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SEC Filings

CINEMARK HOLDINGS, INC. filed this Form 10-Q on 11/05/2015
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In thousands, except share and per share data


Digital Cinema Implementation Partners LLC

On February 12, 2007, the Company, AMC and Regal 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. On March 10, 2010, the Company signed a master equipment lease agreement and other related agreements (collectively the “Agreements”) with Kasima LLC (“Kasima”), which is an indirect subsidiary of DCIP and a related party to the Company. Upon signing the Agreements, the Company contributed the majority of its U.S. digital projection systems to DCIP, which DCIP then contributed to Kasima. The Company has a variable interest in Kasima through the terms of its master equipment lease agreement; however, the Company has determined that it is not the primary beneficiary of Kasima, as the Company does not have the ability to direct the activities of Kasima that most significantly impact Kasima’s economic performance. As of September 30, 2015, 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 and its subsidiaries under the equity method of accounting.

Below is summary financial information for DCIP for the three and nine months ended September 30, 2015 and 2014.


     Three Months Ended September 30,      Nine Months Ended September 30,  
     2015      2014      2015      2014  


   $ 43,129       $ 41,600       $ 123,731       $ 127,684   

Operating income

   $ 26,178       $ 24,913       $ 72,945       $ 75,917   

Net income

   $ 20,189       $ 17,759       $ 54,153       $ 42,352   

As of September 30, 2015, the Company had 3,750 digital projection systems being leased under the master equipment lease agreement with Kasima. The Company made equipment lease payments of approximately $3,133 and $3,005 during the nine months ended September 30, 2015 and 2014, respectively, which are included in utilities and other costs on the condensed consolidated statements of income.