Good morning, my name is Felicia, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Cinemark's Q4 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer session. [Operator Instructions] Thank you, Ms. Brashears, you may begin your conference.

Thank you, Felicia, and good morning, everyone. At this time, I would like to welcome you to Cinemark Holding Inc.'s Fourth Quarter 2014 Earnings Release Conference Call hosted by Tim Warner, Chief Executive Officer; and Sean Gamble, Chief Financial Officer. In accordance with the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995, certain matters that are addressed by members of management during this call may constitute forward-looking statements. Such statements are subject to risk, uncertainties and other factors that may cause Cinemark's actual performance to be materially different from the performance indicated or implied by such statements. Such risk factors are set forth in the company's SEC filings. The company undertakes no obligation to publicly update or revise any forward-looking statements. Today's call and webcast may include non-GAAP financial measures. A reconciliation of these non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP, can be found in today's press release and on our company's website, investors.cinemark.com. I would now like to call turn the call over to Tim Warner.

Thank you, Chanda. Good morning, everyone. Thank you for joining us for our fourth quarter 2014 results call. The fourth quarter North American industry box office was initially strong with the performances of Gone Girl and Annabelle, but it also meant the film product could not compete against the robust film slate in the prior year period which included Gravity, Frozen and Thor. While the industry's fourth quarter declined 4.5%, Cinemark's domestic admission revenues over indexed the industry by 140 basis points. Worldwide Cinemark exceeded the North American industry by more than 600 basis points on a currency adjusted basis marking 20 out of 22 consecutive quarters of industry outperformance. Huge congratulations to our entire worldwide operations team for sustaining our outperformance trend. On a total year basis, following a record setting 2012 and 2013, the North American industry was impacted by the dating shift of Fast & Furious 7 and the absence of a Pixar film and declined 5.2% in 2014. Cinemark domestic operations outperformed the North American industry by 430 basis points for the year and our worldwide operations outperformed by 540 basis points on a currency adjusted basis. Furthermore, Cinemark continued to lead the industry and delivered more than 20% of worldwide adjusted EBITDA margins to our shareholders in the fourth quarter and throughout 2014. We are encouraged by the diversity and spacing of the 2015 film slate that our studio partners are bringing to the market. The first quarter is off to a strong start and has increased more than 10% over Q1 of 2014 with the successes of American Sniper, SpongeBob and Fifty Shades of Grey. We are looking forward to the remaining films this quarter including the Second Best Exotic Marigold Hotel, Chappie, Cinderella, and Divergent. The outlook throughout 2015 is very encouraging with…

Thank you, Tim and good morning everyone. In spite the industry box office headwinds we faced in the fourth quarter, we are pleased to have delivered strong overall financial results. Our total worldwide revenues increased to 1.2% to $659.9 million and our worldwide adjusted EBITDA grew 11.4% to $156.9 million resulting in an adjusted EBITDA margin of 23.8%. These increases were driven primarily by a healthy international attendance growth, strong global concessions performance and our disciplined operating approach that Tim just addressed. Furthermore, as a result of these same drivers, we delivered more than $2.6 billion in total worldwide revenues for the full year generating $596.5 million in adjusted EBITDA and resulting in a robust full-year adjusted EBITDA margin of 22.7%. Specific to the U.S., total fourth quarter attendance was 44 million patrons which generated admissions revenues of $312.9 million, 3.1% reduction versus last year. While these results were down versus 2013, as Tim previously mentioned, they still outperform the industry by 140 basis points. Part of our admissions revenues decline was driven by 1% reduction in our average domestic tickets price to $7.11. This reduction was a byproduct of last year's strong 3D mix that was heavily impacted by the film Gravity. Conversely, our domestic concession revenues grew 5.3% to $164.2 million with a concession per patron of $3.73 a considerable 7.5% increase over last year. We have now delivered 32 consecutive quarters of domestic concession per cap growth. We believe this success is the direct result of our concentrated focus on driving incremental incidents through combo deals, coupons and offering a wide range of concession options, coupled with strategic marginal price increases. Total U.S. revenues for the fourth quarter were $498.8 million with an adjusted EBITDA of $122.9 million resulting in an adjusted EBITDA margin of 24.6%. Outside…

[Operator Instructions] The first question comes from the line of Townsend Buckles with JP Morgan.

Thanks, on the impressive margin expansion you saw in the quarter versus the U.S. and Latin America as we look out to promising 2015, do you feel like your ability to drive positive operating leverage is stronger than it has been in the past, and whether that's through premium pricing and the strong concession gains you're seeing or just through managing costs? Thanks.

Yeah, thanks Townsend. We think that Cinemark, the way we've built and designed the companies that our margins performed very well in a down year as it was in 2014 and also in an up year it allows us to brink a lot more to the bottom line. So, you know we're very focused on delivering great results and expanding the margins.

And Tim, your cash balance is near record levels and leverage remained slow. As we look out to this year potentially Sean earnings in free cash flow growth, what are your priorities for excess cash? I know you highlighted some areas of special projects and your headquarters purchase but do you also see M&A opportunities on the horizon and what does the board need to see to consider raising the dividend or return more cash to shareholders in other ways?

Yeah as I mean from management's perspective, I mean our objective is to continue to continue to invest and grow the company with 20% margins and 20% returns on investment. However, that will be subject to the M&A opportunities that come up during the year, obviously with the amount of cash we have on our balance sheet the board is going to, you know we're going to make our arguments to the board as to where we should be investing our cash or you know on a quarter-to-quarter basis they look at where we should be going with the dividend. Historically Cinemark as always just increased the dividend, but you know that is a board decision.

Do you think they are receptive to something like that, increasing the dividend this year later in the year?

I think the board is very cognizant of our obligation to deliver great results for our shareholders and they will seriously consider all options that as you know we present our plans throughout the year.

Okay thanks, and if I could ask a last quick one for Sean, Regal reported a DCIP cash distribution of about $6 million in its Q4 adjusted EBITDA. I didn’t see it in your reconciliation, so is that something you received as well and is it in your reported EBITDA?

We did receive a $4 million cash distribution from DCIP in accordance with equity income accounting rules. We booked it as reduction to our investment on the balance sheet and consistent with the way we treat our NCM distributions and we only add back distribution to adjusted EBITDA that flow through our P&L. So it's not included in our adjusted EBITDA. Incidentally we recognized an additional $4 million of NCM distribution that also did not get recorded in our adjusted EBITDA.

Okay, great, thanks.

Your next question comes from the line of Eric Handler with MKM Partners.

Thank you very much. Just curious, when you look at your concession per cap increases, I wondered if you might be able to break down some of the key drivers within that, particularly alcohol sales or some of the other initiatives you've been doing and how much is just typical pricing increases? And then secondly, when you look at your G&A expense, your G&A expenses have been coming down quite nicely, is that because you get the, well FX virtually on the revenue side you also have the benefit on the expense side. So how much of that was FX and how much of that is cost controls and how should we be thinking about G&A going into 2015? And then lastly for Sean, you know every year there's always optimism about getting to 100 new screens of Latin America. Now that you've been in the CFO position for several months now maybe give your perspective on why this hundred screen potential view is feasible?

Yeah, Eric I'll take your first question on our concessions. Cinemark has driven their concessions primarily by expanding the number of people that buy and that's always been our focus, also our self service concessions which we have in, especially here in the U.S. is probably 30% or 40% of our platform, you know we also think is very additive because it creates a lot of impulse buying and you know, people don't run into any lines and we find the self service stands to be very, very productive. We've had some minor price increases. The other way we drive our concession sales and I referred to in the call to both our app downloads, which gives us direct communication with our customer and then also our weekly emails of over 3.5 million is that we try to drive sales via concession couponing and outselling the customer before they ever get to the theater. Now we've also added alcohol in 20 or 30 of our locations and in a lot of our stands we have what we call hotspots, which is a variety of food concepts. But Cinemark from that standpoint we tend to focus across the entire platform and we have some specifics like Bistro Concepts or Cinemark Reserved Concepts or the VIP Concepts, but the big focus is Cinemark has always been across the entire platform. Regarding your G&A we do pick up some benefit as you translate you know, just like it hurts us the other way when we translate revenues back, you know we get some impact, some benefit as we translate expenses back and Sean can expand on that and then I'll let him take a shot at the 100 screens because that has been a challenge for us. We remain committed to delivering on average 100 screens per year in Latin America and I'll turn it over to Sean.

Just to first build further on your G&A question, you know, for this particular quarter, fourth quarter we had about $2 million of that favorability in G&A coming from foreign exchange. Really the rest was driven by the sale of our Mexican subsidiaries last year. So, if you were to normalize for that it would be about flat. As you kind of look forward and we just think about overall G&A management, we do face some pressures in 2015 with minimum wage increases across the board, but I will be actively working on where we can to continue to try to manage those costs and hold G&A as flat as we can. With regard to your question on the international screens and not getting to the 100 screens specifically, you know, I can say as I've toured around Latin American and dug into this question, I think I'm reassured by the fact that the projects are real and they're there. The delays have largely been a byproduct of just issues with getting these malls opened. In some cases it's just general construction delays, in other cases it's permits, but the projects are progressing. They just in certain instances taken a little bit longer then we would ideally like. So, I think as we kind of look forward particularly to 2015, I'd say we're still targeting that 100 for '15. There is a strong pipeline, but based on kind of the unpredictability of mall openings and I guess, I suppose you could say our track record to a certain degree, I think the safest best is to continue to assume that. We do have some other carryover from '14, but I would still kind of hold to that 100 assumption in '15. Well you know, the other thing I'll add and then we'll get off to that is that we are building in some of the most dense urban markets in the world, like Greater São Paulo is 18 million to 20 million people, Rio is 14 million plus people, Buenos Aires is 14 million, 15 million people, Lima is 14 million people. So it’s like in a lot of these markets we're building like in a New York on steroids and for people that live in New York you know, you can see how difficult it is to get projects built and constructed. So, but that remains our objectives and our entire team down there are very committed to trying to deliver it.

Thank you very much.

Your next question comes from the line of Robert Fishman with MoffettNathanson.

Yeah hi, good morning. Tim, given the recent trend of nontraditional film releases and windowing strategies, would you consider having conversations with your traditional studio partners as well as some of these new film studios come up with an alternative windowing strategy for non-Temple [ph] movies that is potentially a win-win for all parties?

No, Cinemark thinks that the studios via electronic sell through come up with we feel a solution that is gaining traction to return some of their in-home windows. We're very committed and we think as those, that for the creative community, the content providers and the overall industry that the theatrical window remains a priority for film. So, and also we think that it would be unfair to try to hold the major studios to one windowing standards and then try to say other people can have a different standard, it's way too complicated or unfair to where, but we think right now the whole windowing model is working well for the studios to recover their in-home markets and also working great for the theatrical space.

Okay, thanks and for Sean or Tim, can you share with us an update on the progress of FlikMedia and how quickly you plan on rolling in out to other territories in Latin America this year and beyond? And just lastly, when we can start to see the results in the reported financials? Thanks a lot.

Well, yeah first off it's you know, from a rollout standpoint it has been rolling out for a couple years in Brazil and as we reported we have the second largest exhibitor in Brazil, Ribeiro as a client and we're adding some other clients this year. We also have the technology to disburse the content very efficiently as you know, rollout and establish in Brazil. We have expanded it to Argentina in our Hoyt's circuit is now Flix developed and enabled. And in Chile we've at first of the year after our screen advertising contract was up, we launched Flix in Chile we bought a small advertising company called Empiric [ph] that will help us roll it out to not only to Cinemark, but other aspects in the community and we're now focused on getting it rolled out into Columbia and Central America and Bolivia and Peru, and Ecuador, so. And you know, you're already seeing some results obviously as we don't single them out, but they are showing up in our results in Brazil and will start to show up in our results in some of these other countries as it becomes more established. Now from a long-term basis, you should think more on three to five years before we have the satellite is another piece of this, is that that will have this here one-point access to thousands of screens to where we can say to our advertiser that, hey look, here's this network and here's is your satellite delivery system and it's all digital and here's this one-point access to 1000 screens. That's probably a three to five-year goal, but to that that type of network in place.

Okay, thank you.

Your next question comes from the line of Ryan Fiftal with Morgan Stanley.

Great, thanks. Good morning. Two if I may. I guess first, is there anymore granularity you could provide on the domestic admissions performance, obviously with the strong quarter I don't know if there's anything regionally or anything you could point to there?

No, you know Cinemark is always focused on attendance, I mean that's always been our driver and so we obviously have a lot of programs in place that really encourages our customer to go to the movies. But when you look back over Cinemark over the years it's always been focused on the entire platform. You know, we do have as we talked about Cinemark Bistro, Cinemark Reserved, VIP or recliner concepts. But our focus has always been on driving the entire platform and like when we come up with a concept like XD, which we introduced into the industry or the private label premium large format. The idea was to be able to spread it across the entire platform. When we were talking you know, several years ago about classic films, we introduced that to the industry and spread it across not only our platform, but you're starting to see it is spreading throughout the industry both here and also into our Latin American countries. Also alternative content, we've made some good progress along with AMC and Regal as we expand Fathom, but the focus is Cinemark is screen utilization. And we've really expanded another very successful initiative we have is our CineArts program. We also tend to be the number one or number two Indian film company in the marketplace. And so it is that focus on screen utilization that allows us to want to get great attendance, but also to expand our margins.

And I would just add you know, I think our sustained investment in our core circuit provide a quality theater to all our patrons with a top notch presentation from the technology we provide on our screens coupled with our pricing strategies to make it an affordable offering. All those things combined with the content offerings and varied content offerings that Tim mentioned, you know that all plays together and is what's helped to deliver those 20 out of 22 consecutive quarters of outperformance domestically.

Okay, thanks. Maybe following up on the screen utilization point, you know, what's your outlook, are there any levers you can pull for this coming year? I think you mentioned that domestically you're now 100% satellite delivered, I don't know if that's a catalyst for alternative content and then I think we saw this quarter there was a test with Game of Thrones on IMAX screens. I don't think you guys participated, I might be wrong about that, but any opportunity for things like that the experiments here? Thanks.

Yes. No, we didn't participate in the Game of Thrones on IMAX. We held American Sniper on our IMAX screen which was performing really well in our marketplace, but you know, I mean I think you're going to see continued expansion of alternative content and that's why we created Fathom not only for us, but for the industry. And I think DCDC, which is the satellite delivery company is, we're 100% satellite delivery, but other circuits beside the founding members are also being added to it, but I think is going to be a great benefit because you can think of the industry more as a network now than as a platform. And so I think you're going to see both an expansion of live and store forward content and I think as the studios get more engaged in this that they'll be bringing us a lot of that content that we have a test going right now in the LA area with NBC Universal on the ice hockey tournament between the Northern and Southern California, which I think will be a nice little test for how you add product to this mix. We also had a very successful test of Legal Legends, which we streamed it from South Korea into some of our theaters in the U.S. and Brazil for example we ran the Super Bowl in 15 of our theaters and we ran about 80%, 90% occupancy in any of those theaters in Brazil. And so again the focus continues to be as to how do we take programs across our entire platform and enhance utilization of the entire platform, not just in one or two theaters.

Okay, thank you.

Your next question comes from the line of David Miller with Topeka Capital Markets.

Yeah, hey guys, obviously the result of Regal strategic review was that they've decided to kind of go up market with this whole luxury component, essentially copy what AMC is doing. Could you guys just refresh our memories on where you stand with that and integrating any type of sort of luxury component into various assets, it feels to me like you're kind of dabbling in it, but it's not necessarily a priority at this time? And then if memory serves, I believe you guys overlap somewhat with AMC's footprints in some markets. It looks like they're going to go to a subscription model, which looks actually quite compelling. Tell me a little bit more about what your thoughts are about dabbling in that? I appreciate it, thanks very much.

You know, first off I would say on a luxury component, you know Cinemark has always been involved in that segment. When you look at Latin America we've had VIP recliner auditoriums for years. When you look in the U.S. we've had several, what I'd call plush, when you look at you anybody that's been to our Boca theater would say, that's sort of a luxury format, when you look at our Cinemark Bistro that would be our sort of restaurant type format, when you look at our Cinemark Reserve, which we just opened a 1000 and in fact you're going to see we opened in Playa Vista on March 12, anybody that goes to that theater would, I think would deem it a luxury theater. And so, we've always been in that segment. However we, and then in our reports we're saying that we think right now it is about 10% of our screens that would sort of fall into that category with the different concepts we're bringing to the marketplace. We think that grows over the next two or three years we're saying to 15% and might even grow a little bit beyond that. But Cinemark's focus has always been on the entire platform and back to my previous remarks, we focus on the utilization of the entire platform and we've always felt that attendance is the key driver because it drives all the incremental income and so that remains our focus. But and then our XD theaters, we led the premium large format initiative, which I think speaks very, very well for us. On the subscription model Cinemark has tested that in the past. We've tested it probably 10 to 15 years ago with limited results and it is not that we won't also maybe, we'll be doing some testing in that area. It hasn’t worked very well, but we'll just have to see how it develops, obviously if that's the popular being with our patrons. We're in a position because we've had our own point-of-sale systems in that in place for over 15 to 20 years.

Do you recall why it didn't work very well at that time?

You know for the pricing that we felt you had to charge, I think that the patrons just didn't see it as a value, you know, they didn’t want to commit to that monthly fee because they didn't see it as a value because you're also dealing with the studio per cap requirements here in the U.S. So you have to balance those two and I'm sure the studios are going to be watching that also to make sure that they're getting their per cap requirements.

Thank you.

Your next question comes from the line of Ben Mogil with Stifel.

Hi, good morning, thanks for taking my question. I just wanted to delve in a little bit into the reclining seats and so the theater upgrade, so of the $45 million that you're spending for XD and for reclining seats, can you sort of breakout how much is sort of for, sort of physical theater improvements and what that works out to be per screen? And sort of more broadly, are you sort of doing a screen in each complex or you're doing the whole complex, want to get a sense of the magnitude of the investments?

Ben, yes, thanks. You know, we don't break it up, but we do say it's 10% to 15% of our circuit, but also we aren't hiding anything, like you can go to our theatre in Hazlet, New Jersey and you can see a fully converted recliner theater. You can go to our theater in Centreville, which is part of the Greater DC area and is a total recliner, you can go to our theater in Mountain View, this is not a - it will be a 100% converted. I still think they got a few more auditoriums to convert, but where we felt it is an underutilized theater and we're converting it, we are converting it 100%, but and you know this is all on our website. These are public spaces, you know, you can go and physically see the theaters if you know, people would want to see how we're doing it versus how AMC or other circuits are doing it. Also as we pointed out our Cinemark Reserved is opening up in Playa Vista, or we have one at Towson, we also and sort of a model of our as to how we develop that or expanded it beyond Boca. There is also some in Toledo, Ohio, that people could go to and then if you wanted to see our bistro concept again these are live working theaters that anybody can visit. But they are sort of spread and I think even AMC and Regal are calling their different concepts by different names. We're saying that we're calling ours Cinemark Reserved, Cinemark Bistro, NextGen Theaters, which is a focus on high technology and we're also doing VIP recliner auditoriums. But all these concepts we think are more market specific adaptive and are throughout the U.S. and they are also part of our global platform. And I'm sure that if anybody wants they can go to our website and see specifically where these theaters are being located.

That's great, Tim, thanks for the color.

Yes.

Your next question comes from the line of James Marsh with PiperJaffray.

Great, thanks very much, just two quick questions here. One kind of bigger picture and one little I guess shorter-term. So the first one on big picture, I just was trying to get a sense for where you guys think you are in your ultimate investment down in South America? I think there in 14 of the 15 largest markets down there, but just was hoping maybe you could give us some quantification of that, may be where you are from a penetration standpoint to where you could be, how many new markets could you move into and if you want to just kind of use the maybe the baseball analogy with innings, you know, what inning might you be in there? And then secondly, obviously the first quarter is off to a strong start here domestically, but was just wondering how some of these R-rated films that have been outperforming like Sniper and Fifty Shades of Grey are performing so far in Latin America, sometimes these R-rated films don't run well. So just wondering if those are trending consistently with U.S. theaters or outperforming or underperforming?

Well, I'll try with your second question first. Fifty Shades of Grey had one of our biggest advance sales in Latin America. So Fifty Shades translated well. America Sniper hasn't opened in that many countries in Latin America. I think it opened in Argentina, it performed very well. I think they are sort of holding it back to see how it does at the Academy's and is going to get a lot of exposure, whether it wins or loses at the Academy, so that will also be beneficial as they rollout internationally. It's a sensational film, I think it will translate well into Latin America. The other part of your question was South America. I think where to your baseball, we're maybe you know, in a lot of these countries only in like the third inning, because the, when you look at Brazil it roughly has like one screen for every 90,000 to 105,000 people, where the U.S. is one for every like 10,000 people, Mexico is about one for every 45,000, 50,000 people. Obviously we feel, I don't think Brazil ever becomes a U.S. ratio, but it could easily become a Mexican ratio. And that's a similar ratio in a lot of these other countries. The sort of the governor on development in a lot of these countries and we talked about in the past is mall development, because it's very difficult to develop a freestanding theater and so you only progress as malls expand. You know, Cinemark has been down there for 20 years now. We feel we're in the best position to capitalize on the great development and we'll continue to roll it out, but it's not going to happen overnight and I wouldn’t want to mislead people. We're projecting an average of 100 screens a year. And as we talked about earlier sometimes we have a hard time hitting that one, and so, but we continue to be very optimistic about Latin America, but it's a long-term growth strategy.

Okay, that's helpful. Thanks very much.

Your next question comes from the line of Barton Crockett with FBR Capital Markets.

Okay, thanks for taking the question. I was very interested in the concession per cap trends for the industry. I mean the numbers that you guys have put up for the past couple of quarters high single-digit, Regal stands similarly up high single digits, AMC stands high single or double digit, those are pretty impressive numbers and very kind of unusual in the history of the industry. You know, I know you guys have talked about your particular initiatives, so is there something bigger going on here? I mean, is the consumer maybe buying more food in theaters because they feel wealthier, maybe because of lower gas prices, is it just that everyone is kind of hit on the magic formula from mix and offerings that people prefer to check out a popcorn or is it film mix? I mean, what kind of explains that the strength in the industry film mix [ph]?

Well you know film mix has always played a role in it to start with that and get from films do perform very well and better with concessions than other films, but also I mean I think all of us are trying to come up with innovative programs as to how we up sell the customer or how we approach the customer and also the concession mix and the type of products to where we are offering the consumer a lot of variety. All circuits are doing that and even in the VIP space. You'll see companies such as iPic is, if you went to an iPic Theater, they have probably some of the best restaurants in the marketplace because their focus is more on a restaurant concept and is probably the high end of the luxury space. But also you have Cobb, it has a great bistro operation, you have Marcus' very focused, you have Alamo Drafthouse, Studio Movie Grill. There are a lot of people that are in this ballgame or space as the industry. I think is good for the overall industry and is good for the moviegoers because they're seeing some great options out there as places to attend. And I sort of commend all my peers that I think we have all tried to improve our game or up our game to really go after the customer aggressively. I think we all see it as that we're competing with that in-home experience. You know, not that we don't compete sometimes directly or indirectly in the marketplace, but at the end of the day we're trying to get people out of their house and into the theaters. And I think that everybody has sort of upped their game as to how do we reach out to our customers to get them to come to the theaters.

Okay, and if I could follow up just quickly, you know it is noted that the R films are really working well this quarter and last year LEGO booked really well in the first quarter. Is that putting that kind of a headwind for concession, I mean is the R-rated movies less concession friendly and the kids movies more confession friendly?

No, it's in fact, like on Fifty Shades of Grey we tried to come up with a special drink that's tied into it and so it worked really well. I think the R-rated movies obviously bring out a different crowd, but I don't know if you're seen the trailer on the Get Hard. But that, I mean that looks really, really, funny which starts on March 27, and when you run and see the Magic Mike trailer people react to it and of course Ted 2, which you know was a foul-mouth talking teddy bear, which I wondered how that would translate in Latin America and the last one translated very, very, well and so, but I think that the thing that really drives attendance for all of us in the industry is the diversity of the product. You know they're not all making the same type of films and then the spacing of product that they're not going after the same market at the same time. And I think that's what happened even on American Sniper and SpongeBob and Fifty Shades of Grey is that diversity of product hitting in the market at the right time and the right type of pictures going after different audiences and that sort of continues. You got to see Marigold Hotel, which is a great art movie coming in early March and then you're coming in with Cinderella, which I think is going to do extremely well. It's going to go after the whole Frozen type of audience, but then you come in with Divergent and so, I mean it's just that diversity of product I think is really going to help us drive attendance.

And Barton, just you know, I think on the concessions with family product versus R-rated part of the drivers Tim talked about, I think having more placement of concessions throughout the theater has been a help. I think also the variety that we've talked to, whether it be more offerings for adults, but also more offerings for kids, we've introduced Honest beverages and Honest foods and so there's more health-conscious options beyond kind of the standard fare. So I think that broader diversification of offerings plays both to adults and to children. So you shouldn't necessarily see a headwind as some more of the family-friendly content comes out later in the year.

Okay, great. Thank you very much for that.

Your next question comes from the line of Tony Wible with Janney Capital Markets.

Thanks. I was hoping you guys can comment on whether or not the drought and blackouts in Brazil are having any effect either on your existing theaters or the new construction? And then also, I know you provided a little bit of comment about Fifty Shades and some of the films here and how they opened in Latin America, but can you give us a sense just quarter-to-date in aggregate how Latin America is pacing up just given the third-party sources that generally report that stuff have been widely off?

Yes, well you know the drought in Brazil is serious. It has not impacted our operations in Brazil to-date. I know that however it is a serious concern for the entire country and they're trying to address it, but to-date we haven't been impacted. That doesn't mean that there hasn't been some brownouts now and internationally unlike domestically. We also build in our own power sources for our theaters so that because when we first went in there, there were sort of a not just Brazil, but in a lot of countries the power sources were unreliable and so we stabilized them with backup generators and so that's how we design our theaters in the marketplace. Now on the other question Sean?

Your other question was just on box office is how it is translating?

Well, just in aggregate. The Latin America box office, I mean you commented about the U.S. and we can track that rather closely, but Latin America third-party sources are rather spotty?

Yeah, I mean unfortunately kind of with box office Mojo no longer reporting Latin America data there really isn't a public source to point you to. Without all the circuits providing information I'd say even our data is less reliable than what we have in the U.S. So we tend not to provide formal guidance with regards to the industry. That said, I can tell you at a very high level our industry sources show healthy overall growth across Latin America, much like our international circuit results on a constant currency basis. Maybe to point to at least one specific example that was referenced in some of the trades. If you look at the performance of the third Hunger Games that film grew about 30% to 40% over the second film in Latin America. So, at least one example that just kind of reflects just positive overall health in movie going in Latin America.

Got it, and then the last follow up here, the costs of running those generators the incremental cost, is it material or not?

No, it's not and two, like that's been baked into our circuit since we went into Latin America, so it's not a - so if you went back in the history of our company that's in the numbers.

Great, thank you.

Your next question comes from the line of Jim Goss with Barrington Research.

Thanks. I've got a couple plus a follow up to your prior discussion. First question, I was wondering if you mentioned the various initiatives you had such as the Cinemark app, CineMode, e-mail, and you probably have international versions, I'm wondering if you could talk about how they contribute, which are most useful, effective and is there any way to quantify any of that?

Well, I don't know if you can quantify it, but our focus as we develop our version of a loyalty program, first off we don’t charge for our, what we, our loyalty program or our app because we don't think you can charge your best customers a fee to be great customers, so there's not charge in it. The whole philosophy behind our programs is to have that direct connection with your customer so that you can have a direct communication. That’s why we feel it's important that you're on their smartphone. Although the emails I would add you know, that people will actually request the emails, it is not that we just blanket sending out the emails that they are signing up for them and stating that they want the information or they want that contact, but we call it Cinemark Connection and so the focus is just to connect directly with the customer.

Okay, and a separate unrelated item, is there any effort to work with studios in terms of maybe an impulse presale of DVD or streams at the time of initial viewing at the box office?

There is an effort to work directly with the studios on how we market and sell films and how we might work with them on a more efficient basis in marketing and not to worry. I would say we have an outstanding relationship with all our studio partners, but regarding their in-home and Sean, because of his background could comment it. Their in-home platforms are sort of signed up for years in advance or determined and as to how they go to their in-home platforms and Sean, you might expand on that a little bit.

Yeah, I mean, I don't have too much more to add to that. You know, as far as those ideas and where we are constantly having conversations with studios about different ways we can kind of partner, both just purely in the exhibition space as well as in the broader landscape. So, I guess I would just leave it at that.

Okay, lastly the discussion earlier about the 100 international openings now you never quite make, and I'm wondering shouldn’t at some point you lap whatever you had been doing such that whatever you missed this year you might recapture from what you were doing the year before, just seems like or maybe there should be a lower target overall?

Well, I mean I think that I would agree with your premise that at some point we should come to you and say, hey we opened a 120 this year rather than 100 since, and I don't know if this year will be the year. We're obviously doing everything we can to achieve that. These are complicated markets, but I mean I agree with your premise that at some point you know, it'd be great if that were to happen.

Okay, all right. Thank you very much.

Your next question comes from the line of Matthew Harrigan with Wunderlich Securities.

Thank you. You knew the SpongeBob, Fifty Shades of Grey movie to drive concessions though, which we would see. Hey, you called out Gravity as being a dampening effect on your North American pricing, but it did very well in Latin America and your local currency, you were up 8.2%. Was that an anomaly or do you think you really have a lot of above inflation pricing power down there? I know it’s the film mix this year lot more 3D animations, Bond, Avengers, I mean it feels like you could probably get a lot if pricing down there? And that my inevitable question on the local production down there and how healthy it feels and I know you can't really call out particular films this year you had, but just that seems like a nice complementary growth factor for your business down there?

Yeah, the local film varies from year-to-year, but it can be really dramatic and I think that is an upside for Cinemark is that you got this great potential 2015 year in the U.S. and there is a potential for a really strong local film Telstar [ph] really performed at a high level.

I think the good thing is as you look at the 2015 slate other than Tomorrowland or Pixels or some of the new concepts that is coming to market, these are well known products that are in the market and Sean referred to how Hunger Games over performed 30% to 40% as they become more aware of the concept. The same thing happened with Twilight and were you know, probably the final Hunger Games is going to really outperform in Latin America because they are very aware of the concept. Fast & Furious, the last Fast & Furious that now I would add it was filmed in Brazil, so it has a Latin theme, but the Fast & Furious concepts really do well in Latin America and are extremely well received, but also Avengers is a well known and Bond is well known in Latin America. So a lot of the product that is coming to the market is ideally suited and well known in Latin America. So I think that you know, the Latin America in 2015 should perform on a very similar basis as the U.S. And to your point we have been able to get a little bit above inflation in our price increases in that and that's always our objective.

Yeah, and to your point that 3D mix factor did play through internationally and if anything it would have been higher and the numbers recorded, but to Tim's point our objective has been to at least match inflation if not slightly exceed it and that's what we've been able to do over the years, so.

It sounds like it's more of an exogenous function of the film mix and whether it's 3D then just consciously saying we're going to go 4% faster than inflation or something like that?

Right. It's you know, the film mix anymore because of the premium concept elements, the 3D and our XD add to it, have a lot of influence on our average ticket price.

Great quarter again, thanks.

Thank you.

Your final question comes from the line of Eric Wold with B. Riley.

Thank you. Two questions on Latin America. One, you said that the currency headwind was 17% in the quarter, assuming stable exchange rates from here what do you think the headwinds look like for the first quarter? And then does the strength of the dollar give you an opportunity to kind of push more capital down that market to be possibly more aggressive on acquisitions and opportunities around that or do you prefer to have the growth in Latin America to be fueled and predominantly by cash flow from that region?

So to address your first question, if currencies were to kind of just hold where they are today, we'd be looking at similar low to mid double-digit percentage headwind for the first quarter based on what we see right now.

And regarding M&A activity in Latin America, we think there's some very attractive assets down there that we would like to buy. I think we have quite a bit of cash in these various countries and so I don't know if we necessarily have to push it down, but obviously with the strong balance sheets we have and the strength of the dollar we're very capable of pushing it down. But Latin America for years now has been sort of self generating and can pretty much handle both, whether it's acquisitions or organic you know, new builds.

And just a last follow up on that, your attractive acquisition targets down there what would you say it's going to be made impediment to when you're getting your hands on the ongoing sellers or prices maybe too high?

It's more who the sellers are. I'd say they tend to be more family and strong family owners of the properties like Cine Colombia if for example in Colombia is owned by the Santo Domingo Family, which is very strong family throughout South America. In Peru you've got Cine Planet, which is huge banking mall development company, where the theaters is just a piece of the company and they might decide to sell it off and have a tenant in their malls operating the theater versus the theaters and so their motivations for coming to the marketplace are a lot different.

Helpful, thank you.

Well, thanks everybody and we look forward to having you join us on our first quarter call and if the initial results continue for the first quarter, hopefully we can report strong results in the first quarter. Thank you.