Cinemark USA, Inc. Reconciliation of Adjusted EBITDA (unaudited) (in thousands) Three months ended  March 31, 2004 2003 Net income  $             9,934  $             5,453 Income taxes                 7,949                 3,949 Interest expense (1)               12,466               13,879 Other expense                    754                 1,545 Loss from discontinued operations, net of tax benefit                 1,763                    315 Operating income               32,866               25,141 Add:  Depreciation, amortization and asset impairment loss               17,889               15,996 Add:  Gain on sale of assets and other                   (513)                  (616) Add:  Amortized compensation - stock options (2)                    145                    274 Add:  Deferred lease expenses (3)                    540                    802 Adjusted EBITDA (4)  $           50,927  $           41,597 (1) Includes amortization of debt issue costs and excludes capitalized interest.   (2) Non-cash expense included in general and administrative expenses. (3) Non-cash expense included in facility lease expense. (4) Adjusted EBITDA as calculated in the chart above represents net income before income taxes, interest expense, other  expense, depreciation, amortization and asset impairment loss, gain on sale of assets and other, accrued and unpaid compensation expense relating to any stock option plans and changes in deferred lease expense. Adjusted EBITDA is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to net income or operating income as an indicator of operating performance or as an alternative to cash flow provided by operating activities as a measure of liquidity (as determined in accordance with GAAP). Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. The calculation of Adjusted EBITDA is consistent with the definition of EBITDA in our senior subordinated notes indentures. We have included Adjusted EBITDA because we believe it provides management and investors with additional information to measure our performance and liquidity, estimate our value and evaluate our ability to service debt. In addition, we use Adjusted EBITDA for incentive compensation purposes.