61 million. Actual expenditures for continued theatre development and acquisitions are subject to change based upon the availability of attractive opportunities.

We plan to fund capital expenditures for our continued development with cash flow from operations, existing cash, borrowings under our amended senior secured credit facility, and proceeds from debt issuances, sale leaseback transactions and/or sales of excess real estate.

 

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