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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

 

The Company’s long-term debt at December 31, 2013 matures as follows:

 

2014

   $ 9,856   

2015

     8,389   

2016

     8,389   

2017

     8,389   

2018

     8,389   

Thereafter

     1,789,388   
  

 

 

 

Total

   $ 1,832,800   
  

 

 

 

 

13. INTEREST RATE SWAP AGREEMENTS

The Company is currently a party to three interest rate swap agreements that are used to hedge interest rate risk associated with the variable interest rates on the Company’s term loan debt and qualify for cash flow hedge accounting. The fair values of the interest rate swaps are recorded on the Company’s consolidated balance sheet as an asset or liability with the effective portion of the interest rate swaps’ gains or losses reported as a component of accumulated other comprehensive loss and the ineffective portion reported in earnings. The changes in fair values 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 and under this approach, the Company uses projected future interest rates as provided by counterparties to the interest rate swap agreements and the fixed rates that the Company is obligated to pay under these agreements. Therefore, the Company’s measurements use significant unobservable inputs, which fall in Level 3 of the U.S. GAAP hierarchy as defined by FASB ASC Topic 820-10-35. There were no changes in valuation techniques during the period and no transfers in or out of Level 3. See Note 14 for a summary of unrealized gains or losses recorded in accumulated other comprehensive loss and earnings.

Below is a summary of the Company’s interest rate swap agreements, all of which are designated as cash flow hedges, as of December 31, 2013:

 

Nominal
Amount

  Effective Date     Pay Rate     Receive Rate     Expiration Date     Current
Liability  (1)
    Long-Term
Liability (2)
    Estimated
Total Fair
Value at
December 31,
2013
 

$175,000

    December 2010        1.3975     1-Month LIBOR        September 2015      $ 1,943      $ 1,195      $ 3,138   

$175,000

    December 2010        1.4000     1-Month LIBOR        September 2015        1,984        1,228        3,212   

$100,000

    November 2011        1.7150     1-Month LIBOR        April 2016        1,440        1,386        2,826   

 

         

 

 

   

 

 

   

 

 

 

$450,000

          $ 5,367      $ 3,809      $ 9,176   

 

         

 

 

   

 

 

   

 

 

 

 

(1) 

Included in accrued other current liabilities on the consolidated balance sheet as of December 31, 2013.

(2) 

Included in other long-term liabilities on the consolidated balance sheet as of December 31, 2013.

The Company was previously a party to an interest rate swap agreement that was effective during 2007 with a counterparty that filed for bankruptcy during September 2008 and whose credit rating was downgraded as a result. Prior to the counterparty’s credit rating downgrade, the change in fair value of the interest rate swap was

 

F-31