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SEC Filings

10-K
CINEMARK HOLDINGS, INC. filed this Form 10-K on 02/28/2014
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Table of Contents

CINEMARK HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In thousands, except share and per share data

 

As of December 31, 2013, 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 a rollforward of our investment in DCIP from January 1, 2011 through December 31, 2013:

 

Balance as of January 1, 2011

   $ 10,838   

Cash contributions

     1,471   

Equity in income

     489   
  

 

 

 

Balance as of December 31, 2011

   $ 12,798   

Cash contributions

     1,325   

Equity in income

     8,889   
  

 

 

 

Balance as of December 31, 2012

   $ 23,012   

Cash contributions

     3,232   

Equity in income

     11,241   

Equity in other comprehensive income

     548   
  

 

 

 

Balance as of December 31, 2013 (1)

   $ 38,033   
  

 

 

 

 

(1) 

Investment in DCIP is included in investments in and advances to affiliates on the consolidated balance sheets.

Below is summary financial information for DCIP as of and for the years ended December 31, 2011, 2012 and 2013.

 

     Year ended December 31,  
     2011     2012      2013  

Net operating revenue

   $ 113,424      $ 166,017       $ 182,659   

Operating income

   $ 70,508      $ 102,663       $ 116,235   

Net income (loss)

   $ (2,510   $ 36,752       $ 48,959   

 

     As of  
     December 31, 2012      December 31, 2013  

Total assets

   $ 1,209,932       $ 1,264,870   

Total liabilities

   $ 1,070,346       $ 1,063,110   

As a result of the Agreements, the Company has installed digital projection systems to a majority of its first run U.S. theatres. The digital projection systems are being leased from Kasima under an operating lease with an initial term of twelve years that contains ten one-year fair value renewal options. The equipment lease agreement also contains a fair value purchase option. Under the equipment lease agreement, the Company pays minimum annual rent of one thousand dollars per digital projection system for the first six and a half years from the effective date of the agreement and minimum annual rent of three thousand dollars per digital projection system beginning at six and a half years from the effective date through the end of the lease term. The Company may also be subject to various types of other rent if such digital projection systems do not meet minimum performance requirements as outlined in the agreements. Certain of the other rent payments are subject to either a monthly or an annual maximum. As of December 31, 2013, the Company had 3,619 digital projection systems being leased under the master equipment lease agreement with Kasima. The Company recorded equipment lease expense of approximately $5,332, $7,802 and $7,990 during the years ended December 31, 2011, 2012 and 2013, respectively, which is included in utilities and other costs on the consolidated statements of income.

 

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